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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Carter v Gamlens (A Firm) [2000] EWCA Civ 137 (19 April 2000)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2000/137.html
Cite as: [2000] EWCA Civ 137
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Case No: CHANF 1995/0369 A3
FC3 1998/5878 A3
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION) ON APPEAL
FROM THE HIGH COURT OF JUSTICE, CHANCERY DIVISION
(JUDGE PAUL BAKER QC)
Royal Courts of Justice
Strand, London, WC2A 2LL
Wednesday 19 April 2000
LORD JUSTICE CHADWICK
LORD JUSTICE ROBERT WALKER
and
SIR ROY BELDAM
CARTER |
Appellant | |
- and - |
||
GAMLENS (A FIRM) |
Respondent |
(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 180 Fleet Street
London EC4A 2HD
Tel No: 0171 421 4040, Fax No: 0171 831 8838
Official Shorthand Writers to the Court)
- - - - - - - - - - - - - - - - - - - - -
Mr Carter in person
Mr N Elliott QC (instructed by Reynolds Porter Chamberlain for the respondent)
Judgment
As Approved by the Court
Crown Copyright ©
LORD JUSTICE ROBERT WALKER:
This is an appeal from an order made on 3 February 1995 by Judge Paul Baker QC, sitting as a deputy judge of the High Court, Chancery Division. His order was made after a twelve-day action for solicitor's negligence in a conveyancing transaction. The judge awarded nominal damages (totalling £20) for two heads of claim which were admitted or found to have been established. The other claims failed, and because of a payment into court the claimants, Mr Michael Carter and his wholly-owned company Harbury Estates Ltd, were ordered to pay the bulk of the costs of the defendant solicitors, Gamlens. Mr Carter's company has now assigned its right of action to him and he is the only appellant. Indeed for practical purposes he can be treated as having been the sole claimant throughout.
Harbury Hall: geography
The conveyancing transaction on which the case centres was Mr Carter's purchase under a contract dated 11 August 1987 of part of Harbury Hall and the whole of the Harbury Hall Stud Farm. Harbury is a small village south of Leamington Spa in Warwickshire. The railway from Leamington to Oxford runs close to the village and crosses (in a fairly deep cutting) the stud farm, which is about 17 acres in extent. Harbury Hall and its gardens and grounds (about another five acres) lie immediately to the south of the stud farm and on the north side of the village. It is necessary to describe the Hall and its outbuildings and immediate surroundings in some detail. It has already been described in detail in the judgment of Sir Thomas Bingham MR on the occasion of Mr Carter's appeal to this court from the Warwick County Court in proceedings between Mr Carter and two of his neighbours, Mr and Mrs Green. These two expensive pieces of litigation are an awful warning against the dangers of division and multiple occupation of a large house. So long as all the occupants remain friends, it may not matter that their legal rights are not defined with absolute precision. But once they fall out, careless drafting and inadequate plans can lead to serious trouble.
I gratefully adopt part of the description of the Hall in the judgment of the Master of the Rolls in the earlier appeal:
"The main body of the house has a frontage facing north. It is not, I think, fairly to be described as a stately home, but it is a substantial country house. Running southwards from the centre of the main house is a line of buildings ending in what was originally a staff cottage. The Assistant Recorder likened the layout of the house itself to a capital "T" and this is to my mind an apt image, the horizontal upper stroke of the "T" running from west to east and facing north being the main body of the house, and the vertical upright of the "T" running from the staff cottage that I have mentioned northwards towards the point at which it joins the house."
The Master of the Rolls then went on to describe in detail the courtyard on the west side of the Hall. This courtyard was roughly square (although wider at its south side) and was almost completely surrounded by buildings of various types. These included (on a tour anti-clockwise from the north-east corner) a game larder (or laundry), tack rooms (or grooms' quarters), garages and a metal structure referred to as the carport (all these on the north side) a garden store (converted into a garage) and stabling (all on the west side) and some picturesque loose boxes with lofts over them, and other outbuildings (all on the south side). That tour brings one back to the foot of the "T" and to the old staff cottage, now called Stables Cottage. There are gardens to the north, south-east and south of the buildings; the lane into the village runs down the west side, and a small part of the stud farm land is on the other side of the lane.
When the Hall was divided for multiple occupation the parking space allocated to the upper apartment was the converted garage at the northernmost end of the range of outbuildings on the west side of the courtyard. That allocated to Stables Cottage was the carport. Between the garage and the carport was a gate giving access from the courtyard to the north side of the Hall.
Harbury Hall: conveyancing history
Until 1982 the Hall and the stud farm were in single ownership. But in that year two married couples who were old friends, the Pearsons and the Greens, decided to buy these properties and to divide ownership and occupation between them. Mr Pearson was a solicitor, and senior partner in a small Coventry firm called Rotherham & Co. Mr Green (who has since died) owned a chain of chemist's shops. The general plan was that the Pearsons (as co-owners) should have the ground floor of the Hall, the garden to the north and the stud farm, and that the Greens (through Mr Green as sole owner) should have the upstairs of the Hall, the garden to the east and south, and some of the buildings on the south and west of the courtyard. The upper part of the Hall was to be granted by a 999-year lease, in order to facilitate the enforcement of covenants entered into by both parties, but the parts of the garden and outbuildings allocated to Mr Green were to be granted in fee simple. There were to be mutual rights of pre-emption.
These arrangements were put into effect by (i) a conveyance dated 29 September 1982 by the original owner, Mrs Price, to Mr and Mrs Pearson of the whole of the Hall and the stud farm; (ii) a conveyance dated 27 October 1982 from the Pearsons to Mr Green of the land and outbuildings which he was to have in fee simple; (iii) a lease of the same date and between the same parties of the upstairs of the Hall (other than Stables Cottage); (iv) two pre-emption agreements dated 2 June 1983; and (v) a deed of variation and a deed of rectification both dated 24 October 1985, correcting errors in the plan on the conveyance of 27 October 1982 and in the insurance covenants in the lease. As the judge said, the plan on the conveyance was for the purpose of identification and was no good for any other significant purpose. It was absurdly small. The plan on the deed of variation was a bit better but it was still not very clear, and it showed the courtyard as squarer than it actually was.
So from 1982 until 1987 the Pearsons and the Greens were amicably sharing all the property apart from two small residential units: a property called The Bungalow (or Hall Bungalow), in a small enclave (bordering the lane and between the north garden and the stud farm) which Mrs Price had retained but sold to Mr and Mrs Turner, the conveyance to them being dated 14 October 1983; and Stables Cottage, which the Pearsons sold to Mr and Mrs Middleton, the conveyance to the Middletons being dated 19 December 1985. As it happens Mr Middleton was also a solicitor. The Bungalow plays only a peripheral part in the story, although effluent from its septic tank was the cause of one of Mr Carter's complaints. Stables Cottage, and the rights of way and car parking which went with it, play a more central part.
In 1987 the Pearsons decided to sell the whole of their freehold interest in the Hall and the stud farm. It appears that they asked Mr Green whether he wished to exercise his right of pre-emption, and he declined. So the property was put on the market by Knight Frank and Rutley in three lots, and in July 1987 Mr Carter became interested in it.
The principal witnesses
Mr Carter was then a businessman in his forties. His interests included the travel business. One of his companies traded under the name of Hot Turkey and he travelled to Turkey and elsewhere on business. The judge said of him,
"He is a man of quick intelligence but not very systematic. I found him to be a totally honest witness, but he is voluble and answers questions quite effusively, not always directly. Unless restrained, he takes over the argument, so I regard him as quite forceful. Certainly, in his own words, he does not accept the word "can't" without argument, although he would not refuse to accept it to the point of stupidity."
Mr Carter instructed Gamlens to act for him. His instructions were given to Mrs Kiki Bosi (then Kiki Williams) with whom he had been friendly since they met on holiday during the previous year. Mrs Bosi had been admitted as a solicitor in 1981 and had been made a partner in Gamlens in 1984. She was a conveyancing solicitor but her experience had been rather limited in that she had undertaken a large volume of work for one single client, a mortgage lender. This particular transaction was out of the ordinary for her (as it would have been, I think, for most conveyancers). The judge said that she gave her evidence in the most straightforward way and was a totally honest witness.
Mr Carter has commented in his skeleton argument that the judgment must be unsatisfactory because the judge found both witnesses to be totally honest yet had to choose between their different versions of events. However a judge is often faced with that task and his or her judgment is not to be discredited because of that. Mr Carter and Mrs Bosi were giving evidence about events more than seven years before, which both must have been mentally rehearsing on many occasions during that period. Many of their communications were made or recorded in writing but others (including many telephone calls, and their conversations when they visited Harbury together on 15 July 1987) have no written record. In these circumstances it would be surprising if even the most honest witnesses' recollections had coincided exactly.
Events from July 1987 to trial
Mrs Bosi was instructed by telex on 11 July 1987 (which was a Saturday). She began to deal with the instructions on the following Monday, 13 July. The events of the next year are covered in some detail, and subsequent events in rather less detail, in the judgment now under appeal and in the judgment of the Master of the Rolls in the other appeal. At this point in this judgment it is sufficient to highlight some of the most important events in the chronology, before going on to summarise Mr Carter's claims against Gamlens and the way in which Judge Baker dealt with them. Later I shall have to return to the period before exchange of contracts and consider in more detail the evidence relating to that period.
I have already noted that Mrs Bosi began acting on 13 July 1987 and that she and Mr Carter visited the property two days later. Mr Carter was away in Turkey from 22 July until 6 August and did not see Mrs Bosi's written report on title (dated 28 July) until after his return. Mr Pearson was by then pressing quite hard for exchange of contracts. Mrs Bosi negotiated some last-minute additions to the special conditions and contracts were exchanged on 11 August, providing for completion in two stages: the Hall on four weeks' notice between 29 October 1987 and 1 March 1988, and the stud farm two months after completion of the Hall. In the event the sale of the Hall was completed on 4 May 1988 and that of the stud farm on 24 June 1988. The latter completion was effected only after service by the Pearsons of a notice to complete. In the meantime, on 20 June 1988, Mr Carter's partner Ms Celia Parker contracted to buy Stables Cottage from the Middletons (the transfer, on or about 3 August 1988, was to Mr Carter).
On any view the contract for Mr Carter's acquisition of the Pearsons' interest in the property was negotiated and entered into in something of a rush, and the delayed completion gave time for some of the potential problems to start to emerge. The problems got worse (especially as between Mr Carter and Mr Green) after completion, when Mr Carter made various applications, some of which were successful, for planning permission for residential use of some of the outbuildings surrounding the courtyard. Mr Carter had hoped that the practical solution to his problems would be for him to acquire Mr Green's freehold and leasehold interests, either under the right of pre-emption or otherwise, but it became apparent that Mr Green was not inclined to sell. It also became apparent that Mr Green objected to Mr Carter's development plans as being contrary to a landlord's covenant in the 999-year lease, a covenant which bound Mr Carter as the Pearsons' successor. That covenant ("clause 5.5") was in the following terms:
"Not to do or suffer to be done in or upon the lower apartment anything which may be or become a nuisance or annoyance or cause damage or inconvenience to the Lessee or the occupier of the upper apartment and not to use the lower apartment except with the consent in writing of the Lessee except for the purposes of a single private dwelling and in conjunction with the business of the Lessors' Stud Farm."
The expression "the lower apartment" was not defined and that was indeed the central issue in the litigation between the Greens and Mr Carter.
On 14 August 1988 Mr Carter wrote a letter to Mrs Bosi at her home address which, although beginning `Kiki dear', contained numerous complaints and must be regarded as the first shot in his campaign against his former solicitors. On 22 December 1988 Mr Green issued a High Court writ against Mr Carter seeking declarations and injunctive relief. On 22 February 1990 Mr Green executed a deed of gift transferring his freehold and leasehold interests into the joint names of his wife and himself. It is not clear why Mr Green took that step, but in any case his motives are not relevant for present purposes. The High Court proceedings were struck out. In August 1990 Mr Carter started proceedings in the Warwick County Court seeking various declarations, the most important of which would if granted have restricted the meaning of "the lower apartment" in clause 5.5 to the smallest possible area. Other proceedings were also started in the Warwick County Court and the two sets of proceedings were heard together. The assistant recorder who heard the case decided on 25 September 1990 that the expression "the lower apartment" had a very wide meaning. Mr Carter appealed to this court which on 1 February 1994 allowed his appeal to the extent of excluding any buildings on the west side of the courtyard (while still treating the laundry, the grooms' quarters and the adjacent garages and carport as within the lower apartment).
Mr Carter's claim against his solicitors
By this time Mr Carter's proceedings against Gamlens were well under way. The writ had been issued on 18 May 1992. The amended statement of claim pleaded the solicitors' duty in conventional terms. It also pleaded that Mrs Bosi knew that it was Mr Carter's intention to seek to acquire Mr Green's lease of the upper apartment, to seek planning permission to convert the old stables and outbuildings into self-contained residential units, and then to carry out that conversion. The reamended defence admitted that Mrs Bosi knew that Mr Carter wished to develop the property if he could, but did not admit knowledge of his exact intention and denied knowledge of his intention as pleaded.
The amended statement of claim then pleaded claims for professional negligence under six heads, as follows:
(1) The right of pre-emption (para 20 of the statement of claim): it was pleaded that Mrs Bosi was negligent in the drafting of clause 12 of the special conditions (part of the last-minute additions which Mrs Bosi negotiated with Mr Pearson shortly before exchange of contracts).
(2) Clause 5.5 (para 23): it was pleaded that Mrs Bosi was negligent in not advising Mr Carter that the expression "the lower apartment" in clause 5.5 of Mr Green's lease was ambiguous, and might give Mr Green power to frustrate Mr Carter's development plans; and that she failed to clarify this with the Pearsons or with Mr Green.
(3) Stables Cottage and its rights (para 26): it was pleaded that Mrs Bosi was negligent in failing to advise Mr Carter about the right to park in the carport which was appurtenant to Stables Cottage, and its detrimental effect on Mr Carter's development plans. This problem was resolved when Mr Carter acquired Stables Cottage, but it was pleaded that he had to pay an enhanced price.
(4) The septic tank (para 30): it was pleaded that Mrs Bosi was negligent in failing to advise Mr Carter about the right of drainage enjoyed by The Bungalow for the outflow from its septic tank.
(5) Mr Green's right of way (para 34): it was pleaded that Mrs Bosi was negligent in failing to advise Mr Carter about the route of this right of way over the courtyard, especially his turning circle in the vicinity of the carport, and its detrimental effect on Mr Carter's development plans.
(6) The dirty straw (para 38): it was pleaded that Mrs Bosi was negligent in failing to ensure an express contractual arrangement for the Pearsons to remove "some 130 tons of soiled and therefore useless straw".
Particulars of loss were pleaded in relation to all these claims and these were supplemented by voluntary particulars of loss served shortly before trial. Paragraph 13 of the voluntary particulars made clear that there was no separate claim for special damages under paras 34 and 35 of the amended statement of claim (Mr Green's right of way). Paragraph 15, the last paragraph of the voluntary particulars, was in the following terms:
"If the Court shall find, in respect of any of the matters complained of in the Amended Statement of Claim, that but for such breach of contract or negligence on the Defendant's part the First Plaintiff would not have entered into the Contract mentioned in paragraph 13 of the Amended Statement of Claim then the Plaintiffs will in the alternative seek damages on a wasted venture basis as set out at schedule I served herewith."
However no application was made for any further amendment of the statement of claim to plead that Mr Carter would, on receipt of correct advice, have refused to proceed with the proposed purchase. The only references to that in the statement of claim were in particulars under paras 24 and 27, which referred (in the alternative) to the possibility of Mr Carter "seeking a withdrawal from the proposed purchase". Mr Nicholas Elliott QC (appearing in this court, as he did below, for the solicitors) accepts that this should be understood as refusing to proceed to exchange of contracts.
The judgment and the notice of appeal
At the trial the solicitors admitted a breach of duty in their failure to give adequate advice about the septic tank outflow, but disputed that any significant loss had been occasioned by that breach of duty; and they denied all the other alleged breaches. The judge found one other breach established, a failure to give adequate advice about the rights appurtenant to Stables Cottage (which were enjoyed over Mr Carter's property until he purchased Stables Cottage and so achieved unity of the dominant and servient tenements). But the judge awarded only nominal damages for the two breaches of duty. He found three alleged breaches of duty (in connection with the right of pre-emption and special condition 12, clause 5.5, and the dirty straw) not to have been made out.
The judge did not in his judgment make any reference to the remaining matter of complaint (Mr Green's rights of way over the courtyard to get to his parking space in the converted garage in the north-west corner). Mr Carter has complained of that in his notice of appeal but Mr Elliott has explained that at the trial (at which Mr Carter was represented by solicitors and counsel) the judge was told that no substantial damages were claimed under this head, since for practical purposes it duplicated the head of claim concerned with clause 5.5. Mr Green's appurtenant rights were not addressed in either side's closing submissions, and for that reason they were not mentioned in the judgment below.
The judge's decision to award only nominal damages in respect of the rights appurtenant to Stables Cottage followed from his assessment of the valuation evidence. The judge preferred the evidence of the valuer Mr Ball, called on behalf of Mr Carter, and remarked that his evidence was, in the end, virtually unchallenged. The sum of £77,000 which Mr Carter had paid for Stables Cottage in 1988 represented its market value, and not an inflated price occasioned by the Middletons' parking rights (in the carport) having become a sort of `ransom strip'.
As to the claim on which Gamlens admitted liability, the failure to give adequate advice about the drainage rights enjoyed by the owners of The Bungalow to discharge effluent onto the part of the stud farm lying to the west of the lane, the judge found that this breach had no effect on the market value of what Mr Carter had bought. The particular problem which faced Mr Carter on completion was caused not by the solicitors' failure to advise about drainage rights but by the failure by the owners of The Bungalow to maintain the septic tank (a matter which might have been picked up by a surveyor, had Mr Carter accepted Mrs Bosi's advice to have a survey done). This is the only part of the judgment against which there is no appeal.
Before looking more closely at the judge's reasoning and the grounds on which Mr Carter has challenged it in this court, I should note some matters which have occurred between the trial (more than five years ago) and the hearing in this court. After judgment Mr Carter's counsel prepared a notice of appeal which was issued on 13 March 1995. Mr Carter has suggested to us that this notice of appeal was prepared in a hurry and that it is in some way deficient. Of course, any notice of appeal has to be prepared reasonably promptly, but the notice of appeal prepared by Mr Carter's counsel sets out eleven paragraphs of grounds of appeal and appears to be comprehensive.
At some time later in 1995 Mr Carter was compelled to start acting in person, and he has been acting in person ever since (apart from a conference with counsel which he had shortly before the appeal hearing). He also found himself faced with an application for security for costs, and this court was told that his former solicitors were exercising a lien over his papers. These matters partly explain the regrettably long delay in the hearing of this appeal.
The fact that Mr Carter has been acting in person may also explain another unfortunate feature of this appeal, which is that this court has not had the benefit of a transcript of the judgment corrected and approved by the judge. The judge reserved judgment but he did not hand down a written judgment in a form already approved by him. He gave what must have been quite a lengthy oral judgment (it runs to just over fifty pages of typescript) and it was transcribed by a firm of official shorthandwriters in a form marked `for revision'. It is no serious criticism either of the judge or of the shorthandwriters that, in a long and often technical judgment, there are some passages in which some revision does seem to be called for. That applies both to the judgment itself and (with still more force) to the transcript of some exchanges after judgment when Mr Carter's counsel respectfully raised the question whether the judge had failed to deal with part of Mr Carter's case. In these circumstances this court has to do the best it can with an imperfect transcript and to make such allowance as it thinks appropriate for the judge not having had the opportunity to revise the transcript.
At the outset of the appeal hearing Mr Carter applied for permission to adduce new evidence in the form of affidavits from himself, his partner Ms Celia Parker, and Mr Philip Townshend (a cousin of Mrs Green and at the time a solicitor with Rotherham & Co). He also applied for permission to amend his notice of appeal. Mr Elliott opposed both applications. This court refused both applications, for reasons given orally in the course of the hearing. But it is right to record briefly that the main purpose (although not the only purpose) of both applications was to lay a firmer foundation for the claim, already made in paragraphs 8 and 9 of the notice of appeal, that the judge should have found as a fact that Mr Carter, if properly advised by his solicitors, would have withdrawn before exchange of contracts, and that the judge should therefore have assessed damages on a `wasted venture' basis. But to have admitted new evidence on this issue would have been not merely to admit evidence which ought to have been put forward at trial. It would have come close to admitting new evidence from Mr Carter himself to contradict his evidence at trial. That must be fatal not only to the application to adduce new evidence and to amend the notice of appeal, but also to the grounds of appeal in paragraphs 8 and 9 of the original notice, to which I now turn. Apart from the `wasted venture' claim, the proposed amendments to the notice of appeal would have made no significant addition to it.
The `wasted venture' basis of claim
The fact of the matter is that Mr Carter and his advisers were faced with a major strategic choice in formulating his claim against Gamlens: whether to claim substantial damages on the basis of Mr Carter being deprived of the `marriage value' of reuniting the Pearsons' and the Greens' interests in the property; or whether to claim on a `wasted venture' basis. Although a litigant can in theory plead his case on two or more alternative bases, in practice his room for manoeuvre is much more limited if the alternatives depend on his own evidence as to his own (actual or hypothetical) state of mind; indeed, the strategic choice must be determined by the instructions which he gives, and the content of his witness statement, on which his pleaded case is based.
Ms Dorothy Flower of Reynolds Porter Chamberlain (the solicitors acting for Gamlens) has sworn an affidavit dated 23 September 1999 in opposition to Mr Carter's application to adduce new evidence. In paragraphs 23 to 41 the affidavit addresses this part of the application, and to my mind these paragraphs (as developed by Mr Elliott in his oral submissions) conclusively demonstrate that Mr Carter was simply not running a `wasted venture' case at trial. His case was that if he had been properly advised he would have been able to acquire what he bought from the Pearsons and the Middletons at a lower price, and that he would (on acquiring the Greens' interests as well) have made a handsome profit. The alternative case (based on his withdrawal from the transaction) was not properly pleaded (although in paragraphs 29 and 30 of her affidavit Ms Flower fairly notes the two alternative references in paragraphs 24 and 27 of the amended statement of claim, and paragraph 15 of the voluntary particulars). Nor was the alternative claim supported either by Mr Carter's witness statements or by his evidence in chief, in which the only relevant passage was,
"Q You received advice that a time share with or without new building would fall outside the terms of a single private dwelling in the restrictive covenant?
A Yes.
Q Did you receive advice that the restrictive covenant would inhibit your development plans or development potential in any respect going beyond that?
A No.
Q If you had received any such advice would it have made a difference to you? Would it have been important to you?
A I would have wanted it spelling out, what the problems were. It might well have made a difference, it might not, I mean, I don't know.
Q You would have wanted it spelling out?
A Yes. Of course, if she had said, "There are problems" the next obvious question is, "Well, what?" Spell them out"."
There was no cross-examination on this point. Mr Carter's counsel returned to the subject again in re-examination and the following exchange occurred:
"Q ... but another possibility is that she [Mrs Bosi] would have stood by her advice and said, "Come on, Mr Carter, you are paying me whatever it is per hour, I'm the lawyer, you're not, my advice to you stands: you cannot conduct any development in this courtyard without either buying Mr Green out or obtaining his consent". If that had been her advice and she had stuck to it, notwithstanding your arguments to the contrary, would you have nevertheless proceeded with the purchase or not?
MR ELLIOTT: My Lord, that was not a matter I put in cross-examination at all. We already have an answer in chief but I deliberately did not pursue that in cross-examination.
THE JUDGE: I think I must allow the question. I will make a note.
A I am sorry I cannot answer it straightaway because it is not as simple as that. I would have wanted to know what her reasons for her statement were and without your hypothesising as to how she would have answered the question, "Why are you telling me this?", because there is no obvious reason in the documents to my knowledge to say that no development anywhere, which is what Mr Elliott was saying I was told, or alleging I was told, there is nothing to support that theory so I would have wanted to know why she came up with it. She might have persuaded me but I cannot see how.
THE JUDGE: I think you will have to leave it at this point." "
Finally, near the end of re-examination, there was this exchange:
"Q You had not been advised there was a dispute?
A There was a potential dispute.
Q A potential dispute as to the access to the garage - that is Mr Green's garage?
A Yes, my Lord. I had not been advised that Mr Green could hold me to ransom because I thought I had a pre-emption right at open market value. I had not been advised, as far as I am concerned, that Mr Middleton could block anything with his parking rights and/or hold me to ransom, but if I had all that knowledge and I was being told, well even possibly without being told Mr Green could hinder some parking, some development, then there is no way I would have proceeded."
In his closing submissions counsel for Mr Carter concentrated on his claim for loss of profit as set out in paragraphs 1 to 14 of the voluntary particulars. In the circumstances, it was in my judgment almost inevitable that the judge should find (in relation to the clause 5.5 issue) that Mr Carter was an optimist who thought that he was going to persuade Mr Green to sell, and (in relation to the right of pre-emption) that
"Mr Carter would, nevertheless have gone ahead with the transaction. At the time of exchange there was no more than a possibility of using this right."
If not inevitable, that finding is unassailable. The judge did not make similar findings in relation to the effect of full advice about the Middletons' right to use the carport or Mr Green's right to a turning-circle on the approach to his garage. But in view of the way the case was being run that is hardly surprising. The `wasted venture' approach cannot succeed in relation to any of these heads of claim, since it is for the claimant to prove affirmatively that correct advice would have caused him to withdraw: see Sykes v Midland Bank Executor and Trustee Co [1971] 1 QB 113, especially the oral evidence set out at pp.124-5. Mr Carter did not do so, since the judge plainly did not form the view that Mr Carter's final answer in re-examination was to be preferred to the thrust of all the rest of his evidence.
The remaining issues
I must go on to the remaining grounds of appeal in relation to the three heads of claim which were considered by the judge, but on which he found that liability was not established. I take them in the order in which they are put forward in the notice of appeal (this is also the order in which they are first identified in the judgment, although not the order in which they are discussed and decided in the judgment): (i) the right of pre-emption (special condition 12); (ii) the restrictive covenant (clause 5.5); and (iii) the dirty straw. But before addressing these issues in turn I must revisit the events of the last fortnight of July and the first fortnight of August 1987, since it is by reference to those events, without the benefit of hindsight, that Mr Carter's claims against Gamlens must be assessed.
Mrs Bosi first read her telexed instructions on 13 July, and two days later she drove down to Harbury with Mr Carter to visit the property and meet Mr Pearson. There had been sent to her a draft contract and a considerable volume of documents relating to the (unregistered) title; but she did not claim to have mastered them by then. Her evidence was that the main reason for her making the journey was to show Mr Pearson that Mr Carter's interest was serious. That seems a surprising reason for taking up nine hours (with travel) of the time of a partner in a London firm. But on any view Mrs Bosi did not spend the 90 minutes or so for which she and her client were at Harbury in attempting to identify the details of rights of way, parking or drainage, or in testing the terms of Mr Green's 999-year lease against the physical features of the property. Mrs Bosi had only vague recollections of the visit and of any conversation with Mr Carter on the drive there and back.
Mrs Bosi then studied the papers which Mr Pearson had sent her. On 17 July she sent to Mr Pearson copious enquiries before contract - 54 in addition to the standard enquiries on the printed form - and Mr Pearson replied (to most of them) and sent further documents on 20 July. By the time Mrs Bosi had finished her study of the title Mr Carter had gone to Turkey on business and (although his evidence was that he tried to telephone her from Turkey) it was not until 6 August 1987 that Mr Carter first considered Mrs Bosi's letter of 28 July (which was referred to at trial as a report on title).
The report on title was a three-page letter, accompanied by a plan which Mrs Bosi had prepared using a copy of the plan on the Knight Frank and Rutley particulars. The plan was coloured in various colours as indicated in the letter but it was not on a sufficiently large scale to enable the various rights over the courtyard to be shown clearly. The paragraphs of the letter were numbered and paragraph 3.6 was in the following terms,
"There is one clause I particularly wish to bring your attention to and that is clause 5.5 of the lease which is as follows:-
`not to do or suffer to be done in or upon the lower apartment anything which may be or become a nuisance or annoyance or cause damage or inconvenience to the lessee or the occupier of the upper maisonette and not to use the lower apartment except with the consent in writing of the lessee, except for the purpose of a single private dwelling and in conjunction with the business of the lessors stud farm.'
I believe that if you are to convert the downstairs into a time share you will have difficulties in obtaining the consent of Mr Green in the light of this covenant. However, you are fully aware of its implications and your plan is to purchase the property and then try to make a bid for the upstairs in six to nine months."
The letter did not refer to the right of pre-emption at all. This reflected Mrs Bosi's understanding that it was a personal arrangement between the Pearsons and Mr Green, the benefit of which was not to be, and could not be, passed to Mr Carter.
Mrs Bosi's file shows that on 6 August 1987 both Mr Carter and Mr Pearson were trying to contact her. Mr Pearson said that he had been trying to do so for several days. A letter which he sent to Mrs Bosi on the same day stated that he was under considerable pressure to issue a draft contract to another potential purchaser. An attendance note on Mrs Bosi's file shows that she spoke by telephone to Mr Carter on 6 August. He said that he was still interested in buying but wanted clarification on two points. One is not relevant but the other related to clause 5.5. The attendance note continued,
"KW [Mrs Bosi, then Kiki Wilson] did not receive a clear answer as to whether this should have read "and or". KW advised you that before proceeding to an exchange of contracts, you really should go and visit the planning department at the local authority as you will require planning permission to build a tennis court and the swimming pool and convert various buildings and if this is not going to be forthcoming, then there was absolutely no point in your purchasing Harbury Hall. You telephoned the local authority and they said that you can not go up there until Thursday but you are going to arrive there tomorrow and hope that you will be seen. KW advised you that Mr Pearson had telephoned her and that it was agreed that KW would telephone him and say that you had not as yet read the report on title but that no indication had been given that you were not going to proceed with the purchase.
KW telephoned Mr Pearson and confirmed that Mr Carter was in the country but he had not read through the report on title and that he had given no indication that he would not be proceeding with the purchase."
Mr Carter must have obtained an early meeting with the planning officers because he sent a telex to Mrs Bosi on 8 August reporting on a `good meeting' with them. The telex covered several points, including renegotiation of the completion date, but the most relevant point was at the beginning:
"Kiki dear
Can we have a final clarification on 1) the right possibly to assign the personal right to purchase upstairs - no reason why they should not guarantee to me that they will immediately (as right only lasts 4/5 weeks she says) inform me if it's for sale and buy on my behalf."
Mrs Bosi noted in the margin that she had telephoned Mr Carter and stated, in relation to this point,
"Can put clause in contract to say will act as agent in negotiating purchase - right lasts 2 month make him aware where is"
The last (and most cryptic) part of this note is explained by special condition 12 which Mrs Bosi negotiated and agreed with Mr Pearson:
"(i) The Vendor shall advise the lessee of the first floor flat, Harbury Hall, Harbury, Warwickshire ("the flat") of his new address on vacating Harbury Hall so that Mr Green is able to serve notice upon the Vendor pursuant to agreement dated 2nd June 1983 and made between Mr Green (1) and the Vendor (2).
(ii) On written notice being served on the Vendor as described above, the Vendor shall notify the Purchaser forthwith and take his instructions in the purchase of the flat for and on the Purchaser's behalf
(iii) In all respects the Vendor shall act as the Purchaser's agent and shall not agree a price for the purchase of the flat before taking the Purchaser's instructions.
(iv) The Vendor shall only charge his reasonable expenses in acting as the Purchaser's agent."
Mrs Bosi was cross-examined at length about her preliminary enquiries, her report on title, and the negotiation and drafting of special condition 12. Particularly in relation to the report on title, she agreed that it contained several errors or omissions for which she was then unable to provide an explanation.
An important general issue, in relation to the remaining heads of claim, is how much Mrs Bosi knew, before exchange of contracts, about Mr Carter's plans. I have already summarised the state of the pleadings on this issue, which presented itself in different forms in the course of argument. One was whether the judge was right to say in his judgment (p.46A of the transcript),
"It was a question of timeshare or nothing"
and another was whether Mrs Bosi was right in supposing that Mr Carter intended to occupy part of the property as a home (whether or not it was his only home).
Mr Carter had said in his first witness statement that he was looking for a property to convert into a country house hotel. In his oral evidence in chief he referred to
"My concept of a timeshare, which is not at all a typical approach to the timeshare image and something I particularly wanted to do, I thought there might be a way of arguing that what I was doing was getting 30 or 40 people to own a place jointly."
He expanded on this notion of timesharing as a sort of commune in the course of his cross-examination:
"Yes, my whole time share concept was a weekend away from London concept ... I wanted to be one of the people enjoying Harbury Hall at the weekends but probably more than others, probably every weekend or three weekends there per month, whereas my concept was to sell people one weekend a month or maybe even one weekend per two months on a long term basis."
A little later on he explained (in a passage at p.45 A-B which the judge read from his own notes, in substantially the same terms),
"Yes, but not flats. All under one roof eating together like a big chalet party which was the travel medium I had been working in my Hot Turkey, which was the hotel that I ran in Turkey, this is where the idea emanated from; the bonhomie of twenty or thirty people, whatever it is, sitting down at one huge table having a nice evening meal and that was, if you like, the hub of the concept. So nothing to do with self-catering flats which is a typical time share concept; just bedrooms and communal matters."
At the hearing of the appeal Mr Carter said that timeshare had been only one of his ideas for the development of the property, and that Mrs Bosi had been wrong in supposing that he wanted it as his home. He has criticised the judge's declining (p.45E) to find that Mr Carter made clear to Mrs Bosi "the alternative for development without incorporating it into the existing apartment" (that it, as I understand it, the lower apartment bound by the restrictive covenant in clause 5.5; this is a passage which might have been clarified had the transcript been revised).
In view of the conflict between Mr Carter's and Mrs Bosi's recollections it is necessary to see what assistance can be obtained from the contemporary documents. Mr Carter's original telexed instructions spoke only of "trying to do non-horsey things with the stud". None of the preliminary enquiries suggest that Mrs Bosi had any particular development plans in mind. Paragraph 3.6 of her report on title (which I have already set out) reflects her understanding of a plan "to convert the downstairs into a timeshare". It is not clear whether she understood Mr Carter's special concept of what the timeshare would amount to. Her attendance note of 6 August (made after Mr Carter's return from Turkey and also set out above) shows her awareness of a tennis court and a swimming pool as among the development possibilities. After Mr Carter's good meeting with the planning officers on 7 August his telex of 8 August referred to other possibilities. These are not clearly defined in the telex (possibly because they were not clearly defined in Mr Carter's mind) but they seem to have included development of the grooms' quarters, and an unidentified garage and stable. Reference was again made to a tennis court and swimming pool. But this was after the report on title; indeed it was only a few days before exchange of contracts, and with Mr Pearson pressing for exchange.
The judge's findings on this point are not completely clear (at any rate in their unrevised state) but I suspect that that may reflect the changing factual situation, in which Mrs Bosi may not have been kept fully informed of her client's rather volatile plans and hopes. I do not think there is any reason to doubt the judge's general conclusion (at p.46 A-E) that Mrs Bosi thought that the plan was for a communal timeshare and that it would be leaning too much on hindsight to say that a solicitor should have foreseen alternative plans and objections which became relevant only when the relationship between Mr Carter and Mr Green soured (as it did very quickly). On that basis I go on to consider the three remaining heads of claim.
The right of pre-emption
The judge dealt with this matter at the end of his judgment (pp.46F-56B). He thought that there was a short answer which had not been pleaded or relied on by Gamlens, that is that the rights of pre-emption granted between Mr and Mrs Pearson and Mr Green were mutual rights, an arrangement between friends which would not and could not continue after one or other of them sold and moved away. In other words the personal character of the rights (as expressed in clause 6 of each of the agreements dated 2 June 1983) meant not merely that they were non-assignable, but that they simply ceased to exist once one of the friends had moved and the other had not taken that opportunity of exercising his right. I see great force in that view, and if it is correct Mrs Bosi was wasting her time in negotiating special condition 12. But that is not the basis of Mr Carter's complaint, nor is it the basis of the solicitors' defence.
Having noted this point which had not been argued the judge made plain that he was not resting his judgment on it. He put his decision (p.52A) on
"first, that no triggering event has occurred; secondly, that there was no need to guard against the danger that [the Pearsons] would not get notice; thirdly, the solicitor could not be expected to negotiate with the vendors to try and secure some covenant to take proceedings against Mr Green."
These three points need to be explained and examined. The first point relates to the deed of gift dated 25 February 1990 by which Mr Green vested his freehold and leasehold interests in the property in himself and his wife (to hold beneficially as tenants in common in equal shares). The judge held (p.51B) that that deed did not make the Pearsons' right of pre-emption exercisable (on the assumption that it could still be exercisable at all). That is not challenged in the notice of appeal.
The second and third points arise on the same assumption that the Pearsons might still have been able to exercise the right of pre-emption after they had moved. On that assumption Mrs Bosi's drafting of special condition 12 was criticised because it did not go further to ensure that Mr Green gave notice to the Pearsons, and that the Pearsons were bound (if necessary) to sue Mr Green for specific performance. However the judge correctly observed that there were no practical dangers of Mr Green selling without giving notice, because the right of pre-emption was registered under the Land Charges Act 1972 as a Class C (iv) land charge (estate contract). Mr Carter drew attention to the decision of this court in Pritchard v Briggs [1980] Ch 338 and submitted that the right of pre-emption ought not to have been registered. Pritchard v Briggs is a difficult and controversial case in which Goff LJ expressed a minority view based on the very bold assertion that the entirety of the 1925 property legislation had been enacted on a misunderstanding of the nature of a right of pre-emption. Templeman and Stephenson LJJ treated the issue as one of priority of competing equitable interests. Mr Carter's reliance on Pritchard v Briggs shows how carefully he has studied this matter but it does not to my mind raise any real doubt as to the judge's conclusion that there was in practice no danger of Mr Green selling without giving notice, or the fact of his proposed sale coming to the Pearsons' notice through a prospective purchaser's inquiries.
The third point is really concluded by the judge's finding, in reliance on Mr Pearson's evidence at trial, that he would not have agreed to a special condition requiring him to sue his old friend and client, Mr Green. Mr Pearson gave evidence as a witness called by Mr Carter and in his oral evidence he expressed this view more definitely than he had done in his witness statement (in which he said he would have been reluctant). For Mrs Bosi to have tried to insist on this point would therefore have risked losing the whole transaction for no good reason. In my judgment the judge was right to conclude on this part of the case (p.49F) that she did the best she could.
Clause 5.5 (the restrictive covenant)
This is to my mind the most difficult issue in the appeal. Mr Carter himself identified clause 5.5 as important at an early stage. On 16 July 1987 (the day after the visit to Harbury, and before he went off to Turkey) he sent a telex to Mrs Bosi raising two points, the second of which was:
"Also the clause [5.5] saying `private use as dwelling and use in connection with stud'. That `and' is dangerous but presumably not their intentions. Should be or or and/or. Could you check out please what Green thinks this means."
This was a perceptive comment drawing attention to a flaw in the drafting of Mr Green's lease. (Neither side made it part of its case that Mr Pearson was a skilled draftsman, and of course Mrs Bosi was not to blame for past errors, whether in ambiguous wording, defective plans, or anything else; but she did have a duty to advise her client about possible problems).
No clear answer was ever given to the point which Mr Carter raised. Mrs Bosi did not approach Mr Green, and believed that she had been specifically asked not to. Mr Carter said that his prohibition was on raising the question of pre-emption rights with Mr Green. Mrs Bosi might well have formed the view that it was professionally or tactically unwise for her to approach Mr Green otherwise than through Mr Pearson, but there does seem to have been a failure of communication at this point.
The flaw in the drafting of the lease which occupied this court in the earlier appeal from the Warwick County Court, and which has also taken up a good deal of time in these proceedings, is the absence of any definition of the expression "the lower apartment" in clause 5.5. There was no formal definition of "the upper apartment" either but that deficiency was for practical purposes remedied by the description of what was demised by clause 1.
The judge dealt with this part of the case (which he also found the most difficult) at pp.41H-46F. He referred to the pleadings, to paragraph 3.6 of the report on title and to two of the issues formulated at trial by Mr Carter's counsel: (i) whether Mrs Bosi was on notice before exchange of contracts of the importance of the true scope of clause 5.5, and (ii) whether a competent solicitor would have drawn attention to the ambiguity of the expression "lower apartment" and its potential effect on Mr Carter's plans for development of the property (and whether Mrs Bosi discharged her duty in that regard).
It was at that point in the judgment that the judge referred to the importance of the degree to which Mrs Bosi was aware of Mr Carter's plans, and of his expectation of being able to buy out Mr Green. The judge quoted from his notes (at pp.43G-44E) some important questions and answers which I set out from the official transcript. First from Mrs Bosi's evidence in chief (omitting some repetition):
"Q Was there another occasion or other occasions when you spoke to Mr Carter about clause 5.5?
A Yes, there were numerous occasions.
Q Was that prior to your report on title?
A Yes.
Q Are you able to recall how you spoke to Mr Carter about these matters or where you spoke to him?
A It was on the telephone and I advised him. He had described to me that he wanted to develop the downstairs into a time share and to include going through the west wing and extending so that he could have more bedrooms downstairs. I said, "You can't do that. You can't do any development because it is in direct contravention of clause 5.5 in the lease. If you are going to do anything like that you have to get Green's permission or buy the upstairs".
Q You have said time share and I think you used the words "or any development". Was your advice restricted simply to a time share?
A It was any development that was going to occur in the downstairs apartment.
Q Was it just on one occasion you advised him to this effect?
A No, it was several occasions because he was adamant about buying the property and in my opinion it was not the right property for him to buy because of this clause.
Q Did you ever express that opinion to Mr Carter?
A I did.
Q What was his reaction to your advice?
A He ignored it. He wanted this property.
Q He wanted the property. Did he give any reason as to why he wanted the property or why he was ignoring your advice?
A He was ignoring my advice because in his mind he really thought he was going to buy the upstairs in six to nine months and that is what he said to me. That is why I had it in the report. He was going to buy the upstairs."
In cross-examination Mrs Bosi stuck to the passage in her witness statement that the expression `the lower apartment' was not ambiguous and that she had not altered her view so as to coincide with what was eventually decided by the Court of Appeal. The first passage from the judge's notes at p.44C seems to be a condensation of some fairly lengthy exchanges. The second passage at p.44D appears in the transcript as
"Q No dispute between us. Do you not consider that your report on title ought to have then said, "How far restriction on separate building goes depends on the extent of the words `the lower apartment' in the lease"?
A In hindsight, yes, obviously my report should have had numerous other things to it I suppose, with hindsight, but at the time we had had these extensive conversations on the phone. He had made clear to me his idea of extending through to the west wing and developing that as part of his time share plan and I had told him that you cannot do any of those developments because the covenant will bite and you either need to get Green's consent or in the event you buy the upstairs and then that would be okay."
The judge then went on to find (p.45E) that Mr Carter, as an optimist, thought that he was going to persuade Mr Green to sell, and to the "timeshare or nothing" findings which I have already referred to (p.46A-F).
In his written submissions in reply Mr Carter has argued that Gamlens face a dilemma. Either Mrs Bosi is to be believed in her oral evidence that she clearly understood the lower apartment to extend to the precise area subsequently determined by this court in the earlier appeal, or she is not to be believed. If she is to be believed, she must have realised that the Middletons' right (as owners of Stables Cottage) to park in the carport (on this hypothesis, part of the lower apartment) was an existing and continuing breach of clause 5.5, and something that cried out for Mr Carter to be warned about. If on the other hand Mrs Bosi did not in 1987 correctly foresee what the Court of Appeal would decide in 1994, it would undermine the judge's "timeshare or nothing" findings.
This submission calls for serious consideration. The point about the Middletons' rights to use the carport seems not (in this context) to have been raised below, but I would not automatically exclude it for that reason. Moreover I was not impressed by Mr Elliott's answer to it. At the same time I have little doubt that if that point alone had been raised Mr Pearson would have been able to say that Mr Green had no problem about Stables Cottage parking in the carport. (Mr Pearson had in answer to a preliminary inquiry confirmed that he and his wife had no dispute with the Greens or the Middletons.)
In any event I cannot accept the stark dilemma which Mr Carter seeks to pose. The issue of what Mrs Bosi thought in August 1987 about the extent of the lower apartment is not closely linked to the issue of what she knew at that time about Mr Carter's development plans, except so far as both are affected by the general issue of the credibility of Mrs Bosi's testimony. I have read all her evidence and I find her evidence about the meaning of clause 5.5 one of the least impressive parts of it. But the judge accepted her as a totally honest witness (as he accepted Mr Carter as a totally honest witness). The judge must, I think, have accepted Mrs Bosi's evidence (which I have already quoted) about the advice which she gave in relation to any development (not just timeshare) affecting the lower apartment -
"... it was several occasions because he was adamant about buying the property and in my opinion it was not the right property for him to buy because of this clause."
She said that her advice was ignored because Mr Carter was set on buying the property, and expected to be able to buy out Mr Green. That evidence is to some extent confirmed by paragraph 3.6 of the report on title, and the judge (in his findings at p.45E) seems to have accepted it.
In his submissions on this point Mr Elliott drew attention to a warning given by this court in a case decided since the trial, Virgin Management v Morgan and Finers [1996] NPC 8, as to the dangers of holding a solicitor negligent for drafting documents which, while producing the intended effect, can be criticised with "rational argument" as having a different effect. That was a case on drafting, not of advising on existing documents, and in any case much must depend on the particular facts. In my view it would have been very much better (and I doubt whether Mrs Bosi would disagree with this) if she had drawn Mr Carter's attention specifically to the question of the meaning of the expression "the lower apartment", and advised on its meaning, if she thought it was clear. I consider that it was an error of judgment not to do so.
But in view of the judge's acceptance of her evidence about her clear oral advice to Mr Carter, and his decision to count on doing a deal with Mr Green, I am not persuaded that this court would be justified in substituting a different view for that of the judge who saw and heard the witnesses. The judge's findings are not as clear as they might have been, for a variety of reasons which I have already mentioned, and need not repeat. But there are insufficient grounds for reversing the judge's general conclusion that in the light of her limited knowledge of Mr Carter's plans, Mrs Bosi gave him adequate (although far from exemplary) written and oral advice about clause 5.5.
The dirty straw
The judge did not have much evidence about the Pearsons' stud farm but it appears that it was run by three young women employees and that its business continued, although on a decreasing scale, until shortly before completion of the sale on 24 June 1988. It is not in dispute that the farm was in a fairly untidy state when Mr Carter and Mrs Bosi looked round on 15 July 1987. There were some old metal tanks and discarded tractor tyres; but the eventual bone of contention was the pile of old straw, variously described as `rubbish', `muck' or `manure'.
Neither of the principal witnesses then knew much about country matters, including stable management. Lots 2 and 3 were being sold as a stud farm, but Mr Carter never intended to use them for that purpose. The reference in his witness statement to "soiled and therefore useless straw" overlooks the fact that the more densely straw is matted with horse dung and urine, the faster it will turn into rotted manure which is useful to farmers and gardeners; that process is also hastened by a tidy, well-compacted muck heap. The photographs (taken in June 1988) which were put in evidence by Mr Carter suggest that the stable staff at Harbury tended to extravagance in their use of straw, and did not (in the final weeks of business) maintain a well-compacted muck heap. But the judge made no finding about that, and it is not open to this court to do so.
It is common ground that Mr Carter noticed the untidy state of the stud farm on 15 July 1987 (he described it in chief as "rubbish and straw and just unbelievable junk everywhere"). He said to Mrs Bosi that they would have to get Mr Pearson to get rid of it, and she made an additional preliminary enquiry:
"Please confirm that all rubbish around and inside the property will be cleared upon completion."
Mr Pearson confirmed this.
No further thought seems to have been given to this matter until after Mr Carter had completed the purchase of his part of the Hall, and the date for completion of the purchase of the stud farm was approaching. Mr Carter was having difficulty in arranging the necessary finance and he needed to play for time, as he acknowledged in cross-examination:
"It may be that I had the money and I could have completed but I did not want to, if Exeter Trust were still stalling, but that is not to say I would have been necessarily unable to complete. So maybe I was delaying, but I think the main reason was that the place just was not ready to take over."
Furthermore Mr Pearson, who seems to have been remarkably patient in accommodating Mr Carter throughout the long period between contract and completion, began to show signs of irritation. At the end of May and at the beginning of June 1988 Mr Carter wrote and telephoned to Mrs Bosi about what he described as `rubbish' and `muck', saying that it would cost £5000 to remove the muck. Mrs Bosi faxed Mr Pearson about this on 6 June 1988. Mr Pearson replied by fax on the same day stating,
"Mr Carter also complains that a quantity of manure, most of which is well rotted horse manure, remains on the property, which he says as he regards as "rubbish". Clearly this manure is of considerable value as fertilizer and a normal agricultural property purchaser would take to it at a valuation unless otherwise agreed. I did say that we would see if we could arrange for some of it to be burned but unfortunately owing to weather conditions this has not proved possible and I can certainly accept no legal liability in this regard."
He also stated that he wanted a qualified electrician to remove a CCTV camera and some other fittings from the stud buildings.
After that relations deteriorated sharply, with accusations of unauthorised removal of fixtures and counter-accusations of Mr Pearson's electrician being denied entry. On 8 June Mr Pearson stated in the course of a letter on various topics,
"I did say, that if it would be of help to your client, as he appears to wish to have this manure removed, I would make enquiries as to how this could be achieved, but I stand entirely by my statement in my fax to you of the 7th June that there will be no deduction from the purchase price in this respect. It is quite clearly normal practice in the sale of the property of this kind for the Purchaser to take to any manure on the site."
On 10 June he served a notice to complete. The correspondence between solicitors continued, with references made to the well-known case of Cumberland Consolidated Holdings v Ireland [1946] KB 264, but on 23 June Mr Carter agreed to complete, he reserving the right to claim for removal of rubbish and Mr Pearson reserving the right to counterclaim for additional interest. Those claims have never been litigated.
A bizarre feature of the trial was that Mr Pearson gave a witness statement and was called as a witness, not under subpoena, by Mr Carter. In his witness statement he said, after dealing with other topics:
"Following completion I recall that Mr Carter raised a point with regard as to whether or not I had complied with an alleged agreement to remove "rubbish" from the property. I believe that Mr Carter was referring to a large quantity of horse manure as rubbish. I took the view that it was not rubbish and was certainly of some value. I wrote to Gamlens on the 6th June 1988 confirming this."
In the course of his cross-examination he explained that when he owned the stud farm there was a muck heap which was moved fairly regularly by a firm of mushroom growers, who used to take it in a large vehicle with a grab. They came about every six weeks and paid £10 for a load. In re-examination Mr Carter's counsel explored this with the witness:
"Q When Mr Carter's solicitors raised this point, why did you not write back and say "Don't be silly, ABC Company come every six weeks and clear it anyway"?
A It wasn't a question of clearing it, it was a question of there being all the time a residual heap there which they took some of it away, as much as they could, from time to time.
Q So why did you make no reference at all in the correspondence to this mushroom company who would collect it for free and potentially pay a nominal fee?
A Because the argument between Mr Carter's solicitors and myself whether this amounted to rubbish was in the context of the standard conditions."
And then after another question Mr Pearson gave a very revealing answer:
"A Quite honestly, at the time I was getting a bit fed up with Mr Carter."
The judge dealt with this part of the claim quite shortly and for that reason I have dealt with it at some length, despite its relatively low value (had he found negligence, the judge would have awarded £1000). But I am in complete agreement with the judge's conclusion, that in all the circumstances there were no sufficiently clear instructions given to Mrs Bosi on 15 July 1987 as to require her to secure an express contractual obligation for the removal of whatever muck heap was on the stud farm on completion, many months ahead. As the judge said, it was an on-going product of the business being carried on there.
For these reasons I would reject Mr Carter's arguments on this last head of claim also, and dismiss his appeal.
SIR ROY BELDAM:
I agree.
LORD JUSTICE CHADWICK:
I agree that, for the reasons given by Lord Justice Robert Walker, this appeal should be dismissed.
(Order does not form part of the approved judgment)