It may sound trite to suggest that you should "say what you mean" in missives for the purchase of property, but the recent Sheriff Court decision of Park Lane Developments (Glasgow Harbour) Limited v Jeffrey Jesner illuminates the dangers of ambiguous drafting.
Mr Jesner concluded missives in September 2003 with Park Lane, the developers of a residential development at Meadowside Quay Walk in Glasgow, for the purchase of one of the flats in the development. Some time later, the developers raised an action against Mr Jesner seeking to have him implement his side of the bargain - payment of the purchase price. Mr Jesner's argument was that he wasn't prepared to pay, due to the developers' material breach of contract. He was of the opinion that the missives provided for the conveyance of a parking space along with his flat, but the developers were only prepared to give him a right in common with the other proprietors in the development to a parking space, together with "an exclusive right to use" it. When the developers refused to give ownership of the parking space to him, Mr Jesner pulled out of the purchase.
The sequence of events
- missives were concluded by letters dated 11 and 16 September 2003.
- Mr Jesner paid a deposit two days later.
- on 23 December 2004, the developers' agents wrote to Mr Jesner's solicitors enclosing a "title pack" for the development BUT the letter was in respect of another person for whom the solicitors were acting in purchasing a separate flat in the development. The "title pack" was said to have included a Deed of Conditions for the development, setting out the various rights and obligations of the owners of the development. However, this Deed was not registered until the following day, Christmas Eve 2004, and so the registered deed could not have been included in the title pack.
- on 11 January 2005, the developers' agents wrote again to Mr Jesner's solicitors, this time correctly referring to his specific purchase. This letter included a draft disposition (the deed that describes the property and transfers title to it) and other draft documentation, but no title plan to attach to the disposition. No title pack was enclosed this time.
- there was no further correspondence until 17 June 2005 when the developers' agents wrote again to Mr Jesner's solicitors notifying them that the building of the flat had been completed and that the date of entry would be 14 days later, on 1 July 2005.
- on 24 June 2005, Mr Jesner's solicitors replied requesting amendments to the draft disposition to reflect the terms of the missives.
- the developers refused to provide an amended disposition and so Mr Jesner resiled from the purchase.
"Title to an exclusive car parking space"
The crux of the case centred on a clause in the missives, which said:-
"The purchase price will also include title to an exclusive car parking space..."
Mr Jesner argued that this meant ownership of the land on which the car parking space was situated. The developers argued that the words merely covered an entitlement to exclusive use of a parking space. Both parties looked at dictionary definitions of the word "title", and the rules of legal construction in some detail. The Sheriff preferred Mr Jesner's interpretation and agreed that "title" meant ownership of the land in question. The developers may well have intended that the solum (the piece of land on which the car park was built) would be owned in common by all the proprietors of the building, but that was not what the missives said. In fact, the Sheriff was of the opinion that the use of the word "exclusive" tended to contradict any inference of common property.
The Deed of Conditions
The developers attempted to found on the Deed of Conditions as an aid to construction of the terms of the missives. The Deed of Conditions made reference to an "exclusive car parking space" and the "owner's rights of common property" and therefore, if taken into account when construing the missives, would show that the missives did not provide for title, in the sense of ownership, to an exclusive car parking space.
However, the Sheriff decided that it was inappropriate to look at the provisions of the Deed of Conditions in construing the terms of the missives for 2 reasons:-
- the missives were concluded long before the Deed of Conditions was registered in the Land Register; and
- in this case, he was not convinced that the consideration of extraneous documentation (i.e. anything other than the missives themselves) was merited.
The Sheriff was of the opinion that the crucial clause in the missives, highlighted above, had little or no ambiguity attaching to it. What the Deed of Conditions said did not, in fact, help to determine what had been agreed between Mr Jesner and the developer.
Personal bar argument
The final argument put forward by the developers was one of personal bar - if their proposition that the proper construction of the missives was to confer a right of exclusive use, rather than ownership, of the car parking space in question was incorrect, then Mr Jesner should be barred in any event from resiling from the purchase by application of the principles of personal bar, waiver or acquiescence. Their argument was that Mr Jesner should have pulled out of the purchase within a reasonable period of time and that his silence could constitute personal bar. Even if the Sheriff felt that the developers' line of argument here was tenuous, he should allow a proof before answer.
The Sheriff's understanding of the developers' personal bar argument was that they sought to rely on an "absence of change". But the Sheriff was unclear as to which of the developer's pleadings were associated with this "absence of change" argument. In any event, he thought this might be academic as their averments were sufficiently irrelevant and unspecific to preclude any of their pleas being upheld by the court.
Mr Jesner's legal team were quick to point out that, if the developers were trying to rely upon an implied term in the missives requiring Mr Jesner to pull out of the deal within a reasonable time, they had not submitted any pleadings to this effect. Again, the Sheriff agreed with Mr Jesner.
A lesson learned
It is clear that Mr Jesner and the developers thought they had concluded missives fairly quickly and painlessly and were in agreement. But "title" to Mr Jesner was not what the developers intended it to be. The case highlights the need for clear drafting at the missives stage. If developers do not have their Deed of Conditions for the development ready at the time of conclusion of missives, and can therefore refer to its terms in the missives, then they must ensure that the missives themselves clearly set out their intentions for the development. It appears as if the cart came before the horse here and had significant implications for the developers - their case against Mr Jesner was dismissed and they were required to pay his expenses, reflecting complete success on Mr Jesner's part.
The full text of the decision can be found on the Scottish Courts website at https://www.scotcourts.gov.uk/