The Meaning of ‘Good Faith’

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We now have some further clarification as to the interpretation the Courts place on the phrase ‘acting in good faith’.

This arises out of the complicated case where the underlying agreement was held to be unenforceable.  To demonstrate the complexity of the case I note that the judgment ran to some 119 pages of A4.  The facts are, to say the least, unusual. 

Two parties entered into Heads of Terms for the sale of some land, unspecified but consisting of 100 acres, with intended options over a further 400 acres.  The Heads of Terms were dated 2015.  Among other things, the Parties agreed to use all reasonable endeavours to enter into a final binding agreement to incorporate the Heads of Terms and to act in good faith to each other. 

The potential purchaser, Brook Homes (Bicester) Limited, between 2015 and 2018 paid to the Defendant, Portfolio Property Partners Limited, the sum of £1.8 million by way of pre-payments, despite there being no formal agreement.  That, to me, is strange and decidedly unusual – not to say risky. 

By 2018 there was no agreement in place and negotiations had broken down.  Brook Homes had had enough and issued proceedings for specific performance and damages in excess of £500 million.  To me, that seems like a big stakes poker game to play on a weak hand. 

Not surprisingly, the Judge rejected the claim for a breach of contract in respect of the land because:

a.          you cannot have an agreement to agree; and

b.         the Parties have made, throughout the negotiation, various amendments – none of which were made in accordance with the technical provisions of the Law of Property (Miscellaneous Provisions) Act 1989.

Was all lost for Brook Homes?  Luckily for it, the answer was ‘no’.  In two respects the Judge found that whilst the basic agreement failed, Brook Homes succeeded.  Those two heads related to the failure to use all reasonable endeavours by Portfolio Property and that company’s failure to comply with the good faith obligation.  To avoid this blog becoming overly technical and long, and trusting that I still have your attention, I am only going to deal with the good faith issue. 

The Judge summarised the duty of good faith is requiring, subject to the other terms of the agreement:

a.          a duty to act honestly, judged by reference to reasonable and honest people;

b.         the observance of reasonable commercial standards of fair dealing;

c.          fidelity or faithfulness to the common purpose or contractual purpose; and

d.         more generally, to act consistently with the justified expectations of the parties.

As I have indicated, there are a variety of other issues and parties to the action which I could have highlighted but I have written on the one involving the phrase which is much used but often not fully understood. 

As a footnote the Judge awarded Brook Homes damages of £15.5 million.  I just hope that Portfolio has the resources to meet that award, otherwise Brook’s victory could be Pyrrhic.

Hugh Ellins

Covenant requiring approval of plans no longer enforceable

Hugh Ellins

Deeds to many properties include a covenant not to build without the consent of a named person/s

A 2021 reported case has decided that if the named person/s are dead then the covenant is not enforceable.

In the case of Savage v 60 Kent Road (Maintenance) Ltd, an application was made to the Lands Tribunal for the modification or extinguishment of a covenant

The covenant, made in 1961, prevented the landowner from erecting buildings or making alterations to the external appearance of buildings “otherwise than in accordance with plans and specifications to be submitted to and approved by the Vendors Surveyor”. The covenant included a requirement to pay to the surveyor a fee of two pounds two shillings in respect of plans and specifications submitted for approval

 All of the original vendors had died.

The Tribunal Judge said  “There is a body of case law authority … to the effect that where there is a restriction against building or making alterations without the prior approval of plans or specifications, and the power of approval is no longer exercisable because the person with such power is no longer in existence, then the restriction automatically lapses.”

He ruled that the covenant had become obsolete and should therefore be discharged. With the death of the last of the original vendors, the power to approve plans and specifications had lapsed, leading to the restriction itself becoming obsolete.

For advice on Property issues please contact;

Commercial Property : hugh.ellins@bevirs-law.co.uk

Residential Property : emma.morter@bevirs-law.co.uk

OR telephone 01793 848900 and ask for any team member

Hugh Ellins – December 2021

When the word ‘development’ means different things to different people.

Hugh Ellins

The case of Fishbourne Developments Limited v Stephens highlights the problems where words are not given clear meaning in legal documents.

Fishbourne and Stephens had entered into an Option Agreement in respect of 117 acres of land.  The Option was exercisable “if and when the Purchaser (Fishbourne) obtains a Planning Permission”.  Planning Permission was defined in the Option Agreement as:

“a planning permission granted by the local planning authority permitting any development of the Property”.

Fishbourne obtained a planning permission for the construction of a new roof on one of the buildings on the Option Land.  Fishbourne claimed that it was able to trigger the Option on the basis that it had a planning permission permitting development.  Stephens said, no that was not what the Option Agreement meant.  Assumedly, the objection was based on the fact that by reason of the limited extent of the area having the benefit of a planning permission what Stephens would be paid for the land was appreciably less than he was anticipating.

Stephens claimed that what the Option Agreement meant was a planning permission for development of a new building which should apply to all or a substantial part of the Option Property.

Presumably because Fishbourne thought it would acquire the Option Property at, as they say, a good price, it opposed Stephens’ stance, relying on the technical definition of the word ‘development’ – as to which see the Town and Country Planning Act 1990 s.55.

The dispute ended up in the Courts which found in favour of Stephens.  Whether the decision is right or wrong and whether it will be appealed is not the point.  The point is that the Option should have been drawn so that there was no margin of error or misinterpretation.  I appreciate that modern Option Agreements seem to have more definitions than actual provisions and that lawyers seem to spend unnecessary hours in agreeing the definitions.  This case explains why that is necessary.

One of the difficulties is where, as in this case, a word can be interpreted in more than one way. 

Here is something to keep you amused whilst subject to restriction and not able to go to the pub.  Try finding a simple definition of a table.  You may say a table is made of wood and has four legs.  I know tables made of glass with no legs.  Keep going – and have fun!

Hugh Ellins – June 2020

Estates: on 6th February 2020, the statutory legacy is increasing to £270,000.

Janet Strong, Associate Solicitor in our Wills and Estates Team

If someone dies without making a Will, they are called “intestate”. There are  rules setting out who should inherit in such circumstances.

If the person who has died does not have any surviving issue (children or other descendants), their surviving husband, wife or civil partner receives everything.

If the person who died had a husband, wife or civil partner and children, the husband, wife or civil partner is entitled to personal belongings; a “statutory legacy” (which is currently the first £250,000 from the estate); and half of any estate which is left.

There are further rules setting out who should inherit if the person who died did not have a husband, wife, civil partner, children or grandchildren.

For deaths after 6th February, the statutory legacy will be increasing to from £250,000 to £270,000.

Sometimes, certain family members or dependants can make a claim against an estate if they do not feel that these rules make reasonable financial provision for them. This might be the case, for example, where a couple is not married, or if stepchildren are involved.

To avoid the need to rely on the rules of intestacy, it is best to make a Will so that you can set out who should inherit your estate.

If you would like to discuss Wills, or would like advice regarding the estate of someone who has died (whether they have made a Will or not) , please contact me or one of my colleagues in our Wills and Estates department on 01793 532363 or janet.strong@bevirs-law.co.uk

Divorce reforms back on the table

As Parliament returns from its Christmas break, many family lawyers will be pleased to note that divorce reform is back on the agenda.

The Divorce, Separation and Dissolution Bill was first introduced in June 2019. However, progress has been thwarted twice, first due to prorogation of Parliament and then due to the December general election. However, on 6th January 2020, it was finally introduced to the House of Lords.

The current law surrounding divorce requires spouses to evidence one of five “facts” to demonstrate that a marriage has broken down irretrievably; adultery, unreasonable behaviour, desertion, two years separation (with consent) or five years separation (without consent).

Studies show that 90% of family practitioners believe that the law in this area is outdated. It often requires separating parties to point a finger of blame and drag up allegations of conduct. Invariably, this exacerbates what is already an emotionally charged situation, causing unnecessary stress and heartache for the whole family, including any children.

By introducing a no-fault divorce, needless antagonism will be removed from the divorce process. The requirement to evidence one of the five facts will be replaced with a statement of irretrievable breakdown. Parallel changes will also be made to the law in respect of civil partnerships.

There appears to be a general consensus in Parliament that this bill delivers much needed reform without undermining the institution of marriage. For family lawyers who have long campaigned for a no-fault divorce process, this is welcomed news.

For advice on all family related matters, please contact our specialist team at Bevirs Law.

Heather Reilly – Solicitor in our Family Team

More good news for 2020!

Congratulations to Emily Bourne; who after being with the firm for 6 years has now become a Chartered Legal Executive. Well done Emily; from everyone at Bevirs.

Emily Bourne – Chartered Legal Executive in our Residential Property Team

A great start to the New Year!

Today we thought we’d share some positive feedback received from a client about their experience with our Family Team.

“Heather has been my solicitor for over a year now and from start to finish has been friendly, professional and has gone above and beyond to ensure I was always kept informed of everything in the court proceedings and that I had good understanding of every possible outcome. I would just like to thank Heather for all her hard work, I truly appreciate the time and effort you have put into my case”. Anon.

For expert family law advice, please contact a member of the team at Bevirs Law.

Heather Reilly, Solicitor in our Family Team

Celebrating 100 years of women in law.

December 23rd 2019 marked a historic day; the 100th anniversary of the Sex Disqualification (Removal) Act 1919 receiving Royal Assent. This law opened the legal profession to women.

Helena Normanton, who had lodged a petition at the House of Lords when her application to become a pupil in 1918 was refused, reapplied on 24 December 1919 and was admitted to Middle Temple. The first female magistrates were appointed soon after. Dr Ivy Williams was the first woman to be called to the English bar in 1922. However, she never took up practice and instead, was the first woman to teach law at a British university.

Three years later, in December 1922, Carrie Morrison was the first woman to be admitted as a solicitor. She was aged 34. In the years immediately after qualification she spent much of her time working as a “Poor Man’s Lawyer” in the East End of London, providing legal help to those who would otherwise not be able to afford it. She was also a strong advocate of Divorce Law Reform.

The profession has made great strides over the past 100 years. Women now make up just over 50% of practising solicitors and over 60% of new entrants.

Whilst there is still a way to go; reports show that many women in law are struggling to break through the glass ceiling and reach senior positions. However, at Bevirs Law, we are proud to say 50% of our partners are female and 72% of our fee earners are women. We have many talented women in our firm and will continue to champion them and support them throughout their career progression.

Heather Reilly 23.12.2019

Bevirs Law attends Headway’s Annual Awards

Nicola Heales, Hayley Tarrant and Luke Flavell
Jackie and Luke Flavell, Finalist for Headway’s Carer of the Year 2019

Nicola Heales and Hayley Tarrant had a wonderful afternoon attending the Headway Annual Awards 2019. They were joined by their guest, Dr Henderson Slater, Consultant in Neurological Disability and Rehabilitation, at the Awards Luncheon held at The InterContinental, Park Lane in London on Friday 6th December.

Every year, Headway’s members, friends and supporters come together to pay tribute to the very special brain injury survivors, carers, volunteers and campaigners whose personal achievements have earned the respect and admiration of everyone around them.

Their incredible contributions were moving and inspirational, and we were honoured to be part of the celebrations marking their outstanding achievements.

We were lucky to sit alongside Jackie Flavell, her husband and son. Jackie was nominated for Headway’s Carer of the Year Award. Jackie’s son Luke sustained a traumatic brain injury following a car accident in July 2012. Against all the odds, and with intense treatment he pulled through but when Luke returned home it was clear that life would never be the same. Jackie became Luke’s full-time carer and listening to their journey first hand left us feeling that Jackie couldn’t be more worthy of the prestigious award.

Jackie was presented with a finalist certificate by Ryan Mason, a former professional football player who retired from competitive football in 2017 after sustaining a brain injury while playing football. Ryan talked about how his life changed in an instant as a result of his head injury and the challenges he has faced in rebuilding his life. We wish Ryan every success in his new role as the Under 19 Academy Coach at Tottenham Hotspur Football Club.

The event is the highlight of Headway’s year when everyone comes together to show their appreciation and to be inspired by the many dedicated individuals making a difference to the lives of those with brain injuries.

Bevirs Law, Head of Personal Injury and Trustee of Headway Milton Keynes, Nicola Heales said: “The Headway Awards Luncheon is always a must-attend event for everyone working in the field of brain injury. It is truly inspiring to see the highly deserving winners take to the stage to be recognised for their contributions and to prove beyond all doubt that there is indeed, life after brain injury.”

To learn more about Headway, visit: www.headway.org.uk