Fisher and another v Merer

Respondents negotiating right of pre-emption over land owned by appellant’s husband’s company — Right incorrectly registered — Appellant’s husband transferring land to her for “money’s worth” — Whether appellant a legitimate purchaser for purposes of section 4(6) of Land Charges Act 1972 — Judge at first instance ordering specific performance at price determined by joint expert — Whether judge acting outside his jurisdiction — Appeal dismissed The appellant’s husband was a partner in a company that had developed a parcel of land. Planning permission was granted for houses on six of the plots, but was refused in respect of land adjoining property that had been purchased by the respondents. The respondents were concerned that the plot would remain undeveloped and neglected, and they negotiated a right of pre-emption over it. The contract stated that if planning permission was not granted, the vendor was not to dispose of the plot without offering it to the respondents at a fair price to be agreed between the parties. The right of pre-emption was incorrectly registered for the purposes of the Land Charges Act 1972. When his company was wound up, the appellant’s husband transferred the plot to her. The conveyance expressed the consideration for the transfer to be £80,000. The appellant maintained that: (i) since the right of pre-emption had been incorrectly registered, she was entitled to the land free of the right as “a purchaser for money or money’s worth” under section 4(6) of the Land Charges Act 1972; and (ii) although no money had changed hands, the consideration for the transfer of the land had constituted the “writing off” of all the debts that the company owed to the appellant’s husband. The judge, at first instance, found that no such arrangement had been made and that, in any event, the appellant was not a purchaser for the purposes of section 4(6) because the consideration had not been provided by her and she had not procured the release of the debts owed to her husband. He held that the appropriate remedy was to order specific performance on the basis of the mean price of the property value (£11,000), as indicated by an independent valuer. The appellant appealed on the ground, inter alia, that the judge had no jurisdiction to take the valuation prepared by the joint expert. Held: The appeal was dismissed. The judge had been entitled to find as he had upon the evidence before him. As a result, the question of whether the appellant had been “a purchaser” for the purposes of section 4(6) of the Land Charges Act 1972 was irrelevant. The only question to be decided was the issue of the appropriate remedy. The proceedings were based upon a substantive dispute between the parties as to whether consideration had been duly given. The appellant was entitled to have the question of whether the right of pre-emption was binding on her determined in the appeal proceedings. However, there was no suggestion that, having lost the issue, she would fail to comply with the court’s order for specific performance of the original agreement. Thus, the situation was not analogous with the circumstances of Sudbrook Trading Estate Ltd v Eggleton [1983] 1 EGLR 47, where the court had held that some specific machinery for fixing the price had to be determined by the court. The contractual machinery had not, as it had in Sudbrook, failed so that the court needed to determine an appropriate method of valuation. An order was therefore made for specific performance. Peter Birts QC and Stephen Jones (instructed by Ames Kent, of Frome) appeared for the appellant; Jonathan Brock QC and Mark Sefton (instructed by Clarks, of Reading) appeared for the respondents. Vivienne Lane, barrister