The Supreme Court allowed a purchaser’s appeal in a dispute over a land sale in Ennis, County Clare, holding that the vendor could not rely on an earlier rescission after agreeing to a new closing date. It dismissed the vendor’s action and granted specific performance on the purchaser’s counterclaim.
The dispute concerned land with development potential at Rocky Road and Ballybeg Road. The purchaser had bought it at public auction under a contract due to close on 8 April 2005. After the sale did not close, the vendor gave notice requiring completion and later forfeited the deposit and rescinded the agreement. The High Court upheld the vendor’s position and dismissed the purchaser’s counterclaim. The purchaser appealed.
The Supreme Court judgment, delivered by Mr Justice Geoghegan on 4 December 2007, said the rescission had been lawful. But it found that in early July the vendor, through her daughter and the auctioneer, promised that the original contract could be completed on 11 July, without prejudice to the rescission if the purchaser defaulted. The purchaser’s solicitor understood that the original contract terms applied, including contractual interest. The closing was then postponed by agreement to 12 July.
The court accepted the purchaser’s solicitor’s evidence that she was ready and willing to complete on the agreed terms. On 11 July, the vendor’s solicitor told him the sale was off. A partner at the vendor’s solicitors’ firm, who had spoken with the purchaser’s solicitor about postponing completion, was not called as a witness. The Supreme Court preferred the purchaser’s solicitor’s account of that conversation to the vendor’s solicitor’s evidence.
The court held that the promise and agreed postponement created an estoppel: if the purchaser was ready and willing to perform on the agreed date, the vendor was precluded from asserting the rescission against her claim for specific performance. The order did not arise from a new contract. The court allowed the appeal, dismissed the vendor’s action and granted specific performance on the counterclaim.
The court also limited financial claims. Neither party could claim interest or damages from the other for the period beginning 12 July 2005 and ending on the reasonable date set for completion under the order. The purchaser remained liable for full contractual interest up to and including 11 July 2005.