The Supreme Court has dismissed Monica Kiely’s appeal over her attempt to rescind a contract to sell land at Bettyville, Ballyboughal, after it emerged that the plot did not have the right of way described at auction.
The judgment, delivered by Mr Justice Fennelly on 10 July 2012, upheld the High Court’s conclusion that the attempted rescission was invalid. The appeal arose from a special summons under the Vendor and Purchaser Act 1874 asking whether the sale had been duly rescinded.
Kiely sold the land to Ronald and Patricia Delaney for €88,000 in May 2002, with an €8,500 deposit. The Supreme Court said the folio showed a right of way, and access was described as being in order before the auction. But a later map showed the route stopped short of the plot. The right of way had been severed when a previous owner sold an adjoining strip without reserving access over it.
The buyers sought a price reduction, saying alternative access would cost about €25,000, and invoked the contract’s arbitration clause. The seller’s solicitors initially said she could not provide a full legal right of way and offered to return the deposit. The seller later asserted that a right of way existed in practice, objected to the buyers’ requisition and gave notice purporting to rescind. She returned the deposit in June 2005.
The Supreme Court found that the seller’s handling of the dispute was unreasonably delayed. An arbitrator had been appointed, but the seller’s side failed to respond to correspondence and delayed delivering a defence and agreeing a hearing date. The Court said the seller then reversed her position almost three years after the contract, despite the lack of agreement from the owner of the intervening plot. The buyers had remained willing to complete at a reduced price, with compensation determined by arbitration.
Justice Fennelly said those circumstances justified the High Court’s conclusion that the seller had acted so unreasonably that she lost the effective right to rescind under condition 18 of the Law Society’s General Conditions of Sale. That was enough to dismiss the appeal.
The Court did not uphold the High Court’s separate conclusion that the vendor’s solicitor’s imprudence barred rescission. It said the evidence supported a finding of imprudence, but the applicable authorities required recklessness or indifference to the buyer’s interests, and the evidence did not justify a finding that the solicitor had knowingly taken a calculated risk.
The Supreme Court also left undecided whether a vendor may rescind under condition 18 when a purchaser seeks compensation under condition 33. Justice Fennelly said that broader question was unnecessary to decide in this appeal and should be considered in a later case.