The High Court rejected the Commissioners of Public Works’ counterclaim to rescind a land sale contract and recover its deposit, and held that the vendor was entitled to specific performance. It left the vendor’s claim for interest on the purchase price for further argument.
The dispute concerned a contract for the sale of Unit 4A, Glanmire Industrial Estate, in County Cork, for €862,000. Planning permission for a change of use issued on 25 January 2012, making 14 March 2012 the contractual completion date. The vendor later served a completion notice, and the parties agreed that its 28-day period expired on 2 January 2013.
The judge found that the purchaser was ready to close within that period, but the vendor was not. The vendor could not provide a partial release of a Danske Bank charge by the deadline, had no confirmed arrangement for a Bank of Ireland partial discharge, and did not obtain a current tax clearance certificate until 4 January. The judge also found the vendor’s solicitor had not communicated the position adequately as the deadline approached.
The purchaser had proposed closing on 21 or 24 December, but the court found it did not have the required bank drafts until 28 December. The purchaser’s solicitor emailed on 2 January proposing a closing the following day and listing additional requirements, some of which the judge found were not required by the contract. The vendor’s solicitor proposed 4 January, and the parties agreed to that date after further correspondence. The sale did not close that day.
The judge held that the purchaser could not rescind before the full 28-day notice period expired merely because the vendor could not complete on an earlier date. Although the purchaser had a right to rescind on 2 January because the vendor was not ready to close, it continued negotiations as if the contract remained in force and indicated willingness to complete later. Its correspondence did not clearly and unequivocally reserve the right to rescind for the vendor’s failure to meet the deadline.
Because the agreement to close on 4 January came after the completion notice had expired, time was not automatically of the essence for that later date. The purchaser did not make time essential for the new date, so it could not rescind when the sale failed to close. The counterclaim failed. The court held that the vendor was ready, willing and able to complete by the time of judgment and granted specific performance, with the interest issue reserved for further argument.