In the case of Anderson Antiques (UK) Ltd against Anderson Wharf (Hull) Ltd and Another , ownership of a fair interest in a development site was affected.
The complainant company was the owner of several parts of the land which included a development site (site). The other defendant was an experienced property developer and sole board member and shareholder in the first respondent company. The company was incorporated as a single vehicle with the sole purpose of acquiring and developing the website.
In September 2006, a meeting was held between a plaintiff's representative, A, and the other defendant (at the other defendant's home). According to the defendants, the parties at that hearing initiated an oral agreement whereby the applicant agreed that the first defendant had secured the execution of various preparatory work and received the funding required to sell the site to the first defendant for £ 2 million.
The complainant agreed that A had visited the other defendants at home but denied that such an oral agreement had been concluded. According to the applicant, any discussion about the site had been limited to the second respondent's claim that the first defendant could match a rumored offer on the site. A presence listing of the claimant's attorney and relating to a telephone conversation with A that had taken place the day following the meeting supported the applicant's version of events.
Thereafter, the applicant tried to sell the site through an informal tendering procedure. The attorneys lodged a written complaint regarding the accuracy of the content of the sales data. However, they had no problem with the sale in the light of the alleged oral agreement.
During the subsequent correspondence, the accused lawyers accepted that they had no legal interest in the site. The accused had two bids during the tendering procedure. In February 2007, the alleged communications submitted to the site's registered titles on the basis that they had a fair interest in the site resulting from the alleged oral agreement to sell and the expenses incurred in a maliciously dependent addiction.
The complainant issued a procedure according to which he requested
A statement that the defendants had no interest in the site.
Cancellation of notifications to the site's registered titles; and
Damages according to p.77 of the Land Registration Act 2002 (Act).
The defendants have issued a counterclaim for compensation and the applicant sought a summary judgment.
Two main questions fell to settle the court:
First, if the defendants claim that a fair interest in the site had arisen due to harmful dependence on the alleged agreement, had a real prospect of success. and
Secondly, if not, the other defendant was personally liable for any damages made pursuant to p.77 of the Act.
The Court ruled that, in this case, the defendants had not shown that there was an oral agreement on the sale of the site to the first defendants. The alleged oral agreement relied on by the defendants was simply incompatible with evidence of the court and the defendants' behavior.
In particular, the accused lawyers had admitted in correspondence that they had no legal interest in the site, and the defendants had not objected to the applicant who attempted to sell the site by tender. In any event, even if such an oral agreement had been found, the first respondents tried to bid on the site during the tendering procedure to have approved the applicant's repudatory breach of the agreement. In such circumstances, the accused case had no real chance of success.
As regards the personal liability of the other defendants, under §7 of the Act, the primary responsibility for the party to which the application was made was to the subregistry. In this case, that party had been the first defendant.
The first defendant, however, had only been a single vehicle, and it was obvious that the other defendant had acted on behalf of the first defendant on application. It had been the second defendant who had instructed attorneys during the trial and had made the statutory declaration in support of the application to the real estate register. In such circumstances, the other defendant had clearly made an application for notifications against the claimant's title and, therefore, the liability under section 77 of the Act would also be attached to him personally.