Reading two documents together to form a memorandum satisfying CPO, s.3

Section 3 of the Conveyancing and Property Ordinance requires that land contracts either be in writing or that there be a written memorandum of the terms of a contract that was concluded orally. The contract or memorandum has to be signed by ‘the party to be charged’ (the party trying to escape from performance of the contract).

It is permissible to read two documents together in order to produce a memorandum satisfying section 3. So, in Timmins v Moreland Street Property Co Ltd ([1958] Ch 110) a buyer and seller orally agreed terms for the sale of land in London. A director of the buyer gave the seller a signed cheque for the agreed deposit. The seller then gave him a receipt that identified the parties, the property and the price and made it clear that a contract had been concluded. The buyer wanted to escape from the contract and the seller sought damages for the repudiation of the contract.

One of the buyer’s defences was that there was not a memorandum to satisfy the (now repealed) English equivalent of section 3 of the Conveyancing and Property Ordinance. The receipt was not signed by the buyer. The seller contended that it was possible to read the cheque (signed on behalf of the buyer) together with the receipt.

The buyer’s defence was successful. The English Court of Appeal reiterated the requirements to be met before two documents can be read together to form a memorandum. Jenkins LJ suggested that the two documents must be ‘so manifestly connected without the aid of oral evidence as to justify their being read together.’ (at 129).

This was not so in the present case:

‘But before a document signed by the party to be charged can be laid alongside another document to see if between them they constitute a sufficient memorandum, there must, I conceive, be found in the document signed by the party to be charged some reference to some other document or transaction.’ (at 130)

The cheque contained no reference to the receipt and so they could not be read together.

Michael Lower

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