Weekly review: 5th – 9th December

Collateral contracts

Lightman J in Inntrepreneur Pub Company Ltd v East Crown Ltd ([2007] EWCA Civ 622, CA (Eng)) identified five features of a collateral warranty. Applying them, it is unlikely that a statement made during the course of negotiations was intended to have contractual effect where: it was followed by subsequent negotiations and not repeated in the formal contract; there was an appreciable lapse of time between the statement and the contract; and the representation was one of future fact (Business Environment Bow Lane Ltd v Deanwater Estates Ltd).

Constructive trust: Pallant v Morgan equity

A constructive trust can arise where A and B agree that if A refrains from bidding for property B will bid and, if successful, transfer ownership of some of the property to A (Pallant v Morgan).

There must be an agreement together with an advantage to one party or a detriment to the other. It is not necessary for the precise legal arrangements for joint ownership / acquisition to have been agreed (Baynes Clarke v Corless).

Leases: forfeiture: peaceable re-entry

Forfeiting a lease by peaceable re-entry is possible but fraught with legal risk. The courts may not look kindly on landlords who overstep the mark (New G Mei Uk Restaurant v Tin Kwok Keung).

Resulting trust

Where there is a dispute as to who paid for property (and therefore whether a purchase price resulting trust arises) the court will examine the words and conduct of the parties and the relevant documents in an attempt to reach the truth (Tang Wai Cho v Tang Wai Leung).


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