''Daulia Ltd v Four Millbank Nominees Ltd''

977 Year 977 ( CMLXXVII) was a common year starting on Monday (link will display the full calendar) of the Julian calendar. Events By place Europe * May – Boris II, dethroned emperor (''tsar'') of Bulgaria, and his brother Roman ma ...

Dahlia Ltd v Four Millbank Nominees Ltd & Anor

EWCA Civ 5 (24 November 1977) is an

English contract law English contract law is the body of law that regulates legally binding agreements in England and Wales. With its roots in the lex mercatoria and the activism of the judiciary during the industrial revolution, it shares a heritage with countries ...

case, concerning unilateral contracts, and when embarking on the performance of an act for which an offer is open, at what point the offer may be withdrawn. In particular, Goff LJ observed that there would be a duty to not prevent full performance of terms in a unilateral offer, once performance had begun.

Facts

Daulia Ltd wanted to buy the premises on

Millbank Millbank is an area of central London in the City of Westminster. Millbank is located by the River Thames, east of Pimlico and south of Westminster. Millbank is known as the location of major government offices, Burberry headquarters, the Millb ...

, London from Four Millbank Nominees Ltd, who were mortgagees in possession. Formal contracts were never exchanged, but Daulia argued they did obtain a

unilateral contract A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...

by the first defendants that they would enter into a written contract of sale, if they attended Four Millbank's offices with a draft contract on terms already negotiated and a deposit. But when Daulia Ltd's representatives attended, Four Millbank refused to exchange. Daulia Ltd claimed breach of the oral agreement. At first instance, Brightman J struck out Daulia Ltd's statement of claim for failing to comply with s.40(1) of the

Law of Property Act 1925 The Law of Property Act 1925c 20 is a statute of the United Kingdom Parliament. It forms part of an interrelated programme of legislation introduced by Lord Chancellor Lord Birkenhead between 1922 and 1925. The programme was intended to moderni ...

(now, the requirement of form for contracts for interests in land under s.2,

Law of Property (Miscellaneous Provisions) Act 1989 The Law of Property (Miscellaneous Provisions) Act 1989 (c 34) is a United Kingdom Act of Parliament, which laid down a number of significant revisions to English property law. Nature of reforms The Act introduced several distinct reforms: :* T ...

). Daulia Ltd appealed.

Judgment

The

Court of Appeal A court of appeals, also called a court of appeal, appellate court, appeal court, court of second instance or second instance court, is any court of law that is empowered to hear an appeal of a trial court or other lower tribunal. In much of t ...

dismissed Daulia Ltd's appeal. They held there was a unilateral contract for disposition of land, and therefore it could not be effective because it did not comply with s.40(1). Furthermore there was no act of part performance, which could lead to a binding contract. In the course of his decision Goff LJ said that had there been part performance, it would be a duty of the offeror to not prevent full performance (see also, ''

Errington v Errington is an English contract law and English land law judicial decision of the Court of Appeal concerning agreement and the right to specific performance of an assurance that is relied on. Facts Mr Errington in 1936 bought a house in Milvain Avenue ...

''). Goff LJ's judgment went as follows.

References

{{reflist English agreement case law Court of Appeal (England and Wales) cases 1977 in case law 1977 in British law Auction case law

Facts

Judgment

See also

References