The Gazette 1979

GAZETTE

APRIL 1979

Financial Adviser became available to the Plaintiff. As however the Supreme Court did indicate that the Defendants were not entitled to require compliance by the Purchaser with an arbitrarily imposed and unreasonably short period for signing and returning the formal Contract, it might not be unreasonable to assume that the Supreme Court would have held the Solicitors letter and the enclosed Contract to be together a Note or Memorandum in writing sufficient to satisfy the statute. What then is the significance of these two recent decisions for Solicitors? The significance for Auctioneers is clear, that if they have, on behalf of a Vendor, reached an oral agreement with a Purchaser as to the terms of a proposed sale, then almost any letter which they write, whether to their client or to the Purchaser, unless it be totally inadequate as to its recital of the agreed terms, will, no matter what attempt is made to qualify, almost certainly be a sufficient note or memorandum in writing to satisfy the statute. As far as Solicitors are concerned it may well be that by the time they get any instructions "the pass will have been sold" and it is perhaps only in those cases in which the Solicitor is directly involved in the negotiations himself that he, if he has appropriate authority, may be found to have bound his client firstly to the oral agreement and secondly to have provided the necessary evidence thereof by writing an opening letter, whether enclosing a draft Contract or not, either to the prospective Purchaser or to his Solicitors. It is understood that one firm of Solicitors has already taken up the suggestion contained on Page 365 of Wylie's Irish Conveyancing Law that a statement that the Solicitor is not to be taken as the agent of his client for the purposes of Section 2 of the Statute of Frauds (Ireland) 1695 by having a statement to this effect printed on the firm's notepaper. Apart from wondering whether the firm in question has read the footnote on Page 365 which raises the possibility that the Solicitor may be an express agent in a particular case, the writer wonders whether in all cases clients would necessarily be thankful to find that they had not been committed by their Solicitor to a sale or perhaps more likely to a purchase. It has often seemed strange to the writer that although most practitioners must on average act for Purchasers as often as they act for Vendors, conversations about this particular topic always seem to centre around how to avoid binding a Vendor from whom the Solicitor is acting as if Vendors always wished to resile from their bargains. Rarely does a Solicitor seem to consider that a Vendor might want to get both parties bound as soon as possible. The inescapable conclusion to come from these cases is that much greater care must be exercised in negotiating oral agreements on behalf of Vendors and Purchasers and ensuring that whoever is involved in the negotiations be they Auctioneer or Solicitor has firm authority from his client either to conclude an oral agreement or that he has the clients firm instructions to provide at the time of the making of any oral agreement that it is to be subject to subsequent conclusion of a written contract or to the approval of title by both parties or to a subsequent formal exchange of contracts or some other provision which will clearly show that no completed oral agreement has been reached. It now appears that any subsequent attempt in writing to suggest that the parties are not already bound may merely provide the evidence necessary to prove that they are so bound.

Intercontinental ascertained that the Plaintiff was still willing to buy the lands for £110,000.00 and authorised a local Manager of the Northern Bank to make an offer of the lands to the Plaintiff for £110,000.00 which the Plaintiff accepted, a letter was dictated by the Bank Manager addressed to the Manager of Irish Intercontinental Bank Limited which read: "I hereby accept the offer to purchase the property known as Park House and lands at Mallow, Co. Cork containing 120 acrea 1 rood 30.7 perches for consideration of £110,000.00 (One Hundred and Ten Thousand Pounds)". This was signed by the Plaintiff and his signature witnessed by the Northern Bank Manager who telephoned the Banking Manager of Irish Intercontinental who expressed approval of what the Northern Bank Manager had done and of the letter. Subsequently Irish Intercontinental Bank's Solicitors sent out a letter, the first two paragraphy of which read: "We are instructed by our clients, Irish Intercontinental Bank Limited, 91 Merrion Square, Dublin 2, that they have accepted an offer of £ 1 1 0 , 0 0 0 . 00 f r om your client Patrick Casey Our clients are selling as Mortgagees pursuant to the powers in that behalf contained in an Indenture of Mortgage made the 14th day of November 1975 and the power of Attorney dated 11th February 1975". Although, curiously enough, the judgment of the Supreme Court does not say so in so many words, it is clear that the letter from Messrs. Cox & Co., was deemed to be a Note or Memorandum in writing evidencing the previous oral agreement made between the Plaintiff and Irish Intercontinental Bank. As both the leading Irish and English text books on conveyancing agree the "essential elements" which have to be included for the Note or Memorandum in writing to be effective are what are referred to as the four "P's". The Parties, The Property, The Price and any other essential Provisions. Now in the Park Hall case the detailed letter sent by the Agents to the Financial Adviser clearly met all these requirements, the Courts having held in a number of earlier cases that various provisions which Defendants' Counsel had urged were essential though omitted were not in fact essential and could be implied, including such things as the time within which the Contract would be signed, the payment of a deposit or its amount or the date for completing the sale. In the Casey and Intercontinental Bank case again the note in writing clearly sets out the essential elements. Although it is clear from the authorities that the nature of the title to the property does not have to be spelled out, it is surely significant that in each of these two recent cases, the Purchaser was aware of the title, in the Park Hall case because he had bought adjoining lands held under the same title from the Defendants earlier and in the Casey case because the Plaintiff had been to the abortive auction where presumably he had read the conditions of sale and was thus aware of the title being offered. Perhaps the most curious feature of the Park Hall case is that when the proceedings were issued the Plaintiff was relying on the letter of the Vendors Solicitor which sent out the contract in January 1978 and it was only when discovery of documents was ordered in the case that the communication between the Defendants Agents and their

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