Taylor v Fitzpatrick

CourtCourt of Appeal
Judge(Le Quesne, Davies and Nourse, JJ.A.):
Judgment Date29 January 1979
Date29 January 1979
(Le Quesne, Davies and Nourse, JJ.A.):

Civil Procedureappealsmatters of factappellate court only to depart from trial court's conclusions in assessment of reliability of witnesses in exceptional circumstancesmay interfere more readily with conclusions on discharge of burden of proof

Companiessharestransfer of sharesspecific performance may be ordered to compel agreed transfer (a) when damages not an adequate remedy; (b) when not a free market, especially shares in private company; and (c) when vendor unable to perform precise terms of bargain, may be ordered with added compensation

Contractspecific performanceinterests in landoral agreement for sale and purchase with no part performance unenforceable even in damagesno specific performance even of signed contract because contract not perfected until passed by court in presence of parties taking oathcourt will not compel unwilling party to attend

LE QUESNE, J.A.: This case concerns The Moorings Hotel on Gorey Pier and a block of flats adjacent to it called Nelson Court. The hotel belongs to The Moorings Hotel Ltd. and the flats to Nelson Court (Gorey) Ltd. The Respondent, Mr. Fitzpatrick, owns all but 10 of the shares of the former company and all the shares of the latter. 10 of the shares of the former company belong to his former wife. The first issue to be decided is whether a binding contract for the sale and purchase of these shares was made between the Respondent and the Appellant, Mr. Taylor, in a telephone conversation on the 1st April 1977.

It appears that at the time of this conversation the Respondent had forgotten that some of the shares of The Moorings Hotel Ltd. belonged to his wife. He was negotiating to sell all the shares of both companies. As will appear, however, this does not give rise to any difficulty in this Appeal.

The Respondent decided to sell the properties in the autumn of 1976. (For convenience we refer to the transaction as the sale of the properties, though in fact what was to be sold was not the properties but the shares of the two companies.) The price he had in mind was 300,000 though he realised that he might have to come down from that figure. He did not make any public announcement or put the properties in the hands of any agent, but his readiness to sell soon became known among the community at Gorey. In due course Mr. Gothard, who is an Estate Agent, introduced to the Respondent a gentleman called Mr. Millington as a possible purchaser. Negotiations followed between Mr. Millington and the Respondent. By the 20th March, 1977, when the Respondent left Jersey for a holiday in Cyprus, those negotiations had made some progress, but no bargain had been concluded. The price had not been agreed, though it appears that a figure of 250,000 net in the hands of the Respondent was being considered. It had also been explained that before he could complete the transaction Mr. Millington would have to make arrangements to get some money out of West Africa.

The Appellant was a friend of the Respondent, and like him was a hotel owner. In addition to owning other hotels in Jersey, he had a two thirds share of The Dolphin Hotel on Gorey Pier. He knew that The Moorings Hotel was for sale, but decided at first to do nothing about it until he saw how matters were developing. While the Respondent was away in Cyprus he decided that the time had come to act. On the 31st March he sent his manager, Mr. Martin, to see the Respondent's manager, Mr. Sappe, at The Moorings. Mr. Martin and Mr. Sappe were well known to each other. Mr. Martin's evidence was that Mr. Sappe told him on the 31st March that the Respondent's asking price was 260,000. Mr. Sappe was unable to remember the conversation. On the next day, Friday 1st April, Mr. Taylor and Mr. Martin went together to The Moorings in the morning. They tried to speak to the Respondent in Cyprus on the telephone, but were unable to get through. The Appellant returned to The Moorings in the afternoon, and on this occasion did speak to the Respondent on the telephone. The Appellant's evidence was that during this conversation the two of them reached agreement for the sale of the properties for 260,000. The Respondent's evidence was that they did not reach any agreement at all.

The Appellant said, that, after a few preliminary remarks, he said to the Respondent, "I'll give you the price that you're asking." The Respondent asked, "What was that" The Appellant said, "260,000 as you know". Mr. Sappe, who was standing beside him, asked whether that was for everything, and the Appellant said to the Respondent that it would be 260,000 for the shareholding in the companies, "and stock at valuation, and in the clear", by which he meant free of any encumbrances or debts. That, he said, was agreed. The Respondent asked how the money was to be paid, and the Appellant said, "I'll write the cheque out now". He then handed the telephone to Mr. Sappe, so that the Respondent could confirm to him what was happening, and while they were talking made out a cheque for 260,000 leaving the name of the payee blank so that either the Respondent's name or that of the company could be put in. He heard Mr. Sappe say to the Respondent on the telephone, "Just a minute, he's writing the cheque out now", and after looking at him Mr. Sappe added, "Yes, it is for the whole amount." That was the end of the conversation.

The Respondent's account of this conversation was that, after a few preliminary remarks, the Appellant said he wanted to buy The Moorings. The Respondent replied, "It is 4 o'clock in the afternoon. I am lying on my bed in Cyprus. I shall be back in Jersey in 48 hours. I'll put it off till then." Thereupon the Appellant said, "I am writing the cheque out now." The Respondent asked what cheque, and the Appellant said, "The cheque for 260,000." This, the Respondent said, was the first time he had ever heard that figure mentioned. He said he reiterated that he was not going to discuss a business deal like that over the telephone and the Appellant then handed the phone to Mr. Sappe. Mr. Sappe told him that the Appellant was writing out a cheque, and the Respondent asked, "Has he been drinking " Mr. Sappe answered, "I wouldn't like to say". That was the end of the conversation.

It is upon this conversation that the outcome of the case depends. The Appellant's case was that a contract had been made for the sale of the shares, and his claim was for specific performance of that contract, or alternatively for damages for its breach. The Respondent contended that no contract had been made. The conclusion of The Royal Court was that the Appellant had failed to discharge the burden of proving the contract, and they therefore dismissed the action. Before we consider their grounds for doing this and the criticisms which have been made of them, it is necessary to summarise the rest of the evidence.

Mr. Sappe's evidence of the conversation between the Appellant and the Respondent was that he himself made the call to the Respondent, and then handed the phone to the Appellant and left the...

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7 cases
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    • Royal Court
    • 12 August 1985
    ...Fashions v. Liverpool Victoria Trees. Co. Ltd., [1982] Q.B. 133; [1981] 1 All E.R. 897; (1979), 251 E.G. 159. (15) Taylor v. Fitzpatrick, 1979 J.J. 1. (16) Trollope v. Jackson, Royal Court (1983), 270 Ex. 197, unreported. (17) Willmott v. Barber (1880), 15 Ch. D. 96; 43 L.T. 95; 49 L.J.Ch. ......
  • Catriona Mary Fogarty v St Martin's Cottage Ltd
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    • 5 October 2016
    ...[2016] JRC 004. La Petite Croatie Limited v Ledo [2009] JLR 116. Halsbury's Laws of England, 4th ed. (2007 Reissue). Taylor v Fitzpatrick [1979] J.J.1. Houard, Dictionaire Analytique, Historique, Etymologique, Critique et Interprétif de la Coutume de Normandie 1780 ed. Corbin v Lee (1934), ......
  • R v Abacus (CI) Ltd ex parte Viscount Wimborne
    • Jersey
    • Royal Court
    • 19 May 1983
    ...remedy of specific performance is not unknown to the Royal Court (see the decision of the Court of Appeal in Taylor v. Fitzpatrick, 1979 J.J. 1). To the extent, therefore, that the cases cited to me assist in interpreting the provisions of the deed, I have considered them. As far as concern......
  • Rahman v Chase Bank (CI) Ltd
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    • 6 June 1991
    ...v. Ryley, veuve Saumarez, Royal Ct. (1904), 223 Ex. 318, unreported. (21) Symes v. Couch, 1978 J.J. 119. (22) Taylor v. Fitzpatrick, 1979 J.J. 1. (23) Taylor v. Goodwin (1879), 4 Q.B.D. 228; [1874-80] All E.R. Rep. 873; 40 L.T. 458; 48 L.J.M.C. 104; 43 J.P. 653; 27 W.R. 489. (24) Williams v......
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