in this litigation, in a case considering contractual variations, which was of direct relevance to this matter.
The appeal Judges found that (following the aforementioned Supreme Court decision – MWB Business Exchange Centres Ltd -v- Rock Advertising Limited [2018]), parties to a contract can decide a regime for varying the original contract; if that regime is not followed any potential variation is of no legal effect.
In the present case, there was such a clause in the sale contract and the statement of agreed facts did not comply with the variation regime. Accordingly, the court concluded that the statement of agreed facts was not binding.
Potential for Dunmow to run an estoppel argument
That is potentially not the end of the matter. Whilst the path seems clear for the expert to proceed to a determination of price, adopting the challenge expiry date as valuation date, Dunmow can decide whether they want to ask the High Court to consider an estoppel argument.
In rudimentary terms, that will turn on whether the parties ought equitably to be held to the agreement reached in the statement of agreed facts in all the circumstances of this case and regardless of the earlier contractual valuation date.
If this estoppel argument is run, will the court decide that it would be unconscionable to ‘release’ Crest from the position taken in the statement of agreed facts? That will be a highly fact sensitive issue for the court, so even if the argument is advanced, it may be difficult to discern any general proposition of the law on this issue.
Points to note
Practitioners, agents and surveyors ought to note – if there had been no contractual variation regime in the sale contract, then the parties may have been held to the statement of agreed facts.
Any decision to agree points in a statement of agreed facts ought to be carefully considered, as the law stands, there may be no going back.
There are also perhaps further points on which there is still no final landing on this issue – does an expert or arbitrator have power to relieve the parties of an agreement reached during a dispute resolution process if it is wrong or if it would be equitable to do so? Could such an agreement be vitiated if there was a clear mistake? It is perhaps a shame that the MWB case provided such a decisive answer to the main point at issue – it would have been interesting to see how the Court of Appeal dealt with the appeal as originally advanced.
This is an area of law that continues to warrant a careful watching brief.
About the authors
Marcus Barclay Partner Nick Wood Partner Anna Ralston-Crane Senior associate CMS law Tax