Bushwall Properties v Vortex Properties

Bushwall Properties v Vortex Properties [1976] 1 WLR 591

Contract law – Option Agreement – Enforceability – Uncertainty

Facts

The parties agreed to sell a property of 51 ½ acres of land for a set price of £500,000. The payments were to be made in unequal instalments. When these instalments were paid, a ‘proportionate part of the land’ was to be released. There was no suggestion in the agreement of which part of the land was to be regarded as being ‘proportionate’ for any of the instalments, and no mechanism for suggesting how this was to be determined. The first payment was to be of £250,000, followed 12 months later by a payment of £125,000. The balance was to be paid after a further 12 months.

Issues

Whether or not the agreement was certain enough to be enforceable by the court. Whether or not, the fact that the parties had not specified the way the ‘proportionate’ part of the land to be released was to be measured meant that the agreement was void for uncertainty.

Decision/Outcome

The agreement was void for uncertainty. The parties had failed to specify a mechanism for calculating the ‘proportionate’ part of the land that was to be released upon payment of the instalments and so the entire agreement itself failed for uncertainty. The parties could not decide which parts or proportions of the land were to be the parts conveyed and so the agreement was inherently uncertain. The Court of Appeal rejected suggestions that a term be implied that provided that one of the parties was to choose which of the parts of the land were to be the parts which were ‘proportionate’ to the sum paid in the instalment. As such, the contract could not be upheld by the court and it failed for uncertainty.