Woodar v Wimpey - 1980

Legal Case Summary

Woodar Investment Development Ltd v Wimpey Construction UK Ltd [1980] 1 WLR 277

Contract – Repudiation – Right to rescind reserved – Purported exercise – Damages – Breach

Facts

Wimpey, the purchasers, entered into a contract with Woodar to buy land. It was agreed that part of the purchase price would be paid on completion of the build. There was a clause in the contract that allowed the purchasers to rescind in the event that an authority were to negotiate an acquisition of the property. Wimpey later sent a notice to rescind the contract to Woodar after it was confirmed that the an Environmental secretarial authority had commenced the procedure for the compulsory acquisition of part of the land. Woodar brought action claiming Wimpey had no right to rescind the contract and also claimed damages for breach of contract.

Issues

Whether the sum outstanding on the purchase was recoverable in action by Woodar and whether Wimpey were entitled to rescind the contract in the circumstances.

Decision / Outcome

The appeal by Wimpey was allowed, overturning the court’s previous decision that the contract has been wrongfully repudiated. It was held that Wimpey had relied on the term of the contract in question. Further, it could not be found that Wimpey had had an ulterior motive to abandon the contract from the beginning and was not to be treated as repudiating the contract. Their conduct did not support a case of repudiation. Therefore, Woodar was not entitled to damages as even though the final sum of money was not paid, the contract had provided for the rescindment.