Geddes Meyer v Kehvin Dickinson

• Jurisdiction: Antigua and Barbuda
• Judge: Blenman JA
• Judgment Date: 31 October 2019
• Judgment citation (vLex): [2019] ECSC J1031-2
• Docket Number: ANUHCVAP2014/0005
• Court: Court of Appeal (Antigua and Barbuda)
• Date: 31 October 2019

[2019] ECSC J1031-2

THE EASTERN CARIBBEAN SUPREME COURT

IN THE COURT OF APPEAL

Before:

The Hon. Mde. Louise Esther Blenman Justice of Appeal

The Hon. Mr. Mario Michel Justice of Appeal

The Hon. Mde. Gertel Thom Justice of Appeal

ANUHCVAP2014/0005

Between:

Geddes Meyer

Appellant/Counter Respondent

and

Kehvin Dickinson

Respondent/Counter Appellant

Appearances:

Mr. George Lake for the Appellant

Ms. Safiya Roberts with her Ms. Kamilah Roberts for the Respondent

Civil appeal — Contract — Breach of contract for sale of land — Specific performance — Whether time was of the essence in the contract — Frustration — Whether judge erred in concluding that the contract had been frustrated — Whether judge erred in refusing to order specific performance — Whether judge erred in not awarding mesne profits and costs.

The appellant, Mr. Geddes Meyer (“Mr. Meyer”) leased land from the respondent, Mr. Kehvin Dickinson (“Mr. Dickinson”) on which Mr. Meyer built a structure and carried on business for several years. Subsequently, Mr. Meyer entered into a contract with Mr. Dickinson for the purchase of the land. To secure financing for the purchase of the land, Mr. Meyer was required to pay taxes owed to the Government of Antigua and Barbuda (“the Government”), which were to be assessed by the Government. The tax value was to be incorporated in the financing which was being sought, which meant that obtaining the financing was dependent on the assessment being completed. The Government's assessment was not carried out in a timely manner. The delay in the assessment resulted in the failure of Mr. Meyer to acquire the requisite financing from the bank.

The contract for the sale of land did not indicate that time was of the essence. However, the parties had agreed to a single extension of time for completion of the sale. Mr. Dickinson refused to agree to further extensions and sold the land to a third party a few days after the extended date and for a price which was higher than that agreed to with Mr. Meyer. Mr. Meyer sued Mr. Dickinson for specific performance of the contract. The crux of his position was that he ought to have been given the first option to purchase the land having been in occupation of it. Mr. Dickinson filed a counter claim on the basis that Mr. Meyer had breached the contract and unlawfully occupied the land thereafter. In his counter claim, Mr. Dickinson claimed mesne profits.

The learned judge held that the contract had been frustrated by the act of the Government, and that Mr. Dickinson was entitled to treat the contract as at an end. The learned judge however, did not award Mr. Dickenson mesne profits.

Being dissatisfied with the decision of the learned judge, Mr. Meyer's has appealed and Mr. Dickinson has cross appealed, each raising several grounds. The issues arising on the appeal and the cross appeal are: whether time was of the essence in the contract; whether the learned judge erred in concluding that the contract had been frustrated; whether the judge erred in refusing to order specific performance of the contract; and whether the learned judge erred in not awarding Mr. Dickinson mesne profits and costs.

Held: allowing the appeal in part and awarding to Mr. Meyer nominal damages in the sum of $40,000.00; allowing the counter appeal and ordering Mr. Meyer to pay Mr. Dickinson mesne profits in the sum of $6,625.00 per year from 1 ^st January 2011 to the end of Mr. Meyer's occupancy of the land; ordering Mr. Meyer to vacate the land within six months of the delivery of this judgment; and making the costs order stated at paragraph 66 of the judgment, that:

• 1. It is the law that a term or stipulation in a contract relating to the time of performance is not generally regarded as being ‘of the essence’. Time is made of the essence where the parties have expressly stipulated in the contract that the time fixed must be met or that time is to be ‘of the essence’ In cases where time has not been made of the essence, the law requires that agreed obligations are to be performed within a reasonable time. Where there has been unreasonable delay by one party, the innocent party should give notice of an intention to terminate due to the breach or the failure to complete the contract. In this case, there is no evidence from which it could be correctly concluded that time was to be of the essence. Indeed, it was not so stipulated in the contract and there was no notice issued to make it so.

  D & B Trucking and Trailer Hauler Service Ltd v Caribbean Insurers Ltd BVIHCVAP2008/0025 (delivered 8th February 2010, unreported) followed; Universal Cargo Carriers Corporation v Ciatati [1957] 2 All ER 70 applied.

• 2. Frustration occurs when, without default of either party, a contractual obligation has become incapable of being performed because the circumstances in which performance is being called for would make the contract radically different from what was agreed. The effect of frustration in law is the immediate termination of the contract. In the present case, time was not of the essence in the contract and Mr. Dickinson had not issued a notice that time was of the essence. Therefore, in order for the contract to have been frustrated, the delay ought to have been a frustrating delay at the time Mr. Dickinson opted to treat the contract as at an end. There is no doubt that Mr. Meyer was not afforded a reasonable amount of time within which to complete the payment. A delay of a mere few days cannot be regarded in law as having frustrated the contract, bearing in mind that Mr. Meyer was in occupation of the land as a lessee for several years and the need to have the land evaluated for taxes in order for him to secure the loan. Accordingly, there was no frustration of the contract and the learned judge erred when he ruled that the contract had been terminated by frustration.

  Lauritzen (J) AS v Wijsmuller BV, The Super Servant Two [1990] 1 Lloyd's Rep 1 applied; Hirji Mulji and Others v Cheong Yue Steamship Co Ltd [1926] AC 497 applied; Davis Contractors Ltd v Fareham Urban District Council [1956] 2 All ER 145 applied.

• 3. Specific performance is an equitable remedy to a cause of action for breach of contract. The remedy is not available where damages would be an adequate compensation to an innocent party. Further, where the parties have not made time of the essence, the courts would not usually grant the remedy of specific performance where the obligation to complete was not performed. In this case, since time was not of the essence in the contract, Mr. Meyer was required to prove that all of his contractual obligations had been fulfilled or that he was ready and willing to perform all of the obligations required by the contract. However, Mr. Meyer has not provided to this Court, or to the court below, any proof that he had performed or was able to perform his main obligation under the contract, namely the payment of the purchase price. Accordingly, specific performance is not an appropriate remedy in the circumstances. Damages would be an adequate remedy to compensate Mr. Meyer for any losses suffered as a result of Mr. Dickinson's breach.

  Ramsbury Properties Limited v Ocean View Construction Limited SKBHCVAP2011/0020 (delivered 29th January 2019, unreported) followed; Beswick v Beswick [1968] AC 58 applied; Greer v Alston's Engineering [2003] UKPC 46 applied.

• 4. The owner of land will have an action for wrongful use and occupation or mesne profits against a person who has been in occupation of land without a contract. Generally, mesne profits may be claimed from the date on which the landlord became entitled to possession of the land. There is no doubt in this case that at the end of the lease, Mr. Meyer was a tenant holding over and as such is under an obligation to pay rent. The lease came to an end after one year, namely on 31 ^st December 2010 and Mr. Meyer remains in possession of the land and has not paid rent. In the circumstances, Mr. Dickinson is therefore entitled to recover, from Mr. Meyer, mesne profits from the date on which the land should have been yielded up to the date Mr. Meyer vacates the land.

  Ministry of Defence v Thompson [1993] 2 EGLR 107 applied; Beswick v Beswick [1968] AC 58 applied; Greer v Alston's Engineering [2003] UKPC 46 applied.

Introduction

Blenman JA

1 This is an appeal by Mr. Geddes Meyer (“Mr. Meyer”) against the decision of the learned judge in which he dismissed Mr. Meyer's claim against Mr. Kehvin Dickinson (“Mr. Dickinson”) for breach of a contract for the sale of land. There is also a counter appeal by Mr. Dickinson on the basis that he had been successful in establishing his counterclaim against Mr. Meyer. Mr. Dickinson's counter appeal includes an appeal against the learned judge's refusal to award him costs and mesne profits. The appeal and the counter appeal are respectively resisted by Mr. Dickinson and Mr. Meyer.

Background

2 Mr. Dickinson was the owner of a parcel of land located on All Saints Road. Mr. Meyer had leased the land from him and constructed a building on the land which he (Mr. Meyer) used for his mechanical business for several years.

3 In 2010, Mr. Meyer entered into a contract with Mr. Dickinson for the purchase of the land from him. Mr. Meyer required financial assistance to make the purchase and therefore sought a loan from a bank in order to effect the purchase. To obtain the loan from the bank, he was required to pay the taxes that are owed to the Government of Antigua and Barbuda (the “Government”). The Government was required to assess the value of the land for the purpose of his payment of taxes. The taxes due also had to be assessed in order to be included in the loan sum. The Government did not carry out the assessment in a timely manner and due to the delay, Mr. Meyer was unable to obtain an indication of the outstanding taxes and was therefore unable to provide that information...