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In what circumstances will a firm of solicitors be liable where a contract conditional on planning fails to complete? The High Court confirmed that a firm's retainer does not extend to advising on planning or commercial issues.
Rentokil Initial 1927 plc v Goodman Derrick LLP  EWHC 2994 (Ch)
Goodman Derrick (GD) was retained by Rentokil to act on its behalf in the sale of commercial office premises to Taylor Wimpey. The purchase was to be subject to the grant of planning consent for development for residential purposes. Planning consent was to be sought after exchange of contracts. Completion was to be dependent on the grant of planning consent with acceptable conditions.
Rentokil asserted that:
At the heart of the allegations was the assertion that GD failed to properly draft and advise on the definition of 'Unacceptable Planning Conditions'. Rentokil also asserted that GD was negligent in drafting the definition of 'Costs' payable in respect of obligations to be performed under a Town and Country Planning Act 1990, s 106 agreement between Taylor Wimpey, as buyer, and the local planning authority--with the result that the definition was capable of reducing the purchase price when it ought not to have been.
Taylor Wimpey had argued that the planning conditions that were ultimately imposed were unacceptable and refused to complete the purchase. The parties started arbitration proceedings on the issue, which were compromised a few days before the hearing was due to take place. The compromise provided for completion of the
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