Creating a valid contract
Creating a valid contract

The following Property guidance note provides comprehensive and up to date legal information covering:

  • Creating a valid contract
  • Joint purchasers
  • When is a contract signed?
  • What is the difference between enclosed and incorporated?
  • Implied terms
  • Rectification
  • Future potential owners
  • Is there a collateral contract?
  • Varying the contract
  • Boundary agreements

A contract for the sale of land, or of any interest in land, is void unless it complies with Law of Property (Miscellaneous Provisions) Act 1989, s 2 (LP(MP)A 1989). It must:

  1. be in writing

  2. contain or incorporate all of the terms expressly agreed by the parties, and

  3. be signed by or on behalf of the parties

LP(MP)A 1989, s 2 applies only to executory contracts for the future sale or other disposition of an interest in land and does not apply to a contract which itself effects such a disposition. The decision in Joyce regarding a demarcation agreement (see Boundary agreements below) did not alter this principle.

LP(MP)A 1989, s 2 applies to any contract for the sale or other disposition of an interest in land, and so can affect agreements where the land sale is incidental to the main purpose of the agreement.

In Abberley, the court held that although heads of terms agreed at a mediation did not record all the terms discussed by the parties, or all the terms likely to be included in a later formal agreement intended to be executed by the parties, they were still sufficient to create a legally binding contract which complied with LP(MP)A 1989, s 2.

Joint purchasers

In Marlbray, a joint contract for the purchase of land was held to be void