Q&As

If an original deed (option to buy agreement) has not been validly executed, will a subsequent deed of variation fail or can it stand on its own?

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Published on LexisPSL on 16/10/2017

The following Property Q&A provides comprehensive and up to date legal information covering:

  • If an original deed (option to buy agreement) has not been validly executed, will a subsequent deed of variation fail or can it stand on its own?

This Q&A raises the issue of the requirements which must be satisfied for the valid grant of an option to purchase an interest in land. It raises questions of the formal validity and the contractual validity. It is convenient to consider each in turn.

As to the question of formal validity, it is helpful first to keep in mind the distinction between the grant of an option and the subsequent exercise of it. There are three distinct stages: the grant of the option (A grants B an option to purchase land), the exercise of it (B informs A in accordance with the terms of the option of the wish to do so) and the giving effect to the exercise of it (A transfers the land to B upon payment of the agreed price). With those three stages in mind, one sees how different requirements as to validity will arise.

The grant of an option does not transfer title to the land. It is not a contract of sale but something in the nature of an irrevocable offer to the grantee to sell the land to it. Hoffman J analysed the nature of an option as such in Spir

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