From: Andrew Tettenborn <a.m.tettenborn@swansea.ac.uk>
To: obligations@uwo.ca
Date: 24/05/2016 12:16:05 UTC
Subject: sharma v simposh
A decision in the English CA today trenchantly upholding and approving Sharma v Simposh [2013] Ch 23, the case holding that an ineffective contract may nevertheless justify retention of a deposit. In Marlbray v Laditi [2016] EWCA 476, a husband signed a contract for an apartment on behalf of himself and his wife and paid a deposit. In fact he had no authority to sign for his wife. He later sought to exit the deal and get back his deposit, arguing s.2 of the 1989 Act and also that the contract never became binding on any of the parties because the wife, though said in the document to be a party, never became bound (!). Both points failed. But the CA also said that even if the contract had not been binding, this didn't mean the deposit could be clawed back. There had been no failure of consideration / assumptions, and hence no reason for relief.

And, in the view of this commentator, quite right too.

Andrew
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Andrew Tettenborn
Professor of Commercial Law, Swansea University

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Andrew Tettenborn
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