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Response to Thanks

from Neil (Neilaw_uk@yahoo.co.uk)
Hi Terry glad to be of help, little bit of caselaw regarding underselling you may also be interest in:

Skipton Building Society v. Bratley and Stott CA 10 Dec 99:-

BS loaned to a company, secured by mortgage. B and S guaranteed company’s obligations to BS. Administrative Receivers appointed over company. Owner of adjacent property offered £122,500 for the mortgaged property. Completion delayed for few months.

By time sale completed, shortfall, which BS sought to recover from guarantors.

S argued that best price not obtained as property not advertised and price did not reflect special purchaser, so released from liability. Judge found breach of duty, but reduced BS claim by only £25,000 representing loss of chance of obtaining higher price. S appealed.

Held

CA allowed the appeal.

Judge was correct that breach of duty did not absolve guarantor from liability, merely reducing guarantor’s liability pro tanto. But loss of a chance was not correct basis of quantification. Damages should be calculated on difference between what could have been reasonably obtained and what was actually obtained. In this case, that difference was more than the shortfall, so BS should recover nothing.

good luck

(posted 7624 days ago)

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