Sadly here in Whitstable (on the North Kent coast, UK) when the local authority sold open space intended to be held by the local authority for the public at a massive undervalue to developers(which was arguably by mistake, although some locally have alleged something less innocent), and the local resistance sought to have it set aside, the High Court weren’t particularly supportive of the various arguments including ultra vires: http://www.bailii.org/ew/cases/EWHC/Admin/2017/254.html (no mention of unjust enrichment) – the ground on which the transaction could have been set aside was that ‘the contract for the sale of the land was entered into at a value which is less that the best which could reasonably been have been obtained for the land and therefore in breach of the relevant legal requirements under the Local Government Act 1972’ but unfortunately it wasn’t set aside due to undue delay in bringing the action and prejudice to third parties. Of course, unlike Mr Zomparelli’s situation, our local authority for some reason (I won’t speculate on such an open forum!) didn’t want to have the transaction set aside.

___________

Nick Piška 

Senior Lecturer in Law

Kent Law School

University of Kent

Canterbury

Kent CT2 7NS

e: n.piska@kent.ac.uk 

t: +44 (0) 1227 824766

It would be unjust enrichment if it is established that the council acted ultra vires and thus the contract is void, just as with the interest rate swaps litigation. I imagine (though have no expertise here) that the argument in favour of ultra vires is based on the Housing Act, which confers on the authority the right to sell the house at the market value (i.e. not at the value which their agent happened to think was correct), and questions of value are to be determined according to a time-limited statutory process by a ‘district valuer’. Of course, we have no idea whether and to what extent this process was followed, so I suspect the ultra vires argument rather hangs on this. But until we have more detail, one can only guess!

Nick

Of course, we don’t have the precise statement of claim yet, but the letter references one in “unjust enrichment.” Surely, the juristic reason is a contract of sale. How, then, could it go forward on that basis?

Aren’t they limited to an uphill battle on the question of unilateral mistake? The council hired an independent surveyor before completing the sale. So, both the buyer and seller (through its agent) were aware of the nature of the premises.

I get the argument that they had no authority to make a sale at lower than market value, but surely the surveyor’s report would have established or supported the value for which the transfer was made.

---------------------------------
Matthew P Harrington
Professeur
Faculté de droit
Université de Montréal
www.commonlaw.umontreal.ca
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