Hicklane Properties Ltd v Bradbury Investments Ltd

Rectification may be ordered where the parties shared a common intention on the substance of a term, even though they expressed it in different language. Convincing proof is required that the executed document fails to record that intention. A complete technical valuation formula is unnecessary where the drafting error is confined to an identifiable term and the remaining detail is not in issue. Thus, wording requiring valuation with vacant possession may be removed where the parties intended a reversionary freehold to be valued subject to the existing lease.

Bradbury Investments Limited held a 30-year lease of industrial premises containing a right of pre-emption over the freehold reversion. The valuation clause defined open market value by reference to a sale of the freehold interest with vacant possession.

After notice of an intended sale, the parties disputed whether the reversion should be valued subject to the lease or as if vacant possession were available. An independent valuer adopted the latter construction. The High Court, HHJ Kaye QC, ordered rectification by deleting the disputed words and making the lease’s continuing existence explicit. Hicklane Properties Limited appealed, arguing that Bradbury had not proved a complete common valuation formula.

The central issue was whether the evidence established a sufficiently precise common intention concerning the disputed wording.

1. Appeal dismissed. The order rectifying the lease was upheld.
2. The relevant question was whether the words “with vacant possession” recorded the parties’ agreement and common intention. The judge was entitled to find that the freehold was to be valued subject to the continuing lease, with Bradbury’s expenditure on refurbishment disregarded.
3. Convincing proof did not require identical language or agreement on a complete technical valuation formula. The parties’ different descriptions—capitalising the passing rent or assessing the open-market price of the reversion—could express the same substantive intention.
4. The evidence supported a finding that the only material error was the insertion of “with vacant possession”. The remaining detail of the valuation provision was not in issue, so no fuller finding was necessary.
5. Rectification properly removed the mistaken words and made clear that the freehold acquired under the pre-emption was to be valued at open market value subject to the lease.

• Court of Appeal (Civil Division): Appeal dismissed and the High Court’s rectification order upheld.
• High Court of Justice, Chancery Division: HHJ Kaye QC ordered rectification of the lease by omitting “with vacant possession” and inserting wording making the valuation subject to the lease.