Monsolar IQ Ltd v Woden Park Ltd

Where a contractual drafting mistake has been established, the court must identify the correction that objectively reflects the nature of that mistake. A different possible commercial arrangement does not make the correction unclear if it would require proof of a separate, unestablished mistake.

A party cannot use consequential submissions to introduce an opportunistic new case after judgment. The court may mark significant non-compliance in witness evidence by disallowing an appropriate proportion of the costs.

This supplementary judgment followed the court’s substantive judgment in [2020] EWHC 1407 (Ch). The defendant sought permission to advance further argument that the lease might have been intended to contain an upwards-only rent review clause, and contended that this made the mistake and required correction unclear.

The court also determined costs and refused permission to appeal. The central issue was whether the proposed alternative meaning showed that the drafting error previously identified was not sufficiently clear to justify correction.

1. Further argument refused in substance. The defendant’s proposed upwards-only review argument was a new argument, a volte face from its earlier case, and outside the permission sought. It was nevertheless considered on its merits.
2. Correction of drafting mistake. The relevant question was whether, objectively, these parties could have intended an upwards-only RPI review. The established mistake was the specification of the wrong base index figure, which caused each annual RPI adjustment to be repeated at later reviews. An upwards-only clause would involve a different mistake in kind. The reference to a cost-of-living index supported the conclusion that no such additional omission had been established.
3. Distinction from the Trillium case. That case turned on its particular commercial facts. More than one possible correction produced different financial outcomes there. In the present case, once the mistake in Schedule 6 was established, the correction was objectively clear.
4. Costs. The claimant succeeded. Because significant parts of its witness statements contained argument, speculation and inadmissible opinion evidence, one-third of the costs of preparing both statements was disallowed. Subject to that deduction, the defendant was ordered to pay the claimant’s costs on the standard basis if not agreed, with £65,000 payable on account within 28 days under CPR Part 44.2(8).
5. Permission to appeal. Permission was refused because the proposed grounds had no real prospects of success. The alternative correction would address an additional alleged mistake that had not been established.

The judgment was supplementary to the court’s earlier substantive judgment in [2020] EWHC 1407 (Ch). Permission to appeal was refused.