Stephen Byrne outlines a blow to formulism
In November 2015 the Supreme Court handed down its judgment in the case of Bank of Cyprus UK Limited v Menelaou [2015] UKSC 66, [2015] All ER (D) 38 (Nov). The case will be of most interest to those who specialise in unjust enrichment and restitution, but it is also of wider interest. For banks it upholds the remedy of the vendor’s lien and extends it to situations where the purchase moneys have come indirectly from the lender. More generally still it illustrates the practical and common sense approach the appeal courts are prepared to take when applying equitable remedies.
The facts
Paris Menelaou was a property investor. He and his wife Donna owned Rush Green Hall in Great Amwell, Hertfordshire (RGH), which was charged to Bank of Cyprus UK Limited (the bank) to secure debts of £2.2m. The couple contracted to sell RGH for £1.9m on 15 July 2008.
On 24 July 2008 they exchanged contracts to buy 2 Great Oak Court in Hunsdon, Hertfordshire (GOC) for £875k. Mr and Mrs Menelaou instructed the firm of
