Someone recently bought our

students are currently browsing our notes.

X

Linden Gardens BC v Wiltshier Northern Ltd

[1994] 1 AC 85

Case summary last updated at 03/01/2020 16:58 by the Oxbridge Notes in-house law team.

Judgement for the case Linden Gardens BC v Wiltshier Northern Ltd

X contracted with D for D to remove asbestos in its buildings, and it did the job badly i.e there was remaining asbestos even after performance. IN X and D’s contract, X undertook not to assign its rights on the properties to another party. In fact X assigned its interests and rights to the properties concerned to P, who then sued D for breach of contract in failing to remove all the asbestos. Issue was whether the assignment in breach of contract was valid and hence whether P was a party to the contract and could sue. HL held that for legal and policy reasons, the contractual prohibition on assignment was valid, therefore the assignment was invalid, and therefore P had no ability to claim damages from D. However in the second case, where P had contracted D to remove the asbestos, which it had failed to do, P also tried to assign its rights. The assignment was held ineffective, but P was still entitled to substantial damages on behalf of the loss suffered by the 3rd parties who now occupied the buildings. 
 
Lord Browne-Wilkinson: There is a policy argument for allowing such clauses to be effective: some people might prefer only to deal with a particular party and might want to avoid a relationship with a party that they find unreasonable to work with etc. On P’s claim for TP’s damages in the second case, he said that the Dunlop principle no longer applied to cases of goods conferred under a “bill of lading” and it is to be extended here to construction contracts since, when the non-assignment clauses apply, there would be no other remedy (why is this not true of all types of contracts?). 

Linden Gardens BC v Wiltshier Northern Ltd crops up in following areas of law