Roiter Zucker (A Firm) v Khadijeh Minai [2005] EWHC 2676 (QB)

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
[2005] EWHC 2676 (QB)Case No Case No: HQ02X01628Venue Royal Courts of Justice, Strand, London, WC2A 2LL
Between
Roiter Zucker (A Firm)ClaimantKhadijeh MinaiDefendant
Before
MR. JUSTICE FIELDMr. Robert Moxon Browne QC and Mr. Charles Dougherty (instructed by Kennedys) for the Claimant Mr. Andrew Onslow QC (instructed by Watson Farley &Williams) for the Defendant Hearing dates: October 24,25,26,27,28,31November 1,4, 2005
[1]Mr. Justice Field : Introduction This is the trial of a counterclaim. The claimants in the action are Roiter Zucker, a firm of solicitors in practice in London. The defendant/counterclaimant is Ms. Khadijeh Minai, a successful and wealthy Iranian business woman who is not domiciled in the UK. In 2000 and 2001 Roiter Zucker were retained by Ms. Minai in relation to the proposed acquisition of four properties in London: Apartment 7, 2 Cambridge Gate, Regents Park ("Cambridge Gate"); 22 Weymouth Street, W1 (Weymouth Street); 17 Hill Street, W1 ("Hill Street"); and Unit A, 4-12 Queen Anne's Gate, SW1 ("Queen Anne's Gate"). The partner at Roiter Zucker who acted for Ms. Minai was Mr. Graham Jaffe. Ms. Minai purchased two of these properties, Cambridge Gate and Queen Anne's Gate. For one reason or another she did not acquire the other two. The price paid for Queen Anne's Gate was £7.18 million.[2]Contracts for Queen Anne's Gate were exchanged on 14th September 2001 and the transaction completed on 7th February 2002 at a price of £7.18 million. However, Ms. Minai has neither occupied the property nor rented it out. It has accordingly stood empty for four years. It is now worth £8.25 million.[3]Following exchange of contracts for Queen Anne's Gate, but before completion, Ms. Minai terminated Roiter Zucker's retainer and refused to pay their outstanding fees. In May 2000 Roiter Zucker issued a claim for those fees in the sum of £60,781.11. Ms. Minai defends the claim by way of a counterclaim for alleged breach of the Queen Anne's Gate retainer. She contends that Mr. Jaffe acted in excess of his authority in exchanging contracts for the property and also acted negligently and/or in breach of contract by pressurising her to exchange, failing to advise her of the risks of exchanging when she did not have financing in place to pay the price, failing to advise her that the price was too high given the defects identified in a surveyor's report, failing to inform her of the price at which the vendor had acquired the property ten months previously and failing to protect her interest in respect of her strong desire to install a food hoist (a "dumb waiter") in the property. Ms. Minai claims that if Mr. Jaffe had not acted in excess of his authority or negligently as alleged, she would not have purchased the property and claims the difference between what she has paid for and in respect of the property and its current value.[4]Contracts were exchanged for Queen Anne's Gate in the course of a telephone conversation between Mr. Jaffe and the vendor's solicitor, Mr. Neidle, between 7.31pm and 7.35pm on Friday 14th September 2001. Mr. Jaffe made this telephone call from his office at Swiss Cottage, London NW6; Ms. Minai was sitting opposite him about four feet away. On any view she had been at the office for about 1½ hours. It was her evidence that Mr. Jaffe accepted her instruction not to exchange that day and agreed to take her through the contract the following morning with a view to exchange taking place on Monday 17th September 2001, if that was her final decision. According to Ms. Minai she had no idea that contracts had been exchanged whilst she was at Mr. Jaffe's office until she was told of this the following Monday.[5]It was Mr. Jaffe's evidence that Ms. Minai gave him specific authority to exchange contracts during the evening of 14th September 2001 and was well aware that evening that exchange had taken place. Assessment of the witnesses[6]This stark conflict in the evidence requires me to form a view of the reliability of Mr. Jaffe and Ms. Minai as witnesses. Mr. Moxon Browne QC for Roiter Zucker contended in his closing submissions that Ms. Minai was a person who lies readily and recklessly and had lied in her evidence. At the centre of this grave charge was an allegation that in the course of the trial Ms. Minai tampered with documents she had been ordered to disclose. The documents in question were telephone records relating to the period 28th August to 4th September 2001. It was Ms. Minai's case that she had been out of the country during this period and so had not received certain correspondence and telephone calls from Mr. Jaffe relating to Queen Anne's Gate. Ms. Minai had disclosed telephone records up to 28th August 2001 but none for the following seven days. She was cross-examined about this by Mr. Moxon Browne who then applied for an order on Day 2 (25th October 2005) that she produce her diary and further telephone records for 28th August to 4th September 2001. Without objection from Ms. Minai's counsel, Mr. Onslow QC, I ordered Ms. Minai to look for her diary and copies of the requested telephone records overnight and to produce them to her legal team who should decide if they contained any relevant information; if they did they should be produced, with irrelevant information redacted. The following morning I was told that no diary for 2001 existed but three pages of mobile telephone records had been found covering the period 7th to 28th August 2001 and these had been handed to those acting for Roiter Zucker. On Day 6 (31st October 2005) Ms. Minai was recalled to answer questions arising from these documents. Ms. Minai was adamant that the three pages had been provided to her solicitors more than a year ago. Asked if she had found these documents on the night of 25th October 2005 she replied:
"No, the solicitor had them over a year ago…."
Mr. Moxon Browne then contrasted the three pages with the other records of the same mobile telephone company that were in the bundle. The records in the bundle all had printed on them a page number of a specified total number of pages, eg "page 16 of 29". However this information had been removed from the three pages produced in the course of the trial so that it did not readily appear that the three pages were part of a record consisting of a larger number of paginated sheets. Mr. Moxon Browne accused Ms. Minai of having excised the page numbers on the three documents in the evening of 25th October 2005. Ms. Minai vehemently denied this accusation. She suggested that when the documents had first been collated for the purpose of disclosure someone might have deleted the pagination without her knowledge and her secretary must have found the three pages amongst the collated documents and faxed them to her solicitors. She did not know that the pagination had been removed; she had not removed this information: she would not have been so stupid knowingly to have allowed altered documents to be sent to her solicitor during the trial.[7]The allegation that Ms. Minai tampered with the three pages in the course of the trial is a most serious allegation. As Lord Nicholls observed in Re H and Others (Minors) [1996] AC 563 , "[b]uilt in to the preponderance of probability standard is a generous degree of flexibility in respect of the seriousness of the allegation". In the circumstances of the instant case, this means, in my opinion, that I must apply what in effect is the criminal standard of proof in determining whether the tampering allegation is proved. The evidence relied on by Mr. Moxon Browne in support of the allegation is circumstantial in nature. He pointed to Ms. Minai's differing explanations as to how the documents came to be produced. He submitted that it was plain that Ms. Minai's solicitor had no record of Ms. Minai sending him the three pages as part of the disclosure process, since there had been an adjournment to allow him to check his files and we had heard nothing about there being such a record. mb also drew my attention to other documents that had been disclosed by Ms. Minai from which she had redacted relevant information.[8]Although the removal of the pagination from the telephone records is certainly suspicious I do not find that Ms. Minai tampered with the documents as alleged. It is plain that she has relied on her staff to assist with the litigation documents and in my judgement there is a sufficient likelihood that a member of staff redacted the documents without Ms. Minai's knowledge and approval for it to be impossible for me to conclude beyond a reasonable doubt that Ms. Minai herself redacted the documents in the course of the trial.[9]Mr. Moxon Browne also invited me to conclude that Ms. Minai had knowingly given false evidence when she denied:(a) being told by Mr. Jaffe on the telephone of a meeting that had been arranged at Queen Anne's Gate for 4th September 2001; and(b) accusing Mr. Jaffe of: (i) having been in league with the vendor's solicitor; (ii) helping the vendor because she (the vendor) was Jewish and so was he; and (iii) forcing her to buy Queen Anne's Gate in order to secure fees from the vendor and her agent. Mr. Jaffe was a conscientious maker of attendance notes of conversations that were important, if time allowed. He made notes of the occasions on which Ms. Minai made these allegations and also made a note of telling Ms. Minai about the meeting at the property. There is not the slightest doubt that these notes of the proposed meeting and of the abusive allegations are accurate contemporaneous records of what was said. I therefore cannot escape the conclusion that Ms. Minai's denials were untruthful, although I am bound to observe that the matters she denied were not facts that were central to the case but went instead to her credit.[10]Mr. Moxon Browne also relied on the fact that Ms. Minai testified on oath that she purchased Queen Anne's Gate as an investment, whereas:(a) she had served a pleading endorsed with a statement of truth that she had purchased the property as a pleasant home in which she could relax in her rare hours of leisure; and(b) had told the Bank of Scotland that she intended to live in Queen Anne's Gate. Mr. Moxon Browne also prayed in aid Ms. Minai's evidence that she was a 50% shareholder in two companies when she applied to the Bank of Scotland for a loan, which evidence she subsequently contradicted when she maintained that at this time she was the sole shareholder of these companies.[11]Although Ms. Minai gave untruthful evidence on the matters identified in paragraphs 9 and 10, these were peripheral matters and I do not conclude from this that she knowingly gave false evidence about what happened on 14th September 2001. Indeed I am satisfied that Ms. Minai believed that her account of that day's events was truthful. That is not to say that I find her uncorroborated evidence to be reliable. I do not, both because parts of her testimony, eg her insistence that she was not told on 14th September 2001 that contracts had been exchanged that day, were inherently incredible or contradicted by a reliable contemporaneous note, and because of her general manner in the witness box. As to this latter consideration, Ms. Minai spoke English reasonably well but she was an emotional witness who had a pronounced tendency not to answer difficult questions but instead to make speeches in which she rehearsed her many complaints against Mr. Jaffe. She deeply regrets the Queen Anne's Gate transaction and believes that she was betrayed by Mr. Jaffe. As a result she has in my judgement convinced herself that her version of events is accurate and truthful.[12]Turning to Mr. Jaffe, I have no doubt that the entirety of his evidence was honestly given. Although he too sometimes answered questions by making a speech and occasionally gave answers off the top of his head when he ought to have given more thought to what he was saying, the great bulk of his evidence was clearly and convincingly given. In my judgement he was a reliable witness.[13]I also heard evidence from Mr. Alan Russell, an estate agent who acted for Ms. Minai in the Queen Anne's Gate transaction, and Mr. Peter Neidle, the vendor's solicitor, with whom Mr. Jaffe was negotiating throughout 14th September 2001. Mr. Russell's recollection of some of the events in which he was involved was a little rusty but he was a straightforward witness. He testified that at about 7.15 pm on 14th September 2001 he was told over the telephone by Mr. Jaffe that contracts had been exchanged. He has got the time slightly wrong but otherwise I accept his evidence on this matter. Contracts were exchanged three or four minutes after 7.30 pm. I find therefore that Mr. Russell received the call from Mr. Jaffe at about 7.35 pm.[14]Mr. Neidle made hardly any attendance notes and his recollection of events was at times a little hazy but he was unquestionably an honest and reliable witness. At the beginning of the trial he had mislaid the relevant file but it was eventually tracked down and he was re-called to deal with a small number of documents found therein.[15]The other witness who gave evidence about the events of 14th September 2001 was Mr. Hosein Salehian, a British citizen of Iranian origin. Mr. Salehian speaks excellent English. He is a director of Olewatt Limited, a management company owned by Ms. Minai and which has an office in London where Mr. Salehian works. It was to this office that Mr. Jaffe sent faxes and letters addressed to Ms. Minai.[16]Mr. Salehian is someone whom Ms. Minai trusts implicitly and from whom she frequently seeks advice. Mr. Salehian was a transparently honest witness who gave his evidence clearly and with care. However, I find that his memory in the witness box as to the number of telephone conversations he had with Mr. Jaffe on 14th September 2001 was faulty. I also find on the basis of Mr. Jaffe's evidence and a contemporaneous attendance note that the call Mr. Salehian made to Ms. Minai from Gatwick airport in the evening of 14th September 2001 was not made when she was at home but when she was still in Mr. Jaffe's presence in his office and that in the course of that call he spoke about the proposed purchase of Queen Anne's Gate. The facts July 2001 to 13th September 2001[17]Ms. Minai retained Mr. Jaffe in respect of Queen Anne's Gate in July 2001. She had already retained him in relation to Hill Street. Queen Anne's Gate is a leasehold property held under a 999 year lease. It is a very substantial property of 11,500 square feet covering three floors. The lower ground floor contains, inter alia, the kitchen, a servant's room, a bathroom and utility room and a garden reception room. The ground floor contains a main hall, a reception room, two bedrooms with bathrooms, a staircase area and a library. At first floor level there is a hall, reception room, wine storage, three bedrooms and bathrooms, a lift area and boiler room and a large reception room. The asking price was £7.5 million. Ms. Minai liked the property very much and was keen to purchase it. She offered £6.9 million but this offer was rejected. On Mr. Jaffe's advice, Ms. Minai commissioned a survey by Slocock Collings. Ms. Minai thought that it was most important that a food hoist be incorporated into the property so that food prepared in the kitchen on the lower ground floor could be served hot in the dining room on the ground floor. Ms. Minai also wanted some railings erected on the balcony. On 30th August 2001, Mr. Jaffe wrote to Mr. Neidle stating inter alia that incorporation of a food hoist would need the landlord's licence, building regulation approval, planning and listed building consents and the approval of English Heritage and that the vendor had agreed to carry out the installation work.[18]On 4th September 2001 there was a meeting at Queen Anne's Gate at 12 noon attended by Ms. Minai, Mr. Salehian, Mr. Jaffe, Mr. Slocock (who had done the survey for Ms. Minai), Mr. Russell and a Mr. Edwards, who was representing the vendor. Mr. Jaffe notified Ms. Minai of this meeting the previous day by telephone. I reject Ms. Minai's evidence that the first she knew of the meeting was when Mr. Salehian told her about it during the morning of 4th September 2001. By the time of the meeting the asking price for the property had dropped to £7,330,000. Ms. Minai wanted to persuade the vendor to carry out substantial works to the interior of the property without increasing the price. In a letter dated 3rd September 2001 to Mr. Jaffe, Mr. Neidle had stated that apart from being willing to exchange conditionally on obtaining appropriate confirmation form the City of Westminster and English Heritage concerning the installation of a food hoist, the vendor was determined to sell the property in its present condition. At the meeting Mr Edwards made it plain that the property would be sold "as is". Ms. Minai told her advisers that if the vendor refused to carry out her required works she wanted a reduction in the price of £300,000. (She had told Mr. Jaffe that this was her position on 3rd September 2001). In a conversation with Mr. Jaffe alone she said that her "bottom line" was a reduction of £150,000. Ms. Minai's demand that there be a reduction in the price of £300,000 was put to Mr. Edwards but he rejected it out of hand. Ms. Minai also talked with her advisers about the installation of a food hoist. She said that it might cost £50,000. Mr. Jaffe suggested that Ms. Minai rather than the vendor should apply for the food hoist consents and recommended that she engage Paula Carney, a planning consultant, to handle the application. Mr. Jaffe said that he did not anticipate any problem in securing the appropriate permissions.[19]The following day Mr. Jaffe and Mr. Neidle spoke on the telephone. Mr. Russell had suggested that Mr. Jaffe should propose to Mr. Neidle that there could be an early exchange of contracts if there were a reduction in the price. Mr. Jaffe accordingly proposed to Mr. Neidle a reduction of £300,000 to take account of the work that had to be done. Mr. Neidle rejected the figure of £300,000 outright. Mr. Jaffe then said that the reduction had to be a figure beginning with a "2". This was also rejected and Mr. Jaffe put Ms. Minai's bottom line figure of £150,000 which was neither rejected nor accepted. Mr. Jaffe also tried to negotiate a reduction of £40,000 in respect of the food hoist and mentioned Ms. Minai's requirement that some railings be erected on the balcony.[20]When Ms. Minai learned that Mr. Jaffe had been negotiating the price with Mr. Neidle and had proposed a reduction of £150,000 she was very angry. As far as she was concerned, negotiation of the terms of the acquisition were for her and Mr. Russell, and not her solicitor. She also felt that Mr. Jaffe had too readily dropped the proposed reduction to £150,000. She stated that she wanted the vendor to obtain the food hoist consents and to carry out some repair works to the exterior of the property. Mr. Russell was also very annoyed that Mr. Jaffe had taken it upon himself to get involved in the price negotiations.[21]On Mr. Jaffe's recommendation, Ms. Minai consulted an interior designer called Michael Lewis to advise her on the modifications she wanted to make to the property, including the food hoist. Mr. Lewis proceeded to inform Mr. Jaffe that in his view it was not necessary to use an architect -- he would get a builder to draw the plans for the hoist; nor was it necessary to employ a planning consultant. Mr. Jaffe informed Ms. Minai of Mr. Lewis's advice by a letter dated 7th September 2001 adding the words, "although that is something we may decide differently. I have already told you that I use Paula Carney of Chapman Warren as my planning consultant. I have a good experience of dealing with her. Because timing is becoming crucial I think it is essential that you instruct Michael Lewis as soon as possible to have his builder prepare the necessary plans for the railings and the food hoist and an application should then be made to the City of Westminster for planning/listed buildings consent."[22]Following a number of conversations with Ms. Minai, Mr. Jaffe wrote to Mr. Neidle by letter dated 7th September 2001. There can be no doubt that Ms. Minai fully approved of the contents of this letter. In the letter Mr. Jaffe stated that Ms. Minai would not accept a price reduction of a penny less than £150,000; Ms. Minai was adamant that the vendor must carry out repairs to the exterior of the property; and the agreement had to be conditional on the vendor obtaining retrospective approvals for works already carried out on the property; as regards the balcony railings and the food hoist, Ms. Minai would instruct her own planner who would also give the vendor such assistance as was necessary to expedite the approvals.[23]Early in the evening of 10th September 2001, Ms. Minai and Mr. Russell informed Mr. Jaffe that the vendor had agreed to reduce the price to £150,000. On Monday 11th September 2001 Mr. Lewis telephoned Mr. Jaffe about the food hoist: the architect needed "as is" plans of all floors. Mr. Jaffe told Mr. Lewis to ask Mr. Russell to get the plans from Mr. Edwards. Also on 11th September 2001, Mr. Jaffe wrote to Ms. Minai setting out a number of matters that had to be addressed to allow an early exchange of contracts. These matters included:(i) the need for Ms. Minai to transfer a 5% deposit totalling £359,000 to the client account;(ii) sight by Mr. Jaffe of a copy of the loan offer; if the loan offer were not yet available, Mr. Jaffe needed Ms. Minai's specific written instructions that he was authorised to exchange contracts -- with a purchase of this size it was really essential that Mr. Jaffe see the loan offer before exchange of contracts, but the final decision was Ms. Minai's; and(iii) Ms. Minai's preferred completion date.[24]Mr. Jaffe also wrote to Mr. Slocock on 11th September 2001 asking him to liaise with Mr. Russell and Ms. Minai with a view to drawing up a schedule of exterior works. Negotiations were then conducted by Ms. Minai and Mr. Russell with Mr. Edwards over what exterior works the vendor was to carry out. The vendor wanted to limit these works to cleaning. Ms. Minai contended for more extensive works. To begin with the vendor was willing to agree to paint the outside of the property, but the freeholder refused to allow this, stating that such work must be done by the freeholder.[25]By a faxed letter dated 13th September 2001, Mr. Edwards warned Mr. Russell that the vendor felt that it was going to be impossible to agree the final negotiations and that it was better to request the return of the papers. Mr. Jaffe was told of this warning and passed it on to Ms. Minai by a faxed letter of the same date. Mr. Jaffe also sent a revised schedule of external works to Mr. Neidle asking him to confirm as a matter of urgency that the vendor would carry out these works. Mr. Neidle replied that evening stating that his client required exchange by close of business the next day. Shortly before receiving Mr. Neidle's reply, Mr. Jaffe received a faxed letter from Ms. Minai saying:
"You have to take care of the problem of the outside of the house by tonight. You are wasting time and money. This mater (sic) must be taken care of once and for all tonight, and exchange must take place on Monday 17th September 2001"
. Friday 14th September 2001[26]On Friday 14th September 2001 Mr. Jaffe had a strong preference for exchanging that day because he was due to fly to Israel the next day for Jewish New Year which fell on the following Tuesday and Wednesday, 18th and 19th September 2001. He had been deeply involved in the transaction and wanted to be the solicitor who handled exchange. However, if it was not going to be possible to exchange that day, exchange could be effected by his partner, Mr. Cyril Chody, on Monday 17th September 2001 and if not on that day, on the following Thursday and Friday. Mr. Jaffe explained all this in a letter faxed to Ms. Minai at 9.17 am.[27]At 9.18 am a letter from Mr. Jaffe to Mr. Russell was sent by fax asking Mr. Russell as a matter of urgency to finalise with Mr. Edwards the agreed schedule of external works. At 10.22 am a letter from Mr. Jaffe to Ms. Minai was faxed to Ms. Minai's office at Waterloo Place. The first three and the last paragraphs of this letter read: I write further to my earlier letter. I have now heard from Alan Russell. He had spoken to David Edwards who had made it absolutely clear that the works that they will carry out are those set out on David Edwards' letter of yesterday. THEY WILL NOT CARRY OUT ANY OTHER WORK. There is absolutely no point in your trying to negotiate further – this is the end of the line! This is also now crunch time. You have to make an immediate decision because I understand the fact that there is very real prospect that if you do not exchange today the transaction will not exchange AT ALL because the vendor will withdraw. I am ready to exchange. You have been pushing all of us to exchange and now we are ready to do so. Please immediately transfer the deposit to our client account and have your secretary confirm to me when the monies are on the way from your bank. I cannot repeat how important it is that you take immediate steps to transfer the deposit to me because I intend to exchange today.[28]Sometime before 11.59 am, Ms. Minai telephoned Mr. Jaffe and suggested that he could give the vendor the £10,000 held in the client account and she would transfer the balance of the deposit on Monday with a view to exchange the following Thursday. When told by Mr. Jaffe on the telephone that Ms. Minai was suggesting exchange on Thursday, Mr. Neidle said that his client would go mad.[29]Mr. Salehian telephoned Mr. Jaffe sometime before noon. He was in the Ukraine on business and was due to arrive back in the UK that evening. He told Mr. Jaffe that he was going to a meeting at the bank on Monday to discuss financing for completion and felt it was too sudden to exchange on the Friday; exchange should not take place without him being there; he was happy for Mr. Chody to handle exchange and they should aim for Thursday or Friday.[30]At 11.59 am Mr. Jaffe received a fax letter from Mr. Neidle returning the draft contract slightly amended. In the penultimate paragraph of the letter Mr. Neidle stated: I can not emphasise strongly enough the importance of exchange taking place by no later than close of business today. I have discussed the matter once again with my client and have no doubt whatsoever that if this does not take place, then she will have no hesitation in requesting that I withdraw the papers immediately. I do not think that this is an idle threat![31]At around 12.53 pm, a letter from Mr. Jaffe to Ms. Minai was faxed to Ms. Minai together with Mr. Jaffe's reply to Mr. Neidle. The letter to Ms. Minai was in these terms: I attach a copy of Peter Neidle's letter to me and my reply. I cannot stress how important it is that we exchange today. I think that there is every possibility that you will lose the property if you do not exchange today which would be a tragedy. I am tied up for about an hour from 2 pm today but otherwise I am available. I know that you would have preferred Mr. Salehain (sic) to see the papers before exchange but that is not going to be possible and you will simply have to trust my judgement and my advice. Please call me as soon as possible.[32]In his reply to Mr. Neidle, Mr. Jaffe said, inter alia: "My client is taking urgent steps to finalise matters and I am hopeful that we can exchange today. She is currently with her bank. She tells me that she accepts the position regarding the works and indeed all the other conditions now agreed but she does have one final stipulation with regard to completion which must be not less than 10 weeks from today.[33]Mr. Jaffe understood that Ms. Minai was at her bank but he was mistaken: Ms. Minai did not visit her bank on 14th September 2001.[34]Sometime after Mr. Jaffe received Mr. Neidle's 11.59 am letter and probably before 12.53 pm Mr. Salehian spoke to Mr. Jaffe again on the telephone and was told by Mr. Jaffe that the deal had to be done that day; Mr. Salehian said that completion could not take place for a minimum of eight weeks. Somewhat later but again probably before 12.53 pm there was a conference call between Mr. Jaffe, Mr. Salehian and Ms. Minai in the course of which Mr. Jaffe was told that Ms. Minai was planning to borrow £4.675 million, plus £1.45 million by way of bridge finance and an additional £600,000 and that she and Mr. Salehian were confident that the money would be advanced but they had not yet got it in writing; Ms. Minai would transfer the deposit to Mr. Jaffe but he was not to pay it over without her approval. In two other telephone calls from Ms. Minai at around this time, Mr. Jaffe was told by Ms. Minai that Mr. Salehian had told her that a loan of £5 million had been approved by the bank, but there had been a misunderstanding; Mr. Jaffe and Ms. Minai discussed the risk of exchanging without a loan having been arranged; Ms. Minai said that the bank had verbally approved the financing and she was confident it would be forthcoming, but there had to be a minimum of 10 weeks before completion.[35]At 1.09 pm Mr. Jaffe received a call from the telephone in Ms. Minai's office. The call lasted about 14 minutes. It was Mr. Jaffe's recollection that it was Ms. Minai who made this call. Ms. Minai vehemently denied this. She said that it must have been one of her two female secretaries to whom Mr. Jaffe spoke. In my judgement, it is highly improbable that Mr. Jaffe would have had such a long conversation with a secretary on such a busy day, even if he were on conversational terms with her. In my judgement Mr. Jaffe's recollection is accurate: it was Ms. Minai who made the call from her office.[36]At 1.58 pm Ms. Minai rang Mr. Jaffe yet again to say that she was worried about the cost of converting US dollars to pounds sterling; if the dollar funds were converted that day the cost would be £39,000. She also said that she was talking to Mr. Edwards. Mr. Jaffe recommended that contracts be exchanged that day.[37]Sometime in the early afternoon, Ms. Minai sent a written instruction to HSBC requiring the bank to transfer £349,000 (the balance of the deposit) to Roiter Zucker's client account. She informed Mr. Jaffe she had done this at 2.25 pm. A little earlier, Mr. Jaffe received by fax from Mr. Neidle the engrossment of the contract and was told that the list of external works was to follow.[38]At 2.59 pm Mr. Jaffe faxed to Ms. Minai a brief report on title he had dictated earlier that morning: he had not had time to prepare a longer report. In this document Mr. Jaffe set out the details of the property and the main provisions of the lease. He stated that the agreement contained an obligation on the vendor to obtain retrospective permissions for the works done to the property. Under the heading Your Proposed Works the report stated: You are aware from the survey report and the report of the services engineer of the works needed to complete the interior of the property and to correct defects in the services. I am aware that you wish to install a food hoist and metal railings to separate your balcony from that of the next door property. No planning permission is likely to be necessary for any of the interior works but it will be necessary to obtain planning/ listed building consent for the food hoist and the metal railings. I understand that Michael Lewis will deal with this matter after exchange. You will also need landlord's licence for these two items but this is being provided for in the agreement.[39]Under the heading The Contract the report stated, inter alia: Once Contracts have been exchanged, you will be bound to complete the purchase on the agreed completion date. If you fail to complete, you run the risk of losing your deposit; in addition, the vendor[s] could sue you to force you to complete or has/have the option of cancelling the Agreement and selling the property elsewhere. If the property is re-sold at a loss, you could be sued for losses and all costs. Further, if you are late in completing, you will be liable to pay interest on a daily basis at 4% above NatWest base rate.[40]The report then set out the salient points of the contract and concluded: I conclude that the title to the property is good and marketable and that you may safely proceed to exchange subject to your being satisfied that you will have the mortgage finance and the balance purchase price available in time for completion. I say this because we are about to exchange contracts without your being in receipt of a formal offer. I need to make four final points:(a) I need to see your passport to comply with the Law Society requirements for identifying clients. I will in any event need a copy for your mortgagee. Please bring your passport with you this afternoon.(b) Before I can exchange contracts I need to raise from you the balance of the 5% deposit of £349,000. I understand that your bank has been instructed to transfer the money.(c) I need you to sign the contract. Please come to my office as soon as possible.(d) I require your specific written authority to exchange contracts. I have included a provision for you to sign at the bottom of the last page of this letter. ……….. I, KHADIJEH MINAI hereby acknowledge that I have read and understood the contents of this letter and hereby authorise you to exchange contracts on the terms set out therein.[41]After he had sent the report on title, Mr. Jaffe was informed by Ms. Minai over the telephone that there was a problem with the deposit: her instruction to HSBC had arrived too late for a transfer to be effected that day. Later Mr. Jaffe received by fax a letter from Ms. Minai's bank, HSBC, confirming that they had been instructed to transfer £349,000 to Roiter Zucker's client account. Ms. Minai arranged for this letter to be sent to Mr. Jaffe on her own initiative; Mr. Jaffe did not suggest it.[42]Mr. Jaffe and Mr. Neidle discussed some amendments to the contract and Mr. Neidle faxed a further copy of the agreement and the schedule of works at 4.57 pm. The two solicitors also discussed whether there could be exchange even though the deposit was not going to be in Roiter Zucker's hands until Monday 17th September 2001. Mr. Jaffe proposed that the vendor should accept a payment of £10,000 to be followed by a payment of £349,000 when that sum was in the client account. If the balance was not paid by Tuesday 18th September 2001, the vendor could keep the £10,000. To reassure the vendor that the deposit was on its way to Roiter Zucker's client account, Mr. Jaffe faxed a copy of HSBC's letter to Mr. Neidle at 5.57 pm.[43]Eventually, Ms. Minai arrived at Mr. Jaffe's office and whilst there signed in Mr. Jaffe's presence the authorisation set out at the end of the report on title. Almost immediately afterwards Mr. Jaffe inserted the words "sign the contract on my behalf and to" after the words "authorise you to" and the initials "KM" were written in the margin. Before signing Ms. Minai added in handwriting these words:
"I signed above, is subject to all my verbale (sic) instruction will be added to the contract mainly outside the building. Care for this business. Be careful. Thanks."
Ms. Minai's account of what happened whilst she was at Mr. Jaffe's office on 14th September 2001 and subsequently down to close of business on Monday 17th September 2001[44]Ms. Minai said that she arrived at Mr. Jaffe's office shortly after 6.00 pm. Mr. Jaffe had called her at her office at 4.30 pm and insisted that she go to his office immediately. She set off shortly after 5.00 pm. When she arrived at Mr. Jaffe's office she waited outside whilst she spoke on the telephone to Mr. Edwards about work on the courtyard. She also talked to Mr. Lewis. She was subsequently shown into Mr. Jaffe's office and spent the next half an hour talking to Mr. Chody about Hill Street. She then talked to Mr. Jaffe about Queen Anne's Gate. She questioned him about the cost of repairs to the property, including in particular the food hoist. He said that the vendor did not want to get involved with the hoist and went on to say that it would only cost £7000 to decorate the exterior. She spoke again to Mr. Edwards. He said he was very angry. He had been trying to get the vendor to agree to pay for the cost of repair to the outside and had just been told by the vendor that he would be fired if he did not stay out of things since Mr. Jaffe had conceded many points. At this point she was furious with Mr. Jaffe and walked out but he grabbed her arm and persuaded her to return and cool down. Later she got up to leave a second time and again was persuaded to stay, referring to her previous faxes to him and her complaints about delay.[45]She told Mr. Jaffe that she would not be in a position to exchange until she had the finance lined up. They had to wait until Mr. Salehian returned to see if he could negotiate the balance required. Mr. Jaffe claimed to have a good relationship with the Bank of Scotland and said he would be able to raise the necessary finance. Eventually Mr. Jaffe presented her with the last page only of the report on title. He told her that he wanted her to sign a power of attorney to give him authority to exchange contracts on her behalf. He assured her that he would not exchange contracts until she gave him the go-ahead to proceed. He said he would go over the contract with her on Saturday morning. She had not previously received the report on title. As Mr. Jaffe had known, she had been at the hospital when the report was faxed to her office. He did not show her the rest of the document or explain the document's contents. She told him she had not read the report or any of the other documents he had sent that day. She never saw the schedule of works that had been agreed with Mr. Neidle. Mr. Jaffe told her that by signing the report she would merely be giving him a power of attorney to exchange contracts on her behalf once the contract had been approved and she had given him authority to exchange. Mr. Jaffe came around his desk to the side where Ms. Minai was sitting, put a pen in her hand and directed her where to put her signature. She proceeded to sign the document. She then added the handwritten words in order to confirm her verbal instruction not to exchange contracts without her specific approval. She did not initial the amendment to the grant of authority.[46]Mr. Jaffe returned to his chair and telephoned Mr. Neidle. He told Mr. Neidle that Ms. Minai had given him authority to sign the contract but that he would amend it and send it to him. He did not formally agree an exchange of contracts in Ms. Minai's presence. Mr. Jaffe then had a further conversation with Mr. Neidle: he repeated that he had her power of attorney and that if she did not transfer the balance of the deposit by Tuesday 18th September 2001 he would send Mr. Neidle the £10,000 by way of compensation and would return the papers. Ms. Minai asked him why he was giving away her £10,000 to which he replied that it was in case they did not get things moving. Ms. Minai then again made it clear to Mr. Jaffe that he was not to exchange contracts until she confirmed to him that she had a sufficient loan.[47]Beginning at 7.35 pm or thereabouts, Ms. Minai spoke to Mr. Edwards on the telephone for thirteen and a half minutes. It was her evidence that throughout this call she was continuing to negotiate, demanding that the price be reduced to reflect the works that had to be done. According to Ms. Minai, at no time on 14th September 2001 did Mr. Jaffe tell her that he had exchanged contracts.[48]Ms. Minai testified that after she had returned home, Mr. Salehian telephoned. She told him that she had given Mr. Jaffe a power of attorney. Mr. Salehian expressed some concern at this: if Mr. Jaffe had a power of attorney he could exchange contracts without having the contract approved. He advised Ms. Minai to contact Mr. Jaffe as soon as possible but as it was very late she postponed calling Mr. Jaffe until the following morning. On Saturday 15th September 2001, she tried to call Mr. Jaffe on his mobile, home and office numbers but was unable to reach him. On 17th September 2001 at about 9.00 am Mr. Salehian telephoned her from the office to ask if she had instructed Mr. Jaffe not to transfer the deposit. Ms. Minai asked Mr. Salehian to telephone Roiter Zucker to stop them paying the deposit.[49]It is common ground that Mr. Salehian then spoke to HSBC but was told that the money was in the "pipeline" and could not be stopped. He then called Roiter Zucker but was unable to stop payment of the deposit. Mr. Jaffe had undertaken to pay the deposit as soon as it arrived in the client account and that undertaking had to be and was honoured.[50]In the course of the 17th September 2001, Ms. Minai received a handwritten letter from Mr. Jaffe faxed from Israel in which he responded to the many messages that had been left on his phone. In this letter Mr. Jaffe stated, inter alia: I have to say I am shocked at your attitude. You were present at exchange. You knew exactly what transpired. But to correctly set out the facts is important: 1. Last week you were desperate to exchange. 2. You were very afraid you would lose the house. 3. You had a deadline to exchange last Friday. 4. You wanted to exchange but you were unable to get the 5% deposit to me on Friday. 5. You at your own instigation had HSBC send me a letter confirming the deposit was on its way. 6. In the course of our 2 ½ hour meeting on Friday we negotiated the outstanding points and after you spoke to Alan Russell about the painting of the exterior exchange took place. 7. I exchanged IN YOUR PRESENCE and with YOUR EXPRESS AUTHORITY. 8…… 16. I reported fully to you before exchange. You read the letter in my office and signed(a) confirming you had read and understood the report(b) authorizing me to sign on your behalf and to exchange contracts.[51]Ms. Minai replied by letter dated 18th September 2001. Much of this letter deals with a conversation alleged to have been overheard when Ms. Minai and Mr. Salehian were telephoning Roiter Zucker on the 17th to try to stop payment of the deposit. Mr. Onslow took no point on this conversation and so this part of the letter is irrelevant. In the rest of the letter, Ms. Minai stated, inter alia: When I was sitting in your office on Friday, 14th September, you reached an agreement with the vendor's solicitors, whom you call Peter. The man gave you time until 5.00 p.m. Tuesday, 18th September, 2001 for the deadline for receiving the payment or (sic) the 5%. You said that 5 p.m. Tuesday was just in case something goes wrong. When I tried to ask you why, you replied "I need this in case". You also said that if he does not receive the money he can keep the £10,000. I never gave you an irrevocable instruction for the transfer of the funds and exchange of contracts. I never said that if something went wrong during the weekend you should go ahead and exchange contracts without my permission and without accepting further written instructions….. Furthermore, how could you lie and say that I was desperate to exchange contracts, if so, I would have waited until Mr Salehian returned and while Mr Salehian was waiting on the phone you refused to listen to him. I told you that I did not want to anything (sic) until Monday. If I was so desperate then why did not I come to your office at 08.00 Friday morning instead I came at 17.00 after several telephone calls from you. I have witnesses that I said that I did not want to exchange on Friday. In any case presumably I was desperate, did I not change my mind over the weekend….. You went against my instructions because we had time until 17.00 on Tuesday. Mr. Jaffe's evidence of what happened whilst Ms. Minai was at his office on 14th September 2001.[52]Mr. Jaffe said that he summoned Ms. Minai to his office because she had to sign the contract if contracts were going to be exchanged that day and also because he wanted to go through the report on title with her. Ms. Minai arrived at the office at 5.00 pm. He made a note of her arrival time. She spent about 20 minutes with Mr. Chody discussing the Hill Street transaction and she then sat in Mr. Jaffe's office opposite him about four feet away. At Mr. Jaffe's insistence, Ms. Minai read through the report on title. She had either brought with her the copy that had been faxed earlier in the afternoon or Mr. Jaffe gave her another copy. There were many telephone calls being made and received. Ms. Minai was talking to Mr. Russell and to Mr. Edwards. She also spoke at one point to Mr. Salehian. After Ms. Minai had read the report on title, Mr. Jaffe spent a total of about 20 minutes going through it with her. This happened not long after Ms. Minai had arrived at the office. He also discussed the contract with her. The process of going through the report and discussing the contract was interrupted by telephone calls but he went through the report and explained the contract thoroughly.[53]Once it had become clear earlier in the afternoon that the deposit would not arrive in the client account that afternoon, Mr. Jaffe had invited Mr. Neidle to agree to a variation of one of the standard formulas for telephone exchange of contracts known as "Formula B". He proposed that Roiter Zucker should undertake to transfer the £10,000 they had in the client account and should further undertake to transfer the balance of £349,000 as soon as it was received into the client account. If the balance were not received by the vendor by 5.00 pm Tuesday 18th September, the vendor could retain the £10,000. Mr. Neidle took instructions and later, at about 6.30 pm, told Mr. Jaffe that his proposal was acceptable.[54]Various versions of the schedule of exterior works were faxed between Mr. Jaffe and Mr. Neidle. Whilst the schedule was going back and forth, Ms. Minai took the opportunity to speak to Mr. Neidle. At no time did Mr. Jaffe advise Ms. Minai that the exterior works would cost £7000 or any other figure. By about 7.00 pm agreement was close on the schedule of works and it became clear to Mr. Jaffe that Ms. Minai wanted to go ahead and that exchange of contracts was almost certainly going to happen that evening. By this time Mr. Jaffe had spoken to Mr. Salehian about the transaction in the course of a call Mr. Salehian made to Ms. Minai from Gatwick. The schedule was then agreed and Mr. Jaffe went through it with Ms. Minai who approved the deletion of the last two clauses. Mr. Jaffe also explained that exchange would take place on the basis that he had undertaken to pay over the £10,000 in the client account and the £349,000 balance after it been received. If by 5.00 pm on Tuesday 18th September the vendor had not received the balance of the deposit, the vendor would have the right to rescind the contract and keep the £10,000. Ms. Minai then signed the report on title having first added her addendum. The time now was close to 7.30 pm. Then Mr. Jaffe asked Ms. Minai to sign the contract but she asked Mr. Jaffe to sign for her, saying that she had been advised not to sign contracts in the UK. Mr. Jaffe reluctantly agreed to do so. He amended the grant of authority, Ms. Minai initialled the amendment and he signed the contract on her behalf.[55]Mr. Jaffe then rang Mr. Neidle. Ms. Minai was sitting opposite him. Mr. Jaffe repeated the undertaking he had previously proposed to Mr. Neidle and confirmed that if the balance was not paid by 5.00 pm the following Tuesday, the vendor could rescind and keep the £10,000. The two solicitors then exchanged contracts. Ms. Minai was well aware that exchange had taken place. Mr. Jaffe did not see or hear her on the phone to Mr. Edwards after exchange. She was very happy. She hugged Mr. Jaffe and kissed him. The two of them then left the office. It was raining. Mr. Jaffe therefore offered to drive Ms. Minai to a point where she could pick up a taxi. He departed to fetch his car from the car park. He returned about 10 to 13 minutes later and drove Ms. Minai up the Finchley Road where he was able to hail a cab for her. Whose evidence is to be accepted as to what happened when Ms. Minai was in Mr. Jaffe's office on 14th September 2001?[56]Mr. Onslow submitted that I should prefer Ms. Minai's account to Mr. Jaffe's account. He pointed out that Mr. Jaffe did not say in his witness statements that he went through the report on title and the contract with Ms. Minai or that he explained the undertaking he was giving to Mr. Neidle about payment of the deposit. He also relied on the fact that Mr. Jaffe made only two attendance notes after Ms. Minai had arrived at his office (H/84-85/2 and H/90) and neither of these notes contains any reference to Ms. Minai being given any advice, or being taken through the report on title, or authorising the amendments to the transaction agreed with Mr. Neidle or having the proposed undertaking explained. Mr. Onslow further contended that:(1) the calls made by and to Ms. Minai between 5.04 pm and 6.00 pm corroborated her evidence that she did not arrive at Mr. Jaffe's office until 6.00 pm; and(2) that the frequency of the calls made to and by Mr. Jaffe and Ms. Minai after 6.00 pm did not square with Mr. Jaffe's evidence that he had carefully reviewed the report on title and the contract with Ms. Minai and explained the undertakings about the deposit. Mr. Onslow also placed heavy reliance on the 13 ½ minute call Ms. Minai made to Mr. Edwards beginning at about 7.35 pm, submitting that this showed that Ms. Minai was still negotiating when Mr. Jaffe exchanged contracts therefore cannot have authorised that exchange.[57]I reject Mr. Onslow's submissions. As I have said, I found Mr. Jaffe to be a reliable witness. I have no hesitation in preferring his evidence to that of Ms. Minai where their accounts differ. It is true that he did not say in his witness statements that he went through the report on title and the contract with Ms. Minai or that he explained the deposit undertakings. In my judgement this was because it was thought at the time to be unnecessary to do so, given that Ms. Minai had signed a grant of authority to sign the contract and to exchange contracts. As to there being only two attendance notes for the time Ms. Minai was in Mr. Jaffe's office and the absence in those documents of any note of Ms. Minai being advised about the report on title and the undertakings that were to be given, Mr. Jaffe was extremely busy at the relevant time negotiating with Mr. Neidle and explaining matters to Ms. Minai.[58]I am entirely satisfied that Ms. Minai arrived at Mr. Jaffe's office at 5.00 pm. This was the time noted by Mr. Jaffe in H/84 and it is the time that Ms. Minai herself said she arrived in her letter of 18th September 2001. I accept Mr. Jaffe's evidence that when he made the very short call to Ms. Minai at 5.15 pm she was in Roiter Zucker's reception area. The phone records show that there was a period of 15½ minutes between 5.34 pm and 5.50 pm when neither Mr. Jaffe nor Ms. Minai was on the telephone. I find that it was principally during this period that Mr. Jaffe went through the report and the contract. It is also abundantly clear that Ms. Minai knew perfectly well that contracts had been exchanged before she left Mr. Jaffe's office. The allegation to the contrary is preposterous. Mr. Jaffe had every reason to inform his client of the exchange and none not to. Moreover, Mr. Russell, an independent witness, said that Mr. Jaffe told him that contracts had been exchanged at a time that must have been just after the event. This call can only have been made in Ms. Minai's presence. Why on earth should Mr. Jaffe tell Ms. Minai's negotiating agent that contracts had been exchanged but not his client?[59]I find that Ms. Minai consented to exchange, signed the report and initialled the amendment having agreed the final version of the schedule of works and having heard and understood Mr. Jaffe's explanation of the contract, the report on title and the undertaking about the deposit. In my judgement, Ms. Minai's 13½ minute call to Mr. Edwards was made after exchange when Mr. Jaffe was fetching his car to give Ms. Minai a lift. Neither side called Mr. Edwards. Whatever Ms. Minai may have said to him during this call, as I find below, she had previously authorised the exchange of contracts.[60]I think that what happened is that Ms. Minai was deeply unsettled by a call from Mr. Salehian after she had returned home in the evening of 14th September 2001 in which he expressed his misgivings about exchange of contracts before the necessary financing was in place. I regard it as highly likely that Ms. Minai did not tell Mr. Salehian that contacts had been exchanged; she could not bring herself to do so. She decided to try to obtain some breathing space by holding up the payment of the deposit balance. When that plan failed she felt she had no choice but to go along with completion, else the £359,000 deposit would be forfeit. However, she deeply resented the limit on her freedom of action that resulted from the transfer of deposit on 17th September 2001 and now blames Mr. Jaffe for a very expensive purchase she wishes she had never made. She cannot believe that she consented to exchange of contracts against Mr. Salehian's advice and has convinced herself that her account of events in Mr. Jaffe's office on 14th September 2001 is accurate. It is not. I am quite satisfied for the reasons I have given that it is Mr. Jaffe's version of those events that is accurate. Did Ms. Minai authorise the exchange of contracts executed by Mr. Jaffe?[61]It is true that the written grant of authority contained in the report on title refers to "the terms set out therein" and those terms contemplated Roiter Zucker being in receipt of the 5% deposit before exchange could take place and made no mention of a solicitor's undertaking to pay the deposit balance once it had been received. However, when Ms. Minai signed the report and initialled the amendment she knew that the balance of the deposit had not reached Roiter Zucker's client account and she had had explained to her the undertakings that Mr. Jaffe was going to give about the deposit. Accordingly, in signing the report and initialling the amendment I find that she authorised the exchange of contracts that occurred shortly after 7.31 pm on 14th September 2001. It follows that her claim to the contrary fails. The claims in negligence[62]I deal now with the claims that Mr. Jaffe was negligent in carrying out the Queen Anne's Gate retainer. Pressure on Ms. Minai to exchange and the alleged failure to advise her to seek better terms.[63]I reject these claims. It suited Mr. Jaffe to exchange contracts on 14th September 2001 but he made it perfectly clear that if Ms. Minai wanted to exchange the following week, Mr. Chody could handle matters on the Monday and the Thursday and Friday. In my opinion, notwithstanding the terrorist attack on the World Trade Centre in New York on 11th September 2001, Mr. Jaffe was fully justified in taking at face value the threats made by the vendor on 13th and 14th September 2001 that if contracts were not exchanged on the 14th, the papers would be withdrawn. Mr. Jaffe drew to Ms. Minai's attention the risk of exchanging contracts when she did not have financing in place: see his letter to Ms. Minai dated 11th September 2001 and the report on title under the heading Conclusion. It was not incumbent on Mr. Jaffe to dissuade Ms. Minai from completing without first obtaining the necessary financing. He knew she was very wealthy and was an experienced business woman. She told him she was confident of obtaining the necessary financing; he had no reason to think that this confidence was misplaced. In my opinion, Mr. Jaffe was entitled to conclude that Ms. Minai was perfectly capable of weighing up the risk of losing the property if contracts were not exchanged and the risks involved in exchanging without financing having been arranged. It was also no part of Mr. Jaffe's duty to advise Ms. Minai not to exchange without having first obtained better terms, in particular a further reduction in the price to remedy the defects set out in Mr Slocock's report. Ms. Minai was aware of what was said in that report and of the tough stance that was being taken by the vendor in the negotiations over a reduction in the price. After Mr. Jaffe was told not to involve himself in the negotiations as to price, those negotiations were conducted by Ms. Minai herself and Mr. Russell whose job it was to advise her as to the price being demanded. As I have held, the vendor's threats to withdraw the papers if contracts were not exchanged at a price of £7.18 million on 14th September 2001 required to be taken seriously. Mr. Jaffe was entitle to proceed on the basis that Ms. Minai (advised as she was by Mr. Russell) was aware of the risks and of the available bargaining counters (such as the weakness of the market after the New York terrorist attacks) and was capable of assessing them. It was accordingly entirely a matter for Ms. Minai whether she exchanged contracts on the terms that had been agreed or not. The food hoist[64]Ms. Minai testified that she discovered after exchange of contracts that it was physically impossible to construct a food hoist without damaging the structure of Queen Anne's Gate because of the concrete slab floor between the kitchen and the dining room. She also said that she has been informed of advice from an engineer that it would not be possible to install a food hoist because stairs are in the way.[65]Ms. Minai contends that Mr. Jaffe knew that for her a food hoist was a fundamental issue and should have advised her to obtain advice from a specialist engineer on the feasibility of installing an internal food hoist before exchange of contracts and not to exchange contracts before obtaining confirmation that the food hoist could be installed and obtaining the required permissions and consents. Alternatively, Ms. Minai claims that Mr. Jaffe should have advised her not to exchange contracts without a clause in the contract making completion conditional on the grant of planning permission and listed building consent, neither of which would have been granted since the hoist was not structurally feasible.[66]At an early point in the negotiations it appeared that the vendor would agree to carry out the food hoist installation works herself. She was also willing to have the contract made conditional on the obtaining of the necessary consent and approval. Following the meeting on 4th September 2001, however, at the suggestion of Mr. Jaffe, Ms. Minai decided to use Mr. Lewis to organise the obtaining of the permissions and approvals. In my opinion, Mr. Jaffe is not to be criticised for making such a suggestion. Ms. Minai was set on having large scale works done on the interior of the property. It made sense to include the installation of the hoist in those works and to have Mr. Lewis organise the works, including related planning and approval applications. Mr. Jaffe recommended that a planning consultant be engaged. Mr. Lewis thought this to be unnecessary; he was also of the view that it was not necessary to employ an architect. Mr. Jaffe said in his letter to Ms. Minai of 7th September 2001 that Mr Lewis's recommendation that no architect be instructed was something that "we may decide differently", but no contrary decision was taken. Ms. Minai did not accept Mr. Jaffe's advice.[67]Mr. Onslow submitted that Mr. Jaffe carried out the Queen Anne's Gate retainer as if he were the ringmaster, taking responsibility for bringing together the necessary experts to make the acquisition of Queen Anne's Gate a success, and it was therefore his responsibility to ensure that an engineer reported on the feasibility of a food hoist before contracts were exchanged. In the alternative, Mr. Onslow submitted that Mr. Jaffe should have advised Ms. Minai to insist that the contract was conditional on obtaining not only the landlord's consent to the installation of a food hoist but also the obtaining of planning consent and listed building approval. I cannot accept these submissions. In my opinion, once Ms. Minai had decided to look to Mr. Lewis to deal with the food hoist, Mr. Jaffe had no duty to concern himself with the obtaining of the necessary permissions and approvals or with whether a food hoist was structurally feasible. From this point on it was for Ms. Minai to ensure that the hoist was feasible and the necessary consent and approval obtained.[68]The vendor's agreement to a reduction of the price was on the basis that she would not be concerned with any future works. In my judgement, Ms. Minai well understood and accepted that it was implicit in this stance of the vendor that she (the vendor) was not going to take the risk of any refusal by the authorities to grant the necessary consents and approvals for future works. The only condition as to planning consent and approvals the vendor was prepared to accept was in respect of the works that the vendor herself had had done. As would have been apparent to Mr. Jaffe, Ms. Minai must have appreciated that she had accepted the responsibility of obtaining consent and approval for a food hoist and that no such consent and approval had been sought, let alone obtained, by the time contracts were exchanged. In these circumstances there was no duty in my opinion on Mr. Jaffe to advise Ms. Minai not to exchange contracts unless the contract was conditional on consent and approval being granted for the hoist. Failure to advise Ms. Minai that the vendor had acquired the property for £2.5 million.[69]On 10th August 2001, Mr. Neidle sent Mr. Jaffe the following documents:(i) the draft contract in duplicate;(ii) copy Lease of Queen Anne's Gate;(iii) copy entry in the Land Registry for Queen's Anne Gate; and (iii) replies to pre-contract enquiries. It was stated within the copy Lease that the assignor had paid £2.5 million on taking the lease of the property in October 1999. It was also stated within the copy entry that the vendor had acquired her title absolute to the property on 18th October 2000 for the same sum, £2.5 million.[70]Ms. Minai accepts that she received a letter from Mr. Jaffe dated 14 August 2001 which stated that he was enclosing the documents received from Mr. Neidle but she alleges that none of these documents was in fact enclosed with the letter. According to her the copy entry she disclosed in the action was provided to her by the solicitors she used after she terminated the Roiter Zucker retainer, Messrs. Neilson & Co. She also alleges that Mr. Jaffe never informed her that the vendor had acquired the property for £2.5 million in October 2000. She claims that these alleged failures constitute negligence on Mr. Jaffe's part and that she has suffered consequential damage in that she was deprived of using the vendor's acquisition price as a negotiating counter.[71]Mr. Jaffe testified that on receipt of the documents from Mr. Neidle he sent copies thereof by hand to Ms. Minai under cover of the letter dated 14th August 2001. I accept his evidence both because I find him to be a reliable witness and because the fax header on the copy entry disclosed by Ms. Minai is demonstrably not that of Neilson & Co but looks strikingly similar to that of the fax used by Ms. Minai.[72]Mr. Jaffe admitted in cross-examination that he was duty bound not only to send the copy entry to Ms. Minai but also specifically to point out to her the price paid by the vendor. He told me he had a recollection that he informed Ms. Minai about the price paid by the vendor and quickly dismissed its significance since the vendor had obviously spent a very large sum on improving the property, although he could not swear to this. Ms. Minai is a very aggressive negotiator. In my judgement, if Mr. Jaffe had drawn Ms. Minai's attention to the price paid by the vendor just ten months previously, it is likely that she would have raised it in her negotiations with the vendor and passed the information on to Mr. Russell; but she did neither of these things. In these circumstances, I find that although Mr. Jaffe sent the copy Lease and copy entry to Ms. Minai, he did not specifically point out the price paid by the vendor and in failing to do so he was negligent.[73]Ms. Minai contends that as a result of this negligence she lost the chance of acquiring Queen Anne's Gate at a lower price than what she agreed to pay. In my judgement, pursuant to Allied Maples Group Ltd v. Simmons and Simmons [1995] 1WLR 1602 , I must assess on the balance of probabilities whether Ms. Minai would have used the price paid by the vendor as a bargaining counter and if the answer is favourable to Ms. Minai, consider what the chances were of Ms. Minai securing a reduction in the price. I have already said that I think it is likely that Ms. Minai would have sought to use the price paid by the vendor in negotiations over the price. What are the chances of the vendor agreeing to a reduction in the price as a result of Ms. Minai playing the acquisition price card? In my judgement, there was no real or substantial chance, as opposed to a speculative one that the vendor would have agreed to any reduction in the price. I reach this conclusion on the whole of the evidence, which shows in particular that:(i) the vendor was extremely tough in the negotiations, especially after the price had come down to £7.33 million;(ii) much had been spent on the property by the vendor;(iii) as Mr. Russell confirmed and Ms. Minai admitted, the property was worth what Ms. Minai paid for it;(iv) from the moment she saw the property, Ms. Minai was very keen to acquire it, to the point that she told Mr. Neidle over the telephone when she was in Mr. Jaffe's office on 14th September 2001 that she would die if she did not get the property; and(v) although Ms. Minai was keen to negotiate right up to exchange, when the vendor would not budge, she accepted the vendor's terms.[74]Accordingly, I hold that Ms. Minai has not established that she suffered any loss from Mr. Jaffe's failure to point out to her what the vendor had paid for the property on 18th October 2000. Conclusion[75]For the reasons given above, the whole of Ms. Minai's counterclaim is dismissed except for the claim considered in paragraphs 69 – 74 above, as to which I award no damages because of my finding that there was no real chance that the price would have been reduced if Mr. Jaffe had told Ms. Minai about the price paid by the vendor.[76]If follows that Ms. Minai has no defence to Roiter Zucker's claim for fees due. Roiter Zucker are therefore entitled to judgement for such of their fees as remain outstanding. I was told in closing submissions that the sum due was £15,431.85. If this figure is not agreed, the parties will be at liberty to serve short written arguments as to what the correct judgement sum is.

Cited in 1 later judgment