Dawn McLean-Sawney v Merlene McGaw-Carter

• Jurisdiction: Cayman Islands
• Judge: Hon. Justice Henderson
• Judgment Date: 09 October 2013
• Judgment citation (vLex): [2013] CIGC J1009-1
• Docket Number: CAUSE NO. 292 of 2008
• Court: Grand Court (Cayman Islands)
• Date: 09 October 2013

Between:

Dawn McLean-Sawney

and

Merlene McGaw-Carter

[2013] CIGC J1009-1

Before:

Hon. Justice Henderson

CAUSE NO. 292 of 2008

IN THE GRAND COURT OF THE CAYMAN ISLANDS

1 The Plaintiff Dawn McLean-Sawney seeks an order to compel specific performance of an option to purchase and, in the alternative, damages for breach of the option agreement. This ruling disposes of some, but not all, of the issues raised in the claim.

Facts

2 The Defendant Merlene McGaw-Carter owns a home in Prospect (‘the premises’) which was badly damaged during Hurricane Ivan. In May, 2005 the parties agreed that Ms. McLean-Sawney would rent the (not yet repaired) premises and be given an option to purchase it. They entered into a written agreement dated June 13, 2005 but almost immediately replaced that agreement with a fresh agreement executed by the parties on July 21 and 26, 2005; I refer to this second contract as ‘the Agreement’.

3 Neither party has any legal training. A form of agreement was obtained from the internet and then modified by the parties to record their bargain. The material parts of the Agreement read as follows (use of bold face and formatting replicates that contained in the document):

1. Rent. Lessee agrees to pay, without demand, to Lessor as rent for the demised premises the sum of one thousand six hundred fifty dollars (CI$ 1, 650) per month in advance on the first day of each calendar month beginning 01 July, 2005 payable to Merlene McGaw Carter. Note: CI $900 goes towards purchase price of the home and CI $750 is applied asrent. If the house is not purchased then the entire CI $1,650 is applied as rent.

5. Security Deposit. On execution of this lease, Lessee deposits with Lessor $2,000 CI AND a house deposit of $16,000 CI Dollars (S) [sic], receipt of which is acknowledged by Lessor, as security for the faithful performance by Lessee of the terms hereof, to be returned to Lessee, without interest, on the full and faithful performance by him of the provisions hereof. (TOTAL DEPOSIT OF $18,000) ($10,000 TO BE GIVEN BY JULY 1, 05, $4,000 in October 05 and $4,000 in January 06)

15.Maintenance and Repair. Lessee will, at his sole expense, keep and maintain the leased premises and appurtenances in good and sanitary condition and repair during the term of this lease and any renewal thereof. In particular, Lessee shall keep the fixtures on or about the leased premises in good order and repair; keep the walks free from dirt and debris; and, at his sole expense, shall make all required repairs to the plumbing, range, and electric and gas fixtures whenever damage thereto shall have resulted from Lessees [sic] misuse, waste, or neglect or that of his employee, family, agent, or visitor. Major maintenance and repair of the leased premises, not due to Lessees [sic] misuse, waste, or neglect or that of his employee, family, agent, or visitor, shall be the responsibility of Lessor or his assigns. Lessee agrees that no signs shall be placed or painting done on or about the leased premises by Lessee or at his direction without the prior written consent of Lessor. Note: House leased as is maintenance and repairs are carried out at Lessees [sic] expense. CIDB will repair roof and windows from damage caused by Hurricane Ivan, as part of the hurricane relief fund offer to the lessor. All other repairs are at the lessee [sic] expense.

23.Holdover by Lessee. Should Lessee remain in possession of the demised premises with the consent of Lessor after the natural expiration of this lease, a new month-to-month tenancy shall be created between Less and Lessee which shall be subject to all the terms and conditions hereof but shall be terminated on thirty days written notice sent by either Less or Lessee on [sic] the other party.

26.Default. If any default is made in the payment of rent, or any part thereof, at the times hereinbefore specified, or if any default is made in the performance of or compliance with any other term or condition hereof, this lease, at the option of Lessor, shall terminate and be forfeited, and Lessor may re-enter the premises and remove all persons there from. Lessee shall be given written notice of any default or breach, and termination and forfeiture of the ease [sic] shall not result if, within thirty days of receipt of such notice, Lessee has corrected the default or breach or has taken action reasonably likely to effect such correction within a reasonable time. Lessee shall pay all reasonable attorneys [sic] fees necessary to enforce Lessors [sic] rights.

32.Purchase Option. It is agreed that Lessee shall have the option to purchase real estate known as: 102 Buttonwood Avenue, Block 25, Parcel 295 for the purchase price of one hundred eighty thousand dollars (CI $180,000) with a down payment of thirty two thousand four hundred dollars (CI $32,400) and a deposit of _$18,000CI Dollars ($ EIGHTEEN THOUSAND_) (amount to be determined and agreed by Lessor and Lessee) payable upon exercise of said purchase option, and with a closing date no later than thirty days thereafter. This purchase option be [sic] exercised in writing no later than 01 August, 2008, but shall not be effective should the Lessee be in default under any terms of this lease or upon any termination of this lease. If the Lessee or lessor does not follow through with the purchase option of the above-mentioned home, this down payment will be considered rent (As above $900 x 12 x 3 years) and it will not be returned to lessee. However, the $18,000 deposit will be returned to the lessee.

4 Ms. McLean-Sawney paid the initial deposit of $10,000 and moved into the premises.

5 The second payment of $4,000 on the deposit was due ‘in October 05’ under clause 5 of the Agreement. Finding herself unable to make this payment on time, Ms. McLean-Sawney asked for additional time and received what she says she understood to be ‘a general extension of time’ (Witness Statement, para. 74). By the end of January, 2006, at which time the third and final $4,000 deposit payment was due (see clause 5), Ms. McLean-Sawney had still not made the second payment.

6 On February 8, 2006 Ms. McGaw-Carter asked in an email message, ‘What's going on with the $8,000 balance due?’ After...