Law Of Property (MISCELLANEOUS Provisions) Act 1989

It is as well to remind you, what you are all already familiar with, that a contract is formed when four basic elements are in place. That is offer, acceptance, consideration and an intention to create legal relations.

These fundaments apply to whatever the type of contract. It can be a simple as you purchasing a second hand car or a property transaction.

This in turn brings us to Section 2 of the Law of Property (Miscellaneous Provisions) Act 1989, a key statutory provision for property transactions.

The statutory requirements of Section 2 of the Law of Property Miscellaneous Provisions Act 1989 apply to sale and purchase of property, or to be more precise that the sale or other disposal of an interest in land. Contract for the sale or disposal of an interest in land must satisfy the requirements of Section.

Those provisions are as follows:

  1. The contract must be in writing
  2. It must incorporate all the terms that the parties have expressly agreed in one document or where contracts are to be exchanged in each document.
  3. It must be signed by or on behalf of each party.

A warning about the provisions of Section 2.

For reasons mentioned above regarding Heads of Terms you will appreciate why care must be exercised.

  • a Heads of Terms document is usually in writing
  • incorporates the expressed terms agreed between the parties
  • and very often is signed by the parties.

It could potentially bring about a binding position and thus be treated as exchange of contracts in accordance with Section 2.

To give some context to this warning, the High Court in 2011, the case of; Green (Liquidator of Stealth Construction Limited) v Ireland state that it might be possible for a string of emails that contained all the relevant terms between parties and which had been signed by both parties to comprise a signed contract in writing for the purposes of the Law of Property (Miscellaneous Provisions) Act 1989. You will see from this example, although the case was not specifically about that issue, that care must be taken.

If you’d like further assistance in this matter please contact Partner, Ivan Barry by emailing him at or call on 020 8567 3477