Part 2: Common intention is vital when supporting arguments based on construction, says Nick Knapman
Having found in favour of Persimmon on the construction issue (Chartbrook Limited v Persimmon Homes Limited and another [2009] UKHL 38, [2009] All ER (D) 12 (Jul)), Lord Hoffmann felt that he had to deal with the two alternative arguments “of very considerable general importance” which Persimmon had advanced relating to the exclusionary rule and the principles of rectification.
The exclusionary rule is well established by case law and has been affirmed on a number of occasions by the House of Lords. It prevents parties from introducing evidence of pre-contractual negotiations to support arguments based on construction.
The existence of the rule notwithstanding, Persimmon argued that the House of Lords should depart from the rule to allow evidence of pre-contractual negotiations—in particular two letters which supported its interpretation of the agreement—to be made available to the court. Lord Hoffmann began by reviewing the variety of reasons to support the exclusionary rule, ie:
During pre-contractual negotiations, parties’ positions are changing—it
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