Hayward v Jackson

In this case Peter Michael Bowles (“the testator”) by his will gave the claimant (“Mr Hayward”) the right to buy part of his farm at the figure agreed between his executors and the Capital Taxes Office (“the CTO”) as its value for inheritance tax purposes. The will provided that his executors were to notify Mr Hayward of his right within six months of the testator’s death, and further provided that if Mr Hayward should wish to exercise his right he should inform the executors within three months of their notifying him. The defendant (“Mrs Jackson”) lived with the testator for many years. The executors renounced probate and she is the administratrix and entitled to the residuary estate.

The testator died in July 2000, and even now there has been no agreement with the CTO as to the value of the land. After the time for exercise of the option had been extended by agreement between the solicitors for Mr Hayward and for Mrs Jackson, the agreement was revoked by Mrs Jackson, and Mrs Jackson’s solicitors gave formal notification of Mr Hayward’s right and required him to exercise the right within the three month period in the will.

Mr Hayward claims (inter alia) a declaration that time was not of the essence and that he can exercise the option at any time until the expiry of a reasonable period after the value of the land has been agreed with the CTO and notified to him. Mrs Jackson claims that time was, or has been made, of the essence, and that Mr Hayward has lost his right to buy the land.

According to Theobald on Wills, ed Martyn et al, 2001, para 25-05, an option in a will lapses if the grantee fails to exercise it within the time limit, and Williams on Wills, 8^th ed Sherrin et al, 2002, para 92.4, is to similar effect. Both texts rely on Re Avard [1948] Ch. 44, and this Part 8 claim raises the question, among others, whether there is any such rule and whether that case was rightly decided.

By clause 3(a) of his will dated 20 September 1993 the testator gave Mr Hayward the right to buy his freehold land situate at Upper Burgate near Fordingbridge comprising 39 acres or thereabouts and shown edged red on the plan referred to therein (“the land”) at the figure agreed between his executors and the CTO as its value for inheritance tax purposes. By clause 3(b) he directed his executors to notify Mr Hayward of his right under clause 3(a) within six months of his death. By clause 3(c) he provided that if Mr Hayward should wish to exercise that right he should inform the executors within three months of their notifying him. Clause 4 contained the usual trusts for sale and administration, and by clause 5 he gave his residuary estate to Mrs Jackson.

The full terms of clause 3 are as follows:

“3.

(a) I GIVE to JOHN ALBERT DAVID HAYWARD of Knoll Farm Damerham near Fordingbridge aforesaid the right to buy from my Executors my freehold land situate at Upper Burgate near Fordingbridge aforesaid comprising thirty nine acres or thereabouts as the same is edged in red on the plan thereof which will be found with my Will at the figure agreed between my Executors and the Capital Taxes Office as its value for inheritance tax purposes:

(b)

my Executors shall notify the said John Albert David Hayward of his right under this clause within six months of the date of my death;

(c)

if the said John Albert David Hayward wishes to exercise his right under this clause he shall inform my Executors within three months of their notifying him of his right;

(d)

the right given by this clause is personal to the said John Albert David Hayward;

(e)

the said John Albert David Hayward shall pay the costs of the Conveyance and any mortgage.”

The background was that Mr Hayward and the testator were friends from childhood and owned farms a few miles apart. The land was part of over 700 acres of farmland which the testator and his brother William acquired from their father in around 1971.

In 1993 the testator and Mr Hayward went into partnership growing strawberries and spent money on the land. The partnership came to an end in 1997 when the supermarkets decided to import strawberries from Spain, but the friendship continued. According to Mr Hayward, the testator gave him the option on the land in consideration for his investment in the land. Between 1998 and his death the testator kept free range chickens and two egg units were built on the land. Before he died the testator sold 3 acres of the land leaving some 36 acres to which the right to buy now applies.

The testator died on July 12, 2000, and Mrs Jackson’s evidence is that he took his own life. The executors were Mr Dixon and Mr Wyatt of Dixon & Templeton, a firm of solicitors. Mr Hayward was given the relevant extract from the will by Mr Dixon shortly after the testator’s death. The executors renounced probate without having given Mr Hayward notice under clause 3(b), and on July 19, 2001 letters of administration with the will annexed were issued to Mrs Jackson.

In a letter dated September 12, 2000 Mr Hayward’s solicitors, Parker Bullen, asked Dixon & Templeton for information about the land, including whether the value had been agreed with the CTO; whether the free-range egg units formed part of the property; and whether there was any lien or charge on the land or units. No reply was received to this letter.

Shortly afterwards, the executors renounced probate and in October 2000 Mrs Jackson instructed Messrs Ellis Jones to act. In a letter dated October 10, 2000 they confirmed that no steps had been taken to value the land or agree a figure with the CTO and that they would be taking instructions on the enquiries in the letter of September 12, 2000. Mr Hayward’s solicitor suggested that the time for exercise of the pre-emption rights should be extended to the later of six months or one month after the enquiries of September 12, 2000 had been dealt with, and this was agreed on October 13, 2000.

Ellis Jones then ceased to act and Mrs Jackson instructed Mess Battens in their place. Mr Hayward’s solicitor drew their attention to the agreed extension of time, and asked them on March 26, 2001 for an answer to the letter of September 12, 2000 and the request was subsequently repeated in a telephone conversation on August 9, 2001 when Mr Hayward’s solicitor was told by Mrs Jackson’s solicitor that Strutt & Parker had advised on the value and that a figure of £250,000 had been returned to the CTO. Despite further requests in October, November and December, the information was not given.

But by a letter of January 18, 2002 Battens gave notice to Mr Hayward through his solicitors under clause 3(b). They confirmed that the value had not been agreed with the CTO, asserted that Mrs Jackson was not obliged to answer enquiries, and withdrew her agreement to the extension of time. Mr Hayward’s solicitors appear to have accepted the withdrawal of the agreement to the extension of time. On January 23, 2002 they wrote:-

“For the avoidance of doubt we write to confirm that your notice is taken as being a notice under clause 3(c) of the Will of the Deceased, which now gives our client three months to exercise his right under clause 3.

As the figure under clause 3(a) has not been agreed with the Capital Taxes Office do you wish our client to propose a figure for agreement or shall the parties appoint an independent valuer?”

Battens replied on February 4, 2002 as follows:

“Your client, if he wishes to proceed, must exercise his right by 21^st April irrespective of whether a value has been agreed with the Capital Taxes Office. We appreciate that this may mean that he will be committing himself to a price still to be ascertained. There is therefore no question of appointing a valuer.”

In a letter dated February 14, 2002 Mr Hayward’s solicitors indicated that Mr Hayward had in mind a price of £85,000, and asked what indications had been received from the CTO as to the value of the land and whether the District Valuer had become involved. No reply was received to that letter. Mr Hayward’s evidence is that the land is basically agricultural land and he believes it to be worth about £85,000 as grade 3 land.

In an attendance note of Mr Hayward’s solicitor of April 5, 2002, Mrs Jackson’s solicitor is recorded as saying that his instructions were not to co-operate. On April 17, 2002 Parker Bullen wrote to Battens pointing out that her conduct was intended to make it impossible for Mr Hayward to exercise the option within the three-month period and that she was in breach of her duties. They referred to the previous requests for information and demanded specific information by 5.00 pm the next day. Her solicitors extended the option period for seven days but on April 25 in effect refused further information. They indicated that they expected the value to be £500,000 and stated that Mrs Jackson was not prepared to grant any further extension.

Mrs Jackson says that the valuation process has been complicated by two factors: (i) the use of the land at the date of death as a free range egg production unit; and (ii) the proximity of the land in relation to the town of Fordingbridge and its planning potential which by definition has and is requiring considerable research. Mr Hayward says that he wishes to decide whether to exercise his option after the price has been determined by agreement with the CTO as provided for by the will; and that even now Mrs Jackson has failed to disclose the advice on which she relies for suggesting that the land is worth around £500,000. She has clearly received valuation advice and it appears that her valuers have corresponded with the District Valuer. There must be many documents in her possession relevant to the value, including documents which show what rights exist in and over the land.

Mr Hayward claims (1) declarations that time was not of the essence and that he can exercise the option at any time until the expiry of a reasonable period after the value of the land has been agreed with the CTO and notified to him; (2) an order for disclosure of all such information as may be relevant to his decision whether to exercise the option, including the rights or interests enjoyed by or over the land, any advice as to the value of the land, the negotiations with the CTO, and all relevant trust documents; and (3) if necessary, an order relieving him from the consequences of not exercising the option within the option period on the ground that Mrs Jackson in breach of duty refused and/or failed to disclose to him the information to enable him to make that decision.

Consequently, the main issue for determination is whether Mr Hayward can exercise the option despite the expiry of the three month period in the circumstances of this case. If he can still exercise the option, there is no dispute about his right to information, save as to the extent of the order, and at the hearing I indicated that an order in the broad terms requested by Mr Hayward would be appropriate in order for him to take a view of the value of the land.

It is not suggested that the effect of his solicitors’ letter of January 18, 2002 is that Mr Hayward cannot argue that the time for exercise of the option has not yet arrived. Mr Hayward’s principal argument is that the essential question is one of construction, namely whether the testator intended that the option should only be exercisable in the period of three months from notification failing which the land would pass into residue and therefore to Mrs Jackson, and that the answer is plainly in the negative.

The testator’s intention was to give Mr Hayward an effective option. If Mrs Jackson is right he did not give Mr Hayward an effective option: (1) probate might not have been taken out within six months of the death, or the executors might have renounced without giving notice; (2) the testator must have intended that Mr Hayward would be able to make an offer at the actual valuation (rather than simply an offer to buy at the figure to be agreed with the CTO), and the CTO valuation might well have not been agreed within the six month period under clause 3(b) or the three month period under clause 3(c), as happened in the event.

The option was granted to Mr Hayward unconditionally by clause 3(a); and sub-clauses (b) and (c) are directory only, and time was not, and has not become, of the essence. Time is not of the essence where there are no prescribed consequences for failure to act in time (such as forfeiture, or a gift over, or a direction that the land be sold), and where the parties can be put back in the same position as if the option had been exercised in the prescribed time. If time were of the essence the option would be unworkable because, without knowing the price, Mr Hayward would not know whether his financial position would justify committing himself to the purchase.

Mrs Jackson’s position is Mr Hayward is not entitled to the declaration because time was of the essence in the context of a need for early certainty for Mrs Jackson, and the testator intended the option to be exercised within the stated period. Delay would prejudice Mrs Jackson because there was a substantial egg production unit on the land. Whether or not time was of the essence in the will, it had been made of the essence by Mrs Jackson’s solicitor’s letter of February 4, 2002, although it was accepted that it was unrealistic for the valuation to be agreed with the CTO in the relevant time.

The starting point is that the object of the court in construing a will to discover the intention of the testator; e.g. Re Allsop [1968] Ch 39, at 47 per Lord Denning MR. Decided cases on the meaning of words or phrases in other wills are of little assistance, unless they are decisions on a relevant rule or principle of law: Perrin v. Morgan [1943] AC 399, 408.

There are, however, three lines of authority which are of some relevance in the present context.

First, in this case there has been no valuation agreed with the CTO, and Mrs Jackson’s construction requires Mr Hayward to have made an offer on the basis of a formula (the price to be agreed with the CTO) rather than on the basis of a figure (the price actually agreed with the CTO).

In Lord Lilford v Powys Keck (No.1) (1862) 30 Beav. 295 the will provided that the testator’s Lancashire estates should be offered to the person or persons entitled, under the existing settlement, to the estate at Bank Hall, Lancashire, of which the testator was tenant for life, at a price equivalent to the price paid for the various parts of the land by the testator, together with an additional sum of £2,500 (representing part of the money spent by the testator on improvement of the estates). The offer of pre-emption was to be accepted or declined within one calendar month of the offer being made by the testator’s trustees, and if it was not so accepted the offer was to be deemed and considered as absolutely declined, and the trustees “shall proceed to dispose of my said estates … without reference to and if no offer of pre-emption had been directed ….”

In the same month as the testator died, the solicitor for the trustees wrote to Lord Lilford, as the person entitled to the Bank Hall estate, offering the properties. Lord Lilford replied to say that he was ignorant of their nature or extent and he asked for a further opportunity of consulting the persons who were locally informed as to the value of the estates. A further notice was given and accepted in November, and the issue was whether this amounted to a binding contract. It was held by Sir John Romilly MR that the first offer was not one which it was obligatory on Lord Lilford to accept, since he was not obliged to accept any offer until the amount of the purchase money was stated to him. No effective offer was made until the price had been ascertained.

Consequently, in a case where the will provided that, if the option were not exercised in time, it should cease to have effect, the court avoided a construction which would require the grantee to exercise the option at a time when he could not know what the price was to be.

So also, a hundred or so years later, in Talbot v. Talbot [1968] Ch 1 (C.A.) the testator directed that on the death of his wife (who had predeceased him) two of his sons should have the option of purchasing the farms in which they lived together with some land “at a reasonable valuation”. The proceeds of sale were to fall into residue and to be divided equally between all his children. There was no provision in the will for the mode of valuation. There were no time limits. The issue was whether the options were so vague and uncertain as to be void for uncertainty. It was held that the options were valid and effectual, and that since the will made no provision for the mode of valuation, the court would undertake the valuation itself and would direct an enquiry, and that the option beneficiaries need not exercise their options until the valuation was completed.

Harman LJ raised (but did not resolve) the question whether the sons must exercise their option first and the “reasonable valuation” was to follow, or whether they were entitled to say to the trustees “Let us arrive first at the reasonable valuation and then we will tell you whether we will buy”: at p. 13. It seems that he preferred the second approach. Russell LJ (at 15-16) said that the sons could exercise the option “blind” before the formula of “reasonable valuation” was worked out, but that it need not be exercised until it had been worked out. The option had to be exercised within a reasonable time thereafter.

This was not a case involving time limits. But again the decision indicates a reluctance to construe an option in a will as requiring the grantee to exercise his or her rights before the price is ascertained. Of course, a will may require the grantee to exercise the option even before the price has been ascertained, but unless the will plainly requires this, these cases show that the court adopts a construction which does not force the grantee to exercise the option blindly before the price is ascertained and communicated to him.

The next group of potentially relevant cases consists of cases where a gift is made in a will subject to a condition, which by the terms of the will is to be performed within a certain time. These cases indicate that where the time limit is not observed the gift will not fail (or time will not be of the essence) if the will does not specify the consequences for non-compliance and the relevant parties can be restored to the same situation as if the condition had been fulfilled.

So, more than 200 years ago, in Taylor v. Popham (1782) 1 Bro.C.C. 169 the testator gave his son £600 per annum on condition that he should within three months execute a release of all the demands on the testator’s estates. Disputes arose between the son and his siblings, who claimed that a release had been tendered and refused, and therefore he was no longer entitled to the £600 per annum. Lord Thurlow LC said that the son did not forfeit the £600 annuity. If the court could put the parties in the same situation as if the condition had been performed, it would not suffer a forfeiture to attach. The matter was referred to a master to prepare a proper release, and subsequently, when the son refused to execute it, it was held that he was not entitled to the annuity.

But the position is different where the testator has provided for what is to happen to the property if the condition as to time is not complied with. So in Powell v. Rawle (1874) 18 Eq. 243 a legacy was given to the testator’s daughter on the “express condition that if the said bequest be not duly claimed by my said daughter within the space of three calendar months next after my decease, that then the said bequest shall lapse, and the amount thereof shall fall into and be considered as part of my residuary personal estate and be applied accordingly.” The daughter did not claim the legacy for some years. She claimed that she had not heard of it until nearly two years after her father’s death, and it was admitted by the executors that no notice was given. But it was held that “the words are too strong” and the fund must fall into the residue, on her failure to claim the legacy.

In Re Packard [1920] 1 Ch 596 the testator gave his daughter a pecuniary legacy upon the express condition that she should within a year of his death settle upon certain trusts of the will a sum to which she was entitled under a deed of settlement. There was no gift over in the case of failure to perform the condition, or direction that in that case the legacy should fall into residue, although the residual estate was given in trust for the daughter and three other persons. The daughter did not comply with the condition in time, but was willing to execute a proper settlement in accordance with the directions of the testator. Sargant J said that the question might arise whether the condition was a condition precedent or a condition subsequent, but it was not necessary to express an opinion. On the basis that it was a condition precedent, he said that it was to be observed that there was no gift over in the event of the condition not being complied with. A mere residuary gift, without a direction that the legacy or fund in question shall fall into the residue on non-compliance with the condition, is not in itself a gift over to some other person. Referring to earlier cases he said (at 602):

“… where there was no gift over, so that there was no question of divesting an interest vested in such ultimate donee the mere time of payment or release was not of the essence of the condition, and accordingly a subsequent release or subsequent payment by the legatee might amount to a substantial compliance with the condition. The language of the Lord Chancellor in Taylor v. Popham is clearly not limited to cases as to release from debts or payment of money, but applies generally to the performance of a condition precedent outside the time mentioned in the will but under such circumstances that the parties can be placed in substantially the same position as if the terms of the will had been strictly complied with. In the present case the direction that the settlement should be exercised within twelve months was no more than a directory provision. It was not of the essence or the substance of the condition, and it was quite clear that all the parties interested could be placed in precisely the same position as if the condition had been literally and accurately complied with.”

In Re Goodwin [1924] 2 Ch 26 the testator bequeathed an annuity of £500 to his wife, but on the basis that it was to be absolutely void and of no effect unless his wife should within six calendar months after his death release and discharge his estate from payment of a £70 annuity which he had covenanted by deed to pay to his wife. There was a gift of residue in the will, but no gift over of the annuity on failure to comply with the condition. Because it remained doubtful during the life of the widow whether the estate would produce anything for the beneficiaries she did nothing specifically during her life to comply with the condition, but it was held that a release by her executors, which would put all parties in the position intended by the testator, would be a sufficient compliance with the condition. Romer J said (at 30):

“It is well settled by authority that where a gift in a will is made subject to a condition, even a condition precedent, to be performed within a specified time, but the condition is not in fact performed within that time, then, at any rate in the absence of an express gift over, it is always a question for the Court to determine whether the time so specified was of the essence of the matter. In determining that question the Court must have regard to what was presumably the intention of the testator in inserting the condition, what it was that he desired to bring about or to guard against; and if the Court finds that a performance of the condition at a time subsequent to the expiration of the period fixed by the testator in substance provides for the very thing that the testator intended to provide for, so that all parties can be put in substantially the same position as they would have been in had the condition been performed within the proper time, time is not regarded as of the essence, and such performance is treated as a sufficient compliance with a condition.”

Even if there is no gift over, the circumstances may show that the testator required the condition to be fulfilled in time. In Re Goldsmith [1947] Ch 339 the testator directed his trustees to hold his freehold house upon trust, after the death of his wife, for a Mr Bingham, but subject to the payment of £800 by him to his trustees within six months of his death to form part of his residuary estate. He failed to comply with the condition to pay the £800 during the life of the widow, but he offered to pay the sum within six months of her death. Wynn-Parry J held that time was of the essence, because performance of the condition would not result in placing all the parties in the same position as if the terms of the will had been strictly complied with: among such parties must be included the widow, as tenant for life of the residue. Having regard to the language of the will, it must be taken the testator intended the £800 to be paid within six months of his death for the purpose of bringing about what was the necessary consequence of those payments, namely an increase in his residuary estate, which would have provided additional income for his widow during her life.

The third series of cases which are of assistance is that dealing with time limits in options granted by will. In two decisions about a century apart, the court required compliance with the time limit and held that the option had lapsed through non-compliance.

In Brooke v. Garrod (1857) 3 K & J 6078, affd (1857) 2 De G & J 62 the testator directed his trustees to offer all his real estate to his brother at the price of £2,500 and provided that if the brother should not, within one calendar month after the testator’s death, signify to the trustees his intention to accept the real estate at that price, or should not, at the expiration of two months from the time of signifying his intention, pay the price, then the testator directed his trustees to sell the premises by public auction or private contract, and directed his trustees to stand possessed of the sale price upon trusts for the benefit of another brother and his sisters.

The brother signified his intention within the relevant time to buy the property, but failed to pay the purchase price, when his solicitor was not provided with an abstract of title. Sir William Page Wood V-C said that the right of pre-emption was a privilege, and the conditions were conditions with which the brother was obliged to comply strictly, and the case was analogous to a case between vendor and purchaser where time was of the essence. Having signified his intention to purchase the property, it became his duty to pay the purchase money, and he was not justified in waiting for an entire abstract of title. It was said that the position might have been different if there had been fraud or laches. On appeal, Lord Cranworth LC agreed:

“It is said, that although he did not pay within the time, he did what ought to be considered as equivalent to payment, or ought to exonerate him from any charge of neglect. Now, I have more than once had occasion to say that I think this Court has gone to too great an extent in departing from the precise terms of the contracts into which parties have entered, and so in effect making other contracts for them … No authority has, however, been produced in which this court has varied the terms of a gift under which a benefit is to be taken. The rule there is cujus est dare ejus est disponereand if the donor choose to say that in the event of a person paying 2,500l. on or before a specified day the gift shall take effect, I do not see how the court, if the money is not paid on or before the day, can take anything as an equivalent for the payment at the prescribed time.”

The decision in Brooke v. Garrod is entirely in line with the cases on gifts subject to a condition. The purchase price payable on the exercise of an option was payable within a fixed time, and the consequences of non-compliance were expressed. If the price was not paid, then the property was to be sold by public auction or private contract, and the proceeds were to be held on various trusts for his siblings.

Re Avard [1948] Ch 43 was an unreserved judgment of Roxburgh J. The testatrix devised two cottages upon trust for her sister for life, and directed that after her sister’s death the tenant of one of them should have the option to purchase them for £500, upon notice to be given by him to the trustees of the will, within three calendar months of the death of the sister.

The sister died on January 1, 1946, and the personal representative of the tenant claimed to exercise the option by letter dated April 10, 1946, i.e. a few days late. The net residuary estate was divided between a number of nephews and nieces. The personal representative of the tenant argued that no-one had been prejudiced by the late exercise of the option, and accordingly the applicable principle was that time was not of the essence in the performance of a condition where there was no gift over. The residuary legatees argued on the basis of Brooke v. Garrod that if the time limit were not complied with, it became too late to exercise the option. All of the cases to which I have referred on gifts subject to a condition were cited.

It was held that the option was not well exercised. Roxburgh J accepted that the circumstance that the personal representative of the tenant was a few days out of time was of no detriment to anyone and made no practical difference at all. He said that at first he had been prepared to follow the line of cases from Taylor v. Popham to Re Goldsmith and to hold that the fact that the option was not exercised in time was not fatal. But he went on (at 46):

“It does seem to me that there may be differences between a gift subject to a condition precedent and an option, which are sufficient to account for the different courses which the authorities have taken, and if that is a possibility it is clearly my duty to follow the decision of the Court of Appeal which is at least as near and probably nearer the present case than any of the other decisions.”

After referring to Brooke v. Garrod, he said that Taylor v. Popham had not been cited and that the proposition of Lord Cranworth to which I have referred would not have been stated in the form it was if Taylor v. Popham had been cited. He went on (at 48):

“That proposition seems to me very difficult to reconcile with the line of cases beginning with Taylor v. Popham and ending with the recent case before Wynn-Parry J. [Re Goldsmith], but two facts remain: one is that the Lord Chancellor did, at any rate in part, approach the question not as though it was one between trustee and beneficiaries, but as though it was one between two independent parties, one making an offer of a contract which it is at the will of the other to accept or not as he pleases. It is only, I think, upon some such footing that the conduct of the trustees could be allowed to affect the rights of the beneficiaries, and it is quite clear that the Lord Chancellor thought that in certain circumstances this might be so. The other fact is that in a case extremely like the present the Court of Appeal as long ago as 1857 decided that the option was not well exercised.”

He then referred to Powell v. Rawle, about which he said

“That again, is a very strong case not altogether unlike the present, and it does not seem to have been possible to apply in that case the doctrine which has been applied in the line of cases beginning with Taylor v. Popham and ending with In re Goldsmith.”

His conclusion was (at 49):

“In the circumstances it seems to me that it is my duty to follow the decision in Brooke v. Garrod, and leave the proper reconciliation of the various streams of authorities to others.”

I am satisfied that I should not follow Re Avard. I do not consider that there is any conflict between the authorities which were cited in that case. Brooke v. Garrod and Powell v. Rawle were cases where there was an express gift over (in the case of the former) or an express direction in favour of residue (in the case of the latter). Powell v. Rawle was not in any event a case of an option, and the basis of the decision was that the words of the will (which were “too strong”) could not be read in any sense other than that the gift was forfeit if the condition were not complied with.

In Re Avard there was no specified consequence for non-compliance, and plainly no prejudice to anyone caused by the few days which elapsed from the date for the exercise of the option. The case therefore fell plainly within the principle that if there is no gift over, and no prejudice, the court is unlikely to find that the testator intended the gift to fail on the basis that time is of the essence. Contrary to the view of Roxburgh J, I do not consider that there is any relevant distinction between a gift and the grant of an option. I am therefore satisfied that Re Avard was wrongly decided, that the propositions which Theobald and Williams derive from it are not good law, and that the criticism of it in Jarman on Wills, 8^th ed Jennings, 1951, p 1469, is justified.

The question is one of construction. The will contains no consequences for failure to observe the time limits. If the time limits were mandatory the testator’s intentions could have been wholly defeated, and the option price is linked to a formula which might require Mr Hayward to be bound before he knew the price. If the option is exercised outside the specified period a residuary legatee would be in the same position as if the option were exercised within that period.

I have no hesitation in deciding that failure by Mr Hayward to exercise the option within three months of the letter of February 4, 2002, does not result in a loss of his right. The time limits are directory in nature, and I consider that he is entitled to wait until the price is ascertainable, and he will have a reasonable time to exercise his option from that date. The three month period will plainly be a factor in what is a reasonable time, and Mrs Jackson will then be able to make time of the essence. The question of relief does not therefore arise.

If the form of the order cannot be agreed, I will hear argument.