When drafting sale and purchase agreements, it is vital that the date for completion is clear and unambiguous.

If parties to a contract do not appreciate when actual completion should occur then this can lead to costly delays with one party seeking to force the other to complete and ultimately, expensive litigation can arise.

The recent case of British Overseas Bank Nominees Limited v Analytical Properties Limited [2015] EWCA Civ 43, before the Court of Appeal serves as a useful reminder of the importance of getting the completion date right and ensuring that the date for actual completion is understood by all parties.

This case concerned the sale of a shopping centre known as King Edward Court in Windsor by the seller, Analytical Properties Limited to the buyer, British Overseas Bank Nominees Limited.

On 13 December 2013, the contract was exchanged and completion was due to occur on 17 December 2013. However, actual completion did not take place until 17 January 2014.

Completion was conditional upon compliance with pre-conditions and the appeal turned on the construction of Clause 37 in the contract.

Clause 37 required the seller to provide Emergency Lighting Certificates “as soon as practicable and in any event prior to the date of Actual Completion”.

Actual Completion meant “Actual Completion of the sale and purchase of the Properties whether or not it occurs on the Completion Date”

By the date of exchange (13 December 2013), the process of testing emergency lighting within the shopping centre had begun but had not yet completed.

The certificates were eventually issued on 14 January 2014 and completion took place 3 days later.

The buyers issued proceedings for breach of contract, claiming that Clause 37 required the seller to provide the certificates by the contractual completion date of 17 December whether or not that was practicable.

The first instance Judge agreed with the buyers, ruling that Clause 37 required the seller to provide the certificates by 17 December 2013, that the clause had been inserted for the buyers’ benefit only and that any failure on the part of the seller to obtain the certificates did not postpone their obligation to complete on the contractual completion date.

However, the Court of Appeal overturned the decision of the Court below. The Court found that the obligation to complete was conditional on the seller obtaining the certificates, but the deadline for providing the certificates was “Actual Completion” which could include but was not limited to the contractual completion date of 17 December 2013. The obligation to complete the contract on 17 December 2013 was therefore postponed until the sellers had complied with their obligation to provide the certificates.

The Court of Appeal found also that the buyers could have insisted on completion on 17 December 2013 or waived their reliance on Clause 37. However, the buyers neither insisted on completion nor waived reliance on Clause 37 at any time prior to 17 January 2014 when completion actually took place. Therefore the seller was not in breach of the obligation to complete.

This case follows a long line of cases highlighting the fundamentals of careful drafting of the completion date and pre-conditions for completion. Had the parties understood what was required of them to complete the sale then they could have avoided the subsequent (and costly) Court proceedings that ensued.