Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd [1994]

Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd [1993] UKHL 4, [1994] 1 AC 85 involved conjoined appeals in the Judicial Committee of the House of Lords, addressing the issue of continued privity of contract following the assignment of property under English contract law.

Stock Conversions Ltd, the original lessee, utilised a JCT standard form contract to engage Lenesta for asbestos removal. Within this contract, Clause 17(1) explicitly stated that "The employer shall not, without the written consent of the contractor, assign this contract." Despite this provision, Stock Conversions Ltd assigned the building lease to Linden Gardens and simultaneously transferred its right of action against Lenesta to Linden Gardens, all without obtaining Lenesta's consent. Asbestos-related issues persisted, prompting Linden Gardens to initiate legal proceedings, claiming negligence and breach of contract. In a separate but related case, St Martin's Property Corp Ltd assigned its property interest and contract benefits to a new owner after completing a shop development, all without the contractor's consent. Subsequently, defective work was discovered.

The House of Lords delivered a verdict that a genuine construction of Clause 17(1) prohibited assignment without consent, and importantly, this prohibition was deemed not contrary to public policy. In the second case, where the likelihood of third-party occupation or purchase was high, any damages resulting from defective works would be borne by subsequent owners rather than the original developer. The existence of a specific contractual provision barring assignment without consent allowed the first claimants to enforce the contract against the defendants on behalf of third parties affected by defective performance. Lord Browne-Wilkinson applied the concept articulated by Lord Diplock in The Albazero [1977], noting an exception applicable to contracts of carriage, which permits the consignor to recover substantial damages against the carrier even if there is privity of contract between the consignor and the carrier.

In summary, the House of Lords affirmed the validity of the prohibition on assignment without consent, emphasising that such a restriction aligns with public policy. Additionally, the court recognised the enforceability of contractual duties on behalf of third parties in specific scenarios, particularly when the parties involved anticipated the likelihood of assignment and the subsequent impact on new owners.
Back to blog

UOL Case Bank

Upon joining, you become a valuable UOL student and gain instant access to over 2,100 case summaries. UOL Case Bank is constantly expanding. Speed up your revision with us now.

Subscribe Now

Where are our students from?

Yale University
Council of Europe
Baker Mckenzie 
University of Chicago
Columbia University
New York University
University of Michigan 
INSEAD
University College London (UCL)
London School of Economics (LSE)
King’s College London (KCL)
University of London
University of Manchester
University of Zurich
University of York
Brandeis University
University of Exeter
University of Sheffield
Boston University
University of Washington
University of Leeds
University of Law
Royal Holloway, University of London 
Birkbeck, University of London
SOAS, University of London
University of Kent
University of Hull
Queen’s University Belfast
Toronto Metropolitan University
Hong Kong University of Science and Technology
University of Buckingham
ESSEC Business School

  • Criminal Practice

    Diagrams and Charts

    Our carefully designed diagrams and charts will guide you through complex legal issues.

  • Criminal Law

    Clear and Succinct Definitions

    Key concepts are concisely defined to help you understand legal topics quickly.

  • Property Law

    Statutory Provisions

    Statutory provisions are provided side by side with legal concepts to help you swiftly locate the relevant legislation.

  • Public Law

    Case Summaries

    We have summarised important cases for you so that you don't need to read long and boring cases.

  • Evidence

    Rules and Exceptions

    Rules and exceptions are clearly listed so that you know when a rule applies and when it doesn't.

  • Company Law

    Terminology

    Legal terms and key concepts are explained at the beginning of each chapter to help you learn efficiently.

  • Case Law

    Case law is provided side by side with legal concepts so that you know how legal principles and precedents were established.

  • Law Exam Guide

    Law Essay Guide

    You will learn essential law exam skills and essay writing techniques that are not taught in class.

  • Law Exam Guide

    Problem Question Guide

    We will show you how to answer problem questions step by step to achieve first-class results.

  • Conflict of Laws

    Structured Explanations

    Complex legal concepts are broken down into concise and digestible bullet point explanations.

  • Legal System and Method

    Legal Research

    You will learn legal research techniques with our study guide and become a proficient legal researcher.

  • Jurisprudence and Legal Theory

    Exam-focused

    All essential concepts, principles, and case law are included so that you can answer exam questions quickly.