511

1 Ch. Rolled Steel Ltd. v. British Steel Corpn. Vinelott J.

knowledge that the guarantee and, to the extent of the sum guaranteed, the
A
debenture, were invalid. It is accepted by Mr. Morritt that if Colvilles
were entitled to rely upon the resolutions at the meeting of the board of the
plaintiff on January 22 as resolutions of a board validly constituted, the
debenture was a valid debenture to the extent of the sum paid to the plaintiff
by Colvilles to enable the plaintiff to repay its debt to S.S.S. No criticism
is made of the conduct of the receivership or of the remuneration charged
g by the receiver. In these circumstances the question whether the receiver
had notice that the guarantee and, to the extent of the sum guaranteed, the
debenture were invalid is devoid of any practical consequence. But in case
the point does become material I should say that in my judgment Mr.
Cooper, when he took possession of the assets of the plaintiff as receiver,
had knowledge of facts from which it should have been apparent to him
that the giving of the guarantee was ultra vires the plaintiff in the wider
C sense and also a breach of duty by the directors of the plaintiff. Mr. Dyson
told him on May 22 that he had entered into arrangements with the trustees,
the effect of which was that " in exchange for not complaining about the
giving of the guarantee, they would, in due course, be ' cut into' the
Andover Group " and that a reorganisation then under consideration would
have to be carried out in such a way that the trustees were compensated
p for what they had " permitted to be given away from the value of their . . .
shares " in the plaintiff.
Order accordingly.
Solicitors: Herbert Smith & Co.; Lovell White & King.
.[Reported by MRS. F. ALLEN MCLEAN, Barrister-at-Law]

[COURT OF APPEAL]

ALAN ESTATES LTD. v. W. G. STORES LTD. AND ANOTHER

F [1979 A. No. 1218]

1981 May 15, 18, 19; Lord Denning M.R., Ackner L.J.
July 1 and Sir Denys Buckley

Deed—Escrow—Lease—Rent in undated lease payable "from the

date hereof "—Lease executed in escrow—Whether rent pay-
Q able from date of delivery in escrow or date of satisfaction of
conditions of escrow
An undated lease and counterpart which provided that rent
was payable " from the date hereof " were executed and ex-
changed, subject to conditions imposed by the tenants' solici-
tors in a covering letter, on November 1, 1976. On November
9 the tenants purported to withdraw from the transaction. The
IT landlords began legal proceedings, but in due course it was
agreed that the lease was binding, but had been delivered as an
escrow on the conditions set out in the letter of November 1,
1976. The last of the conditions was fulfilled by the landlords
on November 18, 1977.
 Alan Estates Ltd. v. W. G. Stores Ltd. (CA.) [1982]
On a summons brought by the landlords to determine from
what date the tenants were liable to pay rent, the judge held A
that a deed delivered as an escrow took effect from the satis-
faction of the conditions and not from the date of delivery in
escrow, that " the date hereof" in the lease was therefore
November 18, 1977, and that rent was due from that date.
On appeal by the landlords: —
Held, allowing the appeal (Ackner L.J. dissenting), that
when all the conditions of an escrow were satisfied {per Lord
Denning M.R.) the title which then passed to the grantee "
under the deed, {per Sir Denys Buckley) the terms and con-
ditions of the instrument which were necessary to give effect
to the transaction, related back so as to operate, as between
grantor and grantee only, from the time of the conditional
delivery of the instrument, and for that purpose the delivery
was treated as though it had been unconditional ab initio; and
that, accordingly, since the term of an undated lease under p
seal began at the date of delivery, the date to be inserted in ^
the lease as the " d a t e hereof," the conditions of the escrow
having been fulfilled, was the date of the delivery on November
1, 1976, and that was the date from which rent was payable
(post, pp. 5 2 0 G — 5 2 1 B , F - G , 528A-C, E-G, 529A).
Terrapin International Ltd. v. Inland Revenue Commission­
ers [1976] 1 W.L.R. 665 not applied.
Per Lord Denning M.R. If the tenants had not repudiated j ^
their obligations, the date inserted in the lease would un-
doubtedly have been November 1, 1976. The tenants should not
be allowed to take advantage of their own repudiation so as
to postpone the date of the deed or the term from which rent
should run, while the issue was being litigated (post, pp.
5 1 9 E - G , 522A).
Per Ackner L.J. A deed delivered in escrow takes effect
from the satisfaction of the conditions. The lease and counter- g
part took effect together on the satisfaction of the condition on
November 18, 1977 (post, pp. 524H, 525B).
Decision of Judge Rubin sitting as a judge of the Chancery
Division reversed.

The following cases are referred to in the judgments:

Beesly v. Hallwood Estates Ltd. [1961] Ch. 105; [1961] 2 W.L.R. 36; [1961]
F
1 All E.R. 90, C.A.
Butler and Baker's Case (1591) 3 Co.Rep. 25a.
Cory (Wm.) & Son Ltd. v. Inland Revenue Commissioners [1964] 1 W.L.R.
1332; [1964] 3 All E.R. 66, C.A.; [1965] A.C. 1088; [1965] 2 W.L.R.
924; [1965] 1 AH E.R. 917, H.L.(E.).
Duke of Devonshire's Settlement, In re (1952) 31 A.T.C. 399.
Eccles v. Bryant and Pollock [1948] Ch. 93; [1947] 2 All E.R. 865, C.A.
Foundling Hospital (Governors and Guardians) v. Crane [1911] 2 K.B. 367, G
C.A.
Harrison v. Battye [1975] 1 W.L.R. 58; [1974] 3 All E.R. 830, C.A.
Kingston v. Ambrian Investment Co. Ltd. [1975] 1 W.L.R. 161; [1975] 1
All E.R. 120, C.A.
Perryman's Case (1599) 5 Co.Rep. 84a.
Security Trust Co. v. Royal Bank of Canada [1976] A.C. 503; [1976] 2
W.L.R. 437; [1976] 1 All E.R. 381, P.C. H
Terrapin International Ltd. v. Inland Revenue Commissioners [1976] 1
W.L.R. 665; [1976] 2 All E.R. 461.
Tupper v. Foulkes (1861) 9 C.B.N.S. 797.
 513
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (CA.)
. Vincent v. Premo Enterprises (Voucher Sales) Ltd. [1969] 2 Q.B. 609;
A
[1969] 2 W.L.R. 1256; [1969] 2 All E.R. 941, CA.
Xenos v. Wickham (1867) L.R. 2 H.L. 296, H.L.(R).
The following additional cases were cited in argument:
Bradshaw v. Pawley [1980] 1 W.L.R. 10; [1979] 3 All E.R. 273.
Coare v. Giblett (1803) 4 East 85.
g Edmunds v. Edmunds [1904] P. 362.
Graham v. Graham (1791) 1 Ves.Jun. 272.
Styles v. Wardle (1825) 4 B. & C. 908.
Thompson v. McCullough [1947] K.B. 447; [1947] 1 All E.R. 265, CA.
APPEAL from Judge Rubin sitting as a judge of the Chancery Division.
By an originating summons dated April 18, 1979, Alan Estates Ltd., the
C landlords under a lease of premises at 32, Goldhawk Road, Hammersmith,
London W.12, sought against W. G. Stores Ltd., the tenants, and Derek
Desmond Solomons, surety for the tenants, inter alia, a declaration that the
obligations of the tenants under the lease commenced or should be deemed
to have commenced on November 1, 1976, and an order for the payment
by the tenants of arrears of rent. On February 1, 1980, Judge Rubin, sitting
as a High Court judge, held that rent was payable by the tenants as from
November 18, 1977, and he dismissed the summons.
The landlords appealed on the grounds (1) that the judge was wrong in
law holding that on the true construction of the lease and in the events
which had happened rent was not payable in respect of any period prior to
November 18, 1977; (2) that the judge erred in law or on the facts in
holding that " the date hereof" for the purposes of the lease was the date
E on which the last condition pursuant to which the tenants' part of the
lease was delivered as an escrow to the landlords' solicitors was satisfied,
namely November 18, 1977; and (3) that the judge failed to have any or
sufficient regard to the fact that the tenants had wrongfully repudiated the
lease on November 9, 1976.
The facts are stated in the judgment of Lord Denning M.R.
F
Gordon Nurse for the landlords. The case is concerned with when
obligations under a lease under seal began to run, and whether a lease
delivered as an escrow takes effect on delivery or when the conditions are
fulfilled. Obligations in a lease can be expressed to begin prior to the
execution of the lease: Bradshaw v. Pawley [1980] 1 W.L.R. 10. There
are five propositions.
G (1) The requirements for the good execution of a deed are that it be
signed, sealed and delivered (but not necessarily dated): Norton on Deeds,
2nd ed. (1928), p. 3 and sections 73 and 74 of the Law of Property Act
1925.
(2) A deed takes effect from its delivery, and not necessarily from its
stated date: Norton on Deeds, 2nd ed., p. 189 and Halsbury's Laws of
H England, 4th ed., vol. 12 (1975), p. 620, para. 1486. Nothing is said there
about the effective date of a deed delivered as an escrow. The question
is: which is the " delivery " from which such a deed takes effect?
(3) A person cannot recall his deed if it has been delivered in escrow,
Ch. 1982—24
514
Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
as long as the condition of the escrow is capable of fulfilment: Beesly V. .
Hallwood Estates Ltd. [1961] Ch. 105 and Kingston v. Ambrian Invest­
ment Co. Ltd. [1975] 1 W.L.R. 161.
(4) Upon the condition being fulfilled, the deed takes effect without
further delivery, and its delivery as a deed will if necessary relate back to
the date of its delivery as an escrow: see Halsbury's Laws of England,
4th ed., vol. 12, p. 527, para. 1334; Graham v. Graham (1791) 1 Ves. Jun.
272, 274; Coare v. Giblett (1803) 4 East 85, 94; Edmunds v. Edmunds B
[1904] P. 362, 374; Governors and Guardians of the Foundling Hospital v.
Crane [1911] 2 K.B. 367 and Williams on Real Property, 19th ed. (1901),
p. 151. Farwell LJ.'s remarks in the Foundling Hospital case [1911] 2
K.B. 367, 377 are obiter; on the actual decision in that case, there was no
delivery at all. " If necessary " is required in the proposition because the
doctrine of relation back is not effective for all purposes: see Thompson Q
v. McCullough [1947] K.B. 447. For example there could be no relation
back in respect of a notice to quit. But once the grant has become wholly
effective, obligations under the deed are retrospective to the date of delivery.
The observations of Diplock L.J. in Wm. Cory & Son Ltd. v. Inland
Revenue Commissioners [1964] 1 W.L.R. 1332, 1346, to the effect that a
deed delivered as an escrow has no effect while it remains an escrow are
against the weight of authority and wrong; at the very lowest, neither party ^
can withdraw from the transaction. Lord Reid's dictum in the same case
in the House of Lords [1965] A.C. 1088, 1108c, " both parties would have
locus poenitentiae," is generally regarded as erroneous: see Emmet on
Title, 17th ed. (1978), p. 650. Diplock L.J. misunderstood the true nature
of an escrow. It is not like an unsigned contract. It is executed and
delivered as a deed. The difference from any other deed is that it E
only becomes operative as a deed when the condition is satisfied. See
generally, per Lord Denning M.R. in Cory's case [1964] 1 W.L.R. 1332,
1341. The case principally relied on by the judge in the present case was
Terrapin International Ltd. v. Inland Revenue Commissioners [1976] 1
W.L.R. 665, a stamp duty case. That case is also against the weight of the
earlier authorities and should not be followed. Walton J. held that there p
was one long process of execution, starting with delivery and ending with
the satisfaction of the condition. That might be appropriate for stamp
duty, but to adapt it for other purposes would be to fly in the face of
centuries of authorities. Walton J. himself said that everything depended
on the provisions of the Stamp Act 1891. Confusion arises when the
terminology is used of a conditional delivery becoming unconditional. That
is not what escrows are about. There are analytically two deliveries, and G
for the present purpose it is not apt to regard the process as one long
execution. In re Duke of Devonshire's Settlement (1952) 31 A.T.C. 399,
405, per Vaisey J. is to be preferred. Security Trust Co. v. Royal Bank of
Canada [1976] A.C. 503 is against the landlords to the extent that Lord
Cross said, at p. 517, that rent during the period of suspense was not recover-
able. However, the landlords are not suing for rent under the deed, as H
such; they merely seek to ascertain the date of the lease. The relevant
question is what was the date of delivery, and hence what is the " date
hereof" in the lease. Lord Cross at p. 517 acknowledged that relation back
 515
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (CA.)
. was deemed for such purposes as were necessary to give effect to the
transaction. That is applicable to the present case.
(5) The date to be inserted in a deed, when no date is stated, is the date
when it is delivered: Styles v. Wardle (1825) 4 B. & C. 908. In the case
of an escrow the relevant delivery is the delivery of the deed in escrow:
Emmet on Title, 17th ed., p. 649 and In re Duke of Devonshire's Settlement,
31 A.T.C. 399, 405. It is then that the deed is executed, and it is binding
B from then. The " date hereof " is accordingly November 1, 1976.
If the date to be inserted is November 18, 1977, the effect will be that
by reason of their wrongful repudiation the tenants will have got away with
a year without rent.
Lawrence Cohen for the tenants. The landlords' first proposition is
accepted, except that there must be unconditional delivery of the deed. An
n escrow is therefore not a deed and does not become one until the condition
is fulfilled: Governors and Guardians of the Foundling Hospital v. Crane
[1911] 2 K.B. 367, 377, per Farwell L.J. Proposition (2) is accepted except
that in the case of an escrow the deed takes effect from unconditional
delivery. No case has ever decided that there is retrospective vesting of the
legal estate. (3) is accepted. (4) is right, but " if necessary " begs the
question of when relation back is permissible. Proposition (5) is not
D accepted.
The incidents surrounding a tenant's obligation to pay rent are deter-
mined by construing the lease. On the true construction of the covenants
in the present lease, the expression " from the date hereof " has reference to
the execution of the lease. Execution depends on signing, sealing and
unconditional delivery. References to " delivery " in the cases are always
references to unconditional delivery: see Styles v. Wardle, 4 B. & C. 908.
" So with the discussion of delivery in Co. Litt., 18th ed. (1823), vol. 1,
p. 46b. An escrow only becomes a deed, and takes effect, on fulfilment
of the condition and hence unconditional delivery. There is a drawn
out process of execution terminating in thefinaldelivery. Reliance is placed
on the approach of Lord Cranworth in Xenos V. Wickham (1867) L.R. 2
H.L. 296, 323; Diplock L.J. in Wm. Cory & Son Ltd. v. Inland Revenue
p Commissioners [1964] 1 W.L.R. 1332, 1346; and Walton J. in Terrapin
International Ltd. v. Inland Revenue Commissioners [1976] 1 W.L.R. 665,
669-671, which is supported by Norton on Deeds, 2nd ed., pp. 18, 20 and
21. Although in the Terrapin case the words of the statute were relevant
for some purposes, the critical point was the time when the instrument was
executed. Walton J. decided that on common law principles, without refer-
ence to the statute.
" Once the condition of the escrow is satisfied, there is only relation back
to the date of conditional delivery for two purposes: (1) the capacity of the
parties, judged as at the date of the conditional delivery—if a party dies or
goes insane before the condition is satisfied, the validity of the escrow is not
affected; and (2) the estate in the land—the estate vested in the grantor at
the date of conditional delivery is the estate which subsequently vests in the
JJ grantee: see Governors and Guardians of the Foundling Hospital v. Crane
[1911] 2 K.B. 367, especially per Kennedy L.J. at p. 382, commenting on
Ferryman's Case (1599) 5 Co.Rep. 84a and Graham v. Graham, 1 Ves.Jun.
272. The grantor puts it out of his power to deal with the legal estate
516
Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
inconsistently with the escrow. But there is no retrospective vesting of the ^
legal estate back to before the date of the fulfilment of the condition: see
Preston on Abstracts of Title, 2nd ed., vol. Ill (1824), p. 65, which also
says that the grantee has no right to the intermediate rents between the
first delivery and the fulfilment of the condition. Thompson v. Mc-
Cullough [1947] K.B. 447, 454, per Morton L.J. is to the same effect.
Security Trust Co. v. Royal Bank of Canada [1976] A.C. 503, 517, per
Lord Cross of Chelsea is powerful authority for the legal estate not B
vesting retrospectively, and Bradshaw v. Pawley [1980] 1 W.L.R. 10
does not state the contrary.
The authority cited in support of the landlords' proposition (5) is In re
Duke of Devonshire's Settlement, 31 A.T.C. 399. The dictum of Vaisey J.
at p. 405 is wrong. The point did not arise for decision in that case, and
had not been seriously argued before the judge, nor were any cases on it _
cited to him; it only arose in the course of observations by the judge on the
propriety of what had occurred. It is contrary to the principle stated in the
cases and the books. The only direct authority on the point is Terrapin's
case [1976] 1 W.L.R. 665, which is to the contrary.
There is a covenant in the lease to pay rent " at the time and in the
manner aforesaid." By clause IB, " the said rents shall in all cases be
paid by equal quarterly payments in advance in the usual quarter days . . . " D
If the " date hereof " is November 1, 1976, the effect would be a require-
ment to pay rent for a proportion of the last 1976 quarter; but there is no
covenant in the lease to pay rent for part of a quarter, and no provision to
pay a lump sum in the past. The express terms of the lease would therefore
be violated. An escrow always arises when a lease is delivered, pending
delivery of the counterpart, and vice versa. If the earlier date were the
effective one, a conveyancer's nightmare would be created. The date con-
tended for by the landlords, November 1, 1976, cannot in any event be right
on the landlords' argument since it was admitted that the counterpart was
executed on October 28, 1976. If the relevant delivery is the conditional
delivery, then the " date hereof " must be October 28, 1976, when that
delivery occurred—but at that date the term was not vested in the landlords,
if as they say the lease began on November 1,1976. F
Nurse replied.
Cur. adv. vult.
July 1. The following judgments were read.
LORD DENNING M.R. In this case we have to consider the mediaeval law
about an escrow and to put it into its modern setting. G
The facts
There is a lock-up shop at 32, Goldhawk Road, London W.12. In
September 1976 it was empty. W. G. Stores Ltd. were keen to take a lease
of it from the landlords, Alan Estates Ltd. They wanted to occupy it as
soon as possible. In anticipation of the lease, the landlords allowed the JJ
tenants to have the key, so as to measure up for shop fittings. The tenants
paid a quarter's rent to the landlords' solicitors, asking them to hold it as
stakeholders pending completion of the lease. Inquiries were made as to
 517
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Lord Denning M.R.
title and so forth. But no preliminary contract was entered into. The solici-
tors got on straight away with preparing the lease, and getting it engrossed
and executed. Then on Monday, November 1, 1976, the solicitors exchanged
the lease and counterpart duly executed. But this is to be noted. Both lease
and counterpart were undated. Each started off:
" This lease is made the day of one thousand nine
hundred and seventy-six between Alan Estates Ltd. . . . and W. G.
B
Stores L t d . . . . "
The tenants' solicitors wrote this letter to the landlords' solicitors:
". . . we now enclose the lease duly executed by our client . . . As
agreed on the telephone you will hold this document to our order
pending receipt by us of satisfactory final searches " and various other
C conditions. ". . . Pending clarification of all the above points by way
of confirmation you will hold the executed lease to our order and also
continue to hold the sum of £937*50"—the first quarter's rent—
" Yours faithfully, Paul Woolf & Co."—the tenants' solicitors—" P.S.
Our company agents advise us that there is an undischarged charge in
favour of Northern Commercial Trust Ltd. and we shall also require
your undertaking in respect of this."
The landlords' solicitors replied on the same day:
" We thank you for your letter of today's date enclosing the lease, duly
executed . . . We presume it is acceptable that we date the lease
today?"—that is, November 1, 1976— "We enclose herewith our
clients' part of the lease duly executed by way of exchange . . . Yours
E faithfully, Martin Boston & Co."—the landlords' solicitors.
Those letters were written on Monday, November 1, 1976. On the following
Monday, November 8, 1976, the tenants' solicitors wrote to the landlords'
solicitors. They took no objection to the date being inserted—November 1,
1976. They simply said:
" Thank you for your letter of November 1 with enclosures as therein
stated. Unfortunately there still appears to be a problem regarding the
mortgage to Northern Commercial Trust Ltd. . . . Our client is anxious
to complete this matter and indeed we did try to telephone your Mr.
Boston on Friday without success."
That was Monday, November 8. On the next day, Tuesday, November
Q 9, the tenants decided to call off the whole thing. Their solicitors telephoned
to the landlords' solicitors. They replied that they regarded the transaction
as binding. The tenants' solicitors wrote this letter on Tuesday, November
9, 1976:
". . . As explained on the telephone today our client has decided to
withdraw from the transaction and we should be obliged if you would
JJ return our client's cheque in the sum of £937-50 which, under the terms
of our letter dated November 1, you are still holding to this firm's
order. As explained on the telephone we very much regret the lateness
of our client's decision and we must confess we were surprised to hear
518
Lord Denning MJR. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
from you that you considered the transaction to have been com-
pleted "
So there it was. The landlords' solicitors considered that the transaction
was binding. The tenant's solicitors said it was not binding. Two days later,
on Thursday, November 11, 1976, the landlords' solicitors issued a writ
claiming a declaration that the lease and counterpart were binding; alter-
natively, that it was an escrow. The defendants denied it.

The decision of Whitjord J.

The action took a year to come on. Then on November 14 and 15,1977,
it was tried by Whitford J. At the end of the day it was accepted by both
sides that the lease was delivered as an escrow on the terms set out in the
tenants' solicitors' letter of November 1, 1976. The only question was
whether the various conditions had been fulfilled. It was accepted that all C
had been fulfilled save for the postscript requiring an undertaking about the
" undischarged charge in favour of Northern Commercial Trust Ltd." It
would have been quite easy to fulfil this but the landlords' solicitors had not
done it. The tenants' solicitors submitted that it was too late for them to do
it. But Whitford J. held otherwise: see Alan Estates Ltd. v. W. G. Stores
Ltd. (unreported), November 15, 1977. He said: D
" I reject the conclusion that is urged upon me by counsel on behalf
of the [tenants] that it is now too late for the [landlords] to satisfy the
outstanding condition. They ought to have had a reasonable time after
November 8, 1976, to meet this last condition contained in that letter
then outstanding, and I am prepared to give them a reasonable time to
satisfy that condition and accordingly to make the transaction binding JJ
to date."
The landlords did satisfy the condition on November 18, 1977, so the lease
became binding.
At the end of the hearing before Whitford J., counsel then raised the
question of rent. From what date was it payable? Whitford J. said: " There
is nothing about this in the pleadings in this connection at all. I am not F
prepared to deal with it."

These proceedings
So these proceedings were commenced to ascertain the date from which
rent was payable. Was it from November 1, 1976, when the lease and
counterpart were exchanged? Or from November 18, 1977, when the last Q
condition was fulfilled?
The landlords took out an originating summons to determine it. Judge
Rubin held that the rent was only payable from November 18, 1977. The
landlords appeal.

The blank in the lease

The difficulty has arisen because of the blank in the lease. No date was
inserted. But the rent was to run " from the date hereof." So we have the
problem: from what date is the rent to run?
 519
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (CA.) Lord Denning M.R.
. Something may turn on the wording of the document. So I will set it
out. The lease was in this form:
" This lease is made the day of one thousand nine
hundred and seventy-six between Alan Estates Ltd. . . . and W. G.
Stores Ltd. . . . the landlord hereby demises unto the tenant all that
property described in the first schedule hereto . . . to hold the demised
premises unto the tenant for a term of twenty-four years from the
twenty-ninth day of September one thousand nine hundred and seventy-
six (determinable as hereinafter provided) paying therefor unto the
landlord from the date hereof and throughout the said term hereby
granted yearly and proportionately for any fraction of a year the
several rents hereinafter referred to: A. Until the twenty-ninth day of
September one thousand nine hundred and eighty the yearly rent of
C three thousand two hundred and fifty pounds (£3,250) . . .
" In witness whereof the parties hereto have hereunto set their
respective common seals and hands and seals as appropriate the day
and year first before written . . .
The common seal of )
W. G. Stores Ltd. )
D was hereunto affixed in the ) [Seal]
presence of )
[signed] B. Solomons Director.
[signed] B. Solomons Secretary."
// there had been no repudiation
g In order to solve the problem, I would ask this question: suppose the
tenants had not repudiated their obligations. What date would have been
inserted in the lease? I feel sure that the solicitors would have inserted
November 1, 1976. I say this because of the letter of the landlords' solici-
tors of November 1, 1976, in which they said: "We presume it is
acceptable that we date the lease today?"—to which the tenants' solicitors
took no objection. In addition, both lease and counterpart were exchanged
F on November 1, 1976, and by analogy with contract and conveyances of
land, the effective date when the parties are bound is the date of exchange:
see Eccles v. Bryant and Pollock [1948] Ch. 93 and Harrison v. Battye
[1975] 1 W.L.R. 58.
However, no date was inserted. It remained blank. The reason was
because the tenants repudiated the transaction altogether. They denied that
Q the tenants were bound. I cannot think that they can take advantage of their
own repudiation, so as to postpone the date of the deed, or the term from
which rent should run. No one can take advantage of his own wrong. We
should insert the date which would have been inserted had they not re-
pudiated. That is November 1, 1976. The rent should run from that date.
In case this simple solution be erroneous, I must go on to deal with
the law about escrow.
H
When does an escrow take effect?
Another way of approaching the problem is to ask: at what date does
520
Lord Denning M.R. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
an escrow take effect? On the date when the deed is delivered? Or on the .
date when the conditions are fulfilled? Judge Rubin held:
" . . . a deed, delivered as an escrow, takes effect from the satisfaction
of the condition and not from the date of its delivery as an escrow.
Applied to the present case, in my judgment both lease and counterpart
took effect together on the satisfaction of the condition on November
18, 1977, and, accordingly, such date is ' the date hereof,' and the rent
ought to be calculated from and become payable from that date." B
In coming to this conclusion Judge Rubin felt that he had the clearest
possible authority in the judgment of Walton J. in Terrapin International
Ltd. v. Inland Revenue Commissioners [1976] 1 W.L.R. 665. Walton J.
said of an escrow, at p. 669:
" . . . although of course it contains within itself the possibility of be- Q
coming an effective deed, a deed rising phoenix-like from the ashes of
the escrow, at the stage before the condition is fulfilled it is of no effect
whatsoever."
To the contrary, however, is the dictum of Vaisey J. in In re Duke of
Devonshire's Settlement (1952) 31 A.T.C. 399, 405:
". . . as a rule the date properly to be inserted in a deed delivered as ^
an escrow is the date at which it was so delivered and not the date
when the condition of the delivery has been fulfilled."

The doctrine of escrow

The doctrine of escrow is a relic of mediaeval times. It dates from the
time when conveyances were made by feoffment and livery of seisin. It E
has survived to the present day and often operates in regard to con-
veyances of land or the creation or disposition of estates and interests in
land such as a term of years. It has changed its features much since the days
of Sheppard's Touchstone of Common Assurances, 7th ed. (1820), vol. I
and Preston's Abstracts, 2nd ed. (1824), vol. III. We no longer speak of
a first delivery or a second delivery. But it does predicate a document which p
is executed and delivered. The accustomed formula is " signed sealed and
delivered." When that formula is used in the document and it is signed
by the party—or in the case of a company its seal is affixed—and attested
by a witness with intent by the maker that it should be binding on him, it
is conclusively presumed to be " signed sealed and delivered." If it is
handed over to another unconditionally, it is delivered as a deed. If it is
handed over to another conditionally, it is delivered as an escrow. It only G
becomes a deed when the conditions are fulfilled.
Thus far there can be no dispute. The question in this case is: what is
the effect of an escrow before the conditions are fulfilled? One thing is
clear. Whilst the conditions are in suspense, the maker of the escrow cannot
recall it. He cannot dispose of the land or mortgage it in derogation of
the grant which he has made. He is bound to adhere to the grant for a JJ
reasonable time so as to see whether the conditions are to be fulfilled or not.
If the conditions are not fulfilled at all, or not fulfilled within a reasonable
time, he can renounce it. On his doing so, the transaction fails altogether. It
 521
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Lord Denning M.R.
. has no effect at all. But if the conditions are fulfilled within a reasonable
time, then the conveyance or other disposition is binding on him absolutely.
It becomes effective to pass the title to the land or other interest in the
land from the grantor to the grantee. The title is then said to " relate back "
to the time when the document was executed and delivered as an escrow. But
this only means that no further deed or act is necessary in order to perfect
the title of the grantee. As between grantor and grantee, it must be regarded
B as a valid transaction which was effective to pass the title to the grantee as
at the date of the escrow: see Perryman's Case (1599) 5 Co.Rep. 84a. But
this doctrine of " relation back " does not operate so as to affect dealings
with third parties: see Butler and Baker's Case (1591) 3 Co.Rep. 25a. So
far as the grantee is concerned, whilst the conditions are in suspense, he gets
no title such as to validate his dealings with third persons. He cannot collect
P rents from the tenants. Nor can he give the tenants notice to quit. He cannot
validly mortgage the land, though, if he purports to do so, the mortgage
might be " fed " later when he acquires the title.
Such are the principles which I deduce from the very learned work of
Williams on Real Property, 19th ed. (1901), p. 151, note (k), and the authori-
ties cited therein, and from the judgments of Farwell L.J. in Governors
and Guardians of the Foundling Hospital v. Crane [1911] 2 K.B. 367, 377,
D and Lord Cross of Chelsea in Security Trust Co. v. Royal Bank of Canada
[1976] A.C. 503, 517. I said likewise in Wm. Cory & Son Ltd. v. Inland
Revenue Commissioners [1964] I W.L.R. 1332, 1341. I realise that both
Diplock L.J. and Lord Reid said otherwise: see [1964] 1 W.L.R. 1332,
1346 and [1965] A.C. 1088, 1107-1108. But they had not the benefit of
having had cited to them the earlier authorities and their observations are
p said in the latest textbook to be erroneous: see Emmet on Title, 17th ed.
* (1978), p. 650.
What date is to be inserted?
The question in this case is as between grantor and grantee. The counter-
part lease was executed (a day or two beforehand) and delivered in escrow
on November 1, 1976. In exchange the lease was executed (a day or two
F beforehand) and delivered in escrow on November 1, 1976. The date of
delivery in escrow was, therefore, November 1, 1976. The conditions were
fulfilled on November 18, 1977. Thereupon the title related back to the
delivery on November 1, 1976. That is the date to be inserted in the lease
as " the date hereof." For this purpose we go back to Coke upon Littleton,
18th ed. (1823), vol. 1, p. 46b:
G "If the habendum be for the terme of 21 years, without mentioning
when it shall begin, it shall begin from the deliverie, for there the
words take effect, as is aforesaid. If an indenture of lease beare date
which is void or impossible, as the thirtieth day of Februarie, or the
fortieth of March, if in this case the terme be limited to begin from
the date, it shall begin from the deliverie, as if there had been no
date at all."
Conclusion
This case has taken us back to the language and thought of the
mediaeval lawyers. The result is that the tenants must pay the rent of the
522
Lord Denning M.R. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
lock-up shop from November 1, 1976, and not from November 18, 1977. .
This seems to me the just result. It would not be right that the tenants, by
repudiating their obligations on November 9, 1976, should thereby get
out of paying any rent for a whole year, whilst the issue was being litigated
—in which they were found to be wrong.
I would therefore allow the appeal.

ACKNER L.J. The habendum in the lease, the subject matter of this B
dispute, provides for
" . . . a term of 24 years from the twenty-ninth day of September
one thousand nine hundred and seventy-six (determinable as herein-
after provided) paying therefor unto the landlord from the date
hereof . . . the several rents hereinafter referred to . , ."
" The date hereof " is a reference back to the date of the execution of the C
lease. But the lease is not dated. The question which we have to decide
is: from what date did the obligation to pay rent begin? Was it November
1, 1976, the date when the lease was executed by the landlords in escrow,
the condition being the unconditional delivery by the tenants of the counter-
part, or November 18, 1977, when for the first time the only outstanding
term under which the counterpart had been delivered—the production j>
of a certified copy of the transfer of the mortgage—was satisfied?
This appeal thus raises the short but by no means simple question:
from what date does an escrow become operative—from the date it was
delivered as an escrow, or from the date when the conditions subject to
which it was delivered have all been satisfied? At first instance the judge
found in favour of the second alternative. He held that the execution of a
lease only occurred when it was signed, sealed and unconditionally "
delivered.

The nature of an escrow

" If an instrument be delivered to take effect on the happening of a
specified event, or upon condition that it is not to be operative until
some condition is performed, then pending the happening of the event F
or the performance of the condition the instrument is called an
escrow:" Norton on Deeds, 2nd ed. (1928), p. 18.
" . . . the maker [of a deed] may so deliver it as to suspend or
qualify its binding effect. He may declare that it shall have no effect
until a certain time has arrived, or till some condition has been per-
formed, but when the time has arrived, or the condition has been Q
performed, the delivery becomes absolute, and the maker of the deed
is absolutely bound by it, whether he has parted with the possession
or not. Until the specified time has arrived, or the condition has been
performed, the instrument is not a deed. It is a mere escrow," per Lord
Cranworth in Xenos v. Wickham (1867) L.R. 2 H.L. 296, 323.
This view of the nature of an escrow was accepted by Diplock L.J. in „
Wm. Cory & Son Ltd. v. Inland Revenue Commissioners [1964] 1 W.L.R.
1332,1346. He said:
" So long as it remains an escrow it is not yet executed as a deed; for
 523
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Ackner LJ.
. delivery again as a deed is required before it becomes one. While an
escrow it conveys nothing, it transfers nothing."
However, a party who executes a deed of transfer as an escrow has no
locus poenitentiae. It is well established that during the intervening time
between the execution of the escrow and the satisfaction of the condition
subject to which it was so delivered, the maker of the escrow cannot with-
D draw. He cannot recall it or repudiate it. He must await the event to see
whether or not the condition is fulfilled: see Beesly v. Hallwood Estates
Ltd. [1961] Ch. 105; Vincent v. Premo Enterprises {Voucher Sales) Ltd.
[1969] 2 Q.B. 609 and Kingston v. Ambrian Investment Co. Ltd. [1975]
1 W.L.R. 161, 166. The dictum to the contrary by Lord Reid in Wm. Cory
& Son Ltd. v. Inland Revenue Commissioners [1965] A.C. 1088, 1108 is
generally accepted as being per incuriam: see Emmet on Title, 17th ed.,
C p. 650, referring to the decision of Walton J. in Terrapin International
Ltd. v. Inland Revenue Commissioners [1976] 1 W.L.R, 665, 669-670
(a case to which I shall make a more detailed reference hereafter).
While this is clearly an important characteristic of an escrow, it does
not seem to me to relate to the problem we have to solve. It is, of course,
common ground that all the conditions subject to which the escrow was
, , delivered have now been satisfied. This escrow had, therefore, ceased, so to
speak, to be in suspended animation and we are not, therefore, concerned
with what might have been the position during the interregnum between
the execution of the escrow and the satisfaction of the conditions.

The doctrine of relation back

E In Preston's Abstracts, 2nd ed., vol. Ill (1824), p. 65, the law is stated as
follows:
" The rules respecting escrows are, 1st, The writing will not operate
as a deed till the second delivery. 2dly, The party deputed to make
the second delivery, cannot give effect to the writing by delivering
the same before the conditions are performed. 3dly, On the second
delivery of the writing, it will have relation, for the purposes of
^ title, and not for the purpose of giving a right to the intermediate
rents, &c. from the delivery. 4thly, So as the conditions be per-
formed, and the deed delivered a second time, the deed will be good,
notwithstanding the death of both or either of the parties before the
second delivery."
_ These observations have frequently been cited with approval: see in
particular Governors and Guardians of the Foundling Hospital V. Crane
[1911] 2 K.B. 367, 377, per Farwell L.J. The reference to a second delivery
was because under the old law an escrow had to be delivered to a third
party—not to the person intended to take thereunder since otherwise there
would have been a technical delivery. On the fulfilment of the condition
the third party would then deliver it to the person intended to take there-
H under. The limited nature of this doctrine is apparent from the following
observations of Lord Cross of Chelsea giving the opinion of the Privy
Council in Security Trust Co. V. Royal Bank of Canada [1976] A.C.
503, 517:
524
Ackner LJ. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
" On fulfilment of the condition subject to which it was delivered as
an escrow, a deed is not taken to relate back to the date of its delivery
for all purposes, but only for such purposes as are necessary to give
efficacy to the transaction—ut res magis valeat quam pereat (see
Butler and Baker's Case (1591) 3 Co.Rep. 25a). Thus the fact that
the grantor has died before the condition of an escrow is fulfilled does
not entail the consequence that the disposition fails. If and when the
condition is fulfilled the doctrine of relation back will save it, but B
notwithstanding the relation back for that limited purpose the grantee
is not entitled to the rents of the property during the period of sus-
pense or to lease it or to serve notices to quit (see Sheppard's Touch­
stone of Common Assurances, p. 60: Thompson v. McCullough
[1947] K.B. 447)."
This doctrine does not seem to me to advance the landlords' case. c
I return now to Terrapin International Ltd. v. Inland Revenue Com­
missioners [1976] 1 W.L.R. 665, which raised for decision the correct rate
of stamp duty payable upon a document originally delivered as an escrow.
Walton J., to decide this question, considered that he had to go back to
first principles as to the nature of escrows. Having cited from Preston's
Abstracts, 2nd ed., vol. Ill, in the terms referred to above, he went on
to say, at p. 669:
" A document which is intended to take effect as a deed when certain
conditions have been fulfilled may be executed as an escrow: that is
to say, with all the formalities of a deed save that the vital uncon-
ditional delivery, which is essential for the proper execution of a true
deed, is missing; it is replaced by a conditional delivery, usually
express, but capable of being assumed. At this stage, the document is E
not a deed; and although of course it contains within itself the
possibility of becoming an effective deed, a deed rising phoenix-like
from the ashes of the escrow, at the stage before the condition is
fulfilled it is of no effect whatsoever."
Having quoted from the judgment of Diplock L.J. in Wm. Cory & Son
Ltd. V. Inland Revenue Commissioners [1964] 1 W.L.R. 1332, 1346, to F
which I have made reference above, he continued [1976] 1 W.L.R. 665,
670:
" If I may repeat the crucial passage: ' So long as it remains an escrow
it is not yet executed as a deed; for delivery again as a deed is
required before it becomes one.' It follows, in my judgment, that...
the first date on which the deed of exchange which is the subject Q
matter of the present appeal was executed was on the day on which
the conditions were fulfilled and it was in the eye of the law for the
first time delivered unconditionally, and thus for the first time
delivered as a deed; . . ."
After anxious hesitation, having had the advantage of reading in draft
the judgments of Lord Denning M.R. and Sir Denys Buckley, I agree with JJ
Walton J., as did Judge Rubin. A deed delivered as an escrow takes effect
from the satisfaction of the conditions and not from the date of its delivery
as an escrow.
 525
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Ackner J.
. I am conscious that in reaching this decision I am not following the
dictum of Vaisey J. in In re Duke of Devonshire's Settlement, 31
A.T.C. 399, 405. The judge was not, however, dealing with an escrow, nor
apparently was this point the subject matter of argument, and it certainly
did not arise for his decision. Moreover, it is clear from the observations
made by counsel at the conclusion of the judgment that for the special
reasons referred to the case had been taken out of its turn and dealt with
B with special expedition.
Thus, with all proper diffidence, I also would decide that both lease
and counterpart took effect together on the satisfaction of the condition on
November 18, 1977, and accordingly such date is " the date hereof."

SIR DENYS BUCKLEY. It v/as common ground between the parties in

Q the 1976 action that the counterpart lease was executed in escrow by the
tenants. Whitford J.'s judgment proceeded explicitly on that basis and that
judgment is undisturbed. It is common ground before us that the con-
ditions of that escrow were fully satisfied on November 18, 1977. The
question for decision in the present proceedings is how, in the circum-
stances set out in the judgment of Lord Denning M.R., the expression
" from the date hereof" should be interpreted. The landlords say that it
^ signifies November 1, 1976; the tenants say that it signifies November 18,
1977. The determination of the question depends in my view upon the true
effect of the delivery of a deed in escrow. The law in this respect is ancient
but has not become anachronistic. Deeds are not uncommonly delivered in
escrow today.
The tenants' argument is to the effect that a document delivered as an
E escrow does not acquire any of the characteristics of a deed until the
conditions of the escrow have been fulfilled. Thereupon unconditional
delivery of the document as the deed of the maker takes place, and the
document is then for the first time effective as a deed. Since the essential
characteristics of a deed are that it is a written instrument which has been
signed, sealed and delivered, an escrow cannot rank as a deed until there
_ has been unconditional delivery.
The landlords' argument on the other hand is to the effect that as soon
as the instrument is delivered in escrow it has all the characteristics of a
deed save in one respect, which is that although the instrument is binding
on the maker from the moment when it has been signed, sealed and de-
livered in escrow, so that he cannot resile from it, it has otherwise no
operative power or effect until the condition of the escrow has been ful-
G filled. It is consequently a deed ab initio, but subject to a temporary re-
striction on its operative effect. It is a deed the operative effect of which,
but not its binding quality, has been suspended by the maker until a
certain event or time by the manner in which he has delivered it.
Over the ages the books contain many authoritative statements of what
constitutes an escrow. It is not easy to reconcile all of them. They can be
JJ found collected in Norton on Deeds, 2nd ed. (1928)—itself a work of great
authority—pp. 18 et seq. The difficulty in reconciling some of these
statements derives, I think, from a difficulty in being sure in precisely what
sense the various writers use the word " deed." Norton starts his work
526
Sir Denys Buckley Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982]
with a discussion of how difficult it is to give a satisfactory definition of a
deed. His own definition is at p. 3 of the second edition. Three of its "■
essential requirements are (1) writing, (2) sealing and (3) delivery. Since
January 1, 1926, an individual executing a deed must sign it or put his
mark upon it: section 73 of the Law of Property Act 1925. It is universally
accepted that to constitute a deed a written instrument must have been
" delivered " by the maker of it.
" Delivery " for this purpose is not to be confused with any form of B
exchange of documents or of physical delivery of the instrument to some-
one other than the maker.
" . . . no particular technical form of words or acts is necessary to
render an instrument the deed of the party sealing it. The mere
affixing the seal does not render it a deed; but as soon as there are acts
or words sufficient to shew that it is intended by the party to be p
executed as his deed presently binding on him, it is sufficient:" Xenos
v. Wickham, L.R. 2 H.L. 296, 312, per Blackburn J.
It is a question of intention and fact to be tried by the jurors: per Pigott B.
in the same case at p. 309.
The maker of the deed may retain it physically in his own possession
and yet " deliver " it so long as he makes clear that he intends it as his
deed presently binding on him. Anything which shows that he treats the D
instrument as his deed will suffice: Tupper v. Foulkes (1861) 9 C.B.N.S.
797, 809, per William J. If, however, an instrument intended to take effect
as a deed be delivered with the intention that it shall operate only at some
future time or on the happening of a specified event, or upon condition
that it shall not be operative until some condition is performed, it is said
to be delivered as an escrow. E
" . . . the maker may so deliver it [the instrument] as to suspend or
qualify its binding effect. He may declare that it shall have no effect
until a certain time has arrived, or till some condition has been per-
formed, but when the time has arrived, or the condition has been
performed, the delivery becomes absolute, and the maker of the deed is
absolutely bound by it, whether he has parted with the possession or p
not. Until the specified time has arrived, or the condition has been per-
formed, the instrument is not a deed. It is a mere escrow ": Xenos v.
Wickham, L.R. 2 H.L. 296, 323, per Lord Cranworth.
Again no special form of words is necessary to constitute delivery of an
instrument delivery as an escrow: it is a question of intention, however that
intention may be displayed. After the happening of the event or the per-
formance of the condition upon which the delivery of an escrow was made,
the instrument operates as a deed without any further delivery.
It has been accepted as common ground by the parties in this case
that, once the maker of an instrument has delivered it as an escrow, he
cannot by any means withdraw from it or alter it: see Beesly v. Hallwood
Estates Ltd. [1961] Ch. 105 and Kingston v. Ambrian Investment Co. Ltd.
[1975] 1 W.L.R. 161, 166. It may perchance never take effect because the H
condition or event upon which the instrument is intended to become opera-
tive never occurs, but otherwise it will certainly take effect upon the satis-
faction of that condition or the occurrence of that event. The maker, having
 527
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Sir Denys Buckley
delivered the instrument, has lost all control and dominion over it. It is as
binding upon him as if he had delivered it unconditionally.
I am much disposed to think that the effect of delivery upon a deed is
the same as the effect of delivery upon an escrow. Each renders the
delivered instrument inescapably binding upon the deliverer. The difference
between a deed and an escrow lies not in the binding quality of the instru-
ment but in the time and circumstances at and in which the obligation can
B be enforced. For my part I should be prepared to hold that an instrument
delivered in escrow is as much a deed as is a precisely similar instrument
delivered unconditionally in the first instance save that the operative effects
of the instrument are suspended while it remains in escrow. In Xenos
v. Wickham, L.R. 2 H.L. 296, 323, in the passage I have already cited,
Lord Cranworth used language suggesting that, until the time specified
£ for the maturity of the escrow has arrived or the condition of the escrow
has been satisfied, the instrument is not a deed: it is a mere escrow. And
in Governors and Guardians of the Foundling Hospital v. Crane [1911] 2
K.B. 367, 377, Farwell L.J. said:
" Now an escrow or script is not a deed at all; it is a document de-
livered upon a condition on the performance of which it will become a
j-j deed, and will take effect as from the delivery, but until such per-
formance it conveys no estate at all."
Lord Cranworth it seems to me was clearly using the term " deed " to des-
cribe an instrument binding on the grantor and immediately enforceable
against him. Farwell L.J. was considering whether the instrument in
question in his case was capable of having conveyed a legal estate, i.e. was
E a deed in the full sense. In the event, however, the document was held not to
have been delivered at all. Norton on Deeds, 2nd ed. does not deal with
the point, but more modern writers seem to favour the view that an escrow,
while it remains in escrow, is not a deed: see e.g. Halsbury's Laws of
England, 4th ed., vol. 12 (1975), p. 527, para. 1334. It is perhaps merely a
matter of semantics whether an instrument which is delivered as an escrow
P should properly be described as a deed, the operative effect and so the
enforceability of which are temporarily suspended, or as a document deli-
vered upon a condition on the performance of which (and not before) it
will become a deed. The substantial point, I think, for the purposes of this
question of construction, is that the maker cannot resile from the terms and
effect of the document which he has " delivered " notwithstanding that he
may have delivered it in circumstances which for the time being deprive it
G of operative effect and enforceability.
I have laboured this point perhaps at undue length because it seems to
me to have an important bearing upon the meaning to be attributed to the
words " the date hereof " in the present case. The date was left blank in
both the lease and the counterpart; the dates which are now to be found
there were inserted later and not by agreement. So we are left to discover
U the date of the lease from extrinsic evidence. We must surely look for the
date when the lease first had some legal effect. That was when the lease and
counterpart were delivered in escrow, i.e. November 1, 1976. True, it can-
not then have vested a legal term in the tenants, but it created a state of
528
Sir Denys Buckley Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) [1982J
affairs in which the landlords could do nothing with the property inconsis- .
tent with their ability to implement their grant upon the instant of the
fulfilment of the conditions attached to the escrow. On the facts the
lease and counterpart were both in my opinion delivered in escrow on
November 1, 1976.
I agree with Lord Denning M.R. that if the tenants had not repudiated
the bargain, it is likely that the solicitors would have inserted the date
November 1, 1976, in both the lease and the counterpart; but for my part I B
prefer to base my decision on the reasons contained in the last preceding
paragraph of this judgment rather than upon the first ground adopted by
Lord Denning M.R.
When the conditions of an escrow are fully satisfied, so that it becomes
an immediately operative deed, that effect relates back to the date of its
delivery in escrow, but not for all purposes—only for such purposes as are
c
necessary to give effect to the transaction (Security Trust Co. v. Royal Bank
of Canada [1976] A.C. 503, 517, per Lord Cross of Chelsea), which I take
to mean all the terms and provisions of the instrument which remain capable
of being given effect to implement the bargain between the parties, A grant
in escrow of a lease, or an assignment in escrow of the reversion to a lease,
falling within section 52 (1) of the Law of Property Act 1925, cannot while it
remains in escrow convey or create any legal estate which did not previously p
exist. It cannot, accordingly, while the instrument remains in escrow,
create the legal relationship of reversioner and tenant. So during the sub-
sistence of the escrow the intended reversioner is not at law the reversioner
upon a term vested at law in the tenant. Accordingly the grant or assign-
ment, while it remains in escrow, will not entitle the intended reversioner to
demand the rents nor to serve notices to quit: Security Trust Co. v. Royal
Bank of Canada [1976] A.C. 503, 517. But if the intention of the parties E
was that, upon the escrow ceasing to be such, the rights and liabilities of
the parties should be treated as being those which would have arisen if the
instrument had been delivered absolutely and not as an escrow in the first
place, the lease, when it ceases to be an escrow and becomes an effective
deed, is, it seems, to be given effect as between the parties, so far as prac-
ticable, as though the term had vested in the tenant and the reversion in p
the reversioner when that would have occurred if the instrument had been
originally delivered unconditionally. Certainly for the purpose of ascertain-
ing the date when the term will expire it must be calculated from the date,
if any, specified in the lease. Where no such date is specified, see Coke upon
Littleton, 18th ed., vol. I, p. 46b. In this case that period is specified as
" twenty-four years from the twenty-ninth day of September one thousand
nine hundred and seventy-six. . . ." The term will expire on September 29, O
1996. Similarly the periods by reference to which instalments of rent are to
be calculated must, I think, be ascertained as though the lease had not been
delivered in escrow but unconditionally. In this case that period runs
" from the date hereof and throughout the said term hereby granted "
It is of course perfectly possible that a lease should reserve a rent to be
calculated as from a date anterior to the date on which the lease takes JJ
effect. There is nothing here to make November 1, 1976, an inappropriate
date to treat as " the date hereof " when construing the redendum of the
lease.
 529
1 Ch. Alan Estates Ltd. v. W. G. Stores Ltd. (C.A.) Sir Denys Buckley
. As a matter of construction there can, in my opinion, be only one " date
hereof." If the lease dates back for any purpose to the original delivery,
that date must in my judgment be the " date hereof " within the meaning
of the lease.
For these reasons I am of opinion that, according to the true construc-
tion of the lease, in the events which have happened, " the date hereof
means November 1, 1976.1 would accordingly allow this appeal.
B
Appeal allowed with costs.
Leave to appeal refused.

Solicitors: Martin Boston & Co.; Wool] Seddon.

P [Reported by MICHAEL HAWKINGS, ESQ., Barrister-at-Law]

p [COURT OF APPEAL]

MIDLAND BANK TRUST CO. LTD. AND ANOTHER V. GREEN

AND ANOTHER (NO. 3)

[1970 G. No. 334]

E
1981 June 8, 9, 10 Lord Denning M.R., Fox L.J.
and Sir George Baker

Conspiracy—Husband and wife—Civil liability—Conspiracy be­

tween husband and wife to defeat option granted to their son
—Whether spouses one person in law—Whether liable for
damages in conspiracy
F
An option to purchase a farm, granted in 1961 by a father
to his son, had not been registered when in 1967 the father,
wishing to deprive the son of the option, conveyed the farm at
a gross undervalue to his wife. In 1970, after the mother's
death, the son commenced proceedings (carried on after his
death by his executors, the present plaintiffs) alleging, inter
alia, that the father and mother had conspired together to
G defraud and injure him by depriving him of the benefit of the
option and seeking, inter alia, damages for conspiracy against
the mother's estate and the father. Following the death of the
father in 1972, his executrix became a defendant to the action
which in the event proceeded to judgment as undefended by
her, and an inquiry as to damages was ordered. The executrix
later moved to set aside the judgment, as a defendant who had
not appeared at the trial, on the ground that the only parties
" to the alleged conspiracy being husband and wife were in-
capable in law of conspiring together. The motion was
dismissed.
On appeal by the executrix from the dismissal of her motion