Filip Saranovic, 29, drew up papers for the property deal and explained the basics to his “ill-educated” brother, Nikola, 41. He did not tell him about a clause allowed either sibling to force through the sale of the flat.
Nikola, faced with being left without a home, challenged the legality of the deal. He claimed his younger brother, who was educated at Cambridge and Harvard and is now a lecturer in maritime law at the University of Southampton, had taken advantage of his trust.
However, a judge at Central London county court has ruled Filip did nothing wrong and that Nikola should have sought legal advice before signing.
The brothers bought the flat in Holmdale Road in June 2014 with money given to them by their mother, discussing the deal at the coffee shop before signing documents drawn up by Filip.
While Nikola was looking at the flat as a family home, his brother’s “primary” reason for buying it was a lucrative plan to develop several attached garages.
Judge Michael Berkley agreed Nikola “had no express knowledge” of the sale clause and had relied on his brother “to explain that important part of the transaction”. But he ruled Filip had “done nothing wrong” and that Nikola, who is “not a details man”, hadn’t paid enough attention to the papers he was signing.
Nikola, his wife Bojana and their four-year-old daughter have now been given two months to vacate the flat, and could face a £200,000 bill for the cost of the legal battle.
Judge Berkley found Filip, who owns two other flats in Cambridge and Southampton, had lived up to the “duty of candour” he owed his brother and was entitled to expect Nikola would take independent advice before signing.
Under the terms of the deal, Nikola could live at the flat rent-free but a clause was inserted to allow either brother to force the sale of the property after a year.
Martin Young, for Nikola, said the brothers previously enjoyed a “good relationship” but the legal battle had caused a deep divide in their family.
“What Nikola wanted all along was to keep the home that he thought would be his for as long as he wanted it,” he said. “Filip knew that Nikola was relying on him to know the nature of the document he was signing. He thought the flat was going to buy a home for him and his family for the foreseeable future.” Jonathon Upton, for Filip, said: “Nikola didn’t ask anyone to explain [the deed] to him. He didn’t read the covering letter. He didn’t take any care.”
In his ruling, Judge Berkley said Nikola “is not as dynamic as Filip” and trusted his brother to explain the document, but was “willing to sign whatever Filip told him to sign, provided that he had the basic impact explained to him”.
“I find that Filip chose not to explain the detail of the express power of sale and in particular the fact that either party could elect to sell the property against the other’s wishes after a year.
“I cannot find anything that Filip did wrong. It is very unfair and inequitable to say that Filip asserted undue influence in anything that he did.”
The judge ordered that the flat can go on the market in a month to give Nikola and his family some time to “adjust to the idea” of leaving their home. He also said he would consider a written plea for a reduction of Nikola’s costs from the court case, estimated at £200,000.