Ang Kok Kuan v Ang Boh Seng and Others

• Jurisdiction: Singapore
• Judge: Chao Hick Tin J
• Judgment Date: 20 August 1993
• Neutral Citation: [1993] SGCA 59
• Docket Number: Civil Appeal No 115 of 1992
• Date: 20 August 1993
• Year: 1993
• Published date: 19 September 2003
• Plaintiff Counsel: V Ramakrishnan (V Ramakrishnan & Co)
• Citation: [1993] SGCA 59
• Defendant Counsel: Joseph Chellappan (WT Woon & Co)
• Court: Court of Appeal (Singapore)
• Subject Matter: Words and Phrases,Unsatisfactory reply,Conditions of sale,Road-widening line affecting 16% of property,Sale of land,'Unsatisfactory reply to requisition',No immediate plan by PWD to widen the road and no present plans for redevelopment of property,Land,Legal Requisition

Cur Adv Vult

This is an appeal by the defendant against a decision of the learned judicial commissioner, KS Rajah, ordering him to refund to the plaintiffs a sum of $59,000, being the deposit paid by the plaintiffs to the defendant in relation to an abortive purchase of a property at No 252/252A Jalan Kayu, Singapore (`the property`). [See Ang Boh Seng & Ors v Ang Kok Kuan [1993] 1 SLR 161 .]

The facts giving rise to this action are, briefly, as follows. On 1 September 1983 the owners of the property, Tan Tou Nam and Tan Tock Heng, granted an option to one Ang Kok Kuan, the defendant herein, to purchase the property at a sum of $510,000. The option was addressed to `Ang Kok Kuan/Nominee (I/C No 0954317A)`. The defendant paid the owners $5,000 for the option, which was to remain open for acceptance until 4pm on 15 September 1983. Under cl 12 of the option it was provided that the owners `shall pay Ang Kok Kuan 2% commission on successful completion of the sale`. It would be noted that the option was addressed to the defendant or his nominee.

Under cl 6 of the option it was provided that:

The property is sold subject to the purchaser`s solicitors receiving satisfactory answers to all requisitions sent or to be sent by them to the various government departments and in the event of any of the answers to such requisitions being found unsatisfactory to the purchaser or the purchaser`s solicitors, the purchaser may annul the sale in which event the 10% deposit paid shall forthwith be refunded to the purchaser without any interest or deductions whatsoever ...

With that option in hand, the defendant went about looking for a purchaser for the property. On 7 September 1983 he found the plaintiffs who eventually were prepared to pay $590,000 for it.

The defendant had previously instructed one Mr YK Yong, a solicitor, to act for him in his property deals. He persuaded the plaintiffs to also instruct Mr Yong to act for them, even though initially the plaintiffs, who were first time property buyers, would have preferred to instruct their own solicitors. On 14 September 1983, when the parties appeared before Mr Yong, he also persuaded the plaintiffs to allow him to act for them. The plaintiffs agreed. On the evidence and as found by the judicial commissioner, the plaintiffs clearly indicated to Mr Yong, and it was understood between the plaintiffs and the defendant, that the plaintiffs would not want the property to be affected by any road widening, drainage, MRT or sewerage works.

A formal agreement for the sale and purchase was drawn up by Mr Yong wherein the defendant was the vendor and the plaintiffs, the purchasers. Clause 3 of the agreement provided as follows:

The sale is subject to the purchaser receiving satisfactory replies to all requisitions (whether on title or to the various government departments). In the event of any such replies being unsatisfactory the purchaser may annul the sale in which event the deposit and all other moneys paid hereunder without interest shall be refunded to the purchaser.

Having executed the sale and purchase agreement with the defendant, the plaintiffs were also asked to sign the option. There is a conflict in evidence as to whether Mr Yong had explained the contents of the option to the plaintiffs before they signed. The plaintiffs said Mr Yong never did. The plaintiffs thought that the option document was part of the documents they had to sign to purchase the property from the defendant. They said they relied on the solicitor`s advice. A cheque for $59,000 was first made out by the plaintiffs in favour of YK Yong & Co. But at the defendant`s request, it was amended and made out to the defendant. On the other hand, Mr Yong told this court that he did explain the option to the plaintiffs. He further said that because the plaintiffs had intended to pay $80,000 (the difference between $590,000 and $510,000) to the defendant the next day, he drew up the sale and purchase agreement in order to protect the plaintiffs.

In relation to this transaction, it seems to us clear that the defendant intended to act both as a property broker as well as a property trader. He was to get 2% commission, being brokerage from the owners, and if he should manage to find a buyer for the property at a price higher than $510,000, he would be able to keep the excess as additional profit for himself. Of course, if he should fail to find any buyer at all for the property, then he would stand to lose the option money, unless he himself wished to purchase the property, in which event he would effectively have to pay only $499,800 being the difference between the purchase price and the 2% commission.

Under the option, completion was scheduled to take place on or before 15 November 1983 at the office of the owners` solicitors, R Ramason. However, under the sale and purchase agreement, completion was also to be on or before 15 November 1983 but at the office of YK Yong & Co at Sim Lim Tower.

On the same day that the plaintiffs executed the sale and purchase agreement and the option, Mr Yong notified the owners that the defendant`s nominees, the plaintiffs, had exercised the option. He forwarded a cheque for $46,000 in favour of the owners, being 10% deposit less the $5,000 option sum already paid (based on the purchase price as stated in the option of $510,000). Mr Yong also informed the owners` solicitors that he was acting for the plaintiffs.

On 14 November 1983, the plaintiffs turned up at Mr Yong`s office to complete the transaction. The defendant was also present. They brought with them two cashiers` orders to pay for the balance of the purchase price of $590,000. However, Mr Yong produced a certain road interpretation plan to show that the property was affected by a road line. There was a dispute here as to what was said. The plaintiffs said that Mr Yong advised them not to buy the property and they accordingly withdrew from buying the property. This evidence was accepted by the court below. The defendant denied that Mr Yong gave such an advice (the evidence as recorded shows that the defendant contradicted himself on this point), or that the plaintiffs said that they were no more interested in the property. Mr Yong said in evidence that in view of the road interpretation plan, he felt it prudent to postpone completion and to seek clarification from the relevant authorities.

As no completion took place on the scheduled date, the solicitors for the owners on 18 November 1983 served a 21-day notice to complete on Mr Yong, as solicitor for the plaintiffs. On the same day, Mr Yong, by a letter to the plaintiffs, discharged himself from acting for them and on behalf of the defendant, gave the plaintiffs a 21-day notice to complete. Also forwarded therewith was the letter of even date from the solicitors for the owners. We would add here that Mr Yong, having found himself in a position of conflict, should have discharged himself from acting for both the plaintiffs and the defendant, and not just the plaintiffs. Be that as it may, on receipt of this notice on 22 November 1983, the second plaintiff telephoned Mr Yong to query the latter of the same. He told Mr Yong again that the plaintiffs did not intend to complete the purchase and requested for a refund of the deposit. Mr Yong advised the plaintiffs to find for themselves another lawyer.

On 5 December 1983, the plaintiffs engaged Murphy & Dunbar to act for them, who in turn notified R Ramason of the same. We ought to add that before approaching Murphy & Dunbar, the plaintiffs had approached other solicitors who apparently did not wish to accept the brief. On 12 December 1983, R Ramason gave notice to Murphy & Dunbar that the owners were forfeiting the deposit of $51,000. On that same day, Murphy...