Attorney General v Tye Kheng (Pte) Ltd

• Judge: Lai Kew Chai J
• Judgment Date: 13 September 2002
• Neutral Citation: [2002] SGHC 212
• Subject Matter: Sale and purchase of property,Limitation of Actions,Accrual of cause of action,Sale of land,Whether buyer's obligation to pay adjusted price extinguishes upon registration of transfer,Doctrine of merger,Contractual terms,Contract,s 6(1)(a) Limitation Act (Cap 163, 1996 Ed),s 66 Land Titles Act (Cap 157, 1994 Ed),Construction of clause in sale agreement providing for adjustment of sale price,Land,Equity and limitation of actions,Construction of s 66 of Land Titles Act (Cap 157, 1994 Ed)
• Defendant Counsel: Cheong Yuen Hee and Patrick Chee Teck Kwong (Chee & Teo)
• Published date: 19 September 2003
• Court: High Court (Singapore)
• Plaintiff Counsel: Leong Wing Tuck and Wilson Hue (State Counsel)

Judgment Cur Adv Vult

GROUNDS OF DECISION

By this action filed on 7 November 2001 the plaintiff is claiming under the terms of an agreement in writing dated 20 November 1995 against the defendants the sum of $588,983.10, interest thereon at 6% per annum from the date of the writ to judgment and costs.

The Facts

2 The Urban Redevelopment Authority ("the URA") offered on behalf of the Government 18 parcels of conservation shophouses at Pagoda Street, Singapore which are prominently within the Chinatown vicinage, as part of the Government Land Sales Programme. It was marketed as "an excellent investment opportunity for those who recognise the potential of these historic shophouses to participate in their restoration."

3 The tender documents were contained in a Developer’s Packet made available to all interested parties, including the defendants. Enquiry Forms were supplied in each Developer’s Packet to facilitate the process of clarification in response to any queries, doubts or uncertainties before the close of the tender in respect of the terms of the tender. The tender documents included the Particulars of Tender, Conditions of Tender, the draft Building Agreement, the draft Lease, Technical Conditions of Sale/Tender, Conditions and Requirements of Relevant Competent Authorities, Structural Report, Conservation Guide Plans, Planimetric Survey "Topographical Plan", Form of Tender and the Tender Brief.

4 6 of these 18 parcels of conservation shophouses along Pagoda Street were put up for public auction. The remaining 12 land parcels, including the subject properties (No. 32 and No. 34), were put up for public tender for leases to be granted to the successful tenders for 99 years upon completion of the restoration works in accordance with the building agreement. The defendants were the successful tenderers of No 32 and No. 34 Pagoda Street ("the Shophouses") and were awarded the tender on 22 August 1995. They signed the building agreement ("the agreement") dated 20 November 1995. It can be seen from the photograph in the Tender Brief that No. 34 Pagoda Street, was a 3-storey corner shophouse and that No. 32 Pago Street was an adjacent 2-storey shophouse. The defendants agreed to restore those buildings in accordance with the technical specifications. The intention was to restore them as far as practicable to their pristine condition. In the event, the defendants invested about $1 million for the restoration works.

5 Under the agreement the sale price for the said land was $3,080,000.00. The First Schedule to the agreement specified the area of the Shophouses as 179.9 square metres (which, as described in the contractual documents, will hereinafter be referred to as "the scheduled area"). The provisional and estimated nature of the scheduled area of 179.9 square metres for the Shophouses is very clearly set out in the First Schedule to the Building Agreement and it reads:

"All those pieces of land known as Lots 261pt and 262pt TS 6 and situated in the REPUBLIC OF SINGAPORE as delineated in red on the Plan annexed hereto and also marked as Parcel (422) and estimated to contain an area of 179.9 square metres more or less subject to survey or resurvey, together with the building/buildings erected thereon known as No. 32 and 34 Pagoda Street."

6 Clause 9 of the agreement is central in this case and the entire clause is reproduced below. It is also mirrored in clause 12 of the Conditions of Tender. Clause 9 reads:

"(a) The land parcel is believed and shall be taken to be correctly described "except as to its area which shall be subject to Government survey or resurvey." The land parcel is open to inspection and may be viewed by Tenderers on application.

(b) If on completion of Government survey or resurvey, it is found that the area of the land parcel ascertained by such survey or resurvey ("the surveyed area") is either more than or less than the area mentioned in the foregoing Particulars ("the scheduled area") by more than 1% of the scheduled area, there shall be a corresponding adjustment of the tendered sale price for the land parcel (hereinafter referred to as "the said sale price") for the difference between the scheduled area and the surveyed area at the rate the successful Tenderer tendered for each square metre of the land parcel as defined below in Condition 12 (e) hereof.

(c) If on completion of Government survey or resurvey, it is found that the difference between the surveyed area and the scheduled area of the land parcel is not more than 1% of the scheduled area, there shall be no adjustment of the said sale price for the difference between the surveyed area and the scheduled area of the land parcel.

(d) If Government survey or resurvey of the land parcel is completed only after the said sale price is paid in full to the Authority, any refund to be made by the Authority as a result of an adjustment of the sale price shall be made in one lump sum without any interest whatsoever and any amount of additional sale price attributable to an adjustment of the said sale price shall be paid in one lump sum without any interest whatsoever by the successful Tenderer within fourteen (14) days of the date of the Authority’s notice to such effect. In the event the successful Tenderer shall fail for fourteen (14) days to comply with the Authority’s notice as aforesaid, the Authority shall have the right and be entitled to treat the successful Tenderer’s aforesaid failure as a breach of these present rights and remedies under Condition 23 hereof or as an event of default which shall entitle the Authority to exercise its rights and remedies set out in Clause 4(ii) of the Building Agreement as the case may be.

(e) The rate the successful Tenderer tendered for each square metre of the land parcel abovementioned shall be the amount obtained by dividing the said sale price with the scheduled area and...