Ng Buay Hock and Another v Tan Keng Huat and Another

• Jurisdiction: Singapore
• Judge: Warren Khoo L H J
• Judgment Date: 13 March 1997
• Neutral Citation: [1997] SGHC 58
• Citation: [1997] SGHC 58
• Defendant Counsel: Anna Oei and Noel Ong (Lim Ang & Wong)
• Published date: 19 September 2003
• Plaintiff Counsel: Susan Tang (Francis Khoo & Lim)
• Date: 13 March 1997
• Docket Number: Suit No 2331 of 1995
• Court: High Court (Singapore)
• Subject Matter: Whether to allow plaintiffs' claim,ss 2(1) & 2(3) Misrepresentation Act [UK] 1967,Measure of damages,s 2(1) Misrepresentation Act [UK] 1967,Land,Defendants' agent advertising house for sale,Plaintiffs claiming for rescission of contract and damages,Plaintiffs discovering built-in area of house less than advertised,Plaintiffs claiming for rescission of contract on basis of misrepresentation,Whether defendants vicariously liable for misrepresentation,Principal's vicarious liability,Damages,Agency,Sale of land,Whether measure of damages tortious or contractual,Whether plaintiffs relying on misrepresentation,Defendants' estate agent's misrepresentation to plaintiffs,Discharge,Contract,Estate agents,Whether plaintiffs can rescind contract and claim for damages,Claim for damages under s 2(1) Misrepresentation Act [UK] 1967,Rescission,Plaintiffs exercising option to purchase,s 2(1)Misrepresentation Act 1967 [UK],Whether misrepresentation of built-in area

This is a claim for rescission, on the ground of misrepresentation, of a contract for the sale of a house, and for damages. The misrepresentation alleged concerns solely what is called the built-in area of the house.

On Thursday, 7 September 1995, the second plaintiff, Mrs Ng, wife of the first plaintiff, saw an advertisement in the classified columns of The Straits Times for the sale of a property in Pasir Panjang Close as follows:

storey inter terr 1,750/2,400 sq ft. Freehold (7 years old). Renovated 4 + 1. ...

Mrs Ng contacted the agents, whose phone number appeared in the advertisement. She spoke to an agent Anthony Lau, and arranged to see the property on that evening. She and her husband turned up at the house as arranged, and met Anthony Lau and his colleague Geoffrey Lim. The house belonged to the defendants.

It is the plaintiffs` evidence that at this visit to the property, Geoffrey Lim told them, when asked about the built-in area of the house, that it was in fact more than 2,400 sq ft. He said the error would be corrected by another advertisement. It is also the plaintiffs` evidence that Geoffrey Lim, when asked whether the built-in area of 2,500 sq ft included the roof garden, told them that it did not, as the roof garden was not enclosed within walls. Mr Lim further said, according to the plaintiffs, that if the area of the roof garden were included, the built-in area would be considerably more than 2,500 sq ft.

The plaintiffs were interested in the property. They were living at an apartment with a much smaller area and were looking to buy a larger property. Apart from the larger built-in area, the land area and the location of the property, all appealed to them. So they arranged to see the house again the next day.

On this second visit, the plaintiffs went through the house again with the two agents. The plaintiffs say in their affidavits that on both visits to the property, Geoffrey Lim told them in the presence of the defendants that the built-in area was 2,500 sq ft. In evidence in court, Mr Ng also said that on this second visit on 8 September, Mr Tan (the first defendant) himself told him that the land area was 1,750 sq ft and the built-in area 2,500 sq ft. The plaintiffs then discussed the price with the agents outside the house. The agents were acting as a go-between between the plaintiffs and Mr Tan. The price was agreed at $1.438m. Mr Ng gave the agents a cheque for $14,380, and obtained an option to purchase the property. The option was dated 7 September. According to Mr Ng, he saw the fresh advertisement on 10 September with the figure `1,750/2,500 sq ft`. He asked Geoffrey Lim the next day whether the option could be amended to include a reference to the land area and the built-in area. Lim, according to him, assured him that since the information was already in the advertisements, it was not necessary to do so.

On 13 September, Mr Ng was told by his solicitors that according to the certificate of title, the land area was only 1,708 sq ft, not 1,750 sq ft as shown in the advertisements. He and his wife went to see Mr Tan that evening. They wanted to call off the deal and have their money back but after a long discussion it was eventually agreed to reduce the price to $1.415m. On 28 September the plaintiffs exercised the option.

The plaintiffs then made plans for the renovation of the house. They had difficulty getting the defendants to allow them and their contractors to get access to the house to take measurements but, with the help of their engineers KC Fong Consultants, they managed to get the architectural drawings of the house from the Building Control Department. No doubt suspicious about the 2,500 sq ft built-in area which they had been told, they asked KC Fong to measure the floor area. They were told that the total was only about 2,100 sq ft. If the car porch and the terrace were taken off, the total was only 1,900 sq ft.

The plaintiffs immediately got their solicitors to contact the defendants` solicitors for confirmation of the built-in area. Receiving no response, they threatened to rescind the contract. They then received a reply stating that the defendants had no knowledge of the built-in area. They made a proposal to resolve the matter by reducing the price. This and a subsequent proposal were rejected by the plaintiffs as inadequate. The plaintiffs then instructed their solicitors to rescind the contract. This was done.

The evidence for the defence as to the history is as follows. Mr Geoffrey Lim says that on 6 September, Mr Tan contacted him on the phone and told him that he wanted to sell the property. He got a few brief details of the property so as to place an advertisement in the papers. According to Mr Lim, Mr Tan gave him the land area. He confirmed it with the database maintained by a professional association. Mr Tan did not give him the built-in area, neither would the database have such information. But he wanted to include it in the advertisement, so he worked it out by using a formula. He simply applied a factor of three to half the land area. He got the figure of 2,400 sq ft as the built-in area. He then placed the advertisement, in time for it to come out the next day.

Mr Lim then went with his colleague Anthony Lau to see Mr Tan to look at the property, and to discuss the terms of their firm`s appointment as the exclusive agents to sell the property. They had with them the firm`s printed standard form of agreement.

There is a slight difference of evidence between Mr Lim and Mr Tan as to what Mr Tan said about the land area and the built-in area at this meeting. Mr Tan says he never said anything about either, but Mr Lim says that both on the phone and later at this meeting, Mr Tan mentioned the land area as 1,750 sq ft. Mr Lim also says that at the meeting Mr Tan told him that he had seen an advertisement of a neighbouring property with a figure of 2,500 sq ft, and thought that it would be the same for the subject property, although he Mr Tan was not sure about it. Mr Tan, however, says that he did not at any time tell Mr Lim anything about the land area or the built-in area, simply because he did not know; he says, in fact, it was Mr Lim who gave him the figures.

In the printed form of the agency agreement there were blank spaces for the land area and built-in area. At some stage, the blanks were filled in showing the figures 1,750 sq ft and 2,500 sq ft. There was also a clause by which the owner warranted the accuracy of the information furnished in respect of the property. Mr Tan did not wish to be held responsible for these figures or for their accuracy. He got the warranty clause deleted and signed the agreement.

As to what was said to the plaintiffs on their viewing of the property, there is also some discrepancy in the evidence of the defence witnesses. Mr Lau says that the plaintiffs never asked about the land area or the built-in area. Mr Lim, however, says clearly that he did tell the plaintiffs on their first visit that the land area was 1,750 sq ft and the built-in area was approximately between 2,400 and 2,500 sq ft.

Then there is the conflict of evidence between the plaintiffs and Mr Tan as to whether Mr Tan told them about the built-in area. The plaintiffs say he did on their second visit. Mr Tan says he did not on either visit say anything about it. In fact he did not speak to them at...