Peh Kwee Yong v Sinar Company (Pte) Ltd

• Jurisdiction: Singapore
• Judgment Date: 16 May 1984
• Date: 16 May 1984
• Docket Number: Originating Summons No 78 of 1983
• Court: High Court (Singapore)

Peh Kwee Yong

Plaintiff

and

Sinar Co (Pte) Ltd

Defendant

[1984] SGHC 13

Lai Kew Chai J

Originating Summons No 78 of 1983

High Court

Land–Sale of land–Legal requisitions–Agreement to purchase land subject to satisfactory answers to requisitions–Requisition alleging land affected by road widening–Whether answer to requisition unsatisfactory

By a written agreement, the plaintiff agreed to purchase a piece of property from the defendant. Clause 6 of the agreement provided that the property was sold subject to the plaintiff's solicitors receiving satisfactory answers to all requisitions sent to various Government departments, and that the plaintiff could annul the sale “in the event of any of the answers to such requisition being found unsatisfactory to [the plaintiff] or [the plaintiff's] solicitors”. The plaintiff subsequently alleged that the property was affected by road widening which would affect the area. The actual area that would be affected by the road widening was 30.6m^2.The plaintiff then purported to annul the sale and purchase agreement under cl 6. The defendant refused to accept the notice of annulment. The sole issue before the court was whether the answers to the plaintiff's requisition were unsatisfactory within the meaning of cl 6. The plaintiff contended that it was the intention of the parties that whether an answer to any requisition was unsatisfactory was left entirely to the subjective view of the plaintiff.

Held, dismissing the claim:

(1) The plaintiff's construction of cl 6 was incorrect, as it could not have been the intention of the parties that the sale and purchase agreement could be annulled by the plaintiff at his whim and fancy. A true and natural construction of the clause must place it on an objective and reasonable basis. Only those answers to requisitions which were unsatisfactory to a reasonably determined purchaser could entitle such a purchaser to call off the agreement. Whether a particular answer was unsatisfactory to a reasonably determined purchaser was, in each case, a question of fact: at [7].

(2) As the area which might have been affected by road widening was so inconsequential, there was no doubt that no reasonably determined purchaser could regard it as giving him a right to annul the sale and purchase agreement: at [8].

Tatlien Hardware Pte Ltd v Tan [1979-1980] SLR (R) 831; [1980-1981] SLR 472 (refd)

Teo Hong Choo v Chin Kiang Industries Pte Ltd [1983-1984] SLR (R) 163...