Riduan bin Yusof v Khng Thian Huat and Another (No 2)

JurisdictionSingapore
Judgment Date17 August 2005
Date17 August 2005
Docket NumberCivil Appeal No 72 of 2004
CourtCourt of Appeal (Singapore)
Riduan bin Yusof
Plaintiff
and
Khng Thian Huat and another
Defendant

[2005] SGCA 39

Yong Pung How CJ

,

Chao Hick Tin JA

and

Kan Ting Chiu J

Civil Appeal No 72 of 2004

Court of Appeal

Civil Procedure–Costs–Principles–Landlord suing tenant for double rent and damage caused to property by tenant removing authorised alterations to property–Whether trial judge justified in ordering parties to bear own costs of trial–Appropriate costs order to make–Landlord and Tenant–Agreements for leases–Covenants by tenant to deliver up property in condition as at commencement of tenancy–Three tenancy arrangements for same property entered into between parties consecutively on same terms–Tenant altering property after commencement of first tenancy and removing alterations upon termination of third tenancy–Whether tenant obliged to deliver up property in condition as at beginning of first or third tenancy–Landlord and Tenant–Demised premises–Fixtures–Whether tenant's alterations to property at commencement of first tenancy amounting to tenant's fixtures–Whether tenant having right to remove tenant's fixtures upon termination of third tenancy

The appellant and his wife leased a property (“the property”) from the respondents for use as a kindergarten (“the first Tenancy Agreement”). As agreed by the parties, after obtaining the required approvals from the authorities, various alterations to the property were made at the appellant's expense (“authorised alterations”). The authorities had also stipulated that such alterations would have to be removed once the property ceased to be used as a kindergarten. Clause 2 (I) of the first Tenancy Agreement provided that the tenant at the expiry of the tenancy was to “deliver up to the Landlord the [property] together with all the fixtures and fittings in like condition as the same were delivered to the Tenant at the commencement of the said term, authorised alterations or additions and damage by fair wear and tear and acts of God excepted”.

In 1997, the lease was extended by a formal tenancy agreement containing the same terms as the first Tenancy Agreement (“the second Tenancy Agreement”). In 2000, the parties agreed by way of a letter of intent to further renew the lease, subject to the conclusion of an official lease agreement (“the third Tenancy Agreement”). However, no formal agreement was executed. The relationship between the parties deteriorated, and the respondents sought to terminate the tenancy in 2001. The appellant only vacated the property in 2003 after removing the authorised alterations.

The respondents commenced an action against the appellant in the Subordinate Courts for, inter alia, double rent and damage caused to the property when the appellant removed the authorised alterations to the property. Upon the respondent's application, the action was transferred to the High Court. The trial judge did not allow the claim for double rent, but awarded damages for the appellant's failure to hand over the property in the same condition as it was at the commencement of the third tenancy. Additionally, the trial judge was of the view that the appellant was motivated by malice and ill will in removing the authorised alterations and thus held that each party was to bear its own costs.

Held, allowing the appeal and ordering that an assessment of damages be carried out in the District Court:

(1) The judge erred in interpreting cl 2 (I) as referring to the condition of the property as at the commencement of the third tenancy. When the first Tenancy Agreement was entered into, it was clear to both parties that alterations had to made to convert the property for use as a kindergarten. Clause 2 (I) provided that when authorised alterations were made, the landlord would not be entitled to ask the tenant to restore the property to its original position upon the expiry of the tenancy. When the parties concluded the second Tenancy Agreement on identical terms, they had effectively agreed to extend the tenancy for another term subject to the same provisions in the first Tenancy Agreement. Clause 2 (I) should therefore be construed to refer to the condition of the property at the time when the property was first delivered by the respondents to the appellant: at [16] and [17].

(2) The interpretation of the court below was inconsistent with the principle, stated in New Zealand Government Property Corporation v HM & S Ltd [1982] 1 QB 1145, that when an existing lease was followed immediately by another to the same tenant remaining in possession, the tenant's right to remove tenant's fixtures would be carried forward into the new tenancy. The proviso to cl 2 (I) could not be construed as prohibiting the tenant from removing authorised alterations, or as giving the landlord the right to retain the authorised alterations. Having made the authorised alterations, the appellant, as the tenant, was entitled to remove them, provided that those alterations did not constitute fixtures which accrued with the land. To deprive a tenant of his right to remove fixtures erected by him for his trade, sufficiently clear words had to be used and the words in cl 2 (I) were hardly adequate: at [18] to [22].

(3) An object which was brought onto land could be classified as a chattel, a fixture or as part and parcel of the land. The category of fixtures was further divided into landlord's fixtures, which had to be left by the tenant at the expiry of his lease, and tenant's fixtures, which the tenant was permitted to remove. What would constitute tenant's fixtures must depend on the circumstances of the case, in particular, the purpose for which the article was affixed onto the land. While doors and windows would ordinarily be regarded as becoming a part of the land, doors or windows forming part of a special structure required for the tenant's business could very well remain as tenant's fixtures: at [25] and [27].

(4) The alterations carried out by the appellant were clearly not intended to be permanent improvements to the land. They were meant to be there so long as the property was being used as a kindergarten. It was obvious that the parties intended, when they executed the first Tenancy Agreement, to comply with the conditions stipulated by the authorities to remove the authorised alterations once the kindergarten ceased operation. Further, it was never the intention of the respondents at the time of the first Tenancy Agreement to continue using the property as a kindergarten after the appellant had vacated it. Hence the appellant was acting within his rights, and was indeed obliged under the conditions imposed by the authorities, to remove the alterations: at [31] to [33].

(5) The remarks by the judge concerning the appellant's conduct were probably too harsh. Both the appellant and the respondents were simply caught up by their own differing interpretation of their rights under cl 2 (I). Furthermore, the respondents had shifted their case in the course of the proceedings, and also ought to bear the consequences of applying to transfer the case from the Subordinate Courts to the High Court. The appellant was therefore entitled to the costs of the appeal and to 80% of the costs below. However the appellant and the respondents were to bear equally the fees payable to the court expert in relation to the work done by the expert for the trial: at [37] to [41].

Cheong Kim Hock v Lin Securities (Pte) [1992] 1 SLR (R) 497; [1992] 2 SLR 349 (folld)

Godson v P Burns & Company [1919] 58 SCR 404 (folld)

Homestar Holdings v The Old Country Inn Ltd [1986] ACWSJ Lexis 34958 (folld)

New Zealand Government Property Corporation v HM & S Ltd [1982] 1 QB 1145 (folld)

Reardon Smith Line Ltd v Yngvar Hansen-Tangen [1976] 1 WLR 989 (folld)

Tasmania, The (1890) 15 App Cas 223 (folld)

Webb v Frank Bevis, Ltd [1940] 1 All ER 247 (folld)

Rules of Court (Cap 322,R 5, 2004 Rev Ed)O 57r 13

Chan Hian Young and Ganga d/o Avadiar (Allen & Gledhill) for the appellant

Hri Kumar and Wilson Wong (Drew & Napier LLC) for the respondents.

Judgment reserved.

Chao Hick Tin JA

(delivering the judgment of the court):

1 This action relates to certain disputes which arose following the termination of a tenancy where the appellant, Riduan bin Yusof, was the tenant, and the respondents, who are husband and wife, were the owners of the premises located at 95 Telok Kurau Road (“the property”). The main claim in the action instituted by the respondents was for double rent. This claim was dismissed by the trial judge. However, the subsidiary claim by the respondents, relating to damage caused to the property plus consequential losses, was allowed by the trial judge at $79,170.

2 Another issue which is before us relates to costs. Even though the respondents failed on their main claim on double rent, which took much of the time of the trial, and succeeded only on the subsidiary claim where the quantum was well within the jurisdiction of the Subordinate Courts, the judge nevertheless made an order that each party was to bear its own costs.

3 Accordingly, the appellant has appealed against the whole of the judge's decision (see Khng Thian Huat v Riduan bin Yusof [2005] 1 SLR (R) 130).

The background

4 Towards the end of 1993, the appellant and his wife, Sa'adiah binte Mohamed Shaffi, approached the respondents with a view to renting the property for the purpose of relocating a kindergarten, known as “Nur Kindergarten”, which they were then operating at another property. Although the property was and is a dwelling house, the respondents were willing to rent it to the appellant and his wife for that purpose, subject to the approval of the authorities and such alterations as the authorities might require. Consequently, the respondents...

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