Tay Joo Sing v Ku Yu Sang

• Jurisdiction: Singapore
• Judge: Karthigesu JA
• Judgment Date: 18 March 1994
• Neutral Citation: [1994] SGCA 45
• Date: 16 September 1994
• Subject Matter: Whether rectification available despite failure to so plead,Steep rise in property prices,Failure to plead rectification,Court's power to take judicial notice of recession and volatile nature of property market in Singapore when deciding the issue,Whether document contained requisite terms of the contract,Contractual terms,Contract,Damages in lieu of specific performance,Whether omission of date for completion fatal,Measure of damages,s 4 Statute of Frauds 1677 [UK],Rectification,Evidence of contract of sale,Specific performance,Damages,Laches,Whether possibility of hardship being caused to other co-owner a relevant factor,Document purported to be option not containing all agreed material terms,Whether delay amounting to acquiescence to abandonment of contract,Formalities,Proceedings against one co-owner only,Whether document signed by parties amounting to a note or memorandum under s 4 of the Statute of Frauds,Sale and purchase of property,Whether assessment of damages to be based on value of property at time of completion or present value of property,Whether failure to plead defence fatal,Remedies,Whether specific performance available for disposition of half share of property owned by two co-owners
• Docket Number: Civil Appeal No 129 of 1993
• Published date: 19 September 2003
• Defendant Counsel: Margaret Wan and Sum Chong Mun (Braddell Brothers)
• Court: Court of Appeal (Singapore)
• Plaintiff Counsel: Cheong Yuen Hee and Cheong Aik Chye (Judy Loke & Cheong)

Cur Adv Vult

A commercial unit in Lucky Plaza, Orchard Road, Singapore, known as No B1-124 (the property) was owned by the appellant and his brother Tay Joo Meng as tenants-in-common in equal shares. They had wanted to sell the property from as far back as 1985 and had periodically advertised the sale of the property in the newspapers but had not got the offer they desired for the property. Tay Joo Meng had emigrated to Australia and left the sale of the property to the appellant. Victor Sim Chye Thiam (Victor Sim), a property broker, was known to the appellant and members of his family. In fact Victor Sim had secured tenants for other properties belonging to the appellant and his family and so he was asked by the appellant to find a buyer for the property sometime in 1985. Victor Sim knew the price range the appellant was looking for as he was given an indication of it.

In or about May 1987, Victor Sim, who had kept in touch with the appellant over the sale of the property since he was first told to find a buyer for it sometime in 1985, told the appellant that he had found a buyer who was prepared to make an offer. Accordingly, on 2 May 1987, the appellant and Victor Sim went to the respondent`s office at Fu Lu Shou Complex to discuss and negotiate the sale of the property. All this is common ground. It is also common ground that, during that meeting, a document prepared by Victor Sim was signed by the appellant and the respondent and witnessed by Victor Sim. The document, for want of an appropriate description and since this appeal, in the main, turns on its construction and legal effect, we will simply designate as `PB1`, which is reproduced below:

Mr Tay Joo Sing and Mr Tay Joo Meng

48 Marshall Road

Singapore 1542

2 May 1987

Re: B1-24 Lucky Plaza, 304 Orchard Road, Singapore 0923

This is to confirm that we, Mr Tay Joo Sing and Mr Tay Joo Meng, owners of the abovementioned property, hereby agree to sell to Mr Ku Yu Sang, NRIC No 1841358B, at the purchase price of SGD470,000 (Singapore Dollars Four Hundred Seventy Thousand only).

We hereby confirm that we have received a deposit of SGD5,000 (DBS 588590) only as part of option fee.

This contract valid for 14 days only.

This property is sold with vacant possession.

Seller`s signature

Mr Tay Joo Sing (IC No 0068340Z)

Buyer`s signature

Mr Ku Yu Sang (IC No 1841358B)

Witness

Mr Victor CT Sim (IC No 1461894E)

It should be noted that although the property is described in PB1 as `B1-24`, there is no dispute that PB1 was in reference to the property. The meeting ended with each party taking a copy of PB1, the cheque for $5,000 referred to in PB1 being handed over to the appellant by the respondent and the names of their respective solicitors being exchanged.

On 4 May 1987, the appellant`s solicitors informed the respondent`s solicitors that the appellant was not agreeable to selling the property to the respondent and the respondent`s cheque for $5,000 was returned. However, the respondent would not accept this position and, on his instructions, his solicitors sent to the appellant`s solicitors a cheque for $42,000 being the balance of the 10% of the purchase price, in accordance with his understanding of the agreement reached with the appellant on 2 May 1987 and also retendered the earlier cheque for $5,000. On 16 May 1987, the appellant`s solicitors returned both cheques to the respondent`s solicitors. The respondent`s attempts to resolve the dispute not being successful, the respondent issued out the writ in this action on 30 June 1989.

The respondent`s claim was, firstly, against both the appellant and his brother Tay Joo Meng as joint defendants in respect of the whole of the property for specific performance of the agreement contained in PB1 or alternatively for damages in lieu of specific performance. Secondly, the respondent`s claim was against the appellant only for specific performance of the agreement contained in PB1 but limited to the appellant`s undivided half share in the property; damages for breach of the agreement contained in PB1; damages for breach of warranty; and alternatively, damages for misrepresentation under the Misrepresentation Act 1967. The respondent also claimed damages from the appellant for costs should Tay Joo Meng be found not liable; an inquiry as to damages suffered by him; interest and costs. In the event the respondent was unable to effect service of the writ on Tay Joo Meng, who, as we have noted above, had emigrated to Australia and was residing there, and accordingly proceeded at the trial with his claims against the appellant only.

The respondent`s pleaded case, inter alia, was that the appellant had instructed Victor Sim in 1985 to find a buyer for the property and that, since the property was registered in the joint names of the appellant and his brother Tay Joo Meng, the appellant had the authority of Tay Joo Meng to sell the property. It was also the respondent`s pleaded case that on 2 May 1987 at the meeting with the appellant and Victor Sim, the appellant had represented to the respondent that he (the appellant) had the authority of Tay Joo Meng to sell the property which was registered in the joint names of the appellant and Tay Joo Meng. The respondent had accepted this representation and acting upon it had accepted the offer of $470,000 made by the appellant and had paid the `option fee of $5,000`. Further, it was on this basis that the appellant and Tay Joo Meng were jointly selling their respective, but undivided equal shares, in the property and that the document PB1 was drafted by Victor Sim.

The appellant`s pleaded defence, inter alia, was that, although he admitted that a meeting did take place between him, the respondent and Victor Lim on 2 May 1987 at Fu Lu Shou Complex, he denied that he had represented to the respondent, or indeed had said anything which could amount to a representation, or that he represented Tay Joo Meng or that Tay Joo Meng had authorized him (the appellant) to sell the property. It was also denied that the document PB1 contained any express or implied representation that he (the appellant) had the authority of Tay Joo Meng to sell the property or to sell Tay Joo Meng`s interest in the property. On the contrary, it was pleaded that `the alleged option [PB1] was signed on the express or implied condition that the second defendant [Tay Joo Meng] was to agree to the sale of the property` and the price of $470,000 was subject to the confirmation of the appellant`s mother. It was further pleaded that it was either impliedly or expressly understood that the sale of the property was subject to a proper contract to be drawn up by solicitors, incorporating all the terms and conditions of the sale. Lastly, that PB1 `was only an acknowledgement to the plaintiff [respondent] for the receipt of the $5,000 cheque and was given at the request of the plaintiff`. On the first day of the trial (14 October 1992) the appellant was given leave to amend his defence further by pleading that `there was no note or memorandum in writing of the alleged agreement as required by the Statute of Frauds 1677,` and `in the premises, the agreement referred to in the statement of claim (if any, which is denied) is not enforceable against the first defendant (the appellant).`

At the trial, amongst others who gave evidence were the appellant, the respondent, Victor Sim and the appellant`s mother, but Tay Joo Meng did not give evidence. The respondent and the appellant gave evidence in support of their respective pleaded case and defence. Victor Sim gave evidence in support of the respondent`s case and corroborated the respondent`s evidence in all its material aspects. It is to be noted that Victor Sim made a statutory declaration of the facts and matters relating to the sale of the property on 20 May 1987. His evidence was substantially the same as that he had declared in his statutory declaration. The appellant`s mother`s evidence fell short of supporting the appellant`s evidence.

The learned trial judge, in a reserved judgment which is reported at [1993] 3 SLR 938 , found as a fact that the appellant did, at the meeting on 2 May 1987, make representations that he was authorized to sell the property on behalf of his brother Tay Joo Meng at the price that was subsequently agreed. The learned judge also found as a fact that the appellant had not made it known, either to the respondent or to Victor Sim, that there would be no binding agreement to sell the property until and unless he got confirmation from Tay Joo Meng agreeing to the sale of the property at the price of $470,000. He also found as a fact that the price of $470,000 was not subject to confirmation by the appellant`s mother. In fact, the learned judge rejected the appellant`s evidence altogether. He said at p 943:

The plaintiff [respondent] and the defendant [appellant] gave entirely opposite accounts of this [the learned judge was referring to the representations allegedly made by the appellant to the respondent and Victor Sim on 2 May 1987]. I accept the plaintiff`s account on this point. The evidence of the defendant and the manner in which he gave it concerning the meeting and PB1 leave me with the distinct impression that little credit could be given to what he says. On any contentious matter, I prefer the evidence of the plaintiff and Mr Sim to that of the defendant.

The learned judge also rejected the appellant`s contention that the sale of the property was subject to a proper contract being drawn up by solicitors and held that PB1 reflected a firm and immediately binding agreement for the sale of the property to the respondent. In effect the learned judge found that PB1 was an option for the sale of the property even though it failed to provide the mode of exercising the option. He found that the sentence in PB1 which reads: `This...