Travista Development Pte Ltd v Tan Kim Swee Augustine and Others

CourtCourt of Three Judges (Singapore)
JudgeChan Sek Keong CJ
Judgment Date31 December 2007
Neutral Citation[2007] SGCA 57
Citation[2007] SGCA 57
Date31 December 2007
Defendant CounselDavinder Singh SC, Hri Kumar Nair, Tham Feei Sy and Low Yun Hui James (Drew & Napier LLC)
Published date13 May 2008
Plaintiff CounselK Shanmugam SC, Dinesh Dhillon and Margaret Ling (Allen & Gledhill LLP)
Docket NumberCivil Appeal No 59 of 2007 and Summons No 2740 of 2007
Subject MatterLand,Contract,Equity,Breach,Whether any estoppel by convention in relation to specific date which bound property redevelopment company so that it was prevented from denying that that date was contractual completion date,Sale of land,Estoppel,Obligation to use "best endeavours" and to do so "without delays",Estoppel by convention,Whether conduct satisfying "best endeavours" test,Construction of sale and purchase agreement,Sale and purchase agreements,Whether sale and purchase agreement validly rescinded

31 December 2007

Chan Sek Keong CJ (delivering the grounds of decision of the court):

1 This was an appeal against the decision of the High Court in Originating Summons No 538 of 2007 (“the OS”), in which the judge (“the Judge”) dismissed the application by the appellant for a declaration that it be at liberty to complete the sale and purchase of a property development at 55 Devonshire Road, also known as Mayer Mansion (“the Property”), which is collectively owned by the respondents: see Travista Development Pte Ltd v Tan Kim Swee Augustine [2007] 3 SLR 628 (“the GD”). The appellant had agreed to purchase the Property for the sum of $30.5m, but had failed to complete the purchase in accordance with the terms of the sale and purchase agreement entered into between it and the respondents on 12 December 2006 (“the S&PA”). The Judge also ordered the deposit of $3.05m which had been paid by the appellant to be forfeited by the respondents.

The background

2 The facts were as follows. The appellant is a company which was incorporated for the purpose of purchasing the Property for redevelopment. The 13 respondents are the collective owners of all the strata title units in the Property. As the appellant was a foreign company for the purposes of the Residential Property Act (Cap 274, 1985 Rev Ed) (“RPA”), it required the approval of the Singapore Land Authority (“SLA”) under s 31(2) read with s 31(18) of the RPA (“the Approval”) to purchase the Property. The Approval would be signified by the issuance of a qualifying certificate (“QC”) by the SLA.

3 The relevant clauses in the S&PA pertaining to the obtaining of the Approval were as follows:

3.2 The sale and purchase of the Property shall be completed at the office of the Vendors’ Solicitors within six (6) weeks from the date of the receipt of the Qualifying Certificate from the Land Dealing Units [of the SLA] or within three (3) months from the date of this Agreement, whichever is later …

4. (a) Subject to the provisions of this Contract, it shall be the obligation of the Purchaser to obtain all requisite consents, approvals and clearances as may be necessary for the purchase contemplated herein and the Purchaser shall pay for all costs and expenses of obtaining and complying with the requirements of the relevant authority(ies) arising therefrom. The Purchaser shall comply with all terms and conditions imposed by the relevant authority(ies) including but not limited to payment of any development charges, differential premia, fees, charges, levies or costs by whatever name called and the imposition of any such terms or conditions shall not annual [sic] this Contract nor entitle the Purchaser to be discharged from this Contract.

(b) Subject to Clause 7 below (on [the] Land Dealings (Approval) Unit), if the sale cannot be completed by the Completion Date by reason of the Purchaser failing to obtain the requisite consent, approval and clearance then the Vendors shall be entitled at their absolute discretion to rescind the sale and purchaser [sic] and recover any damages suffered and the Deposit and all other monies (if any) paid to the Vendors shall be absolutely forfeited and the Purchaser shall not have any claim whatsoever against the Vendors. Provided [that] this provision is to be without prejudice to all such other rights as shall accrue to the Vendors as a consequence of the failure by the Purchaser to complete the purchase of the Property.

7. The sale of the Property may be made to a foreign company or person on the following additional terms:-

(a) The sale of the Property is subject to the Purchaser obtaining the approval of the Land Dealings (Approval) Unit or such other relevant authorities pursuant to the Residential Property Act (Chapter 274) for the purchase of the Property (the “Approval”) on or before the Completion Date.

(b) The Purchaser shall within ten (10) days from the date of this Agreement submit his application for the Approval and copies of his application submitted shall be furnished to the Vendors or the Solicitors within three (3) days of the said application and the Purchaser shall use his best endeavours to obtain the Approval without delay.

(c) Notwithstanding Clause 9(c), in the event that the Approval is not obtained on or before the Completion Date or is not granted by the relevant authorities, the Purchaser shall direct the purchase herein to be completed by its related company which is an “approved purchaser” or a person qualified to purchase the Property under the Residential Property Act. If on the Completion Date, the Purchaser has not obtained the Approval, or has not so directed, this Contract may be rescinded by the Vendors whereupon the Vendors shall be entitled to forfeit for their benefit the Deposit in full. Nothing herein shall prejudice the Vendors’ right for interest for late completion and shall be without prejudice to Clause 15.



(b) If the Purchaser shall refuse, neglect or fail to complete the purchase as herein stipulated or shall fail to comply with any of the terms and conditions herein contained, the Vendors shall be at liberty after giving twenty-one (21) days’ written notice to the Purchaser or the Purchaser’s solicitors to rescind the sale and purchase of the Property and to treat the Deposit as forfeited.

[emphasis added]

4 It should be noted that the “Qualifying Certificate” referred to in cl 3.2 of the S&PA (“Cl 3.2”) and the “Approval” mentioned in cl 7 of the same agreement mean the same thing. It should also be noted that the date falling “three (3) months from the date of [the S&PA]” (see Cl 3.2) was 12 March 2007.

5 The appellant submitted its application for the Approval to the Controller of Residential Property (“the Controller”) through the SLA’s Land Dealings (Approval) Unit on 21 December 2006. By a letter dated 29 December 2006, the Controller approved the appellant’s application, subject to the appellant obtaining a banker’s or an insurance guarantee for the sum of $3.05m (“the Guarantee”) to secure its compliance with the terms for the issue of the QC. One of the terms was that the appellant had to obtain a temporary occupation permit for the redevelopment of the Property within six years from the date of issue of the QC. The appellant was also given six months from the date of the Controller’s letter (ie, the letter dated 29 December 2006) to obtain the Guarantee.

6 The appellant commenced negotiations with Malayan Banking Berhad (“Maybank”) sometime in late December 2006 to obtain financing for the purchase and subsequent redevelopment of the Property (collectively referred to as “the Project”). The appellant also approached Development Bank of Singapore (“DBS”) and The Hongkong and Shanghai Banking Corporation Limited (“HSBC”) for the same purpose. On 14 February 2007, Maybank decided not to provide financing. DBS and HSBC likewise declined to provide financing. However, on 17 February 2007, the appellant managed to obtain from Oversea-Chinese Banking Corporation Limited (“OCBC”) indicative financing terms for the Project.

7 On 26 January 2007, while these negotiations were going on, the appellant’s then solicitors, M/s Central Chambers Law Corporation (“CCLC”), sent to the respondents’ then solicitors, M/s William Oh & Partners (“WO&P”), ten transfer forms (“the Transfers”) postdated 12 March 2007. The date of 12 March 2007 was based on the expectation that completion of the sale and purchase of the Property would take place three months from the date of the S&PA (see Cl 3.2 at [3] above). The Transfers were signed by the respondents by 21 February 2007 and were returned to CCLC. WO&P also forwarded the completion accounts for the sale and purchase computed as at 12 March 2007 to CCLC.

8 Subsequently, via a letter dated 6 March 2007, CCLC informed WO&P that the appellant would not be able to complete the sale and purchase by 12 March 2007 and that the completion date would instead be six weeks from the date of the receipt of the QC to be issued by the SLA. This, CCLC stated in its letter, was “pursuant to” Cl 3.2. WO&P replied the next day to state that the appellant had breached the S&PA as all the parties to the agreement had proceeded on the basis that completion was to be within three months of the date on which the S&PA was signed. WO&P then gave the appellant notice, via a letter dated 13 March 2007, to complete the transaction within 21 days, ie, by 3 April 2007 (“the 21-day notice”).

9 On 3 April 2007, OCBC approved the appellant’s request for financing for the Project, including the request for the Guarantee. However, the respondents refused to withdraw the 21-day notice, whereupon the appellant filed the OS on 3 April 2007. On 10 April 2007, the SLA issued the QC to the appellant. On 18 April 2007, CCLC sent a copy of the QC to WO&P and...

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