Zhang Run Zi v Ascentsia Law Corp

• Jurisdiction: Singapore
• Judge: See Kee Oon J
• Judgment Date: 17 August 2018
• Neutral Citation: [2018] SGHC 183
• Court: High Court (Singapore)
• Docket Number: Suit No 52 of 2013
• Year: 2018
• Published date: 28 August 2018
• Hearing Date: 20 March 2018,17 May 2018,22 March 2018,21 March 2018
• Plaintiff Counsel: The plaintiff in person
• Defendant Counsel: Alfonso Ang Cheng Ann and Cheah Shu Xian (M/s A. Ang, Seah & Hoe)
• Subject Matter: Contract,Breach,Tort,Negligence,Solicitors' duties
• Citation: [2018] SGHC 183

See Kee Oon J: Introduction

By Suit No 52 of 2013, the Plaintiff, Zhang Run Zi (“Zhang”) claimed for loss resulting from the Defendant’s alleged breach of its contractual, tortious, fiduciary and statutory duties as the law firm representing her in the sale and purchase of the property at 10 Hoot Kiam Road Singapore 249395 (“the Property”) in 2007.

Zhang was unrepresented. The trial took place over three days and after hearing the submissions from both parties, I dismissed Zhang’s claim with costs. I now set out the reasons for my decision.

Background to the dispute

The dispute stemmed from Zhang’s intended purchase of the Property. Mr Leong Why Kong (“Leong”), a solicitor with the Defendant, was the solicitor in charge of this property transaction. The purchase was abortive and Zhang alleged that there were multiple instances where Leong had failed to advise her adequately.

On 3 January 2007, Zhang met the vendors of the Property (“the Vendors”) and was shown the Option to Purchase (“OTP”).¹ The purchase price was S$1,020,000. Zhang asked a friend who was a property agent,² Mr Adrian Koh Hoong Tse (“Adrian Koh”), to attend the meeting to help her understand the terms of the OTP because of her alleged poor command of the English language. Adrian Koh told her that there were no problems with the OTP.³ Thereafter, she signed the OTP and made payment of the deposit amounting to 1% of the purchase price to the Vendors. The deadline for exercise of the OTP was 24 January 2007 at 4pm. Leong had not entered the picture when Zhang signed the OTP.

On or around 5 January 2007, Zhang met Leong for lunch mainly to discuss about her divorce matter, in which Leong was then representing her.⁴ Leong had previously represented her in successfully claiming S$800,000 in commissions from her former employer.⁵ During this meeting, Zhang informed him that she had secured two options to purchase, one for the Property and another for a property at 112 Jalan Jurong Kechil Singapore (“the Jalan Jurong Kechil property”). She showed him the OTP for the Property and asked him whether there were any problems with it. He advised her that the preamble stating that the balance 4% deposit was to be released to the Vendors was unusual.⁶ Leong claimed that he had further drawn her attention to Clause 11 because it was also unusual, but Zhang denied that he had done so. This was one of the central disputes between the parties. Clause 11 of the OTP reads:

The Purchaser has notice and knowledge of the road lines affecting the Property … and … shall not annul the sale and purchase herein nor shall any abatement or compensation be allowed in respect thereof.

Thereafter, Zhang took out what was described as a “blurry” map which was attached to the OTP (“the blurry document”) and showed it to Leong. Leong told her he did not know what the document was because it was blurry. Zhang asked Leong what she should do and he suggested that she could check with the CrimsonLogic service bureau (“CrimsonLogic”), which was where most of the property searches were conducted.⁷

In the same meeting, Zhang and Leong also discussed the financing options for the two properties. Zhang decided to engage the Defendant to represent her only in the purchase of the Jalan Jurong Kechil property. Leong accepted her appointment. Zhang stated that she was not appointing the Defendant to act in the purchase of the Property and would appoint another firm,⁸ so she kept the documents in relation to the Property, including the OTP. Although the parties disputed the exact reason behind Zhang’s decision to appoint Leong only for the Jalan Jurong Kechil property purchase, this was immaterial for the purposes of the present case.

Following Leong’s suggestion, Zhang conducted searches on her own on the Property with CrimsonLogic on 7 January 2007. She then went overseas and returned to Singapore on or about 22 January 2007, just before the due date for exercise of the OTP on 24 January 2007.⁹

Subsequently, Zhang showed Leong four searches (“the four requisition replies”), namely a land requisition reply from the Building and Construction Authority (“BCA”), a land requisition reply (Street Works) from the Land Transport Authority (“LTA”), a land requisition reply (Rapid Transit Systems) from the LTA and a legal requisition from the Urban Redevelopment Authority (“URA”). Leong’s account was that this took place on 22 January 2007 and during this meeting, he also informed her that she had not carried out all the searches normally required for conveyancing, in particular, the property tax search and the coloured road line plan.¹⁰ Zhang informed Leong that she would be appointing another law firm for the sale and purchase of the Property.¹¹ Zhang’s account was that she had made a call to Leong one or two days before 24 January 2007, and arranged to meet him on 24 January 2007 at about 11am.¹² It was during this meeting that she showed him the four requisition replies.¹³ On 23 January 2007, Zhang went to the URA to verify the blurry document and was allegedly told that the government had no plans to develop the area around the Property.¹⁴

On 24 January 2007, Zhang met Leong. She handed him the OTP along with the four requisition replies and asked him to exercise the OTP. Zhang alleged that this meeting took place at about noon, while the Defendant alleged that this meeting took place at about 2pm.¹⁵ Leong took the documents but he realised afterwards that the acceptance copy of the OTP had not been signed and rushed to find Zhang to sign it. This occurred at about 3pm on 24 January 2007.¹⁶ Leong successfully exercised the OTP before its expiry which was at 4pm on the same day.

Leong sent a letter dated 25 January 2007 to Zhang confirming that the OTP was exercised the day before and that the completion date was tentatively fixed for 21 March 2007. Zhang confirmed that she did receive this letter.¹⁷ On the same day, Leong also applied for the outstanding searches on the Property.¹⁸ After receiving the search results on 1 February 2007, Leong sent a letter to Zhang stating that the Property had been “earmarked as ‘Land Required as Road Reserve’”.¹⁹ Leong also called Zhang on the same day to inform her of the problem with the Property.²⁰ The Property was wholly affected by the proposed Singapore Underground Road System and was partially affected by a road widening line intended for the proposed expansion of Hoot Kiam Road.²¹ Zhang went down to the LTA on the same day to make enquiries, and was allegedly told by the LTA that the land on which the Property was situated would be acquired by the government.²² This issue of conducting a search on the road reserves affecting the Property was another central contention between the parties.

Zhang sent a letter (“the termination letter”) dated 9 February 2007 to the Vendors personally, claiming that they had misrepresented to her about the development potential of the Property and had induced her into signing the OTP without informing her that the property was affected by road widening or acquisition.²³ Thus, she demanded a return of the deposit paid. She first drafted the letter in Mandarin on 8 February 2007 and Leong translated it for her on 9 February 2007. Leong informed her that she could either send the letter herself or through another law firm, as the Defendant could not represent her in her claim against the Vendors. In his cover letter to Zhang, Leong also cautioned Zhang that by sending the letter, she would be repudiating the agreement between her and the Vendors, and the Vendors were entitled to accept her repudiation, forfeit the deposit, resell the Property and claim any shortfall in the sale price from her.²⁴

On or about 14 February 2007, the government announced that affected owners of compulsorily acquired properties would be compensated based on the market value of the acquired properties, pursuant to the Land Acquisition (Amendment) Act 2007 (No 19 of 2007) (“the statutory amendment”).²⁵

On 15 February 2007, Leong helped Zhang to translate another letter she had written with the intent to send to the Vendors. In the letter, Zhang sought to retract her previous letter and indicated that she was going to obtain a valuation of the Property to determine whether the road reserves would affect the Property adversely (“the retraction letter”). However, on the same day, in response to Zhang’s allegations of misrepresentation and inducement in the termination letter, the Vendors sent a letter to Zhang directly, stating that Clause 11 of the OTP gave express notice of the road lines affecting the Property, which was reflected in the document annexed to the OTP given to her. The Vendors also reserved their rights in respect of the publication of defamatory material in her letter.

On 21 February 2007, the Vendors’ solicitors sent another letter to Zhang directly, stating that the Vendors had shown her the road interpretation plan of the Property, and that their rights against her for defamation were strictly reserved. In the same letter, the Vendors’ solicitors asked Zhang to confirm through her lawyers whether she was proceeding with the purchase of the Property. Since the Defendant was copied in the letter, Leong forwarded the same letter to Zhang on 22 February 2007, together with a cover letter asking her for her instructions whether she was proceeding with the purchase.²⁶ On 26 February 2007, the Vendors’ solicitors sent another letter to Zhang, with the Defendant copied, clarifying that she had gone to the Vendors’ office with an agent who read over the OTP and advised her on it. Leong similarly forwarded this letter to Zhang on 27 February 2007, together with a cover letter asking her once again for her instructions as to whether she was proceeding with the purchase. Leong also stated that the completion was on 21 March 2007 and that there would be penalty interest for late...