Treasure Miles Ltd. v. Lucky Pool Ltd.
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HCMP003435/1997 1997 No. MP3435 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE MISCELLANEOUS PROCEEDINGS _______________
________________ Coram: The Honourable Mrs Justice V. Bokhary in Court Dates of Hearing: 22 and 25 May 1998 Date of Judgment: 28 May 1998 ________________ J U D G M E N T ________________ 1. This is a vendor and purchaser summons taken out by the purchaser. It concerns a property known as Suite No. 18 on Level 3 and Car Park Space No. 5 on Level 6, Elite Villas, No. 22 Shouson Hill Road, Hong Kong ("the Property"). Elite Villas has for the common use of its residents a swimming pool with an adjacent building serving it. I will refer to that swimming pool and that building together as "the Swimming Pool". As we shall see the only requisition now relied upon by the purchaser relates to the Swimming Pool. 2. The purchase price was $21.5 million. By the time when the agreement for sale and purchase ("the Agreement") was signed on 17th June 1997, the purchaser had already paid $1.1 million by way of initial deposit and part payment of the purchase price. Upon the signing of the Agreement, it paid a further $2.125 million by way of further deposit and part payment. $18.275 million, being the balance of the purchase price, was to be paid upon completion. Completion was to be on or before 3rd September 1997. 3. None of that $18.275 million was paid. Completion has not - and will not - take place. 4. A number of requisitions on title were raised by the purchaser. The purchaser has refused to complete: rightly it says; wrongly the vendor says. 5. As I have indicated, only one requisition on title is now relied upon by the purchaser with the view to justifying its refusal to complete, and it relates to the Swimming Pool. 6. That requisition was raised in the following way in a letter dated 22nd August 1997 from the purchaser's solicitors to the vendor's solicitors:
7. The first point taken by the vendor against that requisition is that it is out of time. Clause 9 of the Agreement provides:
8. It is not in dispute that the title deeds were received by the purchaser's solicitors on 10th July 1997 and that the time for raising requisitions expired on 18th July 1997. I have considered the cases cited by counsel and their arguments thereon. I am satisfied that there is no case which prevents the operation of Clause 9 according to its plain wording. Accordingly, I hold that the purchaser is deemed to have waived its rights to raise the requisition which it now seeks to rely upon. 9. That is sufficient to dispose of the issue in the vendor's favour. But in any event, it can be seen that, quite apart from being too late, the requisition is groundless on its merits. That can be explained quite briefly. 10. When the vendor's solicitors wrote to the purchaser's solicitors on 26th August 1997 in reply to their letter of 22nd August 1997, they did not only take the point on time but also said :
11. In the course of argument, counsel for the vendor, emphasising the justice and commercial sense of time limits for the making of requisitions, pointed out that the building plans for Elite Villas which the Building Authority approved show the Swimming Pool. (At the material time, the Building Authority was of course the Director of Buildings and Lands by virtue of s.2 of the Buildings Ordinance, Cap. 123.) Had the requisition been made in time, all of this could have been pointed out, if it needed pointing out. 12. In the result, I hold that the purchaser is in repudiatory breach of the Agreement. The total of $3.225 million already paid to the vendor exceeds 10% of the purchaser price by $1.075 million. Clause 26(a) of the Agreement provides as follows:
13. Save to the extent of that $1.075 million the money already paid to the vendor is forfeited to it; and it is entitled to retain that balance of $1.075 million as security for the damages which it seeks by way of counterclaim. In paragraph 14 of the Affirmation dated 2nd December 1997 of its director Lai Wan-yan, the vendor says this as to its entitlement to damages by way of counterclaim:-
14. I am satisfied that the vendor is entitled to an assessment of such damages. In that regard, there is in this case an Order of Yuen J. dated 17th December 1997 which provides as follows in paragraph 2:
15. Accordingly the assessment of the damages suffered by the vendor will be before a Master as per Yuen J's Order. 16. I will now hear the parties as to costs and any directions which may arise. (V. Bokhary) Judge of the Court of First Instance, Representation: Ms Winnie Chan, instructed by Messrs. Katherine Y.W. Or & Co., for the Plaintiff. Mr Horace Wong, instructed by Messrs. Yuen Sung & Co., for the Defendant. |