Chua Chay Lee v Premier Properties: Repudiatory Breach & Contract Termination
In Chua Chay Lee and Others v Premier Properties Pte Ltd, the Court of Appeal of Singapore dismissed the appeal of apartment owners (appellants) who sought to terminate their contract with Premier Properties (respondents) due to construction delays. The appellants claimed anticipatory breach, arguing the respondents could not meet the original deadline. The court, however, found that the delay did not constitute a repudiatory breach, and the appellants were not entitled to terminate the agreement. The court considered the liquidated damages clause and the progress made by the respondents before the termination notice.
1. Case Overview
1.1 Court
Court of Appeal1.2 Outcome
Appeal dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Apartment owners claimed anticipatory breach due to construction delays. The court dismissed the appeal, finding no repudiatory breach by the developer.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Chua Chay Lee | Appellant | Individual | Appeal Dismissed | Lost | Thio Shen Yi, Priscilla Chang |
| Premier Properties Pte Ltd | Respondent | Corporation | Appeal Dismissed | Won | Mohan Pillay, Andre Maniam |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chao Hick Tin | Justice of the Court of Appeal | Yes |
| Tan Lee Meng | Judge | No |
| Yong Pung How | Chief Justice | No |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Thio Shen Yi | Thio Su Mien & Partners |
| Priscilla Chang | Thio Su Mien & Partners |
| Mohan Pillay | Wong Partnership |
| Andre Maniam | Wong Partnership |
4. Facts
- The respondents, property developers, sought to redevelop a site with 24 apartments.
- The respondents offered apartment owners the option to exchange their old apartments for new ones to be built on the redeveloped site.
- The appellants opted to exchange their old apartments for new ones.
- The agreement stipulated a deadline of 33 months for handing over the new apartments.
- The agreement included a liquidated damages clause for delays at a rate of 10% per annum on $2,805,000.
- The respondents acquired additional land, expanding the housing project.
- The appellants terminated the agreement due to concerns about delays and the respondents' financial difficulties.
5. Formal Citations
- Chua Chay Lee and Others v Premier Properties Pte Ltd, CA 182/1999, [2000] SGCA 34
6. Timeline
| Date | Event |
|---|---|
| Agreement for en-bloc transfer of apartments signed. | |
| Preview of the working model of the project. | |
| Business Times quoted the respondents' representative as saying that the respondents would sell their St Martins' land if the price was right. | |
| Respondents invited the appellants to select their new apartments on 8 May 1999. | |
| Date the appellants were invited to select their new apartments. | |
| Appellants' solicitors wrote to the respondents' solicitors to terminate the agreement. | |
| Appellants' solicitors wrote to the bank to demand the payment of $2,762,603.84 under the performance guarantee. | |
| Respondents' solicitors replied that their clients considered the termination by the appellants of the agreement as wrongful. | |
| Respondents' solicitors wrote to the appellants' solicitors to point out that the appellants had already been verbally informed that the date for completion for their apartments was set back by only about a year. | |
| Appellants' solicitors responded to the respondents' solicitors' letter of 18 May 1999. | |
| Respondents took out an originating summons to determine whether the appellants' demands under the performance guarantees were valid. | |
| Decision Date |
7. Legal Issues
- Repudiatory Breach
- Outcome: The court held that the delay in construction did not constitute a repudiatory breach of contract.
- Category: Substantive
- Sub-Issues:
- Anticipatory breach
- Delay in performance
- Related Cases:
- [1949] Ch 649
- [1957] 2 QB 401
- [1962] 2 QB 26
- [1980] AC 827
- [1983] 1 All ER 449
- [1979] AC 757
- [1971] 1 WLR 361
- [1967] 1 AC 361
- [1989] 166 CLR 623
- [1940] 3 All ER 60
- Contract Termination
- Outcome: The court held that the apartment owners were not entitled to terminate the agreement.
- Category: Substantive
8. Remedies Sought
- Termination of Contract
- Damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Construction Law
11. Industries
- Construction
- Real Estate
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Thorpe v Fasey | High Court of Justice | Yes | [1949] Ch 649 | England and Wales | Endorsed the approach that there is no distinction between the nature of repudiation required to constitute an anticipatory breach and that required where the alleged breach occurs after the time for performance has arisen. |
| Universal Cargo Carriers Corp v Citati | Queen's Bench Division | Yes | [1957] 2 QB 401 | England and Wales | Explained that a party is allowed to anticipate an inevitable event and is not obliged to wait till it happens, it must follow that the breach which he anticipates is of the same character as the breach which would actually have occurred if he had waited. Also, reiterated that while the application of the doctrine of frustration is a matter of law, the assessment of a period of delay sufficient to constitute frustration is a question of fact. |
| Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd | Court of Appeal | Yes | [1962] 2 QB 26 | England and Wales | Addressed the question of whether the occurrence of the event deprive the party who has further undertakings still to perform of substantially the whole benefit which it was the intention of the parties as expressed in the contract that he should obtain as the consideration for performing those undertakings? |
| Photo Production Ltd v Securicor Transport Ltd | House of Lords | Yes | [1980] AC 827 | United Kingdom | Reiterated that the effect of a failure by one party to perform his primary obligation depends on whether it has the effect of depriving the other party of substantially the whole benefit he was intended to have under the contract. |
| Afovos Shipping Co SA v R Pagnan & F Lli | House of Lords | Yes | [1983] 1 All ER 449 | United Kingdom | Reiterated that the effect of a failure by one party to perform his primary obligation depends on whether it has the effect of depriving the other party of substantially the whole benefit he was intended to have under the contract. |
| The Nanfri; Federal Commerce & Navigation Co Ltd v Molena Alpha Inc & Ors | House of Lords | Yes | [1979] AC 757 | United Kingdom | The test of repudiation has been formulated in various ways by different judges. Will the consequences of the breach be such that it would be unfair to the injured party to hold him to the contract and leave him to his remedy in damages as and when a breach or breaches may occur? If this would be so, then a repudiation has taken place. |
| Decro-Wall International SA v Practitioners in Marketing Ltd | Court of Appeal | Yes | [1971] 1 WLR 361 | England and Wales | Formulation by Buckley LJ: `Will the consequences of the breach be such that it would be unfair to the injured party to hold him to the contract and leave him to his remedy in damages as and when a breach or breaches may occur? If this would be so, then a repudiation has taken place.` |
| Suisse Atlantique Société d`Armement Maritime SA v NV Rotterdamsche Kolen Centrale | House of Lords | Yes | [1967] 1 AC 361 | United Kingdom | The `deliberate` character of a breach cannot, in my opinion, of itself give to a breach of contract a `fundamental` character, in either sense of that word. |
| Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd | High Court of Australia | Yes | [1989] 166 CLR 623 | Australia | There is a difference between evincing an intention to carry out a contract only if and when it suits the party to do so and evincing an intention to carry out a contract as and when it suits the party to do so. |
| Ross T Smyth & Co Ltd v TD Bailey Son & Co | House of Lords | Yes | [1940] 3 All ER 60 | United Kingdom | I do not say that it is necessary to show that the party alleged to have repudiated should have an actual intention not to fulfil the contract. He may intend in fact to fulfil it, but may be determined to do so only in a manner substantially inconsistent with his obligations and not in any other way. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Repudiatory Breach
- Anticipatory Breach
- Liquidated Damages
- En-bloc Transfer
- Performance Guarantee
- Handing Over Date
15.2 Keywords
- Contract
- Breach
- Repudiation
- Apartment
- Construction
- Delay
- Singapore
16. Subjects
- Contract Law
- Real Estate Law
- Construction Dispute
17. Areas of Law
- Contract Law
- Building and Construction Law