Harris Hakim v Allgreen Properties: Forfeiture Clause & Developer's Rights in Property Sale Default
In Harris Hakim v Allgreen Properties Ltd, the Singapore Court of Appeal addressed the scope of a developer's rights following a purchaser's default on a property sale agreement. Harris Hakim, the purchaser, defaulted on installment payments to Allgreen Properties for a condominium unit. Allgreen invoked a clause allowing forfeiture of 20% of the purchase price. The court held that Allgreen was limited to recovering amounts specified in the agreement's forfeiture clause and could not claim additional common law damages. The appeal was allowed, and Allgreen was ordered to refund the excess amount withheld from Hakim.
1. Case Overview
1.1 Court
Court of Appeal of the Republic of Singapore1.2 Outcome
Appeal Allowed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Court of Appeal clarifies developer's rights upon purchaser's default in property sale, focusing on the interpretation of forfeiture clauses and remedies.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Allgreen Properties Ltd | Respondent | Corporation | Appeal Dismissed | Lost | |
| Harris Hakim | Appellant | Individual | Appeal Allowed | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chao Hick Tin | Judge of Appeal | Yes |
| L P Thean | Judge of Appeal | No |
| Yong Pung How | Chief Justice | No |
4. Counsels
4. Facts
- Hakim entered into a sale and purchase agreement with Allgreen to purchase an apartment.
- The agreement was in the form prescribed by the Housing Developers Rules.
- The purchase price was $1,165,000, payable in installments.
- Hakim defaulted on installment payments due to financial difficulties.
- Allgreen invoked clause 5(3) of the agreement to annul the agreement and forfeit 20% of the purchase price.
- Allgreen resold the apartment for a lower price and sought to recover the shortfall and other expenses from Hakim.
- Hakim disputed Allgreen's computation of the refundable amount.
5. Formal Citations
- Harris Hakim v Allgreen Properties Ltd, CA 600013/2001, [2001] SGCA 61
6. Timeline
| Date | Event |
|---|---|
| Sale and purchase agreement signed | |
| Hakim requested Allgreen to serve notice under clause 5 | |
| Allgreen invoked clause 5(3) of the agreement | |
| Allgreen's solicitors sent a letter to Hakim regarding forfeiture of deposit | |
| Allgreen's solicitors informed Hakim about refund amount | |
| Hakim commenced proceedings in Originating Summons No 896 of 2000 | |
| Judgment issued |
7. Legal Issues
- Breach of Contract
- Outcome: The court held that Allgreen's rights were limited to the remedies specified in clause 5(3) of the agreement.
- Category: Substantive
- Sub-Issues:
- Default in payment of installments
- Repudiation of agreement
- Interpretation of Contractual Clauses
- Outcome: The court interpreted the 'without prejudice' clause in the context of the Housing Developers Rules, limiting the developer's remedies.
- Category: Substantive
- Sub-Issues:
- Interpretation of 'without prejudice' clause
- Forfeiture clause
- Rights available at law or in equity
- Measure of Damages
- Outcome: The court determined that the developer was not entitled to claim damages at common law in addition to the amounts specified in the forfeiture clause.
- Category: Substantive
- Sub-Issues:
- Liquidated damages
- Unliquidated damages
- Forfeiture of deposit
8. Remedies Sought
- Determination of the amount to be refunded
- Refund of the balance sum
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Real Estate Litigation
- Commercial Litigation
11. Industries
- Construction
- Real Estate
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Tally and Anor v Wolsey-Neech | Court of Appeal | Yes | Tally and Anor v Wolsey-Neech (1979) 38 P&CR 164 | England | Cited regarding the interpretation of 'without prejudice' clauses in property sale agreements and the election of remedies. |
| Wallace-Turner v Cole | High Court | Yes | Wallace-Turner v Cole (1983) 46 P&CR 164 | England | Cited regarding the election of remedies between liquidated and unliquidated damages in property sale agreements. |
| Sakkas and Anor v Donford Ltd | High Court | Yes | Sakkas and Anor v Donford Ltd (1983) 46 P&CR 290 | England | Cited regarding the limitation of damages to the difference between the initial sale price and the resale price, plus costs of resale. |
| Bruce v Waziri | High Court | Yes | Bruce v Waziri (1983) 46 P&CR 81 | England | Cited as a case with a different conclusion regarding the interpretation of similar clauses, but ultimately distinguished. |
| Lim Lay Bee and Anor v Allgreen Properties Ltd | Court of Appeal | Yes | Lim Lay Bee and Anor v Allgreen Properties Ltd [1999] 1 SLR 471 | Singapore | Cited to support the interpretation of 'other rights' as rights to payment of sums accrued under the agreement prior to termination. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Housing Developers Rules (Cap 130, R 1, 1990 Ed) | Singapore |
| Housing Developers (Licensing and Control) Act (Cap 130, 1985 ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Sale and purchase agreement
- Instalment payments
- Forfeiture clause
- Without prejudice
- Housing Developers Rules
- Repudiation
- Annulment
- Liquidated damages
- Common law damages
15.2 Keywords
- property
- sale
- agreement
- breach of contract
- forfeiture
- damages
- housing developer
- purchaser
- instalment
- Singapore
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Housing Developers Rules | 80 |
| Property Law | 75 |
| Sale and purchase of property | 70 |
| Contract Law | 70 |
| Measure of Damages | 65 |
| Liquidated Damages | 60 |
| Land Law | 60 |
16. Subjects
- Contract Law
- Property Law
- Real Estate
- Civil Procedure