Sang v Sudeall et Al

• Jurisdiction: Jamaica
• Judge: Carberry, J.A.,Bingham, J.A.,Wright, J.A.
• Judgment Date: 30 June 1988
• Neutral Citation: JM 1988 CA 119
• Docket Number: Civil Appeal No. 71 of 1984
• Court: Court of Appeal (Jamaica)
• Date: 30 June 1988

Court of Appeal

Carberry, J.A.; Wright, J.A.; Bingham, J.A. (Ag.)

Civil Appeal No. 71 of 1984

Sang

and

Sudeall et al

Appearances

W .B. Frankson, Q.C. and D. Coke for the plaintiff/appellant.

C. Rattray, Q.C. and C. Cousins for the defendants/respondents.

Contract - Sale of land — Deposit paid — Balance to be paid within stipulated time — Balance unpaid — Declaration that contract be rescinded — Counterclaim for specific performance — Specific performance ordered — Appeal against judgment — Whether price to be paid only in exchange for registered title — Duty incumbent on vendor of registered land — Whether purchaser's name to be registered by vendor prior to payment of purchase price — Examination by court of previous negotiations, subsequent declarations, conduct of parties — Finding that purchase price to be paid within contractual stipulation — Vendor entitled to rescind — Judgment entered for vendor — Consequential orders made.

Carberry, J.A.

1 This was an appeal from the judgment of Wolfe, J., delivered on 22nd October, 1984 in a case heard before him for some 5 days in April and October, 1983. The case arose out of a contract dated the 30th March, 1979 made between Enid Phang Sang, the plaintiff/vendor and Conley Joseph Sudeall and his wife Joyce, the defendants/purchasers. Sydney Phang Sang and his wife Enid, the plaintiff, were the owners of land at Anchovy in the parish of Portland registered at Volume 955 Folio 243. The title was by plan and the land contained by survey some two acres and twenty one perches. It was subject to a covenant against being sub divided without the consent of the Portland Parish Council. However that consent was obtained and the land divided into three portions, as appeared in a plan or diagram made by Mr. R. T. Gooden, a commissioned land surveyor, from a survey made by him on the 31st October, 1978. At the time of the sale to the Sudealls the registered title for the land had not yet been divided into its three separate components, though the process to obtain this had begun.

2 The sale to the Sudealls was in respect of lot one, and the price was J$50,000. The contract is set out in full below. To summarize, the price was to be paid by a deposit of $5,000 and the balance of $45,000 was to be paid within 90 days from the date of the contract. Though the deposit was paid, the balance was not paid within the time specified or at all, and eventually the vendor purported to rescind the contract and forfeit the deposit, and brought this action claiming an order rescinding the agreement and a declaration that the deposit be forfeited. Again summarising, the defence was to the effect that there was a term in the contract that the price was to be payable only on receipt by the purchasers of a registered title to this lot of land, that no such title had been presented to them, but that they were willing and able to pay for the land and would do so when they got the title. They counterclaimed for a declaration that the purported rescission of the contract was invalid, and they claimed specific performance of the contract. It should be noted that there was a house on this lot of land, and that the purchasers entered into possession at the time of the contract, 30th March, 1979 and have been there ever since.

3 Wolfe, J., founding himself on dicta by Denning, L.J., in British Movietonews Ltd. v. London & District Cinemas Ltd. [1950] 2 All E.R. 390 at 395; [1951] 1 K.B. 55 to the effect that the Court qualifies the literal meaning of the words in a written contract so as to bring them into accord with the contemplated scope of the contract, and that even if the contract is absolute in its terms, nevertheless, if it is not absolute in intent, it will not be held absolute in effect, Wolfe, J., observed:

“Relying on the dictum of Denning, L.J., as qualified by Viscount Simon (referring to the House of Lords decision in that case), I am satisfied that from the nature of the contract and the surrounding circumstances that It was a condition of the contract, albeit not expressed, that the balance of the purchase money would be paid in ninety days in exchange for a registered title and that this condition was a foundation upon which the parties contracted….

In the light of the foregoing I hold that the balance of the purchase money was payable in exchange for a registered title, which it was the duty of the vendor to procure…” (emphasis supplied).

4 Wolfe, J., found that the vendor was not justified in rescinding the contract, having failed to date to produce for the purchasers a registered title, and he refused the reliefs sought by the plaintiff/vendor. He went on to order specific performance in favor of the defendants/purchasers, holding that the primary cause of any delay was due to the vendor's interpretation of the contract. He ordered, (in what must be surely an unusual order), that the defendants, (the purchasers) shall forthwith pay over to their attorneys-at-law the sum of $45,000 balance of the purchase money, and in addition an amount to cover the defendants half costs of obtaining title. The half costs were to be paid over to the plaintiff's attorneys-at-law as soon as the defendants' attorneys-at-law got them. The defendants' attorneys-at-law were to inform the plaintiff's attorneys-at-law as soon as they got the $45,000 balance of the purchase money, whereupon the plaintiff was to take all reasonable steps to procure a registered title in the name of the defendants within a period of three months from the date thereof.

5 The result of this judgment is that from March 1979 to October 1984 (and to date if the judgment is right) the defendants/purchasers, have been in possession of the land; have paid no rent, and no interest on the unpaid purchase money the value of which has been steadily deteriorating since 1979. Apart from the debatable issue of the condition of the house, the land itself has of course been steadily appreciating in value since 1979.

6 It seems to me that there are two central points of law involved:

• (a) whether it was right to read into this contract the terms inserted by Wolfe, J., that the price should be paid only in exchange for a registered title presumably in the name of the purchasers;

• (b) what is the duty normally incumbent on the vendor of registered land?

7 Point (a) involves a great deal of authority: cases on what is sometimes called the parol evidence rule, and also the collateral contract. Point (b) involves a consideration of the registration of titles and conveyancing practice.

8 Dealing with (b) the shorter point first, the duty of a vendor selling registered land: at common law, normally and in the absence of special terms to the contrary, the purchaser would produce his purchase money and the vendor would then sign a conveyance, prepared by the purchaser's lawyer, (unlike the common law rule in Jamaica, by section 4 of the Conveyance Act it is the vendor's lawyer who prepares the conveyance) of the land to the purchaser. The payment of the money and the conveyance of title to the purchaser would be contemporaneous. Before matters reached that stage there would have been a careful perusal of the vendor's title and supporting documents, questions might be raised and answers given aimed at ensuring that the vendor did indeed have the interest he purported to sell, and that the purchaser would get it in exchange for his purchase money.

9 However, under the Registration of Titles Act or system, title is transferred by the entry of the purchaser's name in the Register Book of Titles. It is not practicable therefore to follow the procedure used in the case of unregistered land. On the one hand it would be obviously unwise for the vendor to actually transfer the land into the name of the purchaser without either having got the purchase, money, or receiving from the purchaser, his attorney or banker an irrevocable assurance that the price will be paid on the transfer taking place.

10 On the other hand the purchaser may cavil at paying his money before getting title, though he could if he wished protect himself by lodging a caveat to protect the title between contract and transfer. Further, he may need to show the title in order to raise part of the purchase money on a mortgage. In this situation the practice is for the vendor to loan the certificate of title to the purchase's solicitor or attorney, on the latter's undertaking to do nothing to harm H the vendor. The purchaser's bank inspects and having assured itself that the title is unencumbered or the like, intimates it will advance the money.

11 Williams in his book “vendor & Purchaser” (4th Edition 1936) at Chapter XX deals with the sale of registered land in England and at page 1155 dealing with completion, observes that the payment of the price and the registration of the purchaser as proprietor cannot be I exactly simultaneous. The one must either precede or follow the other. At page 1156 “Completion at vendor's Office” he observes:

“Thus, notwithstanding that the purchase has not been fully completed by the registration of the purchaser as proprietor, yet it is proper to pay the purchase money in the usual way at the office of the vendor's solicitor, against delivery of the land certificate and of the transfer duly executed; … and also where either of these precautions is considered necessary, the lodging of a priority notice after search at the Registry …”

12 Fox, in his book, The Transfer of Land Act, 1954, (New South Wales) at page 140 et seq., is out the general conditions of Sale of Land under Transfer of Land Act, 1954. These the statutory rules that have been made to govern cases where the parties have made no special terms of their own. Rule 12 reads:

“12. Upon payment of all purchase and other moneys payable by the purchaser under the contract the vendor shall sign a proper instrument...