Upload
ledat
View
220
Download
0
Embed Size (px)
Citation preview
Page 1 of 21
REPUBLIC OF TRINIDAD AND TOBAGO
IN THE COURT OF APPEAL Civ. App. No. 226 of 2011 Claim No. CV2007-02132
BETWEEN
Nidra Williams
Appellant/Claimant AND
Colvin E. Blaize
Respondent/Defendant
*************** Panel:
A. Mendonca J.A.
R. Narine J.A.
P. Moosai J.A.
Appearances:
Ms. A. Sooklal for the appellant
Mr. S. Marcus SC for the respondent
DATE DELIVERED: 2nd May, 2016.
Page 2 of 21
I have read the judgment of Narine J.A. and agree with it.
A. Mendonca, Justice of Appeal.
I too, agree.
P. Moosai,
Justice of Appeal.
JUDGMENT
Delivered by R. Narine J.A.
THE FACTS:
1. This is an appeal from a decision of the High Court dismissing the appellant’s
claim for specific performance of an agreement for sale of a townhouse, and
ordering the appellant on the respondent’s counterclaim to surrender possession
of the townhouse, and to pay mesne profits of $3,000.00 a month, and
prescribed costs of $31,725.00.
2. The basic facts that are material to this appeal are largely undisputed and are set
out below.
3. The parties entered into a written agreement dated 14th October 2003, the
material terms of which are:
Page 3 of 21
The purchase price was $350,000.00 of which a deposit of 10% was to be
paid by the purchaser (the appellant) upon execution.
The balance of the purchase price was to be paid on the date fixed for
completion which was expressed to be on or before forty-five days from
the date of production by the vendor (the respondent) of a completion
certificate issued by the Regional Corporation in respect of the townhouse.
The respondent was required to complete the construction not later than
31st March 2004.
The respondent was required to provide “a good marketable title” to the
property free from encumbrances, and was required to discharge all
outstanding rates and taxes.
The vendor and the purchaser “may by mutual agreement extend the date
fixed for completion and for such extended date time shall be of the
essence of the contract”.
4. As noted above, the agreement provided for completion of construction by 31st
March 2004 and completion of the agreement for sale forty-five days after
production by the vendor of a completion certificate issued by the Regional
Corporation. However, after more than a year and a half had elapsed after the
time contemplated by the agreement for completion of the agreement, the parties
entered into a course of correspondence (as reflected in the Supplemental
Record of Appeal). The correspondence between the parties touches matters of
importance in this appeal, and I propose to set them out in some detail. The
correspondence begins with a letter dated 13th October 2005, from the
respondent to the appellant, in which he encloses, inter alia, a draft deed of
lease, and promised to provide land and building taxes receipts and a WASA
Clearance Certificate “as soon as they become available”.
5. By letter dated 9th December 2005, the appellant wrote to the respondent
advising that the Trinidad and Tobago Mortgage Finance Company (TTMF) had
Page 4 of 21
approved her application for a mortgage, and in order to complete the process
she required certain documents, among them:
Land and Building Tax Receipt for 2005;
A WASA Clearance certificate for the property, and
A completion certificate for the property.
The appellant further informed the respondent that she wished the process to be
completed by the 22nd December 2005, and that failure to complete by the end of
the year would result in her losing her tax benefit.
6. More than a year later, by letter dated 19th January 2007, the respondent wrote
to the appellant advising that he had now obtained “the final approvals and all
completion certificates from the relative authorities” and enclosing copies of
same. He further advised that completion of the agreement for sale would take
place forty-five days from the 19th January 2007, namely, 5th March 2007.
Enclosed with the letter was a completion certificate from WASA dated 30th
October 2006, confirming that the plumbing system on the property had been
inspected and tested and conformed to the requirements of the National
Plumbing Code of Trinidad and Tobago. (This was not a WASA Clearance
Certificate certifying that water and sewerage rates had been paid.)
7. By a written agreement dated 22nd February 2007, the respondent permitted the
appellant to enter into possession of the townhouse “until the completion or
rescission” of the agreement for sale. The document further provided that the
duration of the licence was for one month commencing 22nd February 2007. The
“monthly sum” of $410.00 payable in advance was to be paid for occupation of
the premises.
8. By letter dated 21st March 2007 from the respondent to the appellant, the
respondent purported to unilaterally increase the licence fee to $3,000.00 per
month, and offered to provide an indemnity with respect to all water rates for the
Page 5 of 21
period October 2006 to January 2007, pending receipt of a WASA Clearance
Certificate which he intended to request.
9. The correspondence thereafter took on a less amicable tone. The appellant
replied by letter dated 29th March 2007, indicating that TTMF would not accept an
indemnity from the respondent, and that the WASA Clearance Certificate was the
only document needed to complete the transaction. The letter is set out in full
below:
“Unit C Scott Bushe Street
Port of Spain
Attention: Colvin Blaize
March 29, 2007
Dear Mr Blaize
Further to your letter dated March 21, which I received March 29, I wish to
advise that I will not be intimidated or swayed by your legal manoeuvrings.
I have submitted all of the documentation required to complete my
mortgage transaction for Unit#3 Stirling Court to the Trinidad and Tobago
Mortgage Finance Company (TTMF). The only document needed to
complete the transaction is the WASA clearance certificate which must be
submitted to TTMF by you.
The officials at TTMF have confirmed that they will not accept the
indemnity which you have attached to your correspondence of March 21
Page 6 of 21
and have once again asked that you provide the WASA clearance
certificate as soon as possible.
I trust that in the interest of completing this transaction you will no longer
send me irrelevant correspondence but will instead focus your energies on
ensuring that the WASA clearance certificate reaches TTMF – Ms.
Charlene Williams in a timely fashion.
I look forward to your prompt attention to this matter.
Regards
Nidra Williams
cc. Charlene Williams, Trinidad and Tobago Mortgage Finance Company
Nidra Williams, 337 Singh Street Ext. Dinsley Village Tacarigua. 640 – 1185
(home) 683 – 5943 (mobile)”
10. By letter dated 4th April 2007, the respondent pointed out that the appellant had
not completed the transaction on 5th March 2007, and insisted that she must pay
the sum of $3,000.00 per month for occupying his property pending completion of
the sale. Significantly, the letter makes no mention of the WASA Clearance
Certificate, which the appellant had indicated in her letter of 29th March 2007,
was required to complete the transaction.
11. By letter dated 26th April 2007, the respondent called upon the appellant to
complete the transaction on or before 30th April 2007, time being of the essence.
Page 7 of 21
12. By letter dated 30th April 2007, Mr Carlyle Serrano, Attorney-at-Law, wrote to the
respondent on behalf of the appellant, indicating that his searches had revealed
an undischarged mortgage over the property, and requesting several documents,
including approvals from various state agencies, and the WASA Clearance
Certificate and the 2007 receipt for land and building taxes. The letter further
indicated that the draft lease did not pass any interest in the land, and invited the
respondent to revisit the lease. The letter further made reference to certain
outstanding works that were to be addressed in the townhouse, and affirmed the
appellant’s readiness and willingness to complete the transaction.
13. By reply dated 1st May 2007, addressed to Mr Serrano, the respondent purported
to forfeit the deposit, terminate the licence, and called upon the appellant to
vacate the townhouse within seven days. No mention was made of the matters
raised in Mr Serrano’s letter of 30th April 2007.
14. By letter of even date Mr Serrano responded pointing out that his requisitions had
not been addressed, and calling upon the respondent to revisit the matter. By
letter dated 2nd May 2007, the respondent replied, indicating that “all documents
that were necessary for the completion of the … transaction had already been
forwarded to your client and her prospective mortgagee”, and that there was
“nothing outstanding with respect to the completion of the transaction”. That
apart the respondent did not address any of the other matters in Mr Serrano’s
letter of 30th April. The respondent concluded the letter by stating that his
position remained the same as stated in his letter of 1st May and calling upon the
appellant to vacate the premises.
15. By letter dated 23rd May 2007, Mr Serrano wrote to the respondent, indicating
that he had received some of the documents required from a third party, and
requesting three documents still required for completion namely, a copy of the
lease executed in escrow by the appellant and endorsed by the mortgagee,
evidence of the issuance of a share certificate by Stirling Court Limited, and the
Page 8 of 21
2007 receipt for land and building Taxes. Mr Serrano further indicated that he
was willing to accept a commitment from the respondent to remedy the deficient
works, and that the financier was willing to disburse the cheque to complete the
transaction within three days of the production of the documents requested.
16. The respondent replied the following day enclosing the requested documents
and agreeing to waive his initial rescission of the agreement for sale and to
extend the time for completion of the agreement for sale to 29th May 2007, time
being of the essence.
17. By letter dated 28th May 2007, Mr Serrano raised two requisitions with the
respondent with respect to the deed of lease. The first concern was that the
mortgagee’s consent appeared to have been endorsed some twenty-one days
after the date of the lease itself. The second matter was that the lease did not
“define” the land that was being assigned to the respondent. There were other
minor amendments which Mr Serrano called upon the respondent to address
before the transaction could be finalised.
18. The respondent replied by letter dated 29th May 2007 dismissing the requisitions
raised as lacking in substance. In his view there was nothing to be rectified or
addressed, and he expected the purchaser to complete the transaction as he had
indicated in his letter of 24th May 2007, that is, on the very day he was writing –
29th May 2007.
19. The final letter on the record was dated 31st May 2007 from the respondent to the
appellant, purporting to rescind the agreement for sale, forfeiting the deposit,
terminating her licence to occupy the premises, and calling upon her to vacate
same within seven days.
20. The trial judge found that the appellant may have acted reasonably in querying
the issue “as to whether the assignment of the townhouse carried with it an
Page 9 of 21
assignment of land”. However, he went on to find that time being of the essence,
the respondent “was entitled to treat the agreement as at an end and forfeit the
deposit”.
21. The main issue in this case is whether the respondent was entitled as a matter of
law to rescind the agreement for sale and forfeit the deposit. In considering the
main issue, other sub-issues arise namely:
The issue of the WASA Clearance Certificate;
The issue of the date of the mortgagee’s consent to the deed of lease, and
The issue of the absence of a description of the land being assigned to the
purchaser in the deed of lease.
The WASA Clearance Certificate
22. Mention of this document was first made on 13th October 2005 by the respondent
in his letter to the appellant, promising to provide it as soon as it became
available. In December 2005, the appellant requested the respondent to provide
it as a matter of urgency, as it was required by the TTMF to complete her
mortgage transaction.
23. On 19th January 2007, the date on which the respondent called upon the
appellant to complete the transaction on 5th March 2007, the WASA Clearance
Certificate was still outstanding. Indeed, on the date set for completion, the
WASA Clearance Certificate was still not sent in response to Mr Serrano’s letter.
By letter dated 29th March 2007, the appellant again requested the respondent to
provide the WASA Clearance Certificate “as soon as possible” in order to
complete her mortgage transaction.
24. On 26th April 2007, the date on which the respondent called upon the appellant to
complete the transaction on or before Monday 30th April 2007, time being of the
Page 10 of 21
essence, the correspondence reveals that Mr Serrano still had not received the
WASA Clearance Certificate, as evidenced by Mr Serrano’s letter dated 30th April
2007 requesting the respondent to provide same (in addition to the 2007 receipt
for land and building Taxes).
25. On 1st May 2007, upon receipt of Mr Serrano’s request for the documents, and
his requisition with respect to the description of the land being passed under the
deed of lease, the respondent purported to rescind the agreement and forfeit the
deposit. On the say day, Mr Serrano responded to the effect that the purported
rescission and forfeiture of the deposit was untenable in law. By letter dated 2nd
May 2007, the respondent refused to change his position and indicated that he
had already forwarded all documents that were necessary for completion to the
appellant and her prospective mortgagee. He did not indicate however, when the
WASA Clearance Certificate had been provided.
26. By letter dated 23rd May 2007, Mr Serrano indicated to the respondent that he
had “recently received documentary evidence from a third party that satisfies
some of the requisitions on title raised”. He then requested three documents,
being the deed of lease executed in escrow, the share certificate issued by
Stirling Court Limited, and the 2007 receipt for land and building taxes. These
were supplied by the respondent under cover of letter dated 24th May 2007, by
which the respondent waived his “initial rescission” and extended the time for
completion to 29th May 2007, time being of the essence.
27. The trial judge inferred from the absence of mention of the WASA Clearance
Certificate in Mr Serrano’s letter of 23rd May 2007, that the WASA Clearance
Certificate was no longer an issue in the case. Mr Marcus, in answer to a
specific question as to whether the respondent had ever provided the WASA
Clearance Certificate to the appellant, did not directly respond to the question but
submitted that it was an inference to be drawn from its absence of mention in the
letter of 23rd May 2007.
Page 11 of 21
28. In Mungalsingh v. Juman [2015] UKPC 38, the Privy Council considered a
situation in which the vendor had not produced a WASA Clearance Certificate
and an up to date receipt for land and building taxes. The Board noted that
unpaid water rates and unpaid land tax can each result in distraint or even sale of
the property concerned under the Rates and Charges Recovery Act and the
Water and Sewerage Authority Act, and concluded that the trial judge was
correct in finding that in this jurisdiction, the vendor must provide these
documents before he is in a position to show good title. Accordingly, it was not
open to the vendor to serve a notice to complete, making time of the essence, on
the date that he purported to do so, since he had not shown good title by that
date.
29. On the documentary evidence before the court, the appellant had not received
the WASA Clearance Certificate or the 2007 receipt for land and building taxes
as at 26th April 2007, when the respondent purported to serve notice to complete
by 30th April 2007, time being of the essence. Indeed, if Mr Serrano’s letter is
accepted (and the trial judge made no finding to the contrary), as at 30th April
2007 Mr Serrano still had not received these documents.
30. However, in his letter dated 24th May 2007, the respondent purported to waive
his “initial rescission” and proceeded to fix 29th May 2007, as the date for
completion, time being of the essence. Under cover of this letter he had provided
the 2007 receipt for land and building tax. In my view, it was open to the trial
judge to draw the inference that as at 23rd May 2007, the WASA Clearance
Certificate was no longer an issue. However, there still remained the requisitions
raised by Mr Serrano with respect to the date of the mortgagee’s consent and the
issue as to whether the deed of lease as drafted conveyed any interest in the
land, and if so, the absence of a description of the land to be assigned to the
purchaser. There is also the further issue, as to whether, in all the circumstances
of this case the notice to complete within five days was a reasonable one, the
respondent not having shown a proper title up to 24th May 2007 (when he
Page 12 of 21
provided the 2007 receipt for land and building taxes), having set a date for
completion of construction no later than 31st March 2004, and having produced a
completion certificate of the Regional Corporation almost three years after that
date.
The obligation to show good title
31. It was an express provision of the agreement for sale dated 14th October, 2003
that the sale “shall be subject to the Vendor providing a good marketable title to
the development property free from encumbrances and the discharge by the
Vendor of all outstanding rates and taxes due on the development property prior
to completion”.
32. In Mungalsingh v. Juman (supra) the Board expressed the view that there
appeared to be no justification for a distinction between the “good title” and a
“good marketable title”, the latter being a title “which the purchaser is bound to
accept” (per Millet LJ in Barclays Bank plc v. Weeks Legg Dean [1999] QB 309
at 324 – 325), or a title which “the court will require before it forces a property on
an unwilling buyer” (per Lord Neuberger in Mungalsingh at paragraph 18).
33. However, the contract was silent on the obligation of the vendor to answer
requisitions and inquiries reasonably raised by the purchaser. This obligation is
expressly provided for in the United Kingdom by the Law Society’s Conditions of
Sale, the National Conditions of Sale and the Standard Conditions of Sale which
impose time limits for the making of requisitions by the purchaser and for replies
thereto by the vendor.
34. In the absence of any express term as to the duty of the vendor to answer
reasonable requisitions, there will be implied into the contract a term that the
vendor is under an obligation to properly answer all reasonable requisitions and
Page 13 of 21
inquiries within a reasonable time, so as to enable the purchaser to satisfy
himself on the matters raised, and to arrange his finances so as to be ready to
complete on the date fixed: Active Keen Industries Ltd. v. Fok Chi-Keong
[1994] 1 HKLR 396 at 405, a decision of the Court of Appeal of Hong Kong which
this court considers to be of highly persuasive authority. Likewise, in my view, in
the absence of an express provision in the agreement, a term will be implied that
the purchaser is under an obligation to make his requisitions within a reasonable
time. In this case no issue has been raised by the respondent with respect to the
time at which the requisitions were made. Instead the respondent has argued
that the appellant waived outstanding requisitions by letter dated 23rd May 2007.
In any event, having regard to the facts of this case, in my view the requisitions
were made within a reasonable time, some four days after the deed of lease
executed in escrow was provided.
The consent of the mortgagee
35. In his letter of 30th April 2007, Mr Serrano pointed out to the respondent that the
conveyancing practice was for the vendor to produce a copy of the deed
executed in escrow, so that the proposed mortgagee providing finance to the
purchaser would have evidence of a security. Mr Serrano also expressed
concern that the draft deed of lease did not pass any interest in the land. The
respondent replied by letter dated 1st May 2007, completely ignoring the
concerns expressed, and purporting to forfeit the deposit.
36. It was not until 24th May 2007, that the respondent provided the deed of lease
executed in escrow. Mr Serrano noted in his letter dated 28th May 2007, that the
consent of the mortgagee (RBTT Merchant Bank Ltd.) was dated some twenty-
one days after the date of the lease itself. Mr Serrano expressed the view that
since the consent was obtained some time after the creation of the lease, the
lease itself would be in breach of the existing mortgage.
Page 14 of 21
37. The trial judge found that it could reasonably have been argued that this was in
effect an encumbrance on the title, and the onus lay on the respondent “to
resolve the issue pursuant to his duty to demonstrate a good marketable title free
from encumbrances”. However, the judge went on to express the view that the
matter could easily have been resolved by simply updating the deed. The judge
also noted that the appellant had not yet executed the deed and suggested that
execution by the purchaser on the date set for completion, that is, 29th May 2007,
“would have meant that the consent was properly obtained”. Further the judge
opined that the matter would have been rendered of “academic relevance” since
the existing mortgage would have been released prior to completion. It follows
that in the judge’s view the requisition was a reasonable one which the
respondent was obliged to address. The trial judge found that the respondent
failed to do so. There was no appeal from these findings of the judge.
The requisition with respect to assignment of an interest in the land
38. The issue as to whether or not the draft deed of lease conveyed any interest in
land was first raised by Mr Serrano in his letter of 30th April 2007. He expressed
the view that the draft deed conveyed no interest in the land to the purchaser,
and suggested that the draft deed be rectified. The respondent’s response of 1st
May 2007, completely ignored the requisition, and in fact purported to forfeit the
deposit and terminate the licence.
39. By letter of 28th May 2007, Mr Serrano revisited the matter, pointing out that the
deed of lease executed in escrow did not define the land to be assigned to the
purchaser and again, requested that the deed be rectified. In his response dated
29th May 2007, the respondent advised “that this is a leasehold building scheme
and as I have absolutely no intention of entering into any explanations with
Page 15 of 21
another attorney about the law concerning these particular matters, I would just
indicate that the issue raised lacks substance”.
40. In my view it is unfortunate in the extreme that the respondent did not choose in
his response to address the requisition raised by Mr Serrano, who was acting
primarily for the proposed mortgagee (TTMF), which would require a precise
definition of its security. The respondent’s response was less than helpful, and
unfortunately came across as arrogant, if not arbitrary.
41. Interestingly, in paragraph 2 of his Defence, the respondent averred “that he
never agreed and/or impliedly agreed that the sale of the townhouse would
include the sale of the land upon which it is situated”.
42. Before the trial judge the respondent submitted that since the townhouse was
attached irremovably to the land, the land area and the townhouse were one item
of real property, and so the reference in the deed of lease to “Townhouse No. 3”
necessarily included the land area on which the townhouse stood. The trial
judge noted in paragraph 61 of his judgment, that, this submission appeared to
be at variance with the respondent’s pleaded case that he never agreed to
convey the land on which the townhouse stands. The trial judge made a finding
that as a matter of law the land on which the townhouse stands passes with the
townhouse under the deed of lease in the absence of any clear words to the
contrary. He arrived at this conclusion after a long and detailed analysis of the
law and the draft deed. The judge, however, expressed the view that “for clarity
and certainty, it may be preferable and even good practice to include ‘together
with the land on which it stands’ or some other such form of words” although as a
matter of law in his view, it was not necessary in this case, since the outlying
areas were to be held by Stirling Court Limited.
43. Having found that the assignment of the land was to be implied in the assignment
of the townhouse, the trial judge expressed the view that the appellant “may have
Page 16 of 21
acted reasonably in querying the issue based on the advice she had received
and the position taken by TTMF”. This view surely accords with good sense and
good law. The purchaser needs to be certain as to precisely what interest she is
acquiring under the deed of lease, and the intended mortgagee must be certain
as to the extent of the interest being conveyed to it as security. In my view, the
requisition was an eminently reasonable one which should have been addressed
by the respondent.
44. The response of the vendor in his letter of 29th May 2007 to the effect that he did
not intend to enter into any explanations with another attorney about the law
concerning this requisition, did not address the issue, and implied that the law on
this issue was so elementary that the requisition did not deserve a response.
45. The respondent’s pleading that he never agreed to sell the land upon which the
townhouse stands, together with his complete turnaround on this issue at the
trial, demonstrates that this was not as simple an issue as the respondent first
thought. Indeed, the lengthy analysis undertaken by the judge of this issue,
shows that it was a matter of some complexity.
46. In any event the trial judge expressly found that the appellant may have acted
reasonably in making the requisition. There was no appeal from this finding.
The judge did not go on to consider whether the response to the requisition was
adequate or reasonable. In my view, it clearly was not, having regard to the
shifting position taken by the respondent, and the complexity of the law on this
issue, as demonstrated by the judge’s analysis of the law.
Waiver
47. The issue of waiver was not pleaded in the Defence. Before us Mr Marcus
raised the issue and submitted that it arose on the evidence. His basic argument
Page 17 of 21
was that Mr Serrano’s letter of the 23rd May 2007 indicated a readiness to
complete the transaction within three days provided that the respondent
produced the three documents listed therein namely, the deed of lease executed
in escrow and endorsed by the mortgagee, evidence of the issuance of a share
certificate by Stirling Court Ltd. and the 2007 receipt for land and building taxes.
These documents were provided by the respondent under cover of a letter dated
24th May 2007. On this basis, Mr Marcus contends that the appellant had
impliedly waived any requisitions that were outstanding as at 23rd May 2007.
48. In my view, Mr Marcus’ reliance on the doctrine of waiver is not sustainable on
the facts. The requisition relating to the date of the mortgagee’s consent to the
lease could not have arisen until the provision of the deed of lease executed in
escrow which was delivered to Mr Serrano under cover of letter dated 24th May
2007. Mr Serrano’s requisition on this issue was made on 29th May 2007 which
in my view was within a reasonable time of receiving the executed deed of lease.
49. The requisition concerning the omission of a description of the land to be
conveyed was first made by Mr Serrano by letter dated 30th April 2007. The
requisition was totally ignored by the respondent in his response of 1st May 2007.
The respondent was reminded of the requisition outstanding by letter from Mr
Serrano dated 1st May 2007. In his response of 2nd May 2007 the respondent
again ignored the requisitions. It was only on 24th May 2007 that Mr Serrano
received the deed of lease executed in escrow. Having received the executed
deed of lease, Mr Serrano by letter of 28th May 2007 drew the respondent’s
attention to the relevant provisions of the executed deed and requested the
respondent to rectify the deed, since it did not define the land that was being
assigned to the appellant, before the cheque could be requested of the proposed
mortgagee. This was in essence the same issue raised by Mr Serrano in his
letter of 30th April and which it was apparent the respondent had not sought to
rectify. The response of the respondent by letter of 29th May 2007 was to flatly
refuse to address the requisition on the ground that it lacked substance.
Page 18 of 21
50. In my view, Mr Serrano was entitled to revisit the requisition having now seen the
deed of lease executed in escrow, and his earlier requisitions having been
ignored. Both requisitions in my view relate to matters of conveyance rather than
strictly matters of title. Requisitions as to matters of conveyance can be raised at
any time, and are not subject to any time limit: Barnsley’s Conveyancing Law
and Practice 4th edition page 354 and Contract and Conveyance 3rd edition by
JT Farrand at page 118.
51. In Chaitlal & Ors v. Ramlal [2003] UKPC 12, the Privy Council held that the
party serving the notice making time of the essence must himself be ready, able
and willing to complete at the date when the notice is served. In the absence of
an express term to that effect, such a term would in any event be implied by law.
It followed that since the vendor was in default not having supplied the purchaser
with certain information as to title, he was not entitled to serve a notice to
complete making time of the essence: see paragraph 28 of the judgment.
52. Having failed to address the requisitions which were in fact found by the trial
judge to be reasonably raised by the appellant (from which there was no appeal),
the respondent was not entitled to call upon the appellant to complete the
agreement on 29th May 2007 time being of the essence. It follows that his
purported rescission of the agreement for sale on 29th May 2007 was of no effect.
53. In this case the evidence was that the appellant was ready, willing and able to
complete the agreement subject to the outstanding requisitions being addressed
by the respondent. The appellant is therefore entitled to specific performance of
the agreement. However, before disposing of this appeal, there is one more
matter to be addressed. It concerns the licence agreement upon which the
appellant entered into possession of the premises.
Page 19 of 21
54. On 22nd February 2007, the parties signed a written agreement under which the
appellant entered into possession of the townhouse upon payment of a monthly
licence fee of $410.00 per month. It was expressly provided that:
“(a) The Licensor hereby grants unto the Licensee licence to
occupy the said premises from the 22nd day of February
2007 until the completion or rescission of the Principal
Agreement.
(b) This licence would be for a duration of one (1) month from
22nd February 2007.”
55. As noted by the trial judge, at first glance these provisions appear to be
inconsistent. However, the judge resolved the issue by reference to the
anticipated date of completion which was then 5th March 2007. On 22nd February
2007, it was contemplated under clause (b) that for practical purposes the licence
would be for one month. However, in the event that the agreement could not be
completed within one month, clause (a) would be triggered, extending the
duration of the licence until completion or rescission of the agreement for sale, at
a monthly licence fee of $410.00 payable in advance. This interpretation of the
licence agreement by the trial judge has not been challenged on appeal.
56. Subsequently, by letter dated 21st March 2007, the respondent purported to
unilaterally vary the licence agreement by imposing a monthly fee of $3,000.00.
The appellant refused to pay this sum.
57. In his judgment, having found that the respondent was entitled to rescind the
agreement, thus bringing the licence to an end, the trial judge ordered the
appellant on the respondent’s counterclaim to pay mense profits from 15th June
2007 in the sum of $3,000.00 per month, which the judge found be a reasonable
sum for use and occupation of the premises, based on a valuation report which
estimated the gross rental value of a similar townhouse to be $3,500.00. The
appellant has not paid anything pursuant to the Judge’s order.
Page 20 of 21
58. This court has come to the conclusion that the judge was wrong in finding that
the respondent was entitled to serve notice to complete making time of the
essence, and that his purported rescission of the agreement was of no effect. It
follows from this decision that the licence agreement made on 22nd February
2007 remains in effect until completion or rescission of the agreement. The
question of mense profits for wrongful occupation does not arise. The sum to be
paid pursuant to the licence agreement (which could not be varied unilaterally as
the respondent purported to do) is $410.00 per month.
59. On 27th October 2011 the appellant applied for a stay of execution of the judge’s
order pending appeal. On 12th December 2011, Kangaloo JA granted a stay on
condition that the appellant pay to the respondent the monthly sum of $2,500.00.
To date the appellant has made payments under the order in the sum of
$135,000.00.
60. Mr Marcus submitted that it would be “oppressive” for this court to “interfere with”
the sum of $135,000.00 paid to the respondent pursuant to the order of Kangaloo
JA. This was a sum paid to the respondent as a condition of the grant of a stay
of execution. The order was not made pursuant to any determination by
Kangaloo JA of the rights of the parties. These rights have now been determined
by this court on this appeal. I have found that the sum payable by the appellant
to the respondent under the licence agreement is $410.00 per month. There is
therefore no legal basis for the retention of the sum of $135,000.00.
DISPOSITION:
61. It follows that this appeal must be allowed. The orders of the trial judge are set
aside. The court declares that the agreement for sale dated 14th October 2003
was intended to pass a 999 year leasehold tenure in the townhouse and the land
Page 21 of 21
upon which the townhouse stands. The court orders specific performance of the
agreement to be completed within twenty-eight days of the date hereof. The
counterclaim is dismissed. The appellant must pay to the respondent a monthly
sum of $410.00 commencing 22nd February 2007 to the date of completion of the
agreement for sale. The sum of $135,000.00 and any additional payment that
may have been made by the appellant pursuant to the order of Kangaloo JA
made on the 12th December 2011 is to be set off against monies due to the
respondent for the balance of the purchase price and the licence fees payable to
the respondent by the appellant. Parties to file submissions in writing on costs
on or before the 17th May 2016.
Dated the 2nd day of May, 2016.
R. Narine Justice of Appeal