SUN CHAMP INVESTMENT LTD v. GREEN LEAVES TRADE INVESTMENT LTD

SUN CHAMP INVESTMENT LTD v. GREEN LEAVES TRADE INVESTMENT LTD

The defendant failed to answer several material requisitions (stamp duty undertaking for a deed of gift, compliance with a Building Authority s26 order, and supply of the survey plan) and thus failed to prove or give good title; those failures constituted an anticipatory/repudiatory breach before midnight on the completion date so the purchaser validly rescinded at 17:12 on 1 March 2013; the mid-night rule did not rescue the vendor because there was no realistic prospect of the vendor curing the defects by midnight; the clause for liquidated damages (equivalent to deposit) is a penalty and not enforceable as genuine pre-estimate of loss.

Citation
SUN CHAMP INVESTMENT LTD v. GREEN LEAVES TRADE INVESTMENT LTD
Parties
Purchaser: Sun Champ Investment Limited; Vendor: Green Leaves Trade Investment Limited
Court
District Court
Jurisdiction
Hong Kong
Judgment Date
25 October 2013
Case Number
DCMP706/2013
Procedural Posture
Miscellaneous Proceedings (conveyancing Dispute) District Court Miscellaneous Proceedings No 706 of 2013 / Judgment
Outcome
Judgment for plaintiff. Agreement rescinded for purchaser; defendant held in breach and ordered to repay deposits and reimburse costs; plaintiff awarded interest and costs.
Legal Topics
Requisitions to Title, Good Title, Repudiation and Rescission, Mid Night Rule for Completion, Liquidated Damages Vs Penalty, Interim Undertakings, Interest and Costs
Source Language
EN
Conveyancing Property Law Contract Law Administrative/building Law Tax Law (stamp Duty) Requisitions to Title Good Title Repudiation and Rescission +4 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 7 Authorities cited 22 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

Sun Champ Investment Limited

Purchaser

Green Leaves Trade Investment Limited

Vendor

Procedural Posture

Miscellaneous Proceedings (conveyancing Dispute) District Court Miscellaneous Proceedings No 706 of 2013 / Judgment

Legal Issues

  1. 1 Whether the vendor/defendant failed to answer the purchaser's requisitions satisfactorily
  2. 2 Whether the vendor failed to prove, show and give good title to the property
  3. 3 Whether the purchaser/plaintiff was entitled to rescind the provisional agreement on 1 March 2013

Ratio Decidendi

The defendant failed to answer several material requisitions (stamp duty undertaking for a deed of gift, compliance with a Building Authority s26 order, and supply of the survey plan) and thus failed to prove or give good title; those failures constituted an anticipatory/repudiatory breach before midnight on the completion date so the purchaser validly rescinded at 17:12 on 1 March 2013; the mid-night rule did not rescue the vendor because there was no realistic prospect of the vendor curing the defects by midnight; the clause for liquidated damages (equivalent to deposit) is a penalty and not enforceable as genuine pre-estimate of loss.

Court Disposition

Judgment for plaintiff. Agreement rescinded for purchaser; defendant held in breach and ordered to repay deposits and reimburse costs; plaintiff awarded interest and costs.

Orders

  • Declaration that the defendant was in breach of the Agreement by failing to give good title to the Property on 1 March 2013, breach accepted by the plaintiff by letter on that date
  • Order that the defendant return to the plaintiff HK$200,000 being the total amount of the deposits paid by the plaintiff, together with interest from 1 March 2013 to date of judgment at the rate of HSBC prime plus 1%, and thereafter at judgment rate