TEH KHEM ON & ANOR. V. YEOH & WU DEVELOPMENT SDN. BHD. & ORS

TEH KHEM ON & ANOR. V. YEOH & WU DEVELOPMENT SDN. BHD. & ORS

First defendant (vendor/builder) breached express clause 12 and implied conditions and is liable; appropriate remedy is termination of the sale and purchase agreement for breach and an award of damages measured by the reasonable cost of remedial micropiling (RM98,625) plus expert fees (RM21,141.35) with interest; claims against architects and engineers in negligence are dismissed because plaintiffs sought only recovery for pure economic loss arising from the defective building and such loss is not recoverable in tort absent physical injury to other property or persons.

Citation
TEH KHEM ON & ANOR. V. YEOH & WU DEVELOPMENT SDN. BHD. & ORS
Parties
Plaintiffs: Teh Khem On & Anor.; First Defendant Vendor/builder: Yeoh & Wu Development Sdn. Bhd.; Second Defendants Architects: Architects (second defendants); Third Defendants Engineers: Engineers (third defendants); Fourth Defendant Local Authority: Majlis Daerah Kinta Barat, Batu Gajah
Court
Malaysian court
Jurisdiction
Malaysia
Judgment Date
1995
Procedural Posture
Contract and Tort (negligence) Involving Defective Building, Rescission and Damages / Judgment
Outcome
Judgment for plaintiffs in part against first defendant; claims against second and third defendants dismissed; sale agreement terminated for breach.
Legal Topics
Breach of Contract, Rescission, Measure of Damages, Implied Terms, Negligence, Pure Economic Loss, Causation, Mitigation, Costs
Source Language
en
Contract Tort Property Building and Construction Civil Procedure Breach of Contract Rescission Measure of Damages +6 more

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Parties

Teh Khem On & Anor.

Plaintiffs

Yeoh & Wu Development Sdn. Bhd.

First Defendant Vendor/builder

Architects (second defendants)

Second Defendants Architects

Engineers (third defendants)

Third Defendants Engineers

Majlis Daerah Kinta Barat, Batu Gajah

Fourth Defendant Local Authority

Procedural Posture

Contract and Tort (negligence) Involving Defective Building, Rescission and Damages / Judgment

Legal Issues

  1. 1 Whether vendor/builder breached express and implied terms in sale contract and is liable for defects
  2. 2 Proper remedy: rescission ab initio versus termination and damages; measure of damages
  3. 3 Whether plaintiffs can recover pure economic loss in negligence from architects and engineers lacking contractual privity

Ratio Decidendi

First defendant (vendor/builder) breached express clause 12 and implied conditions and is liable; appropriate remedy is termination of the sale and purchase agreement for breach and an award of damages measured by the reasonable cost of remedial micropiling (RM98,625) plus expert fees (RM21,141.35) with interest; claims against architects and engineers in negligence are dismissed because plaintiffs sought only recovery for pure economic loss arising from the defective building and such loss is not recoverable in tort absent physical injury to other property or persons.

Court Disposition

Judgment for plaintiffs in part against first defendant; claims against second and third defendants dismissed; sale agreement terminated for breach.

Orders

  • Sale and purchase agreement dated 29 November 1983 terminated for breach
  • First defendant to pay RM98625 with interest at 8% per annum from date of judgment to date of satisfaction and to pay one half of the plaintiffs costs to be taxed