THE REPUBLIC OF TRINIDAD AND TOBAGO IN THE HIGH COURT...

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THE REPUBLIC OF TRINIDAD AND TOBAGO

IN THE HIGH COURT OF JUSTICE

CV 2017 – 04669

Between

DINDIAL’S HARDWARE LIMITED

Claimant

And

TERESA DE SILVA

Defendant

Before the Honourable Mr Justice Ronnie Boodoosingh

Appearances:

Mr Terrence Bharath and Ms Esther Gaston instructed by Mr Reza Ramjohn for

the Claimant

Mr Seenath Jairam SC leading Ms Saira Lakhan instructed by Ms Shanta Jairam

for the Defendant

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Date: 7 April 2020

JUDGMENT

1. The claimant and defendant entered into an agreement for the sale of a

parcel of land at Maraval. The purchase price was $ 13 million TTD. A

written agreement was signed by Dirk Dindial, Managing Director of the

claimant and the defendant. This was signed on 10 November 2016. A

10 % deposit of $ 1.3 million was paid on that date by cheque. The

completion date was set as 28 February 2017. The transaction was not

completed on that date. The claimant says the Company is entitled to a

refund of the deposit. The defendant says they are not.

2. Previously, on 12 October 2016, the defendant had entered into an

agreement with Abdul Latif-Kazim, as executor and beneficiary of the

Estate of Ebrahim Kazim, through his power of attorney, in respect of

the purchase of the property.

3. The transaction was negotiated by Mr Dindial and the claimant’s

husband, Mr Rabindranath Ramcoomarsingh, an attorney at law.

4. The agreement was drafted by Mr Ramcoomarsingh. Mr Dindial said he

did not know the defendant was Mr Ramcoomarsingh’s wife. Mr

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Ramcoomarsingh said he assumed the claimant knew this. Mr

Ramcoomarsingh was known to Mr Dindial as a person who was a

customer of the family Hardware. It appears their fathers also knew

each other. Mr Dindial’s father was also involved in the hardware

business and met Mr Ramcoomarsingh at times. They were not however

friends.

5. Four witnesses gave evidence. There was Janelle Coraspe, a title search

clerk, who did a title search. Her evidence is that the property in

question was not registered even up to 2019 in the defendant’s name.

6. Mr Dirk Dindial, the managing director of the claimant, gave evidence as

the claimant’s main witness. According to him, there was a negotiation

between him and Mr Ramcoomarsingh on behalf of a “client”. He paid

down $1.3 M as a deposit. He was provided with a redacted agreement

for sale of the property by Abdul Latif-Kazim to the defendant. He tried

to get a Deed for the property to pursue his financing with his bank. He

never got a Deed. Mr Ramcoormarsingh, he said, reached out to him to

complete the agreement after the end date but he was not interested.

On 4 March 2017 he sent an email to Mr Ramcoomaringh indicating that

he was requesting the return of his deposit since the documents

required to submit to the bank were not forwarded to him. He referred

to a telephone conversation of the previous week.

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7. The next witness was Mr Ramcoomarsingh for the defendant. He acted

as attorney and agent for the defendant. He said the property was

owned by Ebrahim Kazim. Mr Latif-Kazim was the executor and

beneficiary of the estate and did a Deed of Assent in August 2017 to

himself and was entitled to convey the property then. He said the

defendant became beneficially entitled to the property when the

agreement for sale was made with her. The issue then was really an

extension to complete the agreement.

8. He said there was a collateral oral agreement for completion two

months after the grant of probate to Mr Latif-Kazim. His client was not

prepared to return the deposit unless she had gotten another sale of the

property. Of interest, in cross-examination, he said, based on the

agreement between the defendant and Mr Latif-Kazim, it emerged that

the deposit paid by the defendant was $100 USD for the purchase by her

of the property which was being sold for $1.5 M USD. Mr

Ramcoomarsingh asserted that there was an alternative offer on the

property which prejudiced the defendant’s position. I did not accept this

as no credible proof was offered in favour of this. This assertion

regrettably had the sense of being a later invention.

9. The main terms of the agreement were as follows. The property was to

be sold free of encumbrances. The completion date was 28 February

2017. The vendor was to provide the WASA Clearance and up to date

payment of taxes. The defendant was to provide good title. If the

vendor could not, the claimant was entitled to rescind the contract. Of

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interest, in the October 2016 agreement, time was not made of the

essence. However, that was not incorporated into the November

agreement between these parties. The point however was that a

completion date of 28 February 2017 was contemplated. Clause 7

provided for rescission if there was a defect in title and return of the

deposit. Clause 8 provided that if on the completion date the purchaser

could not or was unable to complete, the vendor was entitled to forfeit

the deposit.

10. At the time the agreement was done, the defendant did not have legal

title to the land. The land had been owned as noted by Ebrahim Latif

and his wife. They died. It ended up that Mr Latif-Kazim was entitled to

the land. He, through his Power of Attorney, Hafeez Ali, an attorney at

law, made an agreement with the Defendant for the sale of the land to

her for the sum of $ 1.5 million USD. She paid a deposit of $100. USD.

Probate was pending. In the agreement between Mr Ali and the

Defendant probate was stated to be expected to be obtained by

December 2016. A completion date of 28 February 2017 was provided

in that October agreement.

11. In the November agreement between these parties the completion date

was provided to also be 28 February 2017. Thus, it appears, it was

intended the probate would be granted, the land would be sold to the

defendant and the defendant would sell to the claimant, at a tidy profit.

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12. The defendant was under the November agreement to provide to the

claimant certain documents namely up to date Land and Building taxes

receipts and WASA Clearance Certificate. These had not been provided

up to 28 February 2017 because the transaction had not been

completed. Probate had not been granted up to that date.

13. At 28 February 2017 therefore the defendant was not the legal owner of

the land. She could not convey legal title to the claimant. Her case is

that she had a beneficial interest in equity in the land as of that date.

Her case is also that there was a collateral oral agreement between the

claimant and her, through her agent / husband Mr Ramcoomarsingh,

that time would be extended for completion if probate and assent of the

property was delayed. The defendant’s case is that the claimant,

through Mr Dindial, agreed to this. Mr Dindial on behalf of the claimant

hotly disagrees.

14. A letter written by Mr Ramcoomarsingh to Mr Dindial on 10 March 2017

is said to be a contemporaneous record. In cross examination Mr Dindial

said he accepted the letter was correct. This was a lengthy letter. He

was not taken to the whole of the letter or specific facts. He was asked

if he agreed that the letter was accurate and he said he accepted that.

Now his case both on pleadings, his witness statement and in other parts

of cross examination disputed some of the assertions in that letter.

However, when asked, he did say he accepted it.

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15. It would be useful therefore to consider what the letter by Mr

Ramcoomarsingh stated and what it did not. In that letter Mr

Ramcoomarsingh referred to discussions before which culminated in the

agreement. It is important to note that some of the matters he said

were discussed were not reflected in the agreement. Further it was

stated that his client wished to seek independent legal advice on the

request for the return of the deposit because of the relationship he had

with the Dindial family. Of interest, no where in this letter was it

reflected that Mr Ramcoomarsingh was the defendant’s husband. The

letter did however refer to discussions which Mr Ramcoomarsingh said

took place with Mr Dindial.

16. This letter must be placed in context. It could be said that in a sense it

was self-serving because of the relationship between the defendant and

Mr Ramcoomarsingh. In cross-examination it also emerged that Mr

Ramcoomarsingh did not at the time of the letter have a valid legal

practising Certificate. As pointed out in the claimant’s submissions there

were also certain inconsistencies in the evidence of the defendant’s

witnesses and the letter. There is therefore only so much weight that

could have been attached to it in all of the circumstances and I declined

to give it significant weight.

17. This letter never recorded that Mr Dindial had ever agreed to any

extension after 28 February. He was told, accordingly to the letter, of

the probate matter and issues. However, nonetheless the October

agreement had put the probate date as December 2016. The

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completion date in both agreements were put at 28 February 2017. This

was done despite what the defendant says was the position.

18. Even if therefore Mr Dindial was told things about the probate

application and what the process was, there is no record of any specific

agreement by the claimant to have the contract extended beyond 28

February 2017. The fact that time was not made of the essence in the

contract did not mean that either party was at liberty in the absence of

specific agreement on the part of the other party to extend the time for

completion. That had to be agreed.

19. On 13 April Mr Bharath, on behalf of the claimant, wrote to Mr

Ramcoomarsingh replying to the letter. As pointed out then the

extension was sought by the defendant to 31 March 2017 to complete.

But even up to that date the defendant still could not complete the

agreement since she had not yet purchased the property. Probate had

also not yet been granted of the Ebrahim Kazim estate.

20. In matters such as these the court has to give more weight to the written

terms of the agreement. If terms are to be added as part of a collateral

contract such terms must be clearly shown to exist. Effectively all we

have is the defendant’s say so as against Mr Dindial saying no.

Notwithstanding the lack of valid practising certificate at the time, Mr

Ramcoomarsingh was a lawyer and the defendant’s husband and agent.

One would reasonably expect that if there were other terms agreed, as

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he says, in a parallel collateral agreement, one would have expected this

would be reflected in the agreement he prepared. One would expect he

would act in his client’s and his wife’s best interest, which would be to

correctly reflect the terms in the written agreement. It is all well and

good to say after the fact that the letter reflects the true position, but

the agreement ought to have done so. This was particularly important

in the context of knowing the delays with the probate application

process, which he gave evidence about. He must have known that a

February 2017 completion date might be optimistic in the

circumstances. Thus, reasonably, if that was agreed, in my view, it would

have been part of the written agreement. This was also a substantial

transaction.

21. In this respect I preferred Mr Dindial’s evidence to that offered on behalf

of the defendant. I find it to be more consistent in any event with the

contemporaneous written records available to the court.

22. The defendant’s husband / lawyer drafted the agreement between the

claimant and the defendant. The defendant’s lawyer did not state in the

agreement that the completion of this agreement was contingent on the

probate coming through. It was not stated that there was any

understanding by the parties that there could be a delay beyond 28

February 2017. If this agreement has to be construed against any party

it must be construed against the defendant. The defendant’s husband /

attorney drafted it. He also negotiated the agreement with the claimant.

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The defendant had every opportunity to protect her position by having

appropriate clauses put into the agreement to protect her position.

23. Mr Dindial says he was not told anything about possible delays about the

probate. Documents were to be sent to him before the 28 February so

he could make arrangements with his bank for financing. Those

documents were not forthcoming. On 28 February the agreement

ended because the documents were not given to him and the defendant

could not convey title.

24. The purchase of the property by the defendant and the sale to the

claimant were two separate transactions. The sale to the claimant was

dependent on the purchase by the defendant taking place. However,

there was, in writing, no clear communication that this was the case.

The agreements were not to be read together. Mr Dindial did not have

the benefit of independent legal advice. He was also not told that he

should get independent legal advice.

25. The defendant gave a witness statement also. Much of that statement

was hearsay based on what she was told by Mr Ramcoomarsingh. He

was the one who drove the transaction in this case. She never had any

discussion or negotiation with Mr Dindial.

26. Mr Dindial, on behalf of the claimant, was under no obligation in law on

that date to extend the time for the contract. He promptly asked back

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for his deposit. The defendant was in law obliged to return it. She did

not.

27. Probate was granted in June 2017. It appears a Deed of Assent to Mr

Kazim was done in August 2017. However, a title search did not show

any sale to the defendant after that. It was the defendant’s evidence,

through Mr Ramcoomarsingh, that the purchase from Mr Kazim was not

dependent on the sale to the claimant.

28. Up to the time of trial, the defendant did not have title. Mr

Ramcoomarsingh’s explanation in re-examination for the first time was

that Mr Kazim and the defendant mutually agreed to end the agreement

for sale about a year after.

29. The defendant sought to suggest that it was the claimant who could not

raise finance so that he was the one who breached an agreement to

extend the time. But there is no clear evidence of any agreement by the

claimant, through Mr Dindial, to have time extended for completion.

The claimant was entitled in the absence of any agreement to decline

any request to extend the time. I found there was no implied term to

extend the contract. I also do not find there was a collateral contract

that the contract was to be completed two months after the probate

was granted to Mr Kazim. I did not accept that the claimant, through Mr

Dindial, was aware of the arrangements between Mr Kazim and the

defendant or was relying on whatever may have been agreed between

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them. I found the rescission date was after 28 February 2017 when the

claimant communicated to Mr Ramcoomarsingh that the contract was

at an end.

30. As noted that the defendant did not have legal title on 28 February. The

claimant had not contracted for an equitable interest in the property but

for the purchase of the full legal interest. He could not be compelled to

take something he did not bargain for. There was also no requirement

in law to serve a notice to complete on the defendant.

31. Extensive legal submissions were made on both sides. I will not address

all of the authorities put forward. The following authorities were the key

ones which applied and informed my decision.

32. In Munglasingh v Juman 2015 UKPC 38 Lord Neuberger made the

following observations:

12. So far as the main issue is concerned, it is common

ground that the Agreement was an “open contract”, ie a

contract which had all the terms which are required to

render it a valid agreement in law, but no other

conditions normally found in a well drafted contract. In

those circumstances, as explained in Emmet and Farrand

on Title (looseleaf edition, November 2010 release), para

2.050, certain terms are implied into the contract by law.

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They include that (i) “good title” must be shown within a

reasonable time and (ii) completion should occur as soon

as good title has been shown. It may be that term (ii)

would be better expressed as being “promptly after”

rather than “as soon as”, but nothing hangs on that in this

case.

13. In the normal way, time was not of the essence of the

date for completion of the Agreement. In other words,

while failure by one party to complete as soon as good

title had been shown (or promptly thereafter) may

amount to a breach of contract, it would not entitle the

other party to treat the Agreement as at an end. Once the

date for completion had passed, either party, being ready

able and willing to complete, could make time of the

essence by requiring the other party to complete within

a reasonable time. If the other party did not complete

within the stipulated time, the first party could then treat

the Agreement as at an end. In this connection, the law is

as set out in Raineri v Miles [1981] AC 1050, 1083A-1085F

and 1088F-1091H by Lord Edmund-Davies and Lord

Fraser of Tullybelton respectively.

…

20. More particularly, Mr Chadeesingh said, and the

Judge accepted, that conveyancing practice in Trinidad

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and Tobago was that good title was not shown unless the

seller produced the Documents. On the face of it at any

rate, there is no reason to doubt this. Unpaid land tax

gives rise to a charge on the relevant property (see

section 18 of the Lands and Buildings Taxes Act), and

unpaid water rates and unpaid land tax can each result in

distraint on, or even the sale of, the property concerned

(see sections 7-13 of the Rates and Charges Recovery Act,

section 74(5) of the Water and Sewerage Act and sections

22-27 of the Lands and Buildings Taxes Act respectively).

Accordingly, it is easily understandable why a buyer of

property would wish to be sure that neither water rates

nor land tax were owing in respect of that property

before he completes his purchase.

21. Mr Beharrylal argued that requirement for the

production of the Documents was not, as a matter of law,

capable of being within the ambit of a requisition on title.

The precise limits on what constitutes a good title or a

valid requisition are not entirely easy to define, as perusal

of paras 5.002 and 5.061-5.062 of Emmet and Farrand

and of para 15-082 of Megarry & Wade shows. Thus, even

if Mr Mungalsingh was obliged to produce the

Documents, it might be argued that it would have been

good enough to produce them at actual completion – ie

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that their production was a matter of conveyancing

rather than a matter of title.

22. The questions whether the Documents must be

produced by a seller, and, if so, whether their production

is a matter of title, must, at least to some extent, be

governed by the general practice of conveyancers in the

jurisdiction in question. (That is supported by the judicial

observations quoted at the beginning of para 5.002 of

Emmet and Farrand and by the “doubt” referred to in

para 15-082 of Megarry & Wade). In the present case, it

appears to the Board that the evidence of Mr

Chadeesingh, coupled with the fact that unpaid water

rates and land tax can lead to distraint on, or even the

sale of, the relevant property, renders it impossible for

Mr Mungalsingh to challenge the Judge’s conclusion that

in Trinidad and Tobago the vendor must produce the

Documents before good title is shown. Further, the

evidence of Mr Chadeesingh, coupled with the fact that

completion meetings are no longer common practice, at

least in England and Wales, renders it hard to argue that

Mr Mungalsingh could have contended that the

production of the Documents should have waited until a

completion meeting.

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23. In those circumstances, it was not open to Mr

Mungalsingh to serve notice to complete, making time of

the essence, as he purported to do on 28 December 2006,

as he had not shown good title by that date – see Cole v

Rose [1978] 3 All ER 1121 and Chaitlal v Ramlal [2004] 1

PCR 1. While it is unnecessary to decide the point, it

should be added that, even if production of the

Documents had been a conveyancing matter, it may well

not have assisted Mr Mungalsingh’s case, as he had not

obtained the Documents by the date which he had

prescribed as the completion date in his letter of 28

December 2006.

33. While the facts are not on par with the instant case certain principles

can be extracted as being relevant. A vendor must be able to show good

title. This must be at the date for completion. A party had to be able to

conclude his side of the contract before he could make time of the

essence. Production of the Water Taxes Clearance Certificate and the

Rates and Taxes payments are part of the good title requirements in

practice. In Mungalsingh v Juman the contract was open in the sense

that there was no completion date provided. Here there was a date for

completion but time was not made of the essence.

34. In 42 Halsbury’s Laws of England 4th ed. (1983) at paragraph 126 it is

stated:

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“Date for completion. A date is usually fixed by the

conditions of sale for the completion of the purchase, but, in

the absence of express stipulation to that effect, or unless an

intention that it should be so can be implied from the

circumstances, that date is not of the essence of the contract.

However, although time is not originally of the essence of the

contract in this respect, it may be made so by either party

giving proper notice to the other to complete within a

reasonable time, provided that at the time of the notice

there has been some default or unreasonable delay by that

other. Even where time is not originally of the essence a

party who through his own default fails to complete on the

contractual date commits a breach of the contract and is

liable in damages…”

35. Further, Danckwerts J in Re Barr’s Contract [1956] Ch 551 at 556 stated:

“Apart from the provisions of any plain and clear

conditions of sale, the law about making time of the

essence of the contract for the purpose of

completion… is subject to the following conditions:

first of all, the vendor must be able, ready and willing

to proceed to completion… Secondly, at the time

when the vendor purports to make time of the

essence, the purchaser must be guilty of such default

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as to entitle the vendor to rescind the contract

subject to its being done by a reasonable notice.

Thirdly, once the right to serve a notice of the kind in

question has arisen, the time allowed by the notice

must be reasonable.”

36. What this emphasises is that for a requirement that time be made the

essence the party must be able to complete the transaction. The

defendant here clearly was not. It was not open to the defendant to do

so. A purchaser could do so, but there was no requirement in law that

he must do so.

37. In Lewis Emmet, Emmet and Farrand on Title, 19th edition, Sweet and

Maxwell, 7 -004, it was stated:

“Purchaser’s right of rescission: The breach of contract by the

vendor in failing to show a good title releases the purchaser

from any obligation to perform his part of the agreement and

gives him the right to rescind. If he takes advantage of this

right at once, without making requisitions on title or acting

otherwise under the contract in such a way as to affirm it,

then the contract ceases to have effect and so the vendor

cannot take advantage of any term in the contract under

which he may rescind (Bowman v Hyland (1878) 8 Ch D. 588).

The purchaser may then recover the deposit with interest on

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it and his expenses of investigating title (Re: Bryant and

Barningham’s contract (1890) 44 Ch D 218). As to the

purchaser being entitled to treat the contract as at an end ,

both at law and in equity, as soon as it is discovered that the

vendor has no title, i.e. without waiting on the contractual

completion date, see Pips (Leisure Productions) Ltd v Walton

(1982) 43 P & CR 415.”

38. In the Pips v Walton case Sir Robert Megarry stated:

When a person sells property which he is neither able to

convey himself nor has the power to compel a conveyance of

it from any other person, the purchaser, as soon as he finds

that to be the case, may say, ‘I will have nothing to do with

it’. The purchaser is not bound to wait to see whether the

vendor can induce some third person (who has the power) to

join in making a good title to the property”.

39. In Barnsley’s Conveyancing Law and Practice, M Thomson, Fourth

edition, OUP, at 645 the purchaser’s right was stated as follows:

“The purchaser’s right to rescind for a fundamental defect in

title arises at the latest on the contractual date for

completion. He is not obligated to allow the vendor further

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time to perfect his title. Even though time is not of the

essence, he is free to rescind without first serving a notice to

complete.”

40. From these authorities it can be extracted that there was no

requirement for the claimant to serve a notice to complete and there

was no requirement for the claimant to make time of the essence of the

contract. The rescission could take place on the completion date.

41. For completion sake, I note there were extensive submissions on the

status of the executor and beneficiary pending the grant of probate. In

my respectful view, however, these were not relevant to my

determination of this case. Further since the claimant never contracted

for the purchase of an equitable interest in the property the fact that the

defendant had a remedy against Mr Kazim was also not material to the

claimant’s position.

42. The claimant is entitled to judgment. It is ordered as follows.

43. It is declared that the agreement made between the claimant and

defendant for the purchase by the claimant from the defendant of the

property in Maraval described in Deed No. 1129 0f 1975 was rescinded.

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44. The defendant must repay to the claimant the deposit of the sum of

$1,300,000.00 to the claimant. This is to be paid with interest which is

to run on this sum from 1 March 2017 to the date of judgment at the

rate of 1.5%. The counterclaim is dismissed. I have considered that the

counterclaim was essentially the flip side of the claim. I have therefore

dealt with the costs of the claim and counterclaim together. Prescribed

costs are to be paid by the defendant to the claimant calculated on the

judgment sum of $ 1,300,000.00.

Ronnie Boodoosingh

Judge

THE REPUBLIC OF TRINIDAD AND TOBAGO IN THE HIGH COURT...

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