EVERWIN INC. LTD v. MTR CORPORATION LTD

HCA 884/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 884 OF 2008

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J U D G M E N T

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1.  This is an application under O.18 r.19 Rules of High Court and the court’s inherent jurisdiction for an order that the plaintiff’s indorsement and statement of claim be struck out; alternatively, for a determination of a question of law under Order 14A, to the intent that with success in either application, the plaintiff’s claim should be dismissed, and the writ registered in the Land Registry Office as a lis pendens be vacated.

2.  The defendant (MTRC) needs no introduction in Hong Kong.  In the context of this and related actions, it built for sale on the open market a residential development known as the Arch, at 1, Austin Road, West Kowloon.  Pre-completion, residential units in the complex were promoted for sale.  It is the plaintiff’s case and, at least for the purpose of this application, it is accepted by MTRC that Sun Hung Kai Real Estate Agency Limited (SHK), a wholly-owned subsidiary of Sun Hung Kai Properties Limited, represented its interests as agent in the promotion and sales.

3.  The plaintiff (Everwin) is a company owned by Mr Ho Siu Hung and his wife Lin Li Lan and they are its directors.  It was incorporated for the purpose of becoming the purchaser and thus owner of one of the flats in the Arch.  It happens to be Flat E, 39^th Floor.  In the same format Mr and Mrs Ho had incorporated fourteen more companies to purchase a further fourteen flats in the Arch.

4.  The fifteen companies then committed to the purchase of the flats in question upon signing of memoranda for sale and payment of an initial deposit in each case.

5.  When in due course occupation permits issued, signalling readiness for completion, only two of the transactions completed in accordance with their contracts.  The remaining thirteen did not.

6.  MTRC claimed the purchasers were in breach for failing to complete, terminated the agreements, forfeited the deposits paid and offered the flats in question for resale.  They have now all been resold, with completion pending.

7.  In each case the original purchasers through their directors deny there was a breach and that MTRC had no right to terminate the contracts.  In each case they issued proceedings seeking specific performance and, or in lieu, damages.  In each case the writ has been registered against the particular flat’s title as a lis pendens.

8.  In each case MTRC has filed an application to strike out, in the alternative for a determination of a point of law, for a speedy resolution of the impasse; in particular, to rid the titles of the lis pendens which will otherwise disrupt completion of the resales.

9.  It is apparent from the papers and there is no dispute that all thirteen actions and applications stand and fall together.  Thus my determination of this the application against Everwin will by common consent bind the parties in the remaining twelve actions.

10.  Against that background I come now to the detail; first, pertinent contractual terms.

The Contracts for Sale and Purchase

11.  The memorandum for sale, as a preliminary agreement, came into being on 14 April 2005 and was signed by Mrs Ho (as I shall call Lin Li Lan from now on) for Everwin and SHK for MTRC.

12.  The parties committed to a purchase price of $7,469,800 payable as to a preliminary deposit of 5% thereof, $373,490, upon signing, with four further instalments of like amount due on 18 April, May, July and November 2005; thus by that last date 25% of the price ought to have been paid.  The balance of $5,602,350 was payable within 14 days of notice of completion.  18 April 2005 was the date nominated for signing of the formal agreement for sale and purchase (ASP).

13.  The ASP was executed on due date.  It was stamped by the IRD — “Stamp Duty Deferred”.  Pausing here: by law, the IRD can look to both parties for the stamp duty on an instrument of conveyance of a property.  Any alternative arrangement between the parties is a matter of contract.  Stamp duty is payable whether the deal goes on or off, subject to an application for an exemption which may be made in the latter case.  Commonly, as here, where the purchase is made from plans, the parties seek to defer payment, for up to three years.

14. Pertinent terms of the ASP included the following:

Clause 3(1) referred to schedule 4 which set out the dates upon which the instalments of purchase price fell due for repayment.  As to the final payment the following was recorded:

“(vi) the amount of HK$5,602,350.00 being balance of the purchase price shall be paid by the Purchaser within 14 days of the date of notification to the Purchaser that the Vendor is in a position validly to assign the Property to the Purchaser.”

Clause 3(4) provided for payment of interest on overdue instalments.

Clause 5(1) and (2) dealt with the timing for completion and where it was to take place:

“5. (1)   The Vendor shall notify the Purchaser in writing that he is in a position validly to assign the Property within one month of the issue of the Certificate of Compliance or the consent of the Director of Lands to assign, whichever shall first happen.

(2)   The sale and purchase shall be completed at the offices of Messrs. Winston Chu & Company during office hours within 14 days of the date of the notification to the Purchaser that the Vendor is in a position validly to assign the Property to the Purchaser.”

Clause 16, important in the context of this action, dealt with the consequences of default by the purchaser:

“16.   (1) Should the Purchaser fail to observe or comply with any of the terms and conditions herein contained or to make the payments in accordance with Schedule 4 or any interest payable hereunder within 7 days of the due date, the Vendor may (subject to Clause 3(2)) give to the Purchaser notice in writing calling upon the Purchaser to make good his default.  In the event of the Purchaser failing within 21 days from the date of service of such notice fully to make good his default, the Vendor may by a further notice in writing forthwith determine this Agreement.

(2) Upon the determination of this Agreement pursuant to sub-clause (1):-

(a)   the sum paid by the Purchaser under item (i) of Schedule 4 by way only of deposit shall be forfeited to the Vendor.

…

(3) Upon determination of this Agreement under sub-clause (1) the Vendor may resell the Property either by public auction or private contract subject to such stipulations as the Vendor may think fit and any increase in price on a resale shall belong to the Vendor.

…”

Item (i) is the designated preliminary deposit. 

Clause 14(2) provided that amongst other disbursements the stamp duty was to be borne by the purchaser.

Clause 15, another important term, made time in every respect of the essence.

What Happened Next

15.  Everwin having paid the preliminary deposit upon signing of the memorandum for sale made payment of the next two instalments on time.  Then there was default in respect of the fourth instalment, due on 18 July 2005.  There was correspondence on the topic, including a notice of default, a request for extension of time, and part payment.  In the event, that was paid with interest on12 September 2005.

16.  On 14 November 2005 Mr and Mrs Ho wrote to SHK complaining about what they described was “the pricing issue” of the 15 units their companies had bought.  What had excited their attention was new-found information from another buyer which suggested they had been overcharged.

17.  There was, apparently, a meeting with SHK representatives, for the Ho’s wrote again on 16 November:

“Our representatives pointed out that there is a pricing problem and requested that this should be dealt with in an impartial manner and a refund should be made.  Given the significant gap between the suggestions made by each party, an agreement cannot be reached consequentially.”

18.  One can draw from that that the Ho’s had expressed dissatisfaction with the purchase prices their companies had committed to, sought a reduction, but that that was not forthcoming.

19.  And that was confirmed in a letter from SHK to the Ho’s of 23 November 2005 part of which stated;

“According to the records, Mr. Chan and Mr. Woo of our Real Property Investment Department met with you earlier this month, and heard from you about the views your company held on the selling prices of the units in the Arch purchased.  Our representatives explained clearly to you that factors such as the orientation, landscape, spacing, payment arrangements and the order of launching sale and the like in relation to the real properties would be considered when the developer determined the selling price of each unit, and numerous factors would result in the pricing differences per square feet of such real properties.  With respect of your request for the refund of the payments for the selling prices of each unit, after our study and decision by the management of the developer, and pursuant to the spirit of complying with the contracts, we apologize that your suggestions will not be accepted.”

20.  On 18 November 2005, upon which date the fifth instalment of purchase price was due to be paid, Mr Ho wrote to MTRC seeking a four months’ extension.  There was no direct response to this, though by letter of 26 November Winston Chu & Co. (WCC), the solicitors then representing MTRC, wrote to Everwin giving notice of default and the prospective consequences, reserving all rights to their client.

21.  In the event, that payment was never made. 

22.  The same solicitors wrote again on 21 June 2006.  Therein they noted continued default of payment of the fifth 5% instalment.  Without prejudice to their client’s rights in respect of that default, they gave notice of the issue of the Occupation Permit and Consent to Assign.  That settled the date of completion, which in terms of clause 5 of the ASP was fixed to be on 7 July 2006 at their offices.

23.  The response from Everwin, over the signature of Mrs Ho, was to request an extension for completion to 31 August 2006.  Pausing here, there was no reference to any unresolved complaint, or any reason given why there should not be completion in terms of the notice, apart from the request of seven weeks extension.  That has a bearing on what came to be and is now asserted as I shall come to.

24.  WCC were back into print on 15 July 2006.  This is an important letter in the context of these proceedings, because Everwin had not completed on due date.  The letter was in fact notice of default, issued under clause 16(1) of the ASP, giving 21 days from the date of service to complete, reserving to their client its rights should there be failure to comply.

25.  There was failure to comply.  Instead, by a long letter dated 15 August 2006 addressed to the directors of Sun Hung Kai Properties Limited, the well-known Kwok Brothers, Mrs Ho rehashed the complaints first made a year prior that they had been overcharged in the purchase of the fifteen flats.

26.  The response to that came from SHK by letter of 15 November 2006.  It referred back to its response to the so-called pricing problem of a year prior, the letter of 23 November 2005 I have partly reproduced, repeating and reiterating the pricing policy.  And then was stated the following:

“According to the records, among the 15 flats of The Arch which were purchased by you in the name of various companies, transaction was completed for 2 flats only, and the remaining flats had not completed transaction in accordance with the stipulations of contract until now.  As more than three months had elapsed since the expiry of completion of the concerning flats, therefore, we sincerely remind you that if the buyer does not complete the transaction before 30^th November 2006, the seller may, depending on the situation, terminate the transaction in respect of the concerning flats in accordance with the contract.”

Thus, in effect, Everwin was given a reminder of its default and the chance to make good by an enhanced deadline, or otherwise risk the consequences.

27.  There was no completion by 30 November 2006. 

28.  Instead, there emerged a letter from solicitors engaged by the Ho’s to represent the purchasing companies, alleging misrepresentation.  There was a response to this.  I do not need to rehearse or consider the contents of this correspondence in the context of this application because misrepresentation is not now alleged, and rescission is not sought. 

29.  By letter of 15 May 2007 solicitors representing SHK wrote to those representing the purchasing companies, urging their clients to “make good their default and to complete the purchase of the captioned units (other than the two completed units) without further delay”.

30.  There was a reply to this, dealing with the allegations of misrepresentation.

31.  The matter rested until by letter of 18 March 2008 WCC wrote to Everwin calling for payment of the stamp duty which, with the 3-year period of deferral coming to an end, was due to be paid and, contractually, to be paid by the purchaser Everwin, on or by 7 April 2008.

32.  Finally, by letter of 11 April 2008 WCC gave notice that there had been default in that more than 21 days had expired since service of the notice of 15 July 2006.  Everwin was informed that that amounted to a repudiation which repudiation was accepted.

33.  The ASP was thus terminated with forfeit of the deposit of $373,490, and a right by MTRC to resell the unit.

34.  And that is what it did.

35.  A memorandum for sale to a new buyer was signed on 26 April with due date for completion on 26 August 2008.

36.  I mention here that the remaining twelve flats have also been resold, with completion dates variously fixed between 27 July and 22 September 2008.

37.  Newly appointed solicitors representing Mr and Mrs Ho and the companies, Messrs Ho Tse Wai & Partners (HTW) wrote to WCC on 10 May 2008.  Misrepresentation was again alleged.

38.  It was also said that by virtue of conduct and non-activity by MTRC and its agent SHK, MTRC had throughout affirmed the ASP so that it remained extant; the notice of termination was wrongful.

39.  They concluded:

“We are instructed that our clients as purchasers under the Agreements are willing, prepared and ready to complete the purchase within reasonable time.

Unless we have your favourable reply within 7 days withdrawing your said letters dated 11^th April 2008 and agreeing to complete the sale and purchase of the respective Agreements, we shall commence legal proceedings to enforce our clients’ rights under the Agreements without further notice to you and your client.  All our clients’ rights in respect of the Agreements are hereby reserved.”

But by then all the flats had been resold.

40.  The writ was issued on 20 May 2008.

41.  This application was filed on 2 June 2008.

The Statement of Claim

42.  This followed next; on 21 June 2008.

43.  Given the primary application before me is to strike it out, because it discloses no reasonable cause of action (r.19(1)(a)), it is scandalous, frivolous or vexatious (r. 19(1)(b) and inherent jurisdiction), or it is otherwise an abuse of the process of the court (r.19(1)(d)), the statement of claim comes under scrutiny.

44.  Paragraphs 1 and 2 set out the essential terms of the memorandum for sale and ASP.  Then the meat of the claim is at paragraph 3:

“3. Wrongfully and in breach of the Agreement, the Defendant purported to terminate the Agreement by serving on the Plaintiff a termination notice dated 11^th April 2008 (‘the Termination Notice’) on the purported ground that the Plaintiff had failed to complete the sale and purchase within 21 days from 15^th July 2006 as requested by the Defendant in a notice to complete dated 15^th July 2006  (‘the Notice to Complete’).  Wrongfully and in further breach of the Agreement, the Defendant purported to forfeit the Preliminary Deposit and the Further Payments.”

And then the particulars of breach:

“(1)   By the Notice to Complete dated 15^th July 2006, the Defendant gave the Plaintiff 21 days’ notice to complete the sale and purchase and to pay the balance of the Purchase Price.

(2) By its following conduct since the date of the Notice to Complete, the Defendant has agreed to extend the time to complete, alternatively has affirmed the Agreement despite any breach of the Plaintiff to complete, which is denied, alternatively has waived the requirement and obligation of the Plaintiff to complete the sale and purchase within 21 days from 15^th July 2006:

(a) By a letter dated 15^th November 2006, SHK acting as selling agent for and on behalf of the Defendant, extended the date for completion of the sale and purchase of the Premises to 30^th November 2006.

(b) By a letter dated 15^th May 2007, SHK acting as selling agent for and on behalf of the Defendant, urged the Plaintiff to complete the purchase of the Premises.

(c) On 18^th March 2008, Messrs. Winston Chu & Co acting as solicitors for the Defendant issued letters requesting the Plaintiff to pay the stamp duty on the Agreement.

(3) Further or alternatively, by reason of the above conduct of the Defendant, the Defendant is estopped from terminating the Agreement and/or forfeiting and retaining the Preliminary Deposit and Further Payments as stated in paragraph 3 thereof.”

The Evidence

45.  That adduced by MTRC came from two solicitors of Deacons, now representing MTRC in these proceedings having conduct of the case, Messrs Chung Lai Ming and Robert Clark.

46.  I do not need to summarize their accounts which provide a history of events including the correspondence that I have already recounted.

47.  There was a further affirmation from one Evoone Yiu, a senior officer of MTRC and responsible for matters going to the sale of the Arch units, but it takes the matter before me no further.

48.  Mrs Ho made two affirmations to oppose the application.

49.  In the first, in essence she deposed that by its conduct through its agent SHK, MTRC had during the period from the signing of the ASP up to the notice of purported termination caused herself and her husband and thus the purchasing companies including Everwin to believe that MTRC would not enforce its right to determine the agreements; in particular the ASP. 

50.  There was, she said, no step taken to enforce the right occasioned by the lateness of payment and non-payment of the preliminary instalments of the purchase price, back in 2005.

51.  Further, there were “ongoing negotiations” because of the complaints they had made about being overcharged; so, matters pending.

52.  Then, notwithstanding that the fifth instalment was still outstanding, thus that there was ongoing default, came the notice of issue of the occupation permit and the fixing of a date for completion, 7 July 2006.  That was followed by the notice of default, of 15 July 2006, giving 21 days to perform, and complete.  But there was inaction following expiry of that date.  And then there was a new deadline, of 30 November 2006.  Finally, yet another deadline, though this was less clear-cut, of 15 May 2007, to make good the default “without further delay”.  All these dates passed; yet no termination. 

53.  Demand for the stamp duty was also an indication that the agreement was effectively affirmed with time no longer of the essence.  That was on 18 March 2008.

54.  So, when the termination letter was served on 11 April 2008, it came all of a sudden, relying on a notice that had issued nearly two years before.  By then, it was all too late.  MTRC had by conduct and inaction affirmed the contracts including the ASP.

55.  In her second affirmation, which was short, and filed with leave on the day of the hearing, there was little further added to support Everwin’s cause.

56.  Pertinently however, she deposed that she had had a telephone call with a staff member of SHK on 2 April 2008.  She was told that MTRC was poised to terminate the agreements including the ASP.  Thus the notice of 11 April was in fact preceded by a last-chance warning and could not have been as unexpected as she had made out in her first affirmation.

The Law

57.  It is as well to remind myself about that which is trite when dealing with applications that if granted will terminate the action because there will be no pleading, by quoting from the White Book at 18/19/4:

“It is only in plain and obvious cases that the court should exercise its summary powers to strike out the indorsement on any writ or any pleading under this rule.  There should be no trial upon affidavit.  Disputed facts were to be taken in favour of the party to be struck out.  Nor should the court decide difficult points of law in striking out proceedings.  The claim must be obviously unsustainable, the pleadings unarguably bad and it must be impossible, not just improbable for the claim to succeed before the court will strike it out …

Where the legal viability of a cause of action is sensitive to the facts, an order to strike out should not be made …

The mere fact that a case is weak and not likely to succeed is no ground for striking it out …”

58.  For determination of an action by virtue of a ruling summarily made under Order 14A, the appropriate principles before invoking the procedure are equally succinct.

59.  Mr Tong SC representing Everwin has in his skeleton summarized what is pertinent in the application and I need do no more than reproduce his commentary:

“21.   The principles applicable under O14A are as follows:-

21.1.    Where the issues of facts are interwoven with the legal issues to be determined, O14A procedure is not appropriate for the obvious reason that a question of law cannot be answered on assumed or hypothetical facts.  If it is necessary for the court to resolve a factual dispute in order to conclude on the question of law, O14A should not be invoked; Shell Hong Kong Ltd v Yeung Wai Man Kiu Yip Co Ltd & Another (2003) 6 HKCFAR 222 at 230H-I per Chan PJ.

21.2.    The court must be satisfied that it has all the necessary facts and matters for the determination of a question of law before adopting the procedure under O14A.  Otherwise, the procedure should only be adopted in extremely rare cases:  Rockwin Enterprises Ltd v Shui Yee Ltd [2003] 3 HKC 174 at 185E-H per Recorder Geoffrey Ma SC (as he then was).”

The Arguments Against

60.  Mr Tong submitted that the strike out application is without merit.

61.  It could not be said there was no reasonable cause of action pleaded.  The material facts give rise to pleas of waiver and estoppel which if successful will stop the MTRC in its tracks.

62.  Nor could on the facts the claim be said to be scandalous, frivolous or vexatious, or an abuse of process.  Everwin has demonstrated on Mrs Ho’s evidence that there are triable issues.  By its conduct and in the correspondence, MTRC has repeatedly demonstrated that there would be no strict compliance with time and other formalities in the ASP.  There were ongoing matters that the correspondence between the Ho’s and SHK indicated required final resolution.  Everwin was entitled to rely on these concessions. 

63.  At the least, the nature and extent of the negotiations needed to be explained and tested at trial.

64.  MTRC denouncing the relationship of principal and agent with SHK as pleaded, yet conceding that for the purpose of this application, was to reveal a material dispute of fact that needed to be aired and resolved also.

65.  And there were matters of law that had to be dealt with after findings of fact. 

66.  Repeated acquiescence can give rise to estoppel; see Hazel v Akhtar [2002] 2 PvCR 17(CA) 240.

67.  The not insubstantial period of nearly two years between notice of default and invoking termination might be enough to promote a finding that time being of the essence has been waived, or that the notice had lapsed through prolonged inactivity; at least that is arguable; see Hughes v Metropolitan Railway Co.  [1877] 2 App. Cas. 439.

68.  Order 14A is equally not appropriate.  The validity and legal effect of the letter of 11 April 2008 is fact sensitive and requires a finding of fact after trial.  An assumption of facts actual or hypothetical is not enough; see Shell Hong Kong Ltd v Yeung Wai Man Kiu Yip Co. Ltd [2003] 6 HKCFAR 222.

Analysis

69.  The starting point is represented by the terms of the ASP the MTRC purported to invoke when the time for completion came, and went, without Everwin presenting itself for completion.

70.  There is no challenge but that MTRC complied with the terms of the ASP.

71.  Everwin’s pleaded case of affirmation of the ASP, in the alternative, of waiver; in the second alternative of estoppel, relies on the three letters of 15 November 2006, 15 May 2007 and 18 March 2008.

72.  The first two letters, written by SHK, MTRC’s agent, extended the deadline for completion to 30 November 2006, and then to a date uncertain, but implicit in the expression “without further delay” to be in the immediate future.  The third, by WCC, sought immediate payment of the stamp duty.

73.  Dealing with the letters from SHK:  I say at once that there is nothing to the point that MTRC takes formal issue in its defence with the allegation of agency between the parties.  For the purpose of this application it is conceded that SHK may be treated as having acted on behalf of MTRC as its agent in writing the letters.  In any event, I am obliged to take disputed facts in favour of the party whose pleadings are being sought to be struck out. 

74.  So, the relationship between MTRC and SHK is in this application undeniably one of principle and agent.

75.  As to the first letter; I regard this as the vendor giving the purchaser an opportunity to complete by a new deadline.  There is nothing within it to promote the proposition that MTRC would not exercise its right to terminate the ASP should Everwin fail to avail itself of this opportunity.  Nor is it implicit in the conduct. 

76.  Support for this view is found in a case from the Australian Supreme Court, Tropical Traders Ltd v Goonan [1964] 111 CLR.  This case concerned an agreement for the sale and purchase of land with payment by a deposit of two instalments, four further instalments on account and the balance due five years on.  Late payment of any instalment gave the vendor the right to rescind and to forfeit all sums already paid.  Time was of the essence.  Some of the instalments were paid and received, late by a few days.  The final payment was not paid on the designated date.  The day after the purchaser asked for 21 days’ extension.  The vendor responded by refusing that, but gave the purchaser five more days, provided he paid sufficient to cover additional costs.  When that did not happen the vendor purported to rescind the agreement and forfeit the deposit. 

77.  It was held that the acceptance by the vendor of late payments on earlier occasions did not preclude the vendor from insisting that time should continue to be of the essence.  The extension of time merely substituted a later date for the original date, so that time continued to be of the essence though in respect of the later date.  Kitto J said at p.52:

“Each acceptance of a late payment operated, of course, as an election by the appellant not to rescind the contract for non-payment of the relevant amount on its due date; but to read into the acceptances, considered either separately or as a whole, something promissory or some inducement to a belief in relation to future payments is, I think, to take an unwarranted step.”

The two other judges sitting with Kitto J endorsed his opinion.  Menzies J said at p.60:

“MENZIES J.  I have had the advantage of reading the judgment of Kitto J. with which I am in complete agreement.

Upon the main point, it appears to me on principle that a vendor becoming entitled to rescind for non-payment of purchase money upon the stipulated date for payment, who does no more than give the purchaser the opportunity to pay within a limited time thereafter, is not thereby electing not to rescind for non-payment on the due date nor is he representing that time is not of the essence; rather he is intimating that he intends to exercise his right to rescind unless payment is made within the time of grace.  Kitto J.’s examination of the cases disposes of the contention that authority has established the contrary and requires the decision that a vendor who shows such forbearance has inevitably done so at the expense of his contractual right to rescind.”

For completeness I repeat now what Kitto J went on to say:

“… It may be that repeated acquiescence by one party to a contract in non-observances by the other of stipulations as to time may amount, when considered in the light of particular circumstances, to an assent to time being treated for the future as not of the essence, notwithstanding a provision in the contract that it is of the essence; and in such a case it may not matter whether the result is described as a promissory estoppel or a waiver or a variation of the contract by mutual, though tacit, consent.  But it is not a valid general proposition that wherever some instalments are accepted late without demur the party accepting them is precluded in respect of later instalments from insisting upon the agreement that time shall be of the essence:”

That part of the excerpt I have emphasized might be said to support the proposition that where there is ongoing activity such as Mr and Mrs Ho’s apparent complaint giving rise to ongoing negotiations, current at the time of the deadline, might have the effect of waiving compliance with the term that time is of the essence.

78.  But that, as I find, is a red herring.  For the purpose of this application Mrs Ho said that there were ongoing negotiations.  Clearly on the correspondence there were none.  SHK early on made it quite plain that all the purchasing companies, including Everwin, were to be held to their contracts. 

79.  And time of the essence having been made a term of a contract between contracting parties where the innocent party has given the defaulting party time to perform, remains of the essence:  See Chitty on Contracts, 29^th edition, at 21-014.

80.  So, the first letter does not amount to an affirmation nor to a waiver, and nor to estoppel.

81.  The second letter follows the same path.  It effectively gave Everwin one more chance.  That there was no date stipulated does not change things.  As soon as possible means what it says and in the context of an overdue completion date for the sale and purchase of property must be within reasonable time; say a few days or perhaps a week or two.  It matters not that I am not precise about this; suffice to say that what is clearly not reasonable is a time lapse of some eleven months.

82.  And so to the third letter.  This, as I have recorded, was to remind Everwin that the deferred period for payment of stamp duty was due to expire, and that default would result in penalty.  Everwin remained liable to pay the stamp duty contractually, regardless of its continuing default, and MTRC was entitled to call for that to protect its own position with the IRD.  In my view nothing within the letter indicates a willingness to depart from its rights inherent in Everwin’s default, and in case it could be thought to be otherwise, the matter is put beyond doubt by the final paragraph of the letter:

“We wish to reiterate that nothing contained herein shall prejudice anything contained in our letter dated 15 July 2006 or any of MTR Corporation Limited’s rights under the Agreement, at common law, in equity or otherwise.”

Conclusion

83.  Taking away the smoke and mirrors put up by and for Everwin, this is in reality a simple case where a purchaser in a conveyancing transaction has to suffer the consequences of default in failing to show up to complete.

84.  It was given time to remedy that default but failed to take the opportunity.  That it claims now to be in a position to complete is to ignore the vendor’s prior rights to terminate the contractual relationship.

85.  The claim brought by Everwin is obviously unsustainable. 

86.  In exercise of my power to do so I order a striking out of the statement of claim and indorsement.  I do so upon the grounds that they are frivolous and vexatious, under O.18 r.19(1)(b) and my inherent jurisdiction.  The action is dismissed.

87.  I order further that registration of the writ against the title to the property in question be vacated.

88.  Costs, nisi, are to the defendant, taxed if not agreed.

89.  This order with costs holds good for the remaining twelve writs filed under HCA nos 885-890 and 892-897 of 2008.