Henderson J
IN THE GRAND COURT OF THE CAYMAN ISLANDS
CAUSE NO. 819 OF 2003
BETWEEN:
CONDOCO GRAND CAYMAN RESORTS LTD.
Plaintiff
AND
MBI DIVECORP INC.
Defendant
Transcript of Proceedings heard before
The Honourable JUSTICE HENDERSON on the
19th day of March 2004, in George Town,
Grand Cayman.
APPEARANCES:
On behalf of the Plaintiff: MR. J. WALTON
On behalf of the Defendant: MR. E. GEORGE, QC
CHAMBERS COMMENCED ON FRIDAY,
MARCH 19TH 2004 AT 2:30 P.M.
THE COURT: This is the plaintiff's application for summary judgment. It seeks declarations that, pursuant to the terms of an agreement for the purchase and sale of a condominium, it was entitled to terminate that agreement and to retain a deposit paid by the defendant by reason of the defendant's failure to pay a second installment towards the purchase price on the due date.
The defendant admits the meaning and effect of the terms of the agreement on which the plaintiff's claim is based, and that it did not pay the installment. Its sole basis for resisting the claim is the assertion that it had previously rescinded the agreement based on the anticipatory breach of that agreement by the plaintiff. It says, therefore, that it was no longer bound to pay installments and was entitled to the return of its deposit, plus interest, pursuant to the termination clause in the agreement.
The argument before me requires a
construction of clause 24(f) in the agreement, which was amended by an addendum. The amended version of the clause reads as follows:
"'Completion date' means 14 days after the vendor notifies the purchaser that the following events have all occurred and/or are then currently in effect..."
There follows a list of six events which I will not read. The clause continues:
"...provided that (while the projected date for completion is on or before 31st December 2001) in the event all of the items set out in sub clauses 24(f)(i) to (vi) inclusive have not been achieved or are not available by 31st December 2003, then the purchaser, by notice in writing to the vendor given on or before 31st January 2004, may rescind this agreement and may demand the return of all monies theretofore paid by the purchaser to the vendor
hereunder, together with interest thereon at the rate of five percent per annum from the respective dates the vendor or the vendor's attorneys-at-law received such sums to the date of repayment to the purchaser. Upon the vendor returning the said monies to the purchaser, the purchaser shall accept such return in full satisfaction of all claims under or pursuant to this agreement, and this agreement shall thereupon without more be terminated, and neither party hereto shall thereafter have any further rights of action or claim of any nature against the other party hereto in respect hereof."
In August 2002, the six events specified in the clause had not yet occurred. The defendant, by letter, purported to rescind the agreement at that time on the ground of an anticipatory breach. The defendant says it
formed the opinion at that time that the project could not possibly be finished by the completion date.
In taking that position, the defendant was necessarily asserting that the clause I have read contains a promise that the project would be completed by December 31st, 2003. Failure to complete by that date would, says the defendant, amount to a fundamental breach.
I do not think the contract can be read in that way.
The purpose of the clause is to set out a formula for ascertaining the "completion date" (or closing date, if you will) of the purchase and sale transaction for the purpose of clause 19, which uses the phrase "completion date" without defining it.
This is a case where the language of the contract is clear, unambiguous, and must be taken to represent the mutual intent of the parties.
Clause 24(f), as amended, refers to a "projected date for completion" which is manifestly not a promise to finish the project by that date. It goes on to provide a remedy
for the purchaser if the project has not been completed by December 31st 2003. The purchaser may rescind and receive the return of its deposit, plus interest. The very reason for the existence of this provision is the absence of any promise by the vendor to complete by any given date. There is no other reasonable way to read this clause.
Accordingly, the defendant has no reasonable prospect of success at trial.
In the result, I do not need to address the more difficult question of whether, if there was a contractual promise to complete by December 31st 2003, the defendant had in August 2002 sufficient grounds for concluding that a fundamental breach by the vendor was inevitable.
I award summary judgment to the plaintiff in the form requested in the statement of claim.
[Submission on Costs]
Costs will certainly be denied to a successful party where it would be inequitable
to award them. The concept usually is confined to such things as delay or misconduct in the course of the litigation itself. I do not think it would be appropriate to deny a successful litigant its costs (which are, of course, meant to indemnify it against the cost of the legal proceeding) because it has benefitted by the good fortune of being able to resell the disputed property.
I must award this plaintiff its costs on the usual party and party basis and I do so now.
[Submission on Leave to Appeal]
It is only in the exceptional case that the Court would deny leave to appeal in a case where the point at issue is the construction of a contractual term. I have certain misgivings about your prospects on appeal, but I am not going to deny you leave to appeal.
Henderson, J.