An MOU detailing rights and obligations for property development can be specifically enforceable, irrespective of the absence of a formal contract.

ORAL ORDER:

1. The Plaintiff has essentially sued for specific performance of an Agreement/MOU executed by and between the Plaintiff and Defendants on 8th May, 2004, Exhibit-Q to the plaint. The Defendants have claimed that the said agreement has been terminated by their notice dated 10th August, 2005. The Plaintiff has sought a declaration that the notice of termination is without authority of law.

2. The Plaintiff has prayed for an injunction restraining the Defendants from creating any 3rd party rights in the suit property in the above Notice of Motion.

3. The Plaintiff claims to have been granted right, title and interest as a Developer of the suit plot of land. He claims to have purchased TDR in respect of the development pursuant to the Agreement/MOU entered into by him. He also claims to have been made a co-owner of the suit plot of land which has been transferred to him upon payment of consideration pursuant to the Agreement/MOU dated 8th May, 2004. He further claims to have acted upon the said agreement to develop the suit plot of land by negotiating and entering into registered agreement with several of the tenants on the suit plot of land. The Plaintiff further claims to have obtained ownership rights in respect of certain flats in the building to be constructed on the suit plot of land, also pursuant to the said Agreement/MOU dated 8th May, 2004.

4. The Plaintiff, therefore, claims that based upon the said agreement, the Plaintiff was allowed to develop the suit plot of land before the Defendants sought to terminate it.

5. It is the Defendants case that the MOU does not settle the rights of the parties for development of the suit plot of land and that the agreement for development was yet to be entered into between them. It is contended that the Plaintiff was merely a construction Contractor. He was to demolish the existing structure on the suit plot of land and construct a new building, which agreement is not specifically enforceable.

6. The precise agreement between the parties and the intention of the parties behind the agreement would, therefore, have to be ascertained.

7. The MOU dated 8th May, 2004 shows the parties to the suit by name. It records the understanding arrived at by all the parties mentioned therein. The Plaintiff is stated to be the Developer/Builder/Constructor/Contractor. He was to do certain acts for putting up new construction. Defendant No.1 and 2 are lessees of the suit plot of land belonging to Defendant No.3 Society. Defendants 4 to 8 are the tenants in the existing structure.

8. Clause 1 of the MOU shows that “the Plaintiff will develop” the property by demolishing the existing building and constructing a new building on the suit plot of land. The total available FSI plus the TDR has already been got approved by him from the MMC. Clause 1 further shows that TDR has already been purchased by the Plaintiff upon payment in the name of Defendants 1 and 2, who were then the only lessees of the suit plot of land.

9. Clause 2 shows that two of the tenants, Defendants 5 and 7, who were also signatories to the agreement would reside in temporary alternate accommodation already provided to them, which will be financed by the Plaintiff till the new building is constructed.

10. Clause 3 mentions about the arrangement with another tenant, Defendant No.4 for which a registered agreement was to be entered into within 7 days.

11. Another tenant, Defendant No.8 agreed to sell his two flats to the Plaintiff at the specific consideration in that regard mentioned in the said clause for which a formal tripartite agreement was to be executed within 7 days. The Plaintiff was to be the owner of those two flats upon paying the agreed consideration to Defendant No.8. The Defendant No.8 was to vacate those two flats upon rec