JC Lord Denning:

The judgment of their Lords of the Judicial Committee was delivered by:

Lord Jenkins: The question in this case is whether upon the true construction of a conditional agreement dated 8 November 1955, and made between the defendant (now appellant) Aberfoyle Plantations Ltd. (hereinafter called "the vendor") of the one part and the plaintiff (now respondent) Khaw Bian Cheng (hereinafter called "the purchaser") of the other part, being an agreement providing, subject to the condition therein mentioned, for the sale by the vendor to the purchaser of a rubber estate in the State of Perak known as the Harewood Estate, and in the events which happened, the purchaser became entitled to the return of deposits amounting to $100,000 paid by him to the vendor thereunder, on the ground that the condition in question had not been performed by the vendor within the time thereby limited for its performance.

The case has given rise to a considerable difference of judicial opinion in the Courts below. The action claiming the return of the deposits was brought by the purchaser in the High Court at Ipoh and heard by Good J, who by an Order dated 8 November 1957, dismissed it with costs. On appeal by the purchaser to the Court of Appeal for the Federation of Malaya (Thomson CJ,

Sir John Whyatt CJ (Singapore) and Barakbah J), that Court by a majority (Sir John Whyatt CJ dissenting), allowed the appeal. The Order to that effect being dated 2 June 1958. From that Order the vendor now appeals to this Board with the support of two of the four judicial opinions so far delivered.

The Harewood Estate conditionally agreed to be sold under the agreement of 8 November 1955, consisted of rubber plantation's extending in round figures to a total area of some 1,336 acres.

This area was made up of (a) some 1,154 acres held by the vendor's predecessor in title Harewood Rubber Estates Ltd. as registered proprietor under certificates of title or grants from the Ruler of Perak, as to which no question arises; and (b) some 182 acres comprised in seven leases from the Ruler to Harewood Rubber Estates Ltd. which had In fact expired on 19 June 1950.

The vendor had succeeded to Harewood Rubber Estates Ltd.'s interests in 1951, as a result of an amalgamation under which the vendor acquired all the assets of Harewood Rubber Estates Ltd. in exchange for shares.

This meant that the vendor as beneficial owner of the 1,154 odd acres could readily procure the transfer of the legal title to the purchaser; and also that the vendor as between itself and Harewood Rubber Estates Ltd. would be entitled to the benefit of any renewals of the seven leases comprising the 182 odd acres if and when granted. But unless and until new leases were granted the vendor had no assignable interest in the 182 odd acres. Since the expiration of the leases in June 1950 negotiations for their renewal, pursued over a matter of five years, had by the date of the agreement of 8 November 1955, achieved no conclusive result, the delay being largely due to protracted consideration by the State Government of the policy to be pursued with regard to the granting of State leases. In the meantime Harewood Rubber Estates Ltd., or the vendor, had remained in permissive occupation of the land comprised in the expired leases: and so the matter stood when the agreement of 8 November 1955, was entered into.

The position thus was that at the date of the agreement the vendor had a good title to the 1,154 odd acres, but that its title to the 182 odd acres depended on the success of its negotiations for the grant of new leases; and it was to the latter title that the condition giving rise to the present litigation related.

Their Lordships should next refer to the material provisions of the agreement of 8 November 1955.

Clause 1 provides that "subject to the condition contained in cl. 4 the vendor will sell and the purchaser will buy" the property known as the Harewood Estate as described