The Rt Hon LMD de Silva :

The judgment of their Lordships was delivered by

This is an appeal from a judgment and decree of the Court of Appeal at Kuala Lumpur Supreme Court which reversing a judgment of the High Court entered judgment in favour of the plaintiff (the respondent on this appeal) against the defendant (the appellant on this appeal) for the return of a deposit made by the plaintiff on an agreement for the purchase by him from the defendant of 22 lots of land and for damages for the breach thereof by the defendant.

The following recitals and clauses of the agreement are relevant to the matters in dispute between the parties:

Whereas the Vendor has caused Building Plans prepared by Lee Eng Tong of No. 24, Sultan Street, Klang (hereinafter called the Architect) which have been approved by the Town Council, Klang, under Plans Nos 185/55, 185A/55, 185B/ 55, 185C/55 and 185D/55 for the erection of 21 Terrace Houses on the said Property:

And Whereas the Purchaser intends to erect the said 21 Terrace Houses for sale and agrees to give priority for such sale to the 36 Tenants of the Vendor of premises known as Nos 102, 104, 106, 108, 110, 112, 114, 116, 118, 120, 12