Mohd Saari Yusoff JCA:

This is an action by the respondent ("the plaintiff) against the four appellants ("the defendants") for breach of contract. In the court below, the learned judge entered judgment for the plaintiff and the defendants were ordered to pay damages to be assessed and interest, hence this appeal.

Gist of the case is that at all material times, the plaintiff was the co-owner of undivided share of land held under Sandakan Lease No. 10266 (hereinafter referred to as "the said land"). Under a deed dated 28 July 1984 ("the deed") the plaintiff agreed to transfer the said land to the first defendant ("Dl") for development. The plaintiff had since transferred the said land to D1 but D1 had failed to develop the said land. The other defendants were guarantors to the deed.

On 11 March 1989, the plaintiff issued a writ against the defendants. By order of the court dated 12 February 1990 two questions of law were ordered to be tried first pursuant to O. 33 rr. 2, 3(2), 5 RHC 1980. The two questions are as follows:

(A) Whether upon a true construction of the deed dated 28 July 1984 (a copy of which is annexed hereto and marked "A1" to "A12" and to be referred to hereinafter as the deed) the final approval for the development of the Phase 1 project referred to in cl. 4 of the deed was:

(I) obtained on 19 June 1984 when the Sandakan Municipal Council approved the building plans (No. S1182/12A to S1182/1/4A and No. S1182/2/2A to S1182/2/5 A); or

(II) obtained on 19 June 1984 when the Sandakan Municipal Council endorsed on the said building plans (No. S1182/1/2A to S1182/1/4A and No. S1182/2/2A to S1182/2/5A) the words: "Commencement of construction of buildings to be subjected to final approval of engineering development plans"; or

(III) obtained at all;

(B) Whether, assuming that there is no final approval for the development of the Phase I project, the defendants can rely on the failure of the 1st Defendants - to obtain or to apply at all for the final approval for the development of the Phase I project within six months of 28 July 1984 - to invoke cl. 4 of the deed to treat the deed as null and void and of no effect.

On The Two Questions

It is part of the agreed facts that prior to executing the deed on 28 July 1984, the following were already submitted to Sandakan Municipal Council namely:

(1) Layout & Subdivision Plan (S1182/1B) which was approved in principle on 8 July 1982 and approved on 5 April 1983;

(2) Earth moving, Road Retaining Wall Layout Plan (S1182/2B) which was approved on 5 April 1983;

(3) Structural & Engineering Plans for the infrastructures (S1182/3 to S1182 15) which were approved on 12 May 1983 and on 4 February 1985;

(4) Site & Locality Plan Semi-detached houses (S1182/1/1A) which plan was approved on 27 June 1983 and on 19 June 1984;

(5) Building Plans for Semi-detached houses (S1182/1/2A to S1182/1/4A) which were approved on 27 June 1983 and on 19 June 1984;

(6) Site & Locality Plan for Terraced houses (S1182/2/1A) which plan was approved on 23 June 1983 and on 19 June 1984; and

(7) Building Plans for terraced houses (S1182/22A to S1182/2/5A which plans were approved on 23 June 1983 and on 19 June 1984.

Be it noted that there was delay in D1 applying for approval of the engineering plan and also in applying for permission to commence work. The engineering plan was approved on 4 February 1985. D1 only applied for permission to commence building works on 21 July 1986 which was about 1 1/2 years after expiry of six months from the date of the deed. Clause 4 of the deed expressly provide for the approval of the plans to be obtained within six months from date of the deed.

On the first question, the finding of the learned judge was that the expression "final approval for the development of Phase I project" appearing in cl. 4 of the deed should be taken to mean approval by the council of all plans including structural and engineering plan.

With regard to the second question, the finding of the l