Hashim Yeop Sani SCJ:

This appeal arose out of a sale and purchase agreement relating to premises No. 16 Persiaran Puteh, Off Klang Road, Kuala Lumpur which agreement was executed on 23 June 1981 between the appellant (first defendant in the Court below) as vendor and the respondent (plaintiff in the Court below) as purchaser for a consideration of RM230,000. At the time of the execution of the said sale and purchase agreement a sum of RM54,000 was paid by the purchaser by way of deposit. Under Clause 3 of the said agreement the balance of the purchase price was to be settled within six months from the date of the agreement, that is, on or before 22 December 1981.

It does not seem to be disputed that several sums of money were paid in instalments towards the purchase price and that by 9 December 1981 there was apparently a balance of RM150,000 of the purchase price yet to be settled.

It is also not disputed that the purchaser had to obtain loans to finance the balance of the purchase price and that the property in question was at the material time subject to a charge. Neither of these facts were however mentioned anywhere in the said agreement. There was as a result a delay in providing the necessary undertaking before the loans could be obtained and when the agreed period of six months expired on 22 December 1981 the balance of the purchase price was still not settled. The appellant then instructed Messrs. Lee Beng Cheang & Co. to rescind the said agreement and forfeited the deposit.

It would appear that the learned trial Judge while accepting that the said agreement provided for the reciprocal obligations of the parties was also of the view that there was a "condition precedent" to the performance of the obligations. K. Umar Rajah v. E.L. Magness [1984] 1 CLJ (Rep) 416 was cited. Then the trial Judge proceeded to identify what she thought was the condition precedent in this case. She concluded that there was an implied duty on the part of the appellant to cooperate and not to hinder or obstruct the performance of the agreement. On the facts as found by her the learned Judge attributed the delay in the settlement of the balance of the purchase price to the appellant and his solicitors, Messrs. Lee Beng Cheang & Co. She also held there was no justification on the part of the appellant to terminate the agreement as he and his solicitors were at fault throughout and that they were the causes of the delay that prevented the respondent from fulfilling their part of the bargain.

The trial Judge then made the following orders against the appellant:

(1) to return the deposit of RM54,000 with interest at the rate of 8% per annum from 23 June 1981 to date of payment.

(2) to repay all necessary expenses incurred by the respondent in entering into the said sale and purchase agreement.

To complete the record it may be mentioned that the suit in the Court below included also one Yong Sai Moi @ Yong Chan Ying (f) as the second defendant, and the Registrar of Titles as the third defendant. The claim against the second defendant was dismissed because the learned Judge found that fraud as envisaged under s. 340(2)(a) of the National Land Code had not been proved. As regards the third defendant the learned Judge awarded costs against him for wrongly removing the caveat without a proper service of Form 19C. There was however no appeal by the third defendant. There was also no cross-appeal by the respondent with regard to the rejection of the allegation of fraud against the second defendant.

It would seem to us that a basic question to be settled first in this appeal is the order in which the obligations of the parties in the said sale and purchase agreement were to be performed. The relevant provisions of the agreement in this regard are Clause 3, 4, 5, 7 and 9.

It needs to be mentioned immediately that Clause 11 of the agreement expressly provides that time shall be the essence of the contract. There was no provision anywhere in the ag