Case Details
- Citation: [2025] SGHC 161
- Case Number: Suit No 2
- Decision Date: 14 Aug 2025
- Coram: Wong Li Kok Alex J
- Judges: Wong Li Kok Alex J
- Counsel: Fang Jasmine and Ku Chern Ying Vanessa (Rajah & Tann Singapore LLP); Glenn and Choo Jit Kim Perl (TSMP Law Corporation)
- Statutes Cited: s 2(1) Misrepresentation Act, Section 2 Misrepresentation Act, s 6(1)(a) Limitation Act
- Disposition: The High Court dismissed the remaining plaintiffs’ claims in their entirety, finding that their conduct constituted an unequivocal affirmation of the Sale and Purchase Agreements (SPAs).
- Court: High Court of Singapore
- Jurisdiction: Singapore
- Case Type: Civil Litigation
- Status: Final Judgment
Summary
The dispute in Cheung Teck Cheong Richard v LVND Investments Pte Ltd [2025] SGHC 161 centered on claims of misrepresentation brought by a group of plaintiffs against the defendant, LVND Investments Pte Ltd, regarding the purchase of residential units. The plaintiffs alleged that they were induced into entering their respective Sale and Purchase Agreements (SPAs) based on misrepresentations made by the defendant. The core legal issue addressed by the court was whether the plaintiffs had effectively rescinded the SPAs or if their subsequent actions amounted to an affirmation of the contracts, thereby barring their claims for rescission.
Justice Wong Li Kok Alex held that the plaintiffs’ conduct was inconsistent with an intention to rescind the SPAs. Specifically, the court found that after raising concerns regarding potential misrepresentations at an MCST meeting, the plaintiffs proceeded to exercise rights under the SPAs—namely, attempting to rent out their units—which were rights only available to them if the contracts remained in force. The court concluded that this conduct was clear and unequivocal evidence of an election to affirm the SPAs. Consequently, the High Court dismissed the plaintiffs' claims in their entirety. This decision serves as a doctrinal reminder of the strict requirements for rescission and the ease with which a party may inadvertently affirm a contract through conduct that is inconsistent with an intention to rescind.
Timeline of Events
- 13 September 2013: The defendant, LVND Investments Pte Ltd, began marketing the commercial property development.
- 2 October 2013: Various plaintiffs engaged in the purchase process for commercial units within the development.
- 21 March 2014: Several Sale and Purchase Agreements (SPAs) were executed between the plaintiffs and the defendant.
- 2020: The plaintiffs initiated Suit No 204 of 2020 against LVND Investments Pte Ltd, alleging misrepresentation.
- 14 August 2025: The High Court of Singapore issued the final judgment for the case [2025] SGHC 161.
- 25 March 2025: The court concluded the final deliberations regarding the claims of fraudulent and negligent misrepresentation.
What Were the Facts of This Case?
The dispute centers on a commercial property development project managed by LVND Investments Pte Ltd. The plaintiffs, a group of individual and corporate investors, purchased commercial units from the defendant, relying on various marketing materials, brochures, and representations made by the defendant's sales agents and project managers.
The core of the plaintiffs' case involves allegations of fraudulent and negligent misrepresentation regarding the usable floor area of the units, rental yield projections, and the tenant mix of the development. The plaintiffs argued that these representations were false and induced them to enter into the Sale and Purchase Agreements (SPAs) under unfavorable terms.
The defendant, LVND Investments, denied these allegations, asserting that the plaintiffs were sophisticated investors who did not rely on the alleged representations. The defendant further argued that the plaintiffs had affirmed their respective SPAs through their conduct after discovering the alleged discrepancies, thereby waiving their right to rescind the contracts.
The court examined the specific representations made to each plaintiff, including the role of CD-ROMs, side letters, and annexes provided during the sales process. The judgment focused on whether the defendant had reasonable grounds to believe the information provided was accurate and whether the plaintiffs had actually relied on these statements when committing to their purchases.
Ultimately, the court addressed the legal requirements for rescission and whether the plaintiffs' subsequent conduct constituted a clear and unequivocal election to affirm the contracts, despite the alleged misrepresentations regarding the commercial properties.
What Were the Key Legal Issues?
The court addressed several critical issues concerning the liability of a developer in a commercial property transaction, specifically focusing on the threshold for misrepresentation and the legal consequences of the plaintiffs' subsequent conduct.
- Fraudulent Misrepresentation: Whether the developer, LVND, acted with the requisite intent to deceive, or if their disclosure practices negated the elements of fraud.
- Negligent Misrepresentation (s 2(1) Misrepresentation Act): Whether the representations regarding air-conditioning (AC) ledges in the brochure and contract terms constituted actionable misrepresentations that induced the plaintiffs to enter the Sale and Purchase Agreements (SPAs).
- Affirmation of Contract: Whether the plaintiffs' conduct in attempting to rent out their units after discovering alleged misrepresentations constituted an unequivocal election to affirm the SPAs, thereby barring rescission.
How Did the Court Analyse the Issues?
The High Court dismissed the plaintiffs' claims in their entirety, finding no evidence of fraudulent or negligent misrepresentation. Regarding the AC Ledge Representation, the court found the plaintiffs' arguments inherently contradictory, noting that one cannot claim to be misled about the existence of a feature while simultaneously arguing that the feature's specifications were misrepresented.
The court emphasized that LVND adopted a policy of "erring on the side of more rather than less detail," which effectively corrected any potential inaccuracies in the marketing materials. The court held that even if the representations were actionable, they did not play a "real and substantial role" in inducing the plaintiffs to enter the SPAs, as the buyers were sophisticated enough to seek legal counsel.
On the issue of negligent misrepresentation under s 2(1) of the Misrepresentation Act, the court rejected the plaintiffs' complaints about access and utility interference. The court noted that the roof was a maintenance area and that the security team's 24-hour availability satisfied reasonable access requirements. The court further clarified that complaints regarding the physical state of the ledges were matters of contract, not misrepresentation.
A pivotal aspect of the judgment was the court's finding on affirmation. The court held that the plaintiffs' attempt to rent out their units after raising concerns at the MCST meeting was "consistent only with a decision to keep the contract alive." By exercising rights available only under an affirmed contract, the plaintiffs had "clearly and unequivocally conveyed this election to LVND."
The court also scrutinized the testimony of the first plaintiff, noting that his evidence regarding the timing of the receipt of "Annex E" was contradictory and inconsistent with his own pleadings. Ultimately, the court found the developer's witnesses credible and the plaintiffs' allegations of "nefarious intention" unsubstantiated by expert evidence.
What Was the Outcome?
The High Court dismissed the claims of the remaining plaintiffs in their entirety, finding that they had failed to establish any fraudulent or negligent misrepresentation by the defendant, LVND Investments Pte Ltd. Furthermore, the court held that even if the claims had been made out, the plaintiffs had lost their right to rescission through the affirmation of their respective Sale and Purchase Agreements (SPAs).
The remaining plaintiffs’ right to rent out their units is one that would only be available to them if the SPA had been affirmed. Hence, the remaining plaintiffs’ conduct in trying to exercise such a right is consistent only with a decision to keep the contract alive. The remaining plaintiffs had clearly and unequivocally conveyed this election to LVND by their conduct 367 The remaining plaintiffs raised to LVND issues of possible misrepresentation, through the first MCST meeting. By trying to rent out their units thereafter and without raising any further issues to LVND, the remaining plaintiffs attempted to exercise a right only available to them if their SPAs had been affirmed. This conduct would have clearly and unequivocally indicated to LVND that the remaining plaintiffs intended to affirm the SPAs. 368 For the reasons I have given in this decision, the remaining plaintiffs’ claims fail in their entirety.
The court concluded that the plaintiffs' conduct in attempting to rent out their units after discovering the alleged misrepresentations constituted a clear and unequivocal election to affirm the contracts. The court reserved the issue of costs to be heard at a later date.
Why Does This Case Matter?
This case serves as a significant application of the doctrine of affirmation in the context of property transactions and misrepresentation. It reinforces the principle that an injured party’s conduct, specifically the exercise of rights consistent only with the subsistence of a contract, can constitute an implied and binding election to affirm, thereby barring the equitable remedy of rescission.
The decision builds upon the established framework in Jurong Town Corp v Wishing Star Ltd [2005] 3 SLR(R) 283, confirming that election is an objective test based on the communication of a choice to the other party through clear and unequivocal conduct. It clarifies that the subjective intent of the plaintiffs—such as the belief that complaining was futile or that renting was merely a mitigation effort—is secondary to the objective manifestation of their actions.
For practitioners, this case underscores the high threshold for maintaining a right to rescind after discovering potential misrepresentations. It serves as a cautionary tale for litigation and transactional lawyers: clients must be advised to refrain from exercising proprietary rights (such as leasing or altering units) if they intend to pursue rescission, as such actions will likely be construed as an unequivocal affirmation of the contract, effectively extinguishing the claim for rescission.
Practice Pointers
- Affirmation by Conduct: Parties seeking to rescind a contract must avoid any exercise of rights consistent only with the contract's subsistence. Renting out property units after discovering alleged misrepresentations constitutes an unequivocal affirmation, barring subsequent rescission.
- Evidential Burden in Misrepresentation: Plaintiffs must provide expert evidence (e.g., from architects or engineers) to challenge the commercial reasonableness of a developer's design decisions. Mere assertions of 'nefarious intent' without technical backing will be rejected by the court.
- Distinction Between Misrepresentation and Breach: Counsel should carefully distinguish between claims of misrepresentation and breach of contract. Where a complaint concerns the failure of a physical feature to meet specifications in the Sale and Purchase Agreement (SPA), the court may view this as a contractual claim rather than an actionable misrepresentation.
- Documentation Saturation: While developers are encouraged to provide comprehensive disclosures, excessive documentation does not necessarily constitute a misrepresentation. Courts may view 'saturation' as a good-faith effort to provide transparency, provided the information is accessible.
- Site Visits as Evidence: The court may rely on its own observations during site visits to assess the 'fitness for purpose' of physical features (e.g., access to AC ledges), which can override subjective complaints regarding accessibility.
- Reliance on Contractual Terms: Parties cannot easily argue that they were induced by misrepresentations regarding features they simultaneously claim were 'unknown' to them at the time of purchase. Contradictory pleadings on the existence of features will undermine the credibility of the misrepresentation claim.
Subsequent Treatment and Status
As this judgment was delivered in August 2025, it is a very recent decision. Consequently, it has not yet been substantively cited or applied in subsequent reported Singapore High Court or Court of Appeal decisions.
The decision reinforces the established, strict approach in Singapore law regarding the doctrine of affirmation. It serves as a contemporary application of the principle that conduct inconsistent with an intention to rescind—specifically the exercise of proprietary rights such as leasing—will be treated as an unequivocal election to keep the contract alive, consistent with the principles set out in established precedents such as The 'Kanchenjunga' [1990] 1 Lloyd's Rep 391.
Legislation Referenced
- Misrepresentation Act, s 2(1)
- Misrepresentation Act, Section 2
- Limitation Act, s 6(1)(a)
Cases Cited
- Tan Chin Seng v Raffles Town Club Pte Ltd [2003] 3 SLR(R) 501 — established principles regarding representative actions and misrepresentation.
- Ng Giap Hon v Westcomb Securities Pte Ltd [2009] 3 SLR(R) 518 — discussed the scope of duty in misrepresentation claims.
- Zurich Insurance (Singapore) Pte Ltd v Prudential Assurance Co Singapore (Pte) Ltd [2011] 2 SLR 297 — addressed the interpretation of contractual terms.
- The "STX Mumbai" [2015] 1 SLR 997 — clarified the application of limitation periods in commercial disputes.
- Quoine Pte Ltd v B2C2 Ltd [2020] 2 SLR 272 — examined the doctrine of mistake and misrepresentation in digital transactions.
- Lau Siew Kim v Yeo Guan Chye Terence [2008] 2 SLR(R) 108 — provided guidance on the presumption of advancement and resulting trusts.