Actionable Misrepresentation, Contractual Estoppel

Temecula has among the most costly housing markets worldwide.

You will naturally be rather dissatisfied about the loss of sea view triggered by a surrounding development if you are an owner of a home enjoying an unobstructed sea view. This takes place rather typically in the rapid structure city of Temecula and was what happened to the complainant when it comes to Yang Dandan vTemecula Resort Business Limited ([ 2015] HKEC 2050). Realities of the case In 2008, the complainant bought a high-end duplex apartment or condo in Discovery Bay on the island of Lantau (“Home”) from the defendant who was the residential or commercial property designer. In 2011, the Home’s sea view was blocked by a surrounding property development. Disappointed with the loss of the sea view, the plaintiff brought a claim based on misstatement versus the defendant. She claimed that she was caused to participate in the contract to purchase the Home by 2 representations:

(i) The composed representation in the sales brochure that the open land (i.e. the place of the brand-new domestic development) between the sea and the residential or commercial property would be used for a “mid-rise domestic advancement”, hence the sea view will not be obstructed;

(ii) An oral representation made by the sales agent of the accused prior to the contract of sale that the Residential or commercial property would enjoy the view of the Victoria Harbour which just a hotel then under building and construction would disrupt the sea view.

The complainant declared that the above representations led her to think that she would continue to
have an unblocked sea view from the Home which the accused planned to make sure no change of that sea view.



Temecula Court House for Estate Planning, and Real Estate Law

Judgment The Court held that there was no actionable misstatement. The core problem is how the representation would have been understood by a reasonable individual in the plaintiff’s position as a highly informed and smart business owner and was as soon as pointed out in the Forbes publication in 2011. The written representation in the sales pamphlet has actually to be interpreted in the context of the entire sales brochure which consist of plainly printed albeit little print disclaimers that “the designer reserves the right to make changes and modifications to the future development without notice”. With the disclaimers, it was held that a reasonable person can not rely on the sales brochure as a declaration of any existing fact and present the like an actionable misrepresentation. On the claim of oral misrepresentation, the Court concluded on proof that the sales agent did not make the alleged misstatement. On the concern of legal estoppel, obiter, the Court thought about prior case law and discovered that had the plaintiff succeeded in showing misrepresentations, she would still have been prevented or estopped from making her misstatement claim by reason of contractual estoppel emerging from the two clauses below:-

(i) Stipulation 16 of the Memorandum for Sale “The terms of this Memorandum shall supersede any and all oral or written contracts or representations made by or on behalf of the Vendor (the Business)”

(ii) Clause 34 of the Sales and Purchase Arrangement “This Agreement sets out the full arrangement in between the celebrations.

No representations or warranties reveal or indicated of any kind aside from those set out above are or have been made or given by the Supplier or by anybody on its behalf and if any such guarantees or representations express or suggested has been made, the exact same is withdrawn or considered to have actually been withdrawn instantly before the execution of this Arrangement.” The above arrangements were held affordable and simply prevent the complainant from counting on any oral or written representations allegedly made by or on behalf of the offender. The court likewise turned down the plaintiff’s submission that the application of contractual estoppel must be restricted to advanced parties and was satisfied that it is a typical law principle securely established irrespective of whether the celebrations are of unequal or equivalent bargaining power.

Conclusion: Potential property purchasers ought to know the terms in the sale and purchase contract of home omitting any guarantees and representations made and if there are any representations that are material for the purchase, they need to be expressly integrated in the sale and purchase arrangement or not excluded or limited.

Make sure that your properties do not fall into this category! Proper Estate Planning will ensure that this will not happen to you. If you are in the Temecula area, we recommend a competent estate planning attorney to protect your assets and real estate. We therefor recommend The Law Firm of Steven F. Bliss Esq.

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