In a decision handed down on 28 November 2024 the Privy Council ruled in favour of Replay Destinations (Bahamas) Ltd in an appeal on the terms of a sale and purchase agreement.
The Court upheld the trial decision of Justice Loren Klein and the majority decision of the Court of Appeal (Issacs JA and Crane Scott JA).
It ends a legal battle that centered on the terms of the agreement for sale in respect of a Condominium unit at One Ocean on Paradise Island. The dispute was whether the agreement accurately recorded the description of the Unit that was being sold. The Appellant, Belitza Marling Sagaray Silva, claimed that the Unit was described by the illustrative plan accompanying the agreement for sale. The Respondent, Replay, relied on the terms of the agreement for sale.
Lord Sales in giving the decision for the Board stated in part:
33. In the Board’s view, in agreement with the judge and the majority in the Court of Appeal, on a proper objective construction of clause 1(a) the obligation of the vendor to convey title to the Apartment is defined by reference to the plans attached to the Declaration, not those in Exhibit A. This is clear from a number of matters:
(i) Clause 1(a) expressly states that “the legal description” of the Unit (that is, the Apartment) shall be in accordance with the Declaration plans. In the Board’s view, “the legal description” refers to the precise legal parameters of the legal title which the vendor has agreed to sell and the purchaser has agreed to buy.
(ii) The use of the future tense in the second sentence of clause 1(a) (“the legal description of the Unit shall be in accordance with the plans attached to [the Declaration]”) indicates that it is directed to defining the title which the vendor is obliged to convey to the purchaser when the time for completion comes. It marries up with clause 1(c), which states “[i]t is agreed that the Seller will convey the fee simple estate in the Unit to the Purchaser subject to and in accordance with this agreement on the Closing Date …”. By contrast, the first sentence of clause 1(a) is in the present tense and serves only to give a general description of what is agreed to be bought and sold.
(iii) The reference in the second sentence to “the plans attached to [the Declaration]” is clear and precise as to what is being referred to, as one would expect in an elaborate and lengthy document such as the Contract, drafted by lawyers. By contrast, the reference to Exhibit A in the first sentence is more vague and imprecise (“the several plans and diagrams attached hereto as Exhibit A”). Given the choice which has to be made between them as to which set of plans defines the precise obligation assumed by the vendor, it is clear that the plans attached to the Declaration are those which the parties understand have the requisite precise form.
(iv) That impression is also supported by reference to the respective sets of plans. Those attached to the Declaration are survey plans which give precise dimensions, as appropriate for a document providing a formal definition of title pursuant to the 1965 Act. Those which form Exhibit A are not survey plans and do not set out precise dimensions. Further, as the parties to the Contract knew, when the Exhibit A plans were provided they were described as being “illustrative”, which would be an inappropriate description of a document intended to provide a precise definition for the purposes of setting out the legal obligation of the vendor. Moreover, they were marked on their face as being “conceptual and preliminary” and subject to change; and they were clearly illustrative by their nature and content: see para 9 above.
34. The high point of the purchaser’s case is that clause 1(a) includes reference to the plans in Exhibit A. But, as noted, clause 1(a) refers to two different sets of plans, only one of which can be authoritative to define the extent of the vendor’s obligation assumed under the Contract. In the Board’s view, since that choice has to be made, it is clear that the plans attached to the Declaration are those which fulfil that definitional purpose. It is difficult to see what other purpose is served by the reference to the Declaration plans in clause 1(a).
The Respondent, Replay Destinations (Bahamas) Ltd, was represented by Raynard Rigby KC and Asha Lewis.
