Block M looked abandoned – site locked and marketing suite inaccessible. The original contractor had gone into administration and work only restarted more than fourteen months later but the developer had entered into off-plan sales of the apartments. Purchasers said the delay was a repudiation, which they accepted, and asked for their deposits back.
There was no completion date, and, as in building contracts (unless the contract says otherwise), time was not “of the essence” so that delay gave no entitlement to terminate. But was it an implied term that the developer would complete the apartments in a reasonable time? The developer’s counsel conceded that it was; the sale contract’s specific exclusions of liability for delay only made sense if it was but there was, in any event, an express obligation to complete “with all due diligence”.
So what was a reasonable time for completion after the contractor’s administration? The court could not say a reasonable time had expired by the time the alleged repudiation was accepted but delay alone was not a repudiation. That required conduct that showed an intention no longer to be bound by the contract. The site apparently abandoned, while the developer reviewed the development’s financial viability and decided if it would ever build the apartments, showed this intention and that meant the developer had repudiated and the purchasers could get their deposits back.
Rashpal Singh Bhat v Masshouse Developments Ltd (No link yet available)