Requisitions raised out of time cannot be ignored if the underlying concern is inability to give good title or deliver title deeds

Big Most Ltd v Chau Wah Hung ([2012] HKEC 1057, CFI) concerned three requisitions that the buyer alleged had not been answered. The buyer had refused to complete. The question was whether the seller had shown that it could prove and give good title. The first issue was that the seller refused to deliver the original of a 2010 mortgage which the seller claimed had been discharged. This was a legitimate cause for concern and the buyer succeeded on this point. A buyer is entitled to original title deeds ‘as a matter of proprietary interest.’ ([11]) The seller was required to produce the charge and evidence of reassignment or discharge. The time limit in the agreement for raising requisitions had no effect on the duty to give a good title on completion.

The second issue concerned a second charge. The seller undertook to deliver the charge and evidence of discharge on completion. This was not enough and, again, the requisition could be insisted on even if it had been raised late.

The third issue was that the title to the car parking spaces showed that the area they occupied was subject to a right of way that would render one of them unusable. There was a risk that the Government would re-enter. The seller should have dealt with this requisition but had refused to do so on the basis that it was raised late and the property was sold ‘as is’ but:

‘A requisition can be raised out of time if it goes to the root of the contract or on matters not apparent from title documents provided by the vendor but only come to the knowledge of the purchaser through his own search or enquiry.’ ([37])

When a property is sold ‘as is’ that refers to its physical state and condition ([38]).

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