clr/1982/1982_1_499.pdf

(3)of the Immovable Property Acquisition (Aliens) Law, Cap. 109(as amended by Law 55/72) whichonlyrestricts theregistration, inthename of analien, of immovable property—But does not affect the validity of the agreement. Contract—Construction—A matter of law tobe determined by the trial Court—And Court of Appeal equally well placed as the trial Court to discern meaning of a document—Construction of "on account of" in a contract. Contract—Non existing principal—A party entering into an agreement on behalf of, becomes liable thereunder and acquires a tight to sue so long aspersonal liability is not expressly or by necessary implication excluded. 20 Contract—Sale of land—Specific performance—Existence of separate registration covering land under sale a conditionprecedent to the specific performance of a contract—Proviso to section 3 of the _ Sale of Land Specific Performance Law, Cap. 232 (as amended by Law 26/72). ' 499 Saab and Anotherr. HolyMonasteryAy. Neophytos

(1982)Time—"Month"—Calendar month—Method of calculation of period that elapses after the occurrence of a given event—Section

1. para, (a), of the Interpretation Law, Cap. 1, and section 2,defi­ nition of "Month". Damages—Breach of contract—Principles applicable—Though normally damages are assessed as at the date of breach, where the party persists for good cause to have the contract enforced, notwith­ standing the breach, damages may be assessedas at asubsequent date-—Inthis sense Principle of Wroth v. Tyler [1973] 1All E.R. 897 not exceptional but in line with the common law rulefor the 10 assessment of damages. 5 Interest—Recovery of, as anittm of special damageincase of abreach of contract—Though a remote item of damage whichis notordina­ rily recoverable it may be recovered whenit is specifically pleaded and it appears that loss of interest ought reasonably to have been 15 within the contemplation of the parties at the time of execution of the contract. Costs—Rule that costsfollow the event—Should not befollowed with thesame strictness where two or more plaintiffs with a close,if not identical interest, pursue an action jointly and one of them is 20 successful—Court must examine whether the joinder has added to the costs of the proceedings. On Dcccmbei 5, 1976,appellant i, a Lebanesebanket, entered jnto a written agreement with the respondents for the purchase from them of an area of 200 donums of land for £24,
2. The 25 land was not covered by separateregistration but formed part of two adjoining plots. Thecontracting partiesweredescribed in the body of the agreement, in the introductory part, and were, the Holy Monastery of Ay. Neophytos, as vendors, and appellant 1 " 5 ι ά λογαριασμόν" - "on account of" - 30 MEDITERRANEAN PAPER MANUFACTURERS LIMI­ TED, the purchasers. The company was not ytt inexistence. It had not yet been incorporated. The contract was signed on behalf of the purchasers by appellant 1 whose signatuie was not accompanied by any qualification. 35 On February 5,1977,appellant 1sought to have theagreement deposited at the Paphos District Lands Office under theprovi­ sions of the Saleof Land (SpecificPerformance) Law, Cap.232 500 1 C.L.R. 5 10 15 SaabandAnother?.HolyMonasteryAy.Neophytos but registration was refused on the ground that the contract was pioduced foi registration after 12noon, the hour at which the Lands Department closes for business with the public. Following representations by appellant to the superiors of the Paphos Lands Officer diiectiom weregiven to him on February 9, 1977 to accept registiation of the contract with retrospective effect, that is with effect from February 5, 1977, the date on which the attempt was made to have the contract deposited. In the meantime steps weie taken to have the abovenamed company incorporated and to secure a lianeefiom the Council of Ministers for thi acquisition of the land. Both these objectives weie accomplished by Match 3, 1977; but when appellant 1,actingas the agent of theabovecompany piesented himself at the Lands Office for the purpose of accepting registration of the property purchased, the respondents refused to tiansfir the entiie area of land agieed upon. Hence an action byappellant 1 and the Company foi specific peiformance ofthe agieement and damages in the alternative. The trial Court found and concluded as follows: 20 25 30 35 (a) The terms of the contract were sufficiently certain and the land was properly identifiable. Hence, there was no obstacle to its enforcement from this viewpoint. (b) Appellant 1 purported to execute this agreement not in a personal but in a repiesentative capacity, as the agent of MEDITERRANEAN PAPER MANUFACTURERS LTD. Consequently, the contiact was unenforceable at theinstance of thecompany, in accordance with the well established principles of Company Lav/, making impossible execution by a company of a contract before incorporation. The company had, therefoie, no locus standi in the proceedings and their action was dismissed with costs. (c) Appellant 1 had apersonal righttoenfoicc thecontiact, onthe principlethat an agentwhoenters intoanagreement on behalf of a non existingpiincipal, can sueand can be sued under the agreement, so long as he does not expressly or by necessaiy implication exclude personal liability thereunder. So, the contract was enforceable at the instance of appellant 1 who was 501 SaabandAnotherv.HolyMonasteryAy.Neophytos

(1982)found to be entitled to the lemcdies warranted in the circumstances. (

1. d)The contract was not specifically enforceable, because of lack of legislation, within two months. The subsequent decision of the L.R.O. authoiitie, to havf the 5 contract registered retrospectively, left the position unaffected. (
2. c)The refusal of the vendors to transfer an important poition of the land agreed to be sold, entitled appellantsto treat thecontract at anend and suefor breach. 10 Upon appeal by appellant 1, which was mainly directed against the withholding of specific performance and the date of assessment of damages, an appeal by the Company directed against the order ordering them to pay costs and a cros,.-appeal by respondents directed against the upholding of the validity of 15 the contract the following issues arose for consideration:

(1)The validity of the contract with particular reference to the certainty of its terms.

(2)Thetight of an aliento sueona contiact for thepurchase of land.

(3)The right of Michel Saab to sue under the agreement.

(4)Specific performance of the agieement under consideration and, lastly, if the judgment of the trial Couit in this regaid is upheld to examine

(5)the damages to which appellant 1 is entitled, for breach 25 of contract. Held,

(1)that so long as the essential terms of the agreement are asceitainable by a reading of the contract as a whole, effect will be given to the agreement of the parties; that this was found to bethecase inthepresent action; that havingcarefully 30 perused the agreement of the parties, this Court agrees with the trial Court that the subject-matter was defined with sufficient certainty, as to make the agreement of the parties enforceable; that this being so, the vendors were guilty of breach, entitling the appellant, provided he possessed a right to sue, to claim an 35 appropriate remedy (see s.29 of the Contract Law, Cap. 149).

(2)That the capacity of a person to entei into a valid agree502 20 l C.L.R. 5 10 15 20 25 30 35 40 SaabandAnother?.HolyMonasteryAy.Neophytos ment is in no way qualified by reference to his nationality (see s.l1 oftheContract Law,Cap. 149); that the alienis,therefoie, a competent contracting party under the provisions of the Contract Law; that consequently, unless any othei law restricts this light, an alien is,likeany other person, competent, under Cyprus law, to enter into a valid agreement; that the provisions of s.3

(3)of Cap. 109, as amended by Law 55/72, leave this position unaffected; that a contract by an alien for the purchase of land, is,like any other contract, valid, provided the prerequisites envisaged by the Contract Law for a valid contract are satisfied; that the law merely restricts the registration, in the name of an alien, of immovable property without prior approval by the Council of Ministers; that what the implications of such a failure may be upon the liability of the parties under the agreement, must be decided in each case byreference toitsparticular facts; but,certainly,theagieement is valid at its inception, and binding on the paiti.s.

(3)(

1. a)That the trial Court found that the employment of the expression "on account of" meant that appellant 1 executed the sale agreement as an agent of an unincorporated company; that the construction of a document is a matter of law to be determined as such by the Court; that, therefore, the Appeal Court is equally well placed as the trial Court to discern the meaning of a document in accordance with the established canons of construction; that the meaning of a term of an agreement must be gathered from the expression used, read in the context of the agreement as a whole; that this Court agrees with the tiial Court that the employment of the expression "on account of", in the context of this document, is sufficiently revealing oftheintention of theparties with regaid tothe identification of the purchaser, as well as the capacity in which appellant 1 signed the agreement; that appellant 1 entered into this agreement as agent, on behalf of the company he had in mind to set up,which acquired a juridical personality in due course, with the coming into being of appellants 2; that, therefoie, thejudgment of the trial Couit in this area, mu.t be upheld. 3(
2. b)That a paity'entering into an agreement on behalf of a non existing principal becomes liable thereunder, as well as acquires a right to sue,solongaspersonal liability isnotexpies503 SaabandAnotherv.HolyMonasteryAy.Neophytos

(1982)sly or, by necessary implication, excluded by the terms of the agreemvnt; and that, therefore, this Court is in agreement with the trial Couit that appellant had a right to sue.

(4)(a) (After considering it unnecessary to give a final answer to the question whether specific performance on the above ground 5 was properly refused, although inclined to the view that it was wrongly refused because the power of hierarchically superior organs of administration to review and, where necessary, correct decisions of their subordinates, wouldbe meaningless if its exercise left the original decision intact) that the proviso to section 3 of 10 Cap. 232, as amended by Law 26/72, makes the existence of a separate registration a condition precedent to the specific performance of a contract; that the Court has no discretion to relax this piovision; that in the absence of a sepaiate registration covering the immovable propeity under sale specific per- 15 formance was impossible; and that, therefore, the decision of the trial Court in refusing to order specific performance must be sustained though, for somewhat different reasons from those advanced by the trial Court.

(4)(b) On the submission of counselfor the appellants that the 5th February, 1977 was not the last day of the two-month period within which the contract of 5.12.76 had to be deposited: 20 That "month", in accordance with s.2 of the Interpretation Law, Cap. 1, means a calendar month; that in calculating the period that had elapsed after the occurrence of a given event, 25 in this case execution of the contract, the date on which the event occurred is to be excluded from reckoning (see s.31, para. (a), Cap. I); and that, therefore, a two-month calendar period ends on the fifth corresponding day of the second month and not on the fourth. 30

(5)That the principles regulating the award of damages for breach of contract at common law, do not lequiie of necessity that damage should be assessed as at the datt of bieach; that wheie thejustice of the casesonecessitates,they may be assessed at a subsequent date; that normally, damages aie assessed as 35 at the date of breach because the damage suffered by the innocent party crystallizes on that day; ibat where a paity persists foi good cause to have the contract enfoiced, notwithstanding the bieach, as it often happens whert a paity is seeking the 504 1 C.L.R. 5 10 15 20 25 30 35 40 SaabandAnotherv.HolyMonasteryAy.Neophytos specific enforcement of the contract, there is valid ground for assessing damages as at a subsequent date; that the damage crystallizes when specific performance is refused in the exercise of the Court's discretion; that in this sense the principle of Wroth v. Tyler[1973] 1All E.R. 897,which is to the effect that where specific performance is withheld in the exercise of the discretionary powers of the Court, damagesshould becalculated as at the date of trial, is not exceptional but in line with the general rule at common law foi the assessment of damages; that in the present case, the persistence of the appellant to have the contract specifically enforced had no reasonable chance of success, in view of the absence of a separate registration of the property; that specific performance was withheld, not in the exercise of any discretionary powers of the Court but as a result of the mandatoiy application of the provisions of Cap. 232, as eailiei indicated in thisjudgment; that under s.8 of Cap. 232 the Court has discretion to refuse specific perfoimance, despite compliance with the mandatory provisions of Cap. 232 as to registration of the contract and other formalities; that in that case, theie may be good reason for assessing damages, as at the date of the trial; that in thejudgment of this Couit the trial Court rightly assessed damages in this case, as at the date of breach; and that, further, the assessment made was leasonable in the light of the evidence before the Court.

(6)That where loss of interest is specifically pleaded as an item of special damage, there is no rule preventing its recovery where it appears that such loss ought leasonably to have been within the contemplation of the parties at the time of the execution of the agreement; that normally therecoveiy of interest istreated asaremoteitem ofdamagenot ordinarily lecoveiable; that neither the pleading of the appellant, nor the evidence adduced, taken together,justify the award of interest as an item of damage properly recoverable; and, therefou, this aspect of the judgment of the trial Court is also fustainable.

(7)The costs normally follow the event; that if this rule h strictly applied, the ruling of the trial Court, that apptllants 2 should pay the costs, occasioned by their action, to the defendant, should be sustained; that wheie, however, as in this case,two or more plaintiffs with a closi,ifnot identical inteiest, join forces in the puisuit of an action and one of them issucces- 505 SaabandAnotherτ.HolyMonasteryAy-Neophytos

(1982)Fful, the IUIC thatcosts follow theevent should not be followed with thesame strictness; thatthe Courtmustexamine whether the joinder has added to thecosts of the proceedings; and if so, make an appropriate order as to costs; that in this case, theie is nothingtosuggest that thejoinder had this result; and 5 that, thtrcfoie, the appropriateorder as to costs bttweenappel­ lants 2 and defendants should be - no otdei as to costs; and to this extent, the oidci of thetrial Courtas to costs should be varied. Appealandcross-appeal dismissed. 10 Cases teferred to: Honk Kong Fir Case [1962] I All E.R. 474 at p. 481; Bunge Corporation v. TradexS.A. [1981]2 All E.R. 513 (H.L.); Wroth v. Tyler [1973] 1 All E.R. 897; Horrocks v. Forray [1976] 1 All E.R. 737 (C.A.); 15 Charles Clay& Sons Ltd. v. B.R. Board [1971] 1AHE.R. 1007 (C.A.); Brown v. Gould[1971] 2 All E.R. 1505; BushwellPropertiesv. Vortex Properties [1976] 2 All E.R. 283 (C.A.); 20 Iosifakis and Others v. Ghani

(1967)I CX.R. 190; HalfdanGriegv. SterlingCoalCorpn. [1973] 1All E.R-545per Kerr, J.; Kelner v. Baxter and Others,Law Reports - Common Pleas Cases - Vol. II p. 174; 25 Newborne v. Sensolid (Gr. Britain) LD. [1954] 1 Q.B.45; Phonogram Ltd. v. Lane [1981] 3 AH E.R. 182 at p. 188; Republicv. M.D.M. Estate Developments Limited[1982] 3 C-L.R. 642; Kalisperasv. Ministry of Interior

(1982)3 CX.R. 509; 30 Dodds v. Walker [1982] 2 AU E.R. 609; Hadley v. Boxendale [1843*60] AH E.R. Rep. 461; Marcou v. Michael, 19 C.L.R. 282; Heron II [1967] 3 All E.R. 686; Soleada S.A. v. Hamoor TankerCorporation Inc. [1981] 1 All 35 E.R. 856 (C.A.); C.R. Taylor (Wholesale) Limited v. Hepworths[197η 2 AH E.R. 784; 506 1 C.L.R. 5 Saaband Anotherv. HolyMonasteryAy. Neophytos Lamb v. L.B. of Camden [1981] 2 All E.R. 408; Lloyd v. Stanbury [1971] 2 All E.R. 267; Warnigton v. Miller [1973] 2 All E.R. 372 (C.A.); Grant v. Dawkins[1973] 3 All E.R. 897; Malhotra v. Choudhury [1979] 1 All E.R. 186 (C.A.); Johnsonv. Agnew [1979] 1 All E.R. 883; Wadsworth v.Lydall [1981]2 All E.R. 401; Techno-Impexv. Von Weelde BV [1981] 2 All E.R. 689. Appeal. Appeal by plaintiffs and cross-appeal by defendants against the judgment of the District Court of Paphos (Kourris, P.D.C. and Demetriou, S.DJ.) dated the 4th September, 1980 (Action No. 337/77) whereby the defendants were ordered to pay to the plaintiffs the sum of £2,400.- as damages for breach of contract 15 for sale of land. 10 7Λ Papadopoulos with M. Marangou (Miss), for the appellants. E. Komodromos with /. Droushiotis, for the respondents. Cur. adv. vult. 20 HADJIANASTASSIO») J.: The judgment of the Court will be delivered by Pikis, J. PIKIS J.: Michel Saab, a Lebanese banker, came to Cyprus in 1976, in the wake of civil strife in the Lebanon, with a view to establishing a seat in Cyprus for the Federal Bank of Le25 banon,of which he was president, as wellas set up some business of his own. A licence was issued by the Central Bank, autho­ rising the Federal Bank of Lebanon to operate an office in Nicosia for the transaction of its international affairs. Mr. Saab was himself interested to establish a paper factory for the 30 production of tissue paper, a project designed to be financed by the Federal Bank of Lebanon. He began searches for the purpose of finding an appropriate site for the setting up of the factory. It was within the contemplation of Mr. Saab that the factory and the business connected therewith, would be 35 conducted by a family company to be incorporated in Cyprus under the name of "MEDITERRANEAN PAPER MANU­ FACTURERS LIMITED". Apparently, the word "Mediter­ ranean" was meant to signify the scale of the operations of the company. The specifications for the factory required 507 Pikis J. Saaband Anotherv.HolyMonasteryAy. Neophytos

(1982)that the site that would accommodate the factory should have a certain scaping to facilitate the easy flow of water needed for the operation of the factory. Hence the site had to have a certainelevation, thegradient of whichwould meettherequire­ ments of water supply to the factory. 5 The Holy Monastery of Ayios Neophytos are the owners of a large plot of land consisting of hundreds of donums in extent, at Ay. Varvara village in the district of Paphos. A portion of this land was considered appropriate for thelocation of the factory, meeting the basic requirements for its building 10 and operation. Negotiations were conducted between Mr. Michel Saab ontheonehand,andtheAbbot of the Monastery, now Bishop of Paphos, on the other, for the purchase of part of the land of the Monastery. The purpose for which theland was required, was communicated to the owners of the land. 15 The parties visited the site inthecourse of the negotiations and the area contemplated to be sold, was identified on the spot. The negotiations culminated in an agreement between the parties, embodied in a written contract of sale (exhibit 15). An area of 200 donums, identified in a plan attached to the 20 agreement, was sold for £24,000.- under terms and conditions specified therein. The land formed part of two adjoining plots, notably plots 53 and 54, of Sheet/Plan LI/

1. A sum of £2,400.- was paid upon execution of the agreement, whereas the balance would be paid upontheconveyance of the property. 25 The contracting parties were described in the body of the agreement, in the introductory part, and were, the Holy Monastery of Ay. Neophytos, as vendors, and Michel Saab "διά λογαριασμόν"—"on account of "—MEDITERRA­ NEAN PAPER MANUFACTURERS LIMITED the purch- 30 asers. The company was not yet in existence. It had not yet been incorporated. The contract was signed on behalf of the purchasers by Michel Saab. The signature' of Michel Saab was not accompanied by any qualification. A term of the agreement conferred a right to the purchasers to withdraw 35 in the event of the authorities refusing registration of the company or the establishment of the industrial project under consideration, provided this option was exercised within three months. 508 1 C-L.R. 5 10 15 20 25 30 35 Saaband Anotherτ.HolyMonasfely Ay.Neophytos PikisJ. On 5th February, 1977, Michel Saab sought to have the agreement deposited at the Paphos lands office under the provisions of the Sale of Land (Specific Performance) Law, Cap. 232,as amended by Laws 50/70 and96/
2. Theobject wastohave the contract registered within thestatutory period of two months,a vital prerequisite for the specific enforcement of theagreement indue course. Registration ofthe agreement was refused on the ground that the contract was produced for registration after 12 noon, the hour at which theLands Departmentcloses forbusiness withthepublic. Thepurchasers protested at this decision andapparently took thematterup with the superiors of the Paphos lands officer.. Thedecision in question was reversed, following advice from the Office of the Attorney-General anddirections issued for the purpose tothe Paphos District Lands Office. On9.2.1977instructions were given that the contract be entered into theappropriate registry of the Paphos Lands Department with retrospective effect, that is with effect from 5.2.1977, thedate onwhichthe attempt was made to have the contract deposited. Inthe meantime,steps were afoot to have the company incorporated and secure licence from the Council of Ministers for its acquisition. Both objectives were accomplished by 3.3.1977, so theway was paved for theconveyance of the land in the name of the company. On5.3.1977, Michel Saab, acting as the agent of the aforementioned family company, presented himself at the Paphos Lands Department for the purpose of accepting registration of the property purchased. We find it unnecessary to recite the details of what went on between the parties on that day,a facet of the case analysed in detail inthejudgment of the trial Court. We content ourselves with holding that thefindingsofthe trial Court onthis subject were fully warranted by the evidence before theCourt,and nothing that has been said before us justifies interference with them. The trial Court rejected the contention of the vendors that, as a result of fresh negotiations, the original agreement was rescinded andin its stead a new contract was orally agreed upon between the parties. ThefindingsofthetrialCourtastowhathappenedon 5.3.1977 can be summarised as follows: 40 Thevendors refused to transfer theentire area of the land agreed upon, defaulting in the discharge of their contractual 509 Pikis J. SaabandAnotherv.HolyMonasteryAy.Neophytos

(1982)obligations. What they refused to transfer was an important part of the whole area of about eight donums, severance of which had a serious bearing on the appropriateness of the site for the location of their factory because of a consequential variation ofthegradient oftheland. Thedefault ofthevendors 5 arose from the fact that they had covenanted to sell the strip of land in question to a co-operative society, as far back as July, 1976, and, in fact, conveyed it shortly after their refusal to honour their obligations to the purchasers. In this case, the land was transferred to aco-operative society on 18.3.1977. 10 A short while later, in April, 1977, Michel Saab and the MEDITERRANEAN PAPER MANUFACTURERS LTD., joined in the pursuit of the present proceedings, raised before theDistrict Court ofPaphos,askingfor thespecific enforcement of theagreement withthe HolyMonastery ofAyios Neophytos, 15 and damages in the alternative. The defendants refuted liability on a number of grounds: Firstly, they contended that the terms of the contract were uncertain in a vital respect, concerning the subject-matter of theagreement, viz.theidentification oftheland sold,contending 20 that the contract was invalid on that account. Ths agreement was, in their contention, unenforceable for yet another reason, the submission being that it wasa contract with a non existing entity, inasmuch as MEDITERRANEAN PAPER MANUFACTURERS LTD., was not in existence at the time of the 25 formation of the contract. Nor was the contract enforceable at the instance of Michel Saab who, in their contention, was not a party to it, and, in any event, he could not enforce it in the absence of a licencefrom the Council of Ministers entitling him to acquire it, in accordance with the Immovable Property 30 Acquisition (Aliens) Law, Cap. 109,as amended by Law52/69. Butevenifthecontractwasheldtobeenforceableattheinstance of either of the plaintiffs, they disputed the right of the purchasers to specific performance, for the reason that they had not complied with the prerequisites laid down in the Sale of Land 35 (Specific Performance) Law, Cap. 232, as amended. The trial Court examined in detail every aspect of the case. Their findings and conclusions were, in brief, as follows:(

1. a)The terms of the contract were sufficiently certain 510 1 C.L.R. SaabandAnotherv.Holy Monastery Ay.Neophytos Pfttts J. and the land was properly identifiable. Hence, there was no obstacle to itsenforcement from this viewpoint. 5 10 !5 (
2. b)Michel Saab purported to execute this agreement not in a personal,but in a representative capacity, as the agent of MEDITERRANEAN PAPER MANUFACTURERS LTD. Consequently, the contract was unenforceable at the instance of the company, in accordance with the well established principles of Company Law, making impossible execution by a company of a contract before incorporation. A non existing entity cannot enter into any kind of legal relationship before its incorporation. Nor, indeed, can it ratify acts done purportedly on its behalf before incorporation or for that matter adopt such acts. The company was found to have no locus standi in the proceedings. Their action was dismissed with costs. (
3. c)Michel Saab had a personal right to enforce the contract, on the principle that an agent who enters into an agreement on behalf of a non existing principal, can sue and can be sued under the agreement, so long as he does not expressly or by necessary implication exclude personal liability thereunder. So, the contract was enforceable at the instance of Michel Saab, who was found to be entitled to the remedies warranted in the circumstances. (
4. c)The contract was not specifically enforceable, because of lack of registration, within two months. The subsequent decision of the L.R.O. authorities to have the contract registered retrospectively, left the position unaffected. What the law required, in the view of the trial Judges, was registration as such, within two months. They accepted as a fact that Michel Saab purported to have the contract registered on 5.2.1977 but after 12noon, the hour at which the L.R.O. closes for business with the public. Therefore, their refusal to accept deposit of the contract was found to be justified. 40 The Holy Monastery of Ay. Neophytos were found to be guilty of a breach of contract that entitled Michel 511 Pikis J. SaabandAnother v.HolyMonasteryAy.Neophytos

(1982)Saab to treat the contract as at an end and sue for damages. The Court took the view on a proper construction of thecontract andwhat thevendors expressed readiness to convey something other than they contracted 5 for and that the difference between the two was sufficiently important to entitle the purchasers to treat the contract as at an end, on account of the breach of the vendors, thereby acquiring a right to claim remedies warranted in law for the breach of 10 the agreement. The decision of the trial Court in this area is perfectly well founded and fully consonant with the authorities. Assuming the contract was valid and enforceable at the instance of Michel Saab, the refusal of the vendors to transfer an important 15 portion of the land agreed to be sold, entitled them to treat the contract at an end and sue for breach. (For an analysis of the law on the implications of thebreachofa termofanagreement,seethejudgment of Diplock, L.J., as he then was, in the Hong Kong 20 FirCase[1962]1 AH E.R. 474,481,recentlyproclaimed by the House of Lords as a classical exposition of the law on the subject—BungeCorporation v.Tradex S.A. [1981] 2 AH E.R. 513 (H.L.) ). Michel Saab was awarded £2,400.- damages, that 25 is the difference between the value of the property at the time of purchase and the time of breach, plus £2,400.-return of thedeposit ofthepurchaser. However, the Court refused the claim of Michel Saab to interest, as from the date of the deposit. 30 Michel Saab, the appellant, appealed, mainly contesting the correctness of the judgment in two respects: Firstly, the decision whereby specific performance was withheld, and, secondly, the date of the assessment of damages. In view of the refusal to order specific performance, damages ought to 35 have been assessed as at the date of trial, when they would run to a figure of about £26,000.- instead of £2,400.-. The submission here was advanced on the authority of Wrothv. Tyler [1973] 1All E.R. 897 (Megarry, J.). 512 1 CX.R. SaabandAnotherv.HolyMonasteryAy.Neophytos Pikis J. Mediterranean Paper Manufacturers Limited, the second appellants, raised an appeal directed against the order, directing them to pay costs." The Holy Monastery of Ayios Neophytos raised a cross-appeal, contending that the decision of the trial 5 Court, upholding the validity of the contract, was wrong, therefore, they ought to have been exonerated of any liability thereunder. The appeal was vigorously argued on both sides. Extensive reference was made to the case-law and statutory provisions, 10 on the subjects of the validity of contracts, the specific enforceability of agreements for the sale of land and, the damages recoverable for breach of contract. We propose to deal with the questions raised by the appeal and cross-appeal, in the following order:15

(1)The validity of the contract with particular reference to the certainty of its terms.

(2)The right of an alien to sue on a contract for the purchase of land.

(3)The right of Michel Saab to sue under the agreement. 20

(4)Specific performance of the agreement under consideration and, lastly, if we uphold the judgment of the trial Court in this regard, we shall examine

(5)the damages to which appellant l i s entitled, for breach of contract. 25 1. TERMS OF THE AGREEMENT — CERTAINTY REQUIRED FOR A VALID CONTRACT: It was submitted on behalf of the respondents that the agreement was invalid on the ground that its terms are uncertain with regard to the definition of the subject-matter, viz. the area 30 and extent of the land sold. Section 29 of the Contract Law, Cap. 149, lays down that agreements, the meaning of which is not certain, or capable of being certain, are void. In Pollock and Mulla, 9th ed., on the Indian Law of Contract^there is a discussion of the implications of a similar provision embodied 35 in the Indian Contract Law (see p. 300 et seq.). In fact, s.29 of our law is a replica of the corresponding provision in the Indian Law. Of particular relevance is a note at p. 303 of 513 Pikis J. Saaband Anothel r. Holy MonasteryAy. Neophytos

(1982)Pollock and Mulla, supra, indicating that the expression "appro­ ximating*', in the definition of a vital term of the agreement, does not make a contract vulnerable on grounds of uncertainty. Section 29 aims to incorporate in our statute on Contracts the common law rule, that, only agreements, the terms of which are certain, are enforceable in law. The ingredients of a valid contract were listed in Horrocks v. Forray [1976] 1 AH E.R. 737 (C.A.). They are:- 5 (

1. a)A meeting of the minds of the contracting parties. (
2. b)Reasonable certainty as to the terms of the contract. 10 The essential terms of the contract must be clearly made out. (
3. c)The agreement must be accompanied by an intention to affect legal relations of the contracting parties and, lastly, (
4. d)there must be consideration moving from the promisee. The Court is reluctant to reject a contract for uncertainty motivated by a desire to give effect, if at all possible, to the bargain of the parties. The instinct of the Court is, it was s observed in Charles Clay & Sons Ltd. v.. 5. R. Awvtf[1971r 20 1 All E.R. 1007 (C.A.), to uphold the agreement of the parties. Megarry, J. suggested, in Brown v. Gould [1971] 2^ΑΪ1 E.R. 1505, the following test for deterrnining whether-'the terms of a contract are sufficiently certain to render the agreement enforceable. It is this: Whether someone, genuinely seeking 25 to discover its meaning, is able to-do so. The case of Bushwell Properties v. Vortex Properties: [197'6] 2 All E.R. 283 (C.A.), illuminates some of the.circumstancesthatmay render acontract invalid for uncertainty. The Court refused to enforce acontract that failed to specify the portion of the land that would be 30 transferred upon the payment of certain instalments. The contract provided for the piecemeal transfer of a large plot of land upon the payment of certain instalments, without indicating which part was to be conveyed upon the payment of anyone instalment. The Court ruled that, inasmuch as 35 the uncertainty did not merely go to the machinery of ascertain­ ing the subject-matter but was uncertain as to the subjectmatter itself, no effect could be given to it. The effect of the case-law is that, so long as the essential 514 15 1 C.L.R. 5 20 25 30 35 40 Pikis J. terms of the agreement are ascertainable by a reading οΐ the contract as a whole, effect will be given to the agreement of the parties. This was found to be the case in the present action. Having carefully perused the agreement of the parties, we agree with the trial Court that the subject-matter was defined with sufficient certainty, as to make the agreement of the-parties enforceable. This being so, the vendors were, as we indicated above, guilty of breach, entitling the appellant, provided he possessed a right to sue, to claim an appropriate remedy. 10 2. 15 Saaband Anotherr. Holy MonasteryAy. Nlophytos THE RIGHT OF AN ALIEN TO SUE ON A CONTRACT FOR THE PURCHASE OF LAND: The capacity of a person to enter into a valid agreement is in no way qualified by reference to his nationality (see s.ll of the Contract Law, Cap. 149). The alien is, therefore, a competentcontracting party undertheprovisions of theContract Law. Consequently, unless any other law restricts this right, an alien is, like any other person, competent, under Cyprus law, to enter into a valid agreement. The provisions of s.3

(3)of Cap. 109, as amended by Law 55/72, leave, contrary to the submission of Mr. Komodromos, this position unaffected. A contract by an alien for the purchase of land, is, like any other contract, valid, provided the prerequisites envisaged by the Contract Law for a valid contract are satisfied. The law merely restricts the registration, in the name of an alien, of immovable property without prior approval by the Council of Ministers. What the implications of such a failure may be upon the liability of the parties under the agreement, must be decided in each case by reference to its particular facts. But,certainly,the agreement is valid atits inception,and binding on the parties. In the case of Andriani A. losifakis and 3Others v. Mohammed Abdul Ghani

(1967)1 C.L.R. 190, the Supreme Court dismissed the suggestion that a contract for the purchase of land by an alien prior to obtaining the necessary permission from the Council of Ministers, was either illegal or invalid. As theSupreme Courtpointed out,such licence may be obtained after the conclusion of the agreement, and in this case there was every indication that there would be no impediment to obtaining permission for the registration of the land in the name of appellant 1. In point of fact, permission had been granted for the registration of the land in the name of appellants 2. 515 Pikis J. Saaband Another v.Holy MonasteryAy. Neophytos

(1982)In our judgment, the submission of the respondents to the contrary is untenable.

1. CONTRACTS MADE BY PERSONS PURPORTING TOACT AS AGENTS OFNONEXISTING PRINCIPALS: The Courtfound, inthefirstplace,contrary tothesubmission 5 made on behalf of the appellants, that Michel Saab purported to execute the saleagreement as an agent of anunincorporated company. The employment of the expression "6ιά λογαρια­ σμού" at the outset of the agreement, was found by the Court to be conclusive as to thecapacity in which appellant 1entered 10 into this agreement. The construction of a document is a matterof law tobedetermined as such by theCourt(see Halfdan Grieg v. SterlingCoal Corpn. [1973] 1All E.R. 545 (Kerr, J.)). Therefore, the Appeal Court is equally well placed as the trial Court to discern the meaning of a document in accordance 15 with the established canons of construction. The meaning of a term of an agreement must begathered from the expression used, read in the context of the agreement as a whole. We agree with thetrial Courtthattheemployment of the expression "on account of", in the context of this document,is sufficiently 20 revealing of the intention of the parties with regard to the identification of the purchaser, as well as the capacity in which appellant 1 signed the agreement. Appellant 1 entered into this agreement as agent, on behalf of the family company he had in mind to set up, which acquired a juridical personality 25 in due course, with thecoming into being of appellants
2. We, therefore, uphold the judgment of the trial Court in this area. Also, we are in agreement with the trial Court that appellant 1 acquired a right tosue undertheagreement. Theappreciation of the law on the subject, by the trial Court, is correct. A 30 party entering into an agreement on behalf of a non existing principal becomes liable thereunder, as well as acquires a right to sue, so long as personal liability is not expressly or, by necessary implication, excluded by the terms of the agreement. This principle was established by the leading authority on the 35 subject, the case of Kelnerv. Baxter and Others, Law Reports —CommonPleasCases, Vol. II, 1866-67, p. 174, the validity of which has never been successfully questioned in any sub­ sequent decision. The decision in Newborne v. Sensolid (Gr. Britain) LD [1954] 1 Q.B. 45, to which extensive reference was 40 516 1 C.L.R. SaabandAnotherv.HolyMonasteryAy.Neophytos Pikis J. madein these proceedings, in no way derogates from the above principle of the law. In the fairly recent decision ofPhonogram Ltd. v. Lane [1981] 3 All E.R, 182, there are powerful dicta that support the validity,as wellas the logic,behind the principle 5 in Baxter, supra (see the judgment of Oliver, L.J. at p. 188). The conclusion to which the trial Court arrived at, is not only reasonable but inevitable, both on a reading of the contract itself, as well as upon examination of the background to it. The impression one is apt to form is that Michel Saab, far 10 from expressly excluding personal liability, wanted himself tobecome aparty tothe agreement. In ourjudgment, appellant 1 had a legitimate right to claim performance of the agreement, and the respondents were accountable to him for its breach. 15
3. SPECIFIC PERFORMANCE UNDER CONSIDERATION: OF THE CONTRACT The trial Court declined to decree specific performance of the sale agreement because, as already indicated, they found that appellant failed to deposit the contract with the Paphos lands office within two months, as it is necessary under Cap.20
4. The defect could not, in the opinion of the trial Court, be remedied by the reversal of the decision of the Paphos district lands officer, by his superiors, and the retrospective registration of the contract as at 5.2.
5. Mr. Papadopoulos referred ustodecisionsof theGreek Council ofState,tending to establish 25 that decisions of hierarchically subordinate organs are inherently liable to review and correction by the superior authority (see Conclusionsfrom the Case-law of the Greek Council of State, 1929-59, pp. 166, 167). One may argue that this power is necessary in the interests of both uniformity and legality. 30 The impression must not be given that we are reviewing, in anyway, thepropriety ofan administrative decision, assuming a decision to accept registration of a contract is a matter of public law, a doubtful proposition in view of the recent decision of the Full Bench in The Republic of Cyprus v. M.D.M. Estate 35 Developments Limited,

(1982)3 C.L.R. 642 and Kalisperas v. Ministry of the Interior

(1982)3 C.L.R. 509. Be that as it may, it is jurisdictionally competent for a civil court to evaluate, under any circumstances, the implications of an 517 Pikis J. SaabandAnother v.HolyMonasteryAy.Neophytos

(1982)administrative action on the civil law rights of the parties. We consider it unnecessary, for the reasons given hereunder, to give a final answer to the question raised here, although we rather incline to the view that the decision of the trial Court was wrong. The power of hierarchically superior organs of 5 administration to review and, where necessary, correct decisions of their subordinates, would be meaningless if its exercise left the original decision intact. However, we shall not probe further into the issue for, in the light of the provisions of s.3, Cap. 232, as amended by Law 96/72, specific performance of 10 the agreement was impossible in the absence of a separate registration covering the immovable property under sale. But before going into that, we may conveniently dispose of the submission of Mr. Papadopoulos that the 5th February, 1977 was not the last day of the two-month period within which 15 the contract of 5.12.1976 had to be deposited. "Month", in accordance with s.2 of the Interpretation Act, Cap. 1, means a calendar month. In calculating the period that had elapsed after the occurrence of a given event, in this case execution of the contract, the date on which the event occurred is to be 20 excluded from reckoning. (Sees.31,para, (a), Cap. 1). Therefore, a two-month calendar period ends on the fifth corresponding day of the second month and not on the fourth. That this is so, is also settled by authority—notably the decision of the House of Lords in Dodds v. Walker [1981] 2 All E.R. 609. 25 So, the 5th of February, 1977, was the last day on which the contract could be lawfully deposited, rejecting, as we do, the submission of Mr. Papadopoulos to the contrary. The proviso to s.3 makes the existence of separate registration a condition precedent to the specific enforcement of the agree- 30 ment. The property sold need not be covered by separate registration at the time of sale; a contract of sale affecting such property is registrable under s.2(

1. b)of Cap. 232 (as amended by Law 96/72). But such registration is a prerequisite to its enforcement. The crucial time for examining whether separate 35 registration exists, is, naturally, the date of hearing. Let us say that we regard this as a sensible provision, designed to avoid uncertainties in the enforcement of a court order. A court order must be certain in terms, and capable of being enforced unconditionally. 40 The absence of separate registration is fatal to the claim of 518 1 C.L.R. SaabandAnotherv.HolyMonasteryAy.Neophytos Pikis J. the appellant for specific performance. The Court has no discretion to relax this provision. Every purchaser who buys land not covered by separate registration, takes a risk with the enforceability of the agreement. We, therefore, sustain the 5 decision of the trial Court in refusing to order specific performance, though, for somewhat different reasons from those advanced by the trial Court. DAMAGES FOR BREACH OF CONTRACT: The right to damages for breach of contract, as well as the 10 quantum ofdamages recoverable, are regulated bythe provisions of s.73(
2. l)of the Contract Law, Cap. 149. It provides: 15 "The innocent party is entitled to compensation for any loss of damage which naturally arose in the usual course of things from such a breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it". The principle embodied in s.73(
3. l)issubject to the rule barring the recovery of damage that is remote. One may, however, validly argue that foreseeability and remoteness are the two 20 sides of the same coin, in that damage that is not foreseeable as naturally likely to arise, is, by definition, remote. Section 73 aims to reproduce the common law rules on damages for breach of contract, as they crystallized and were fashioned in the case of Hadley v. Baxendale [1843-60] All 25 E.R. Rep. 461. (See Marcou v. Michael, 19C.L.R. 282). A similar view was taken of the corresponding provisions of the Indian Contract Law, that is that they reproduced the rules of the common law on damages. (See Pollock and Mulla, 9th ed., p. 529 et seq.). The question of damages, its juridical 30 and practical implications, were the subject of discussion in numerous English cases during the last decade. Reinstatement lies at the core of the rules regulating the assessment of compensation for breach of contract. Damages aim to restore the party to the position he would be but for the breach. This 35 is normally accomplished by awarding damages reasonably foreseeable at the time of execution of the agreement, as likely to arise upon breach. (See Heron II [1967] 3 All E.R. 686 (H.L.); Soleada S.A. v. Hamoor Tanker CorporationInc. [1981] 1 All E.R. 856 (C.A.) ). Foreseeability in turn, depends on 519 Pikis J. SaabandAnotherv.HolyMonasteryAy.Neophytos

(1982)actual knowledge and reasonable forecast of what is likely to happen in a given eventuality. So, the plaintiff is normally entitled to recover damage that is objectively foreseeable, and in the face of special knowledge he may, in addition, recover what is thereby subjectively foreseeable. Reason and good sense lie behind rules regulating compensation in both contract and tort. As May, J. pronounced in C. R. Taylor (Wholesale) Limitedv. Hepworths [1977]2 All E.R. 784, the rule as to reinstatement must always be matched with the other equally fundamental rule of the 10 English common law, that damage must, in all circumstances, be reasonable as between plaintiff and defendant. In the case of Lamb v. L. B. of Camden [1981] 2 All E.R. 408, there are powerful dicta, that foreseeability must be determined from a practical perspective in the light of day to day realities of 15 life. In Lloyd v. Stanbury [1971] 2 All E.R. 267, Brightman, J. listed the items of damage that are normally recoverable in a breach of contract action. They are:(

1. a)The legal costs of approving and executing a contract. 20 (
2. b)The costs of performing an act required to be done by the contract, notwithstanding that the act is performed in anticipation of the execution of the agreement, and (
3. c)damage for any other loss which ought to be regarded 25 as within the contemplation of the parties. Theextent of the damagelikelyto besuffered bytheinnocent party, is ordinarily discernible at the time of breach. The repercussions of breach become known thereupon. So, ordinarily, damage is estimated as at the date of breach, and 30 inthecaseofacontract ofsale,ittakestheform ofthe difference between the contract price for the item sold at the time of execution of the agreement, and the value of the same item at the time of breach. In Wroth v. Tyler, supra, Megarry, J.held that, where specific 35 performance is withheld in the exercise of the discretionary powers of the Court, damages should be calculated as at the 520 5 1 C.L.R. SaabandAnothery.HolyMonasteryAy.Neophytos PikisJ. date of trial; the reason is that the purchaser is deprived of the bargain, and his loss becomes quantifiable at that date, and not earlier. The decision in Wrothv. Tyler,supra, was followed in a number of subsequent cases. (See, inter alia, 5 Warnington v. Miller [1973] 2 All E.R. 372 (C.A.); Grantv. Dawkihgs [1973] 3 All E.R. 897). In Malhotrav. Choudhury [1979] 1All E.R. 186 (C.A.), the Court of Appeal held that the principle in Wrothv. Tyler, supra, is subject to the rule that a purchaser should not be allowed, by his own delay, to 10 increase his damages. The decision in Wrothv. Tyler, primarily rested on the implications of the provisions of s.2 of Lord Cairn's Act, 1856, that survived the repeal of the Act. The implications of the decision in Wroth v. Tyler,as well 15 as the principles applicable to the assessment of damages for breach of contract, were reviewed by the House of Lords in Johnson v. Agnew [1979] 1All E.R. 883. The House observed that theprovisions ofs.2 ofLord Cairn's Act are not indiscord to the general principles regulating damages at common law. 20 Therefore, if the case of Wrothv. Tyler, supra, propounded anyproposition different from theabove,itwaswronglydecided. The case of Johnson v. Agnew, supra, offers a most useful guidanceonthegeneralprinciplesfor theassessmentofdamages for breach of contract. The principles regulating the award 25 of damages for breach of contract at common law, do not require of necessity that damage should be assessed as at the date of breach; where the justice of the case so necessitates, theymaybeassessed at a subsequent date. Normally,damages areassessedasatthedateofbreachbecausethedamage suffered 30 by the innocent party crystallizes on that day. Where a party persists for good cause to have the contract enforced, notwithstandingthebreach, asit often happens whereapartyisseeking the specific enforcement of the contract, there is valid ground for assessing damages as at a subsequent date. The damage 35 crystallizes when specific performance is refused in the exercise of the Court's discretion. In this sense,the principle of Wroth v. Tyler,supra, is not exceptional but in line with the general rule at common law for the assessment of damages. In the presentcase,thepersistence oftheappellant tohavethecontract 40 specifically enforced had no reasonable chance of success, in 521 Pikts J. SaabandAnotherv.HolyMonastery Ay.Neophytos

(1983)view of the absence of a separate registration of the property, coupledwith the fact that a crucial part of the property soldwas transferred to a third party, in March, 1977, the month when the breach of the contract occurred. Specific performance was withheld, not in the exercise of any discretionary powers 5 of the Court but as a result of the mandatory application of the provisions of Cap. 232, asearlier indicated in this judgment. Under s.8 of Cap. 232 the Court has discretion to refuse specific performance, despite compliance with the mandatory provisions of Cap. 232 as to registration of the contract and other forma- 10 lities. In that case, there may be good reason for assessing damages as at the date of the trial. In ourjudgment, the Court rightly assessed damages in this case, as at the date of breach. Further, the assessment made was reasonable in the light of the evidence before the Court. 15 / Lastly, the complaint of appellant associated with the refusal of the Court to award interest on the money deposited as from the date of the execution of the agreement. In Wadsworth v. Lydall [1981] 2 All E.R. 401, it was held that where loss of interest is specifically pleaded as an item of special damage, 20 there is no rule preventing its recovery where it appears that suchlossought reasonably tohavebeenwithinthe contemplation of the parties at the time of the execution of the agreement. Normally, as it was observed in the same case, the recovery of interest is treated as a remote item of damage not ordinarily 25 recoverable*. Neither the pleading of the appellant, nor the evidence adduced, taken together, justify the award of interest as an item of damage properly recoverable. So, this aspect of the judgment of the trial Court is also sustainable. Finally, the question of costs. Costs normally follow the 30 event. If this rule is strictly applied, the ruling of the trial Court, that appellants 2 should pay the costs, occasioned by their action, to the defendant, should be sustained. Where, however, as in this case, two or more plaintiffs with a close, if not identical interest, join forces in the pursuit of an action 35 and one of them is successful, the rule that costs follow the event should not be followed with the same strictness. The * See also the decision in Techo-lmpex v. Von WeeldeBV [1981] 2 All E.R. 689. 522 1 C-L-R. SaabandAnotherv.HolyMonasteryAy.Neophytos Pikis J. Court mustexamine whether thejoinder has added to thecosts of the proceedings; and if so, make an appropriate order as tocosts. Inthiscase,thereisnothingto suggestthatthejoinder had this result. In our judgment, the appropriate order as 5 to costs between appellants 2 and defendants should be - no order asto costs. And to this extent, wevary the order of the trial Court as to costs. In the result, the appeal and cross-appeal are dismissed. Therewillbenoorder astocostswithregardto proceedingson 10 appeal. The order of the trial Court as to costs is varied, as hereinabove indicated. Appeal andcross-appealdismissed. Order for costs as above. 523