Crystal Beauty Pte Ltd v Jasmine Xu & 4 Ors

Facts

Crystal Beauty Pte Ltd, a beauty salon run by its sole director Mdm Pan Ying, operated from a unit at D'Leedon. It bought the unit across the corridor to expand, using as its agent Ms Jasmine Xu, a licensed estate agent with ERA Realty Network Pte Ltd and an acquaintance of the director. An earlier attempt to buy the same unit in 2018 had been aborted. In early 2020 an option was exercised at a negotiated price of $1.49m. Both the director and the agent assumed the unit was about 818 sq ft, the figure shown on listing portals and in the title search.

After the clinic tenant left in late 2021, the salon's interior designer measured the unit and found the usable floor area was only about 619 sq ft. The unit has upward-sloping walls, and for such irregular units the lot area is calculated on the larger ceiling area, not the floor. The salon said it could not fit its planned rooms and had to keep running both units. In Originating Claim No 129 of 2022 it sued the agent for fraudulent, negligent or innocent misrepresentation and negligence, and the agency on the basis of vicarious liability, claiming $591,255.38. Claims against the vendor, the vendor's agent and that agent's agency had ended by discontinuance or confidential settlement. The parties appointed a joint expert, Mr Tay Kah Poh.

Issues

1. Whether the agent represented that the usable floor space was 818 sq ft, expressly or by implication
2. Whether any such representation induced the purchase and was actionable as fraudulent, negligent or statutory misrepresentation
3. Whether the agent breached her duty of care as an estate agent, making the agency vicariously liable

Holding

Mohamed Faizal JC dismissed the claim in full against both defendants, and directed submissions on costs if costs were not agreed.

Reasoning

The court found no representation about usable floor space. The salon's pleading was vague and shifted from a single statement to continuing representations. More than two years of messages contained no such statement; instead they showed both women believed they had been jointly misled by the developer, and the director's case against the agent emerged only later. No implied representation arose either: a reasonable person would understand a stated strata lot area to include some unusable space, and the agent knew no more than the director.

Even if a representation had been made, the court would not have found reliance. The director had already viewed and tried to buy the same unit in 2018, so anything said in 2020 was unlikely to have played a real and substantial role. There was no evidence the agent knew the figure was wrong, so fraud failed. The statutory claims also failed, since there was no contract between the salon and the agent, and she had reasonable grounds to believe the figure.

On negligence, an estate agent owes a duty of care but the standard is reasonableness, not strict liability. The unit was larger than the existing premises as instructed. The way its area was calculated was so rare that the joint expert had never seen it and conceded he would have been none the wiser; the agent had cross-checked the size against an industry portal, and a visual inspection would not have revealed the problem. Requiring as-built drawings or surveyors for every property would set too high a standard. With no primary tort, the agency could not be vicariously liable. The court added that the damages claimed appeared inflated, as the salon had not proved its losses, the pro-rated price calculation was unrealistic, and mitigation and the earlier settlement were unaddressed.

From the judgment