A society owning a piece of land appoints a builder X to construct about 50 flats. In the development agreement, which contains the successors and assigns clause, the society allows builder to sell the flats to public if any member of the society can not take possession with in the stipulated time. As per the agreement , X is only a contractor and the land is not conveyed to X. The society also agrees that they will accept the mebership of people to whom the builder has sold flats. X now assigns the development rights to Y . Now Y constructs the building. When the building is almost complete , the society executes another development agreement agreement with X which does not say anything about the first agreement with X. In about 4 months after the second agreement between the society and X, Y completes the building. X issues an authorization letter to the society to pay Y the cost of construction and take possession. The society pays by cheque for 10 flats to Y and take possesion of 10 flats from Y . Now after stipulated time has passed, Y opens a sales office in a ground floor flat in the society and publishes about 25 ads in a leading English daily over a period of 2 years for sale of flats. In this two years Y sells ablut 35 flats. Peceful possession if given to all flat purchasers.
However, now the society refuses to give membership to people who bought flats from Y. They argue that Y did not have title to sell the flats as per the second agreement between the society and X
Can the people who bought flats from Y invoke the doctrine of estoppel by which they can challenge the society's right to question the title because
- All sales happend in societys premises. The society should have known that sales are happening and yet did not do anything to stop such sales by way of an injunction or stay
- There were advertizements in a leading daily appearing practiclly every month. The society should have seen these ads and yet it did not do anything to stop such sales by way of an injunction or stay
Also, does the society have any right to question the title. Even if we consider the second agreement, the title should remain witht X until society pays for the flats