Jurong Town Corp v Dauphin Shipyard Pte Ltd

• Jurisdiction: Singapore
• Judge: Lai Siu Chiu J
• Judgment Date: 04 September 2012
• Neutral Citation: [2012] SGHC 179
• Court: High Court (Singapore)
• Docket Number: Suit No 127 of 2012 (Summons No 2330 of 2012)
• Published date: 06 September 2012
• Year: 2012
• Hearing Date: 10 August 2012
• Plaintiff Counsel: William Ong and Magdelene Sim (Allen & Gledhilll LLP)
• Defendant Counsel: Lim Chee San (TanLim Partnership) (instructed) and S Nabham (S Nabham)
• Subject Matter: Civil Procedure,Summary Judgment,Landlord and Tenant,Agreements for leases
• Citation: [2012] SGHC 179

Lai Siu Chiu J:

This was an application by Jurong Town Corporation (“the plaintiff”) for summary judgment under Order 14 (“Order 14”) of the Rules of Court (Cap 322, R5 2006 Rev Ed) (“the Rules of Court”), pertaining to the holding over by Dauphin Shipyard Pte Ltd (“the defendant”) of a plot of land located at Lot A6566 at 23 Tuas Road, Singapore 638490 (“the Premises”) after its lease had expired.

On 10 August 2012, I granted summary judgment in favour of the plaintiff. As the defendant has filed a notice of appeal against the whole of my decision (in Civil Appeal No 101 of 2012), I shall now set out the grounds therefor.

The Facts The parties

The plaintiff is a statutory board incorporated under the Jurong Town Corporation Act (Cap 150, 1998 Rev Ed). It is the owner and landlord of the Premises. The defendant is a company in the business of building and repairing ships. It was the lessee of the Premises.

Background

Pursuant to a Building Agreement and Supplementary Agreement made between the plaintiff and defendant dated 27 November 1981 and 22 March 1984 respectively, the defendant leased the Premises from the plaintiff for a term of 30 years (“the Lease”), from 16 April 1980 to 15 August 2010. The lease did not contain an option to renew. Rather, clause 1(xvi) of the Special Conditions of the Lease provided that the lessee was to yield up the Property to the lessor at the termination of the tenancy. The defendant claimed that at the time the Lease was executed, one of the plaintiff’s officers made an oral representation to the founders of the defendant, that the defendant had a right or option to renew the Lease for a further 30 years after its expiry (“a 30+30 lease”).

On 28 August 2009, the defendant applied to renew the Lease for a term of 20 years, until the year 2030. The application was made by way of the plaintiff’s standard forms; the defendant made no mention of a right or option to renew the Lease for 30 years. Klint Thian (“Klint”), who is the defendant’s managing-director, submitted the application. The plaintiff rejected the application by a letter dated 19 October 2009. Over the next six months, the defendant repeatedly sought the plaintiff’s reconsideration of its application but to no avail.

Subsequently, the plaintiff offered the defendant a six months’ extension of stay on the Premises, from 16 August 2010 to 15 February 2011 (“Extended Term”) on a goodwill basis so as to give the defendant “sufficient time to wrap up any outstanding works and reinstate [their] site”. Accompanying the offer was a letter setting out the terms of the extension, including a clause which stated that the letter constituted the “full terms and conditions governing the Extended Term”. The Extended Term offer and accompanying terms were unconditionally accepted by the defendant by its letter dated 27 August 2010.

However, the defendant did not vacate the Premises at the expiry of the Extended Term (on 15 February 2011). Instead, the defendant proceeded to submit various appeals through ministers and Members of Parliament (“MP”) in a bid to obtain an extension or renewal of the Lease. These included four appeals submitted through the MP of the Jurong GRC between September 2010 and February 2011, petitions to the Senior Minister of State and the Minister, for Trade and Industry in December 2010 and April 2011, as well as two petitions to the Prime Minister’s Office in May 2011. In every petition, the defendant explained the reason for its rental arrears (which the plaintiff had alluded to in its rejection letters), and reiterated with increasing detail, various grounds on which the renewal of the Lease was justified. The appeals were not acceded to, although the plaintiff did offer the defendant a further three months’ extension of stay from 16 February 2011 to 15 May 2011, and later, a third and final nine months’ extension of stay from 16 May 2011 to 15 February 2012 (“the Third Extended Term”).

The terms of the Third Extended Term were encapsulated in a letter dated 30 June 2012 (“Letter of Offer”), and required, inter alia, that the defendant pay the prevailing market rate for the Premises (“Land Rent”) and a fee for the allocated water boundary line (“Waterfront Fee”), pay in advance a deposit of $120,000 (“the Reinstatement Security Deposit”), and conduct various works (“Reinstatement Works”) on the Premises immediately prior to the expiry of the Third Extended Term.

The defendant unconditionally accepted the offer and terms of the Third Extended Term on 30 July 2011. However, it failed to vacate the Premises and conduct the Reinstatement Works by the time the Third Extended Term expired on 15 February 2012. The plaintiff hence commenced action on 20 February 2012, seeking, inter alia, vacant possession of the Premises.

The parties’ submissions

In its defence filed on 16 March 2012, the defendant argued that the plaintiff was estopped from denying it a renewal of the Lease and/or extension of stay on the Premises by reason of the plaintiff’s oral representation to the defendant at a meeting on 3 June 2011. It was alleged that the plaintiff’s then Chief Executive Officer Manohar Khiatani (“Mr Khiatani”) told Klint that there were cases of companies that had managed to obtain contracts to perform works on their premises even though their leases with the plaintiff were expiring and that in such cases, the plaintiff would consider extending their leases. Khiatani then asked Klint if the defendant had any contracts on hand. In reliance on this exchange, the defendant entered into various contracts for works to be performed on the Premises throughout the year 2012.

In response, the plaintiff stated that the defendant’s account was inaccurate and that Khiatani had in fact informed the defendant that the plaintiff took many other factors into consideration in deciding whether or not to extend a lessee’s stay on the land, and in some cases, companies with on-going contracts would be considered. Further, even based on the defendant’s version, Khiatani’s comments meant nothing more than that the plaintiff would consider the defendant’s renewal application. It was not a representation that renewal would certainly be granted.

In any case, this argument of the defendant was not pursued by the time the plaintiff applied for summary judgment on 10 May 2012. In Klint’s affidavit filed on 18 June 2012 in response to the Order 14 application (“the Show Cause affidavit”), Klint referred instead to an earlier oral representation made by a then employee of the plaintiff, one Oh Kim Wee (“Mr Oh”), to the defendant’s founding members, Thian Kim Hoe (deceased) and Madam Tan Wah Leng (“Mdm Tan”) at the time the Lease was executed (see [4] above). Mr Ho allegedly told the defendant’s founders that they would have a right or option to renew the Lease at the prevailing market rate for a further 30 years after the expiry of the initial 30 year term by reason of the “huge investments involved and required of the defendant”, but that it was neither necessary nor normal to include such an option in the Building Agreement.

This new allegation was refuted by the plaintiff’s Deputy Director of the Aerospace, Marine and Cleantech Cluster, Loh Yew Pong (“Mr Loh”) on affidavit, where he stated that the plaintiff did include in its building agreements an option to renew in cases where such an option was agreed upon at the outset. Mr Loh exhibited copies of some sample leases, which included an express option to renew for a further 30 years after expiry of the initial term, all granted at about the same time that the defendant’s lease...