PACC Offshore Services Holdings Ltd v Kensteel Engineering Pte Ltd
Jurisdiction | Singapore |
Judge | Tan Siong Thye J |
Judgment Date | 15 May 2017 |
Neutral Citation | [2017] SGHC 175 |
Court | High Court (Singapore) |
Docket Number | Originating Summons No 398 of 2017 |
Year | 2017 |
Published date | 01 November 2017 |
Hearing Date | 27 April 2017,08 May 2017 |
Plaintiff Counsel | William Ong, Vincent Leow, Ivan Lim and Robin Teo (Allen & Gledhill LLP) (for the 27 April and 8 May 2017 hearings) and Foo Chuan Min Jerald and Elsa Goh (Cavenagh Law LLP) (for the 17 July 2017 hearing) |
Defendant Counsel | Salem bin Mohamed Ibrahim and Kulvinder Kaur (Salem Ibrahim LLC) |
Subject Matter | Credit and security,Lien,Equitable lien,Land,Caveats,Sale of land,Remedies under uncompleted contract |
Citation | [2017] SGHC 175 |
This application concerns the maintenance or removal of Caveat IE/364752C (“the Caveat”). The plaintiff wishes to maintain the Caveat pending the resolution of the parties’ main dispute in Suit No 898 of 2015 (“Suit 898”), which is fixed for trial next month before a different judge. The Caveat is over a piece of land (“the Land”) of which the defendant is the lessee. The defendant has lodged an application (“the Cancellation Application”) before the Singapore Land Authority (“SLA”) to cancel the Caveat. The plaintiff now asks this court to order – pending the outcome of Suit 898 and any appeal therefrom – that the Cancellation Application be stayed, that the Caveat continue, and/or that the Registrar of Titles be directed not to cancel or remove the Caveat.
The factsThe plaintiff is PACC Offshore Services Holdings Ltd, a publicly listed company incorporated in Singapore. Its business includes the chartering of ships, barges, and boats with crew. The defendant is Kensteel Engineering Pte Ltd, a company incorporated in Singapore that provides engineering products and services for petrochemical industries. The defendant leases the Land, which is a waterfront property, from the Jurong Town Corporation (“JTC”), a government-owned real estate corporation and statutory board.
On 27 January 2015, the parties entered into a sale and purchase agreement (“the SPA”) under which the plaintiff was to purchase the defendant’s leasehold interest (“the Property) in the Land for a sum of $38m. The SPA obligated the plaintiff to immediately pay a deposit of 10% of the purchase price (
Ultimately, for reasons which are in dispute, JTC declined to grant its approval. I shall refer to this event as “the Non-Approval”. On 17 August 2015, the plaintiff, on the basis of the Non-Approval, purported to terminate the SPA and demanded the return of the Deposit. The defendant refused to acknowledge the purported termination as effective or to return the Deposit, taking the view that the plaintiff was at fault for the Non-Approval. Instead, the defendant treated the plaintiff’s purported termination as a wrongful repudiation, which the defendant allegedly accepted on 2 September 2015.
Also on 2 September 2015, the defendant commenced Suit 898 to seek, among other things, a declaration that the defendant was entitled to forfeit and retain the Deposit. In response, the plaintiff filed a counter-claim for the return of the Deposit. Subsequently, on 18 December 2015 (
The Caveat stated the interest claimed as being that of a “lienholder over the [Property] … for the refund of purchase monies (and goods and services tax thereon) aggregating the sum of S$4,066,000.00 paid by the [plaintiff] to the [defendant]”. The grounds of the claim were stated as being the entry into and termination of the SPA and “the liability of the [defendant] to refund to the [plaintiff] the said sum of S$4,066,000.00 or any part thereof as a result of the termination of the [SPA]”.
More than a year later, on 20 March 2017, the defendant brought the Cancellation Application before the SLA in respect of the Caveat. On 31 March 2017, the SLA notified the plaintiff that the Caveat would be cancelled after 30 days (
Lastly, it is relevant to note that after the termination of the SPA, the defendant granted an option to purchase (“the OTP”) in respect of the Property to a third party, Eng Lee Logistics Pte Ltd (“Eng Lee”). That sale is also subject to JTC approval. The OTP was exercised by Eng Lee on 4 April 2017.
Issues The issues before me are fairly restricted. As both parties have agreed, it is not this court’s task to delve into the underlying merits of the larger and substantive dispute between the parties. That dispute engages issues including which party, if either, breached the SPA and/or caused the Non-Approval. Those issues, and the overall dispute, are for the trial judge in Suit 898 to decide. It follows that this court is not being asked to determine whether the plaintiff has an interest in the Property capable of sustaining the Caveat indefinitely. Rather, the question I must answer is whether the Caveat should be maintained
In such a case, it is undisputed that the relevant principles are those set out in
... [The caveator] must first satisfy the court that on the evidence presented to it his claim to an interest in the property does raise a serious question to be tried; and, having done so, he must go on to show that on the balance of convenience it would be better to maintain the
status quo until the trial of the action, by preventing the caveatee from disposing of the land to some third party.
Applying the
Having considered all the circumstances, and the arguments raised and authorities relied on by both parties, I am of the view that the Caveat should remain unless the defendant is able to provide an alternative form of security. In the interest of providing certainty to both parties in what is undoubtedly a time-sensitive dispute, I set out my detailed reasons below.
Does the plaintiff’s claim to a purchaser’s lien raise a serious question to be tried? In the present context, it is helpful to sub-divide the first question into two parts:
The parties explored this point in considerable detail in their written submissions. As this is a fulcrum issue that will decide the fate of the parties in these proceedings, I requested parties to make supplementary written submissions to address each other’s arguments. I will therefore analyse this issue at some length.
The plaintiff argued that it was settled law that a purchaser of land has an equitable lien (known in this context as a purchaser’s lien) over the land for the purchase price which he has paid. The purchaser’s lien is distinct from the equitable interest which the purchaser has under the contract of sale and is not dependent on the availability of specific performance. As authority for this proposition, the plaintiff primarily relied on two Court of Appeal cases,
The defendant’s response was that since the plaintiff, by purporting to terminate the SPA, had renounced any intention of completing the sale of the Property, its...
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