SGLN Consultants Pte Ltd v TPC Commercial Pte Ltd

• Jurisdiction: Singapore
• Judge: Jonathan Ng Pang Ern
• Judgment Date: 08 February 2024
• Neutral Citation: [2024] SGDC 24
• Court: District Court (Singapore)
• Docket Number: District Court Originating Claim No 1866 of 2023 (Summons No 2907 of 2023)
• Hearing Date: 12 January 2024,25 January 2024
• Citation: [2024] SGDC 24
• Year: 2024
• Plaintiff Counsel: Keh Kee Guan (Pacific Law Corporation)
• Defendant Counsel: Choo Ching Yeow Collin and Goh Guan Hui Felix (Tan Peng Chin LLC)
• Subject Matter: Civil Procedure,Injunctions,Interim mandatory injunctions
• Published date: 17 February 2024

District Judge Jonathan Ng Pang Ern:

The Claimant was a tenant of commercial premises at Guoco Tower, a mixed-use development in Singapore’s central business district. Due to the Claimant’s non-payment of rent, the Defendant, who was the landlord of the premises, purported to effect re-entry into the premises and terminate the tenancy. In response, the Claimant commenced this action against the Defendant, seeking, among other things, mandatory injunctions to compel the Defendant to restore it to possession of the premises. The present application was the Claimant’s application for interim mandatory injunctions on the same terms. Was the Claimant entitled to the injunctions sought? After hearing parties, I dismissed the application. These are the grounds of my decision.

Background

The Claimant and the Defendant were, respectively, the tenant and the landlord of a commercial unit at the basement one level of Guoco Tower (the “Premises”).¹ The tenancy was governed by a lease agreement dated 14 May 2021 (the “Lease”) and a deed of novation dated 9 June 2022.² As between the Claimant and the Defendant, the tenancy commenced on 15 June 2022.³ The rent payable on a monthly basis was either: (a) a fixed rent totalling $7,137; or (b) a percentage component calculated at 14% of the Claimant’s monthly gross sales turnover, whichever was the higher.⁴ The fixed rent was payable in advance on the first day of each calendar month. The percentage component was calculated in arrears at the end of each calendar month.⁵

The Claimant operated what was essentially a beauty salon at the Premises.⁶ The Claimant’s business did not seem to go particularly well. The Defendant’s evidence was that the Claimant’s gross sales turnover from September 2022 to October 2023 exceeded the fixed rent of $7,137 in only four months. In three of these four months, the excess was marginal ($7,216 for December 2022, $7,404.60 for September 2023 and $7,651.40 for October 2023).⁷ The Claimant did not dispute these figures.

Insofar as the payment of rent was concerned, the Defendant’s evidence was that, save for the month of February 2023, the Claimant failed to make timeous payment of rent for every month since August 2022.⁸ Again, the Claimant did not dispute this. Indeed, the Claimant’s own position was that its “poor business” caused it to fail to pay rent on “numerous occasions”.⁹

The Defendant initially put up with these late payments, but eventually found itself unable to do so.¹⁰ On 1 November 2023, the Defendant’s solicitors sent a letter of demand to the Claimant which demanded that payment of $7,942.18 be made by 7 November 2023. This sum of $7,942.18 predominantly comprised the rent for October 2023.¹¹ The Claimant proceeded to issue two cheques to the Defendant: (a) one dated 2 November 2023 for the sum of $4,000; and (b) one post-dated 10 November 2023 for the sum of $3,805.16. By way of an email dated 2 November 2023, the Defendant informed the Claimant that it was unable to accept the second cheque, and stated that it “look[ed] forward to receiving the remaining amount” by 7 November 2023.¹²

The Claimant did not pay the balance sum by 7 November 2023.¹³ On 8 November 2023, the Defendant’s solicitors wrote to the Claimant to inform the Claimant that the Defendant “had no alternative but to exercise its right to re-enter the Premises on 8 November 2023 in full accordance with Clause 10.1.1 of the Lease”, and that “[u]pon re-entry, the [tenancy was] terminated”.¹⁴ Clause 10.1.1 of the Lease provided as follows:¹⁵ 10. TERMINATION & RE-ENTRY 10.1 If: 10.1.1 all or any part of the Rent or any other amounts payable by the Tenant under this Lease shall be unpaid for seven (7) days after becoming due (whether or not any formal demand has been made); or

…

then the Landlord or any person authorised by the Landlord may at any time thereafter terminate this Lease by service of three (3) days’ written notice on the Tenant or by re-entering the Premises or any part thereof in the name of the whole … This Lease shall absolutely cease and determine upon the abovementioned service of written notice or re-entry. For purposes of this sub-clause, the Landlord’s re-entry may be effected by changing the locks or adding additional locks to the entrances and exits of the Premises and/or by any acts of re-entry by which the Landlord asserts re-possession of the Premises, including disabling or overriding any card key lock system.

On the same day, the Defendant changed the locks to the Premises and posted a notice on the front door of the Premises stating, among other things, that the Premises had been “re-entered and re-possessed”, and were now in the possession of the Defendant.¹⁶ The Defendant subsequently also cut off the electricity supply to the Premises.¹⁷

After the Defendant’s purported re-entry, the Claimant issued cheques for the payment of rent for the balance of October 2023 and the whole of November 2023.¹⁸ The Defendant did not encash these cheques.¹⁹

On 8 December 2023, the Claimant commenced this action against the Defendant. The final paragraph of the Statement of Claim claimed the following reliefs: 32. And the Claimant therefore claims against the Defendant as follows: (a) relief be granted to the Claimant under S 18A of the Conveyancing and Property Act 1886 [sic]; (b) further and/or in the alternative, an order that the Defendant restores the Claimant to possession of the [Premises] and thereafter to restrain the Defendant from re-entering, repossessing or otherwise interfering with the Claimant’s use and occupation of the [Premises]; (c) an order that the Defendant restores to the Premises the electricity supply and all services under the [Lease] dated 14 May 2021; (d) damages for trespass, any loss of profit suffered during the time the Claimant was unable to carry out its business on account of the Defendant’s breach of the covenant of quiet enjoyment; (e) Costs; and (f) Such other relief as this Honourable Court deems fit and just.

At the first hearing on 12 January 2024, counsel for the Claimant, Mr Keh Kee Guan, stated that the Claimant would no longer be relying on s 18A of the Conveyancing and Law of Property Act 1886 (2020 Rev Ed). This concession was rightly made as this provision only applied “where a lessor [was] proceeding by action to enforce against a lessee a right of re-entry or forfeiture in respect of any immovable property for non-payment of rent” [emphasis added] (s 18A(1) of the Conveyancing and Law of Property Act 1886). In the present case, the Defendant (being the lessor) did not proceed against the Claimant (being the lessee) “by action”. Accordingly, s 18A of the Conveyancing and Law of Property Act 1886 did not apply.

Instead, Mr Keh clarified that the Claimant was relying, in this action, on the equitable principle of relief against forfeiture. As observed in Halsbury’s Laws of Singapore vol 14(2) (LexisNexis, 2014) at para 170.1017:

The proviso for re-entry on non-payment of rent is regarded in equity as merely a security for the rent and, accordingly, provided that the landlord and other persons interested can be put in the same position as before, the tenant is entitled to be relieved against the forfeiture on payment of the rent and any expenses to which the landlord has been put.

…

The present application was filed together with the originating claim for this action. Its prayers sought, in substance, the same injunctive reliefs: a. an injunction to restore the Claimant to possession of the [Premises] and thereafter to restrain the Defendant from re-entering, repossessing or otherwise interfering with the Claimant's use and occupation of the Premises; b. to restore the electricity supply and such services as provided in the [Lease] dated the 14 May 2021 to the Premises; and c. That costs of and incidental of the application be provided for.

While not entirely clear on the face of these prayers, the Claimant’s affidavits and written submissions filed in support of the application made it clear that what were being sought were interim injunctions.

On 15 December 2023, the Defendant handed over possession of the Premises to a new tenant.²⁰

Applicable law

An interim injunction is generally sought when an applicant believes that an immediate remedy is essential to the preservation of a right or entitlement which would be compromised or lost if the applicant had to wait until the trial (Jeffrey Pinsler SC, Singapore Civil Practice vol I (LexisNexis, 2022) at para 27-4). In deciding whether to grant an interim injunction, the court is guided by the fundamental principle that it should take whichever course appears to carry the lower risk of injustice if it should turn out to have been wrong at the trial, in the sense of granting relief to a party who fails to establish his rights at the trial, or of failing to grant relief to a party who succeeds at the trial (RGA Holdings International Inc v Loh Choon Phing Robin and another [2017] 2 SLR 997 (“RGA Holdings International”) at [28] citing Chuan Hong Petrol Station Pte Ltd v Shell Singapore (Pte) Ltd [1992] 2 SLR(R) 1 (“Chuan Hong Petrol Station”) at [88]).

An interim injunction can be prohibitory or mandatory: an interim prohibitory injunction is an injunction that forbids the commission or continuance of an act, while an interim mandatory injunction is an injunction that compels the respondent to do some positive act to repair an omission or restore the status quo by undoing some act (RGA Holdings International at [29]). In this connection, the interim injunctions sought by the Claimant (see [12] above) were, ultimately, interim mandatory injunctions. While the interim injunction sought in prayer (a) contained a prohibitory element (ie, “to restrain the Defendant from re-entering, repossessing or otherwise interfering with the Claimant's use and...