UDL Marine (Singapore) Pte Ltd v Jurong Town Corp

• Jurisdiction: Singapore
• Judge: Lai Siu Chiu J
• Judgment Date: 28 February 2011
• Neutral Citation: [2011] SGHC 45
• Plaintiff Counsel: Thio Shen Yi SC, Ang Wee Tiong and Olivia Low Pei Sze (TSMP Law Corporation)
• Docket Number: Originating Summons No 1133 of 2010/R
• Date: 28 February 2011
• Hearing Date: 03 December 2010
• Subject Matter: Administrative Law,Judicial Review
• Published date: 07 March 2011
• Citation: [2011] SGHC 45
• Defendant Counsel: Dhillon Dinesh and Felicia Tan May Lian (Allen & Gledhill LLP),Sharon Lim (Attorney-General's Chambers).
• Court: High Court (Singapore)
• Year: 2011

Lai Siu Chiu J: Introduction

This case concerned an application for leave under Order 53 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the Rules”) by UDL Marine (Singapore) Pte Ltd (“the plaintiff”) to apply for a quashing order and a mandatory order (“the application”) against Jurong Town Corporation (“JTC”). The application arose out of JTC’s refusal to renew the plaintiff’s lease or to grant the plaintiff a fresh lease of the premises rented by the plaintiff at Benoi Road.

After hearing arguments from both parties and from the Attorney-General (“the AG”), I dismissed the application. The plaintiff has appealed against my dismissal (in Civil Appeal No. 238 of 2010) and I now set out the grounds for my decision.

Background The parties

The plaintiff was the lessee of land located at 3 Benoi Road, Singapore 629877 (“the Premises”). The plaintiff used the Premises as a shipyard for its shipbuilding business.

JTC was the lessor of the Premises. JTC is a statutory board incorporated under the Jurong Town Corporation Act (Cap 150, 1998 Rev Ed) (“the JTC Act”). JTC held the Premises under a lease from the State (“the Head Lease”).

The plaintiff’s application to renew the Lease

The plaintiff’s lease of the Premises (“the Lease”) was due to expire on 31 December 2010. On 6 and 22 August 2008, the plaintiff applied to JTC to renew the Lease (“the Renewal Application”).

In his affidavit filed in support of the application, Leung Yat Tung (“Leung”), the plaintiff’s managing-director deposed that the Economic Development Board (“EDB”) was involved in the plaintiff’s decision to make the Renewal Application. Leung stated that the plaintiff had initially intended to assign the Lease to a company known as Kim Hock Corporation Pte Ltd. Leung explained that the plaintiff decided to assign the Lease because it had heard from “market talk” and JTC’s officers that JTC planned to redevelop waterfront sites, including the Premises, and that leases affected by such plans would not be renewed. Leung claimed that he was contacted by one Sidat Senanayake (“Senanayake”), an EDB officer, in late February 2005. Leung stated that Senanayake persuaded the plaintiff to call off its assignment of the Lease by representing, inter alia, that JTC had reconsidered its redevelopment plans. Senanayake eventually wrote to Leung on 26 May 2005 to inform him that JTC was agreeable to considering a conditional extension of the Lease, subject to EDB’s support. Leung further detailed his interactions with EDB between February 2005 and November 2009 in his affidavit.

I should mention that JTC’s consideration of the Renewal Application was delayed because of a waterfront study.

The alleged involvement of Keppel Singmarine Pte Ltd

Leung claimed that Hoe Eng Hock (“Hoe”), the executive director of Keppel Singmarine Ltd (“Keppel Singmarine”), approached him to propose that the plaintiff share the Premises with Keppel Singmarine. Leung asserted that Hoe told him that the Lease would not be renewed if the plaintiff did not agree to Hoe’s proposal.

Hoe denied Leung’s allegations in an affidavit filed in other proceedings between the plaintiff and JTC (see [18] below). Hoe claimed that he only offered to sublet a part of the Premises for a short period of approximately 12 months to ameliorate any space congestion that Keppel Singmarine might face.

JTC’s rejection of the Renewal Application

JTC eventually informed the plaintiff, in a letter dated 20 November 2009, that it would not be renewing the Lease (“the First Rejection Letter”).

The plaintiff wrote several letters to JTC and EDB between November 2009 and June 2010 even though JTC had indicated in the First Rejection Letter that its rejection of the Renewal Application was final.

On 19 May 2010, JTC wrote to the plaintiff to advise that EDB and JTC had jointly evaluated the plaintiff’s business plans and had concluded that they were unable to support the Renewal Application (“the Second Rejection Letter”).

The plaintiff’s meeting with JTC and EDB on 16 June 2010

Following the Second Rejection Letter, the plaintiff wrote to the chairmen of JTC and EDB. JTC responded that both JTC and EDB would arrange to meet with the plaintiff to clarify their policies.

The plaintiff met with representatives of JTC and EDB on 16 June 2010, (“the 16 June 2010 Meeting”). Leung claimed that one Tang Wai Yee (“Tang”), a JTC officer, explained that waterfront land was scarce and so JTC had to allocate such land to companies with the best business plans. Leung also alleged that Tang informed him that JTC required a minimum amount of investment from companies applying for leases of waterfront land and that the plaintiff’s proposed investment of $20.6m was too low.

The plaintiff’s proposal to take over a lease of 17 Pandan Road

On 4 June 2010, the plaintiff wrote to JTC with a proposal that the plaintiff take over the current lease of land located at 17 Pandan Road (“the 17 Pandan Road Lease”) if JTC agreed to extend the 17 Pandan Road Lease. JTC did not reply to this letter.

Leung deposed that he raised the plaintiff’s request for a renewal of the 17 Pandan Road Lease at the 16 June 2010 Meeting. Leung claimed that Tang responded that it would “look funny” if JTC were to reject the Renewal Application but approve the plaintiff’s application for the 17 Pandan Road Lease. Leung also claimed that when he asked Tang if the plaintiff had been “blackmarked [sic] permanently” by JTC, Tang responded that she could not answer Leung.

JTC filed an affidavit in response to Leung’s claims regarding the 17 Pandan Road Lease. JTC’s Deputy Director of the Aerospace, Marine and Cleantech Cluster, Loh Yew Pong (“Loh”), deposed that he was present at the 16 June 2010 Meeting but could not confirm if Leung’s recounting of the comments made by Tang was verbatim. Loh explained nevertheless that those comments should be understood in context. The plaintiff did not submit any application for the 17 Pandan Road Lease. Loh explained that JTC was “rightfully curious” as to how the plaintiff’s business plan in relation to the Lease, which was rejected by JTC, would impress JTC in relation to another plot of land. As for the response to the plaintiff’s question on whether it was “blackmarked”, Loh explained that Tang’s response, if in fact it was given, was a prudent answer because the meaning of “blackmarked” was unclear.

Suit No 502 of 2010

On 21 July 2010, the plaintiff commenced proceedings against JTC in Suit No 502 of 2010 (“Suit 502”). The plaintiff claimed, inter alia, the following reliefs in Suit 502: a declaration that JTC’s refusal to renew the Lease was and is wrongful; a declaration that JTC is estopped from refusing to renew the Lease or refusing to grant a new lease; an order that JTC renew the Lease or grant a new lease; and further, or in the alternative, that the plaintiff be awarded equitable compensation and/or damages to be assessed.

At the hearing before this court, counsel for JTC (Dhillon Dinesh) informed the court that Suit 502 had been fixed for an expedited hearing between 16 and 25 February 2011.

It would be useful to highlight an affidavit that Loh filed in Suit 502 in response to the plaintiff’s application for an interlocutory injunction (“the LYP Injunction Affidavit”). Loh had stated in the LYP Injunction Affidavit that JTC required that applicants for waterfront land commit to investing at least $100m as fixed asset investment to ensure maximisation of land usage. As will be seen below, the plaintiff relied on this statement in the LYP Injunction Affidavit to explain to this court its delay in making the application and also as support for its substantive application for judicial review. I should add that Loh had explained in his affidavit filed in these proceedings that his statement in the LYP Injunction Affidavit was made in the context of an attempt on his part to explain the loss that JTC would suffer if an interlocutory injunction was granted. Loh explained that JTC would actually consider a “basket of factors” when assessing an application for a lease, and not just the applicant’s proposed fixed asset investment.

The amounts that the plaintiff’s neighbours had committed to investing

According to Leung, the plaintiff discovered in early October 2010 that its neighbours had obtained a renewal of their leases even though they had committed to invest at values that were lower than the amount that the plaintiff proposed. Leung deposed that he discovered that Cosco Marine Engineering (S) Pte Ltd (“Cosco”), which was granted an extension of its lease for a period of 30 years, had committed to investing only $5m over three years without providing a detailed business plan for its future operations. Another neighbour, Asia-Pacific Shipyard Pte Ltd (“Asia-Pacific Shipyard”), which was granted an extension of its lease for a period of 20 years, had committed to investing only $6m over a period of five years without a specific business plan.

JTC responded to Leung’s allegations by Loh’s affidavit. Loh deposed that Leung’s recounting of the details of the leases of Cosco and Asia-Pacific Shipyard in Leung’s affidavit was incorrect and that he did not understand how Leung was in a position to judge their businesses or business plans since he was not privy to the two companies’ submissions to JTC. Loh also stressed that Cosco and Asia-Pacific Shipyard had obtained leases of different plots of land and that JTC considered every application on its own merits.

Originating Summons No. 1133 of 2010

On 2 November 2010, the plaintiff filed the application praying, inter alia, for the following: leave to apply for a quashing order to remove into the High Court and quash JTC’s decision to reject the Renewal Application and to refuse to grant a new lease of the Premises; leave to apply for a mandatory order to oblige JTC to...