UDL Marine (Singapore) Pte Ltd v Jurong Town Corporation and other suits

• Jurisdiction: Singapore
• Judge: Lee Seiu Kin J
• Judgment Date: 07 November 2013
• Neutral Citation: [2013] SGHC 236
• Court: High Court (Singapore)
• Docket Number: Suit No 502 of 2010, Suit No 98 of 2011 & Suit No 156 of 2011
• Published date: 21 November 2013
• Year: 2013
• Hearing Date: 01 March 2013,27 February 2013,28 February 2013,25 February 2013,26 February 2013,13 May 2013,04 March 2013
• Plaintiff Counsel: Siraj Omar and See Chern Yang (Premier Law LLC)
• Defendant Counsel: Dinesh Dhillon, Felicia Tan and Cai Chengying (Allen & Gledhill LLP),Chia Ho Choon and Mr Ushan Premaratne (Khattarwong LLP)
• Subject Matter: tort,misrepresentation,equity,estoppel,proprietary estoppel,landlord and tenant,convenants
• Citation: [2013] SGHC 236

Lee Seiu Kin J: Introduction

The trial before me involved three suits which were consolidated pursuant to an order of court dated 9 February 2012.

UDL Marine (Singapore) Pte Ltd (“UDL”) is the plaintiff in Suit No 502 of 2010 (“S502”) and Suit No 156 of 2011 (“S156”), and the defendant in Suit No 98 of 2011 (“S98”). UDL is a wholly owned subsidiary of UDL Holding Limited, a company incorporated in Hong Kong. UDL was known as Denlane Shipbuilding Pte Ltd (“Denlane”) before it was renamed UDL Marine (Singapore) Pte Ltd on 28 December 2007. UDL’s primary business is in the building of ships, tankers and other ocean-going vessels.

Jurong Town Corporation (“JTC”) is the defendant in S502 and the plaintiff in S98. JTC is a statutory body established under the Jurong Town Corporation Act (Cap 150, 1998 Rev Ed).

Economic Development Board of Singapore (“EDB”) is the defendant in S156. EDB is a statutory body established under the Economic Development Board Act (Cap 85, 2012 Rev Ed).

Background

By way of a lease agreement dated 6 March 1981 (“the Lease”), the land at 3 Benoi Road, Singapore 629877 (“the Premises”) was leased to a company known as UDL Shipbuilding (S) Pte Ltd (“UDL Shipbuilding”).¹ Sometime in 1996, UDL Shipbuilding went into receivership.² At the end of 1998, UDL (then known as Denlane), which was an associate company of UDL Shipbuilding, secured an agreement with the mortgagee, Oversea-Chinese Banking Corporation, to purchase the interest under the mortgage and take over the Lease (subject to JTC’s approval).³ On 12 July 1999, JTC gave its in-principle approval to the proposed transfer, subject to certain conditions including undertaking liability for unpaid and outstanding rent in respect of the Premises.⁴ Formal approval was granted by JTC on 20 October 1999. ⁵

The Lease was to expire on 1 January 2002 and UDL applied for it to be renewed. By way of a letter dated 9 December 2002, JTC made an offer to UDL to renew the Lease for a further term of nine years from 1 January 2002⁶. On 8 September 2003, UDL wrote to JTC, confirming acceptance of the terms and conditions of the offer letter of 9 December 2002.⁷ On 9 December 2003, JTC wrote to inform UDL that the renewal of the Lease had been approved.⁸ The lease was to run for nine years, from 1 January 2002 to 31 December 2010.

Leung Yat Tung (“Leung”), managing director of UDL, gave evidence that around 2004, he gathered from “market talk”⁹ that JTC had plans to redevelop waterfront sites in the area where the Premises was situated. He understood that existing tenants, including UDL, would not have their leases renewed upon expiry. Therefore, UDL decided to sell the remainder of the Lease and found a potential purchaser in Kim Hock Corporation (“Kim Hock”). A conditional sale and purchase agreement for the Lease was entered into with Kim Hock on 14 January 2005 at the price of $3,200,000. The agreement was made subject to the requisite approval from JTC for the transfer of the balance of the Lease. On 18 January 2005, UDL’s solicitors wrote to JTC requesting JTC’s approval.¹⁰ However on 18 March 2005, UDL wrote to JTC advising that the sale and purchase agreement between UDL and Kim Hock had been rescinded. The events leading to this rescission form the core of the dispute in this case.

The disputed facts UDL’s evidence

Sometime in late February 2005, a few weeks after the conditional sale and purchase agreement with Kim Hock was signed, Leung was informed that an EDB officer was trying to contact him and had requested a return call. Accordingly, he called and made contact with Sidat Senanayake (“Sidat”), a Senior Officer of the EDB, handling Oil and Gas and Alternative Energy matters.

In his several affidavits, Leung’s versions of events varied somewhat. Although it may be expected that he would flesh out the details of the conversation between him and Sidat, there were conflicts in terms of what had transpired. The statement of claim (“SOC”) in S502 and S156 asserted that Sidat had told Leung during their very first phone conversation in late February 2005 that EDB had learnt from JTC of UDL’s decision to dispose of the remainder of the Lease. Sidat asked for the reason. Leung replied that UDL’s decision was based on its understanding that the waterfront area was to be redeveloped and that the Lease would not be extended beyond 31 December 2010. Leung claimed that Sidat then made the following representations (as set out in para 8 of the SOC in S502):

… as a yet to be published policy, [JTC] had decided to postpone the redevelopment of the area and would grant extensions of 20 years for the yards in the area including the Premises. Given this new development, [Sidat] requested that [UDL] reconsider the Potential Sale and to maintain their business in Singapore

I shall refer to these representations as the “Alleged Representations”.

Leung then asked Sidat for clear confirmation that the Lease for the Premises would be available for an extension of 20 years. Both SOCs in S502 and S156 continued the narrative with a description of the first meeting with Sidat in early March 2005 during which Sidat repeated the Alleged Representations and assured Leung that he had checked and confirmed this matter with JTC. Sidat further stated that EDB would render the necessary assistance to procure the extension of the Lease and that UDL should therefore withdraw from the sale to Kim Hock.

This version was reaffirmed in Leung’s affidavit in S502 filed on 16 September 2010 (“the 16 September 2010 Affidavit”) in support of an interim injunction. In that affidavit, Leung repeated the position in the SOC that Sidat had represented to him that JTC had postponed redevelopment plans and were prepared to grant extensions to leases in the area. Leung fleshed out the conversation between them in the following manner at para 7.7:

I told [Sidat] that [UDL] needed certainty and asked him to reconfirm the correctness of the [Alleged Representations]. He told me that what he had told me was correct but he would nevertheless reconfirm the position with [JTC] and then speak to [UDL] again. I told him that [UDL] would await the outcome of his discussions with [JTC]. I was quite happy when I heard this and felt re-assured as the EDB is a reputable Statutory Authority and who, from [UDL’s] previous extension application process experience from 2000 to 2002, worked very closely with [JTC].

Leung went on to state that Sidat called him again sometime in March 2005 to state that he had checked with JTC and repeated the representations about the postponement of redevelopment and possibility of a 20-year lease extension. He said that on 13 April 2005 he met with Sidat (in the 16 September 2010 Affidavit, this would be the first meeting with Sidat). He told Sidat that following his assurances about the renewal of the Lease, UDL had called off the sale to Kim Hock. He asked Sidat whether the Lease could be renewed immediately, given that there were another five and a half years left. Sidat responded that JTC was aware of this and he did not foresee any difficulty for a renewal. Leung then asked Sidat to confirm this in writing. This confirmation came, after several reminders, by way of an email¹¹ from Sidat dated 26 May 2005 which states as follows:

Dear Mr Leung,

my apologies for not responding sooner.

We have discussed the matter with JTC, who is agreeable to consider such a conditional extension for UDL.

This is subject to EDB’s support and we would therefore look forward to receiving a proposal from UDL on your proposed plans for the site.

Jen Siang has returned from his overseas travels, so you can follow-up on this directly with him.

thank you & best regards

sidat

“Jen Siang” refers to Kong Jen-Siang (“Kong”), an EDB officer in the logistics and transport cluster handling maritime and land transport matters, who was Sidat’s colleague in EDB. Sidat was no longer involved in the matter after this email.

The main differences between the version in Leung’s 16 September 2010 Affidavit and the SOCs are that there were two phone conversations between Leung and Sidat (as opposed to one in the SOC) and they met for the first time on 13 April 2005 (as opposed to March 2005).

Leung filed another affidavit on 2 November 2010 (“the 2 November 2010 Affidavit”) in originating summons no 1133 of 2010 in an application under O 53 r 5 of the Rules of Court (Cap 322, R5, 2006 Rev Ed) for an order to quash the decision of JTC to refuse extension of the Lease. This affidavit repeated the version in his 16 September 2010 Affidavit.

Leung filed a further affidavit in this consolidated suit, dated 11 June 2012 (“11 June 2012 Affidavit”). This essentially repeated the version in the two earlier affidavits except that Leung added that, after the second phone conversation in March 2005, he “continued to correspond via email” with Sidat.

In his affidavit evidence-in-chief (“AEIC”), a different version emerged in relation to the sequence of events. Leung deposed that in the first phone call, Sidat had only stated that EDB had learnt of the sale to Kim Hock and wanted to meet to discuss this issue. Sidat did not make the Alleged Representations during that conversation. Leung agreed to meet and Sidat, along with a colleague, turned up at UDL’s office at the Premises sometime in late February or early March 2005. It was at this meeting that Sidat had made the Alleged Representations on postponement of redevelopment and the possibility of lease extension. Sidat asked for the reason for the sale to Kim Hock. Leung was surprised that EDB had learnt of this as well as their unsolicited involvement. He asked Sidat the reason for the intervention by EDB. Sidat explained that EDB wanted to know if the sale was due to a decision by UDL to withdraw from Singapore or for some other reason. This was because it was EDB’s role to promote and...