http://www.businesstimes.com.sg/arch...t-row-20131024

Published October 24, 2013

Tuan Sing unit drawn into Gilstead Court row

Three members of sale committee claim breach of contract over an offer

By andrea soh [email protected]


TUAN Sing Holdings' wholly-owned subsidiary Dillenia Land - embroiled in an escalating dispute between owners of Gilstead Court units over a collective sale - yesterday said that it would defend its legal position and reputation "vigorously".

It will also "seek redress for all costs and damages", the group said in an announcement to the Singapore Exchange (SGX).

Three members of the seven-man sale committee of Gilstead Court had last Wednesday applied for the High Court to approve the collective sale of the Newton estate to Dillenia Land.

The Strata Titles Board (STB) had placed a stop order on the deal after mediation failed. Tuan Sing said then: "The company understands that efforts in mediation at STB between the vendors' representative and the non-consenting vendors have not been successful."

The three members alleged in their application that Dillenia Land had breached the contract by offering to pay up to $135,000 to relieve dissenting owners of their liability under the penalty clauses so that they would withdraw their objections to the sale.

They are therefore claiming as "liquidated damages" about $15 million from Dillenia Land.

The penalty clauses of the collective sale agreement had been the cause of the dispute.

Under these clauses, the 43 owners who had consented to the sale would each contribute $2,000 to a common fund for expenses from the sale effort. This would be refunded with 12 per cent interest after the completion of the sale.

However, the five dissenting owners would have $4,000 deducted from their share of the sale proceeds. This amount would be shared equally among the 43 consenting sellers.

The five owners would also have to pay for all costs related to the STB approval proceedings - normally borne by all owners.

These clauses would cost each of the five owners up to $26,000 each, leading them to file an objection with STB.

Responding to the suit which Tuan Sing said has not yet been served on Dillenia Land, the firm denies that it has breached the contract by offering $135,000.

"The offer was made to the sale committee, acting for all owners of Gilstead Court," it said. This offer lapsed after Oct 1.

Before the latest development, four of the seven-man committee, including one of the three involved in the suit last Wednesday, had applied to the High Court on Oct 7 to remove the "offensive clauses", if the dissenting owners sign the sales agreement.

They also want the court to declare any offer by Dillenia Land to contribute to the liability of dissenting owners "permissible".

Dillenia Land was not listed as a defendant in this earlier suit.

Tuan Sing Holdings had successfully tendered for the site in June at $150.168 million. The collective sale of Gilstead Court had been brokered entirely by the sales committee instead of by a property firm, as is usually the case.