SINGAPORE : Supermarket chain operator Sheng Siong
is locked in a court battle with Carilla Pte Ltd over a botched
tenancy agreement.
Sheng Siong had planned to covert a three-storey
building in Kallang Bahru into a supermarket and a food court after
signing a lease agreement with Carilla in March
2009.
It also put down a S$450,000 security deposit to
lease the building, formerly known as Mandarin Theatre, for eight
years.
Sheng Siong was also expected to pay S$112,000 per month in the
first year of the lease.
In April 2009, HDB rejected the supermarket proposal as it did not
want to intensify the competition for the existing industry, though
the food court proposal was allowed by the authorities.
An appeal made by Carilla to HDB was also turned down in June
2009.
Sheng Siong then sued Carilla for a return of the deposit as well
as the legal fees incurred during the lease proceedings.
At the opening of case in the High Court on Monday, Sheng Siong's
lawyers Willie Yeo and Lim Chee San argued that the contract made
between the parties is a conditional agreement where Carilla must
first obtain approval from HDB before granting the lease.
They also said that it was Carilla's duty to obtain permission from
the authorities on the change in use of premises and that the
signed agreement had been amended without their knowledge.
In response, Carilla's lawyer Marina Chin said the lease agreement
was not subject to approval of the building's usage.
Carilla counter-claimed that Sheng Siong failed to obtain
permission from the authorities for a supermarket, and did not
propose alternatives - hence the forfeiture of the security deposit
paid by Sheng Siong.
The hearing continues on Tuesday.
- CNA/al