Soup Restaurant v Y.E.S. F&B: Sub-Lease Termination Dispute
In a dispute between Soup Restaurant Singapore Pte Ltd and Y.E.S. F&B Group Pte Ltd, the High Court of Singapore addressed the issue of whether a sub-lease agreement was terminated by the effluxion of time. Soup Restaurant, the plaintiff, claimed that the sub-lease expired when its head lease with the landlord terminated. Y.E.S. F&B Group, the defendant, argued that the sub-lease was automatically renewed or renewable at their option. The court, presided over by Edmund Leow JC, ruled in favor of Soup Restaurant, holding that the sub-lease terminated when the head lease expired on 18 October 2012. The court found that a new head lease was entered into, and the terms of the 'renewed' sub-lease were unclear. The court allowed the plaintiff's claim for damages, to be assessed at a separate hearing.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
The High Court ruled that a sub-lease agreement between Soup Restaurant and Y.E.S. F&B terminated when the head lease expired, rejecting arguments for automatic renewal.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| SOUP RESTAURANT SINGAPORE PTE LTD (FORMERLY KNOWN AS SOUP RESTAURANT (CAUSEWAY POINT) PTE LTD) | Plaintiff | Corporation | Claim Allowed | Won | Edwin Tong, Kenneth Lim Tao Chung, Chua Xinying, Lee May Ling |
| Y.E.S. F&B GROUP PTE LTD | Defendant | Corporation | Claim Dismissed | Lost | Tan Gim Hai Adrian, Loh Jien Li, Ong Pei Chin, Lim Siok Khoon |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Edmund Leow | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Edwin Tong | Allen & Gledhill LLP |
| Kenneth Lim Tao Chung | Allen & Gledhill LLP |
| Chua Xinying | Allen & Gledhill LLP |
| Lee May Ling | Allen & Gledhill LLP |
| Tan Gim Hai Adrian | Stamford Law Corporation |
| Loh Jien Li | Stamford Law Corporation |
| Ong Pei Chin | Stamford Law Corporation |
| Lim Siok Khoon | Stamford Law Corporation |
4. Facts
- Plaintiff and defendant entered into a sub-lease agreement for a portion of a unit at VivoCity.
- The sub-lease agreement stated that it would survive as long as the plaintiff’s lease with the Landlord was not terminated.
- The plaintiff’s head lease with the Landlord commenced on 19 October 2009 and had a term of three years.
- The head lease terminated by effluxion of time on 18 October 2012.
- The plaintiff entered into a new lease with the Landlord on 26 November 2012 with materially different terms.
- The defendant argued that the sub-lease was automatically renewed when the head lease was renewed.
- The court found that the terms of the renewed sub-lease were unclear, particularly regarding the rent payable and duration.
5. Formal Citations
- Soup Restaurant Singapore Pte Ltd (formerly known as Soup Restaurant (Causeway Point) Pte Ltd) v Y.E.S. F&B Group Pte Ltd, Suit No 1073 of 2013, [2014] SGHC 246
6. Timeline
| Date | Event |
|---|---|
| Defendant obtained a lease at #02-137/138, 1 Harbourfront Walk, VivoCity. | |
| Defendant started operating its restaurant, Dian Xiao Er, at the leased premises. | |
| The leasing manager of VivoCity offered the defendant an opportunity to lease unit #02-141. | |
| Plaintiff leased the Unit from the Landlord (Head Lease). | |
| Plaintiff agreed to sub-let approximately 742 square feet of the Unit to the defendant (Sub-Lease Agreement). | |
| The founders of the defendant brought a minority oppression action against the plaintiff. | |
| Settlement agreement was reached where Eliza and Yik would buy out the plaintiff’s majority stake for $7,901,900. | |
| Defendant wrote to the Landlord proposing a merger of the Sub-Lease Area and Neighbouring Unit. | |
| Landlord replied that it did not agree to the proposed merger. | |
| Landlord offered to renew the plaintiff’s lease. | |
| Plaintiff accepted the Landlord's offer to renew the lease. | |
| Plaintiff informed the defendant to deliver vacant possession of the Sub-Lease Area by 6 October 2012. | |
| Head Lease terminated by effluxion of time. | |
| Lease agreement was confirmed (2nd Head Lease). | |
| Plaintiff brought an action against the defendant claiming damages and possession of the Sub-Lease Area. | |
| Plaintiff’s application for bifurcation was granted. | |
| Defendant made an offer to hand over the Sub-Lease Area to the plaintiff. | |
| Plaintiff accepted the defendant's offer. | |
| Yik filed a supplementary affidavit. | |
| Judgment reserved. |
7. Legal Issues
- Termination of Sub-Lease Agreement
- Outcome: The court held that the sub-lease agreement was terminated by effluxion of time on 18 October 2012.
- Category: Substantive
- Sub-Issues:
- Effluxion of time
- Automatic renewal of lease
- Interpretation of contract terms
- Related Cases:
- [1944] KB 368
- Contractual Interpretation
- Outcome: The court interpreted the sub-lease agreement based on the objective intentions of the parties, considering the commercial context.
- Category: Substantive
- Sub-Issues:
- Intention of parties
- Commercial purpose of transaction
- Back-to-back arrangement
- Related Cases:
- [2008] 3 SLR(R) 1029
8. Remedies Sought
- Damages
- Possession of Sub-Lease Area
9. Cause of Actions
- Breach of Contract
- Wrongful Possession
10. Practice Areas
- Commercial Litigation
- Real Estate Law
11. Industries
- Food and Beverage
- Real Estate
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Lace v Chantler | English Court of Appeal | No | [1944] KB 368 | England and Wales | Cited for the principle that a lease must have certainty of duration to be valid. |
| Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd | Singapore Court of Appeal | Yes | [2008] 3 SLR(R) 1029 | Singapore | Cited for the principle of contractual interpretation, emphasizing the objective ascertainment of the parties’ intentions and the overall commercial purpose of the transaction. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Sub-lease
- Head Lease
- Effluxion of Time
- Termination
- Renewal
- Back-to-back arrangement
- Vacant Possession
15.2 Keywords
- sublease
- lease termination
- contract interpretation
- commercial lease
- property law
- Singapore High Court
16. Subjects
- Lease Agreements
- Contract Law
- Commercial Property
- Landlord and Tenant Law
17. Areas of Law
- Land Law
- Contract Law
- Lease Agreements
- Sub-leases