SMRT Alpha Pte Ltd v Strait Colonies Pte Ltd: Misrepresentation & Breach of Lease Agreement

In SMRT Alpha Pte Ltd v Strait Colonies Pte Ltd, the High Court of Singapore heard a case regarding a breach of lease agreement and a counterclaim of misrepresentation. SMRT Alpha sued Strait Colonies for failing to pay rent for premises at Kallang Wave Mall. Strait Colonies counterclaimed, alleging that SMRT Alpha had induced them into the lease agreement through misrepresentations regarding live entertainment, operating hours, catering, and take-out services. The court (Chua Lee Ming J) found that Strait Colonies had proven misrepresentation regarding live entertainment but had affirmed the lease agreement and failed to prove damages. The court gave judgment for SMRT Alpha for outstanding rent, interest, and damages, and awarded Strait Colonies nominal damages of $5,000 on its counterclaim.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Judgment for Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

SMRT Alpha sued Strait Colonies for unpaid rent. Strait Colonies counterclaimed, alleging misrepresentation. The court found misrepresentation but ruled Strait Colonies affirmed the lease, awarding judgment to SMRT Alpha.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Strait Colonies Pte LtdDefendantCorporationNominal damages awardedPartial
SMRT Alpha Pte LtdPlaintiffCorporationJudgment for PlaintiffWon

3. Judges

Judge NameTitleDelivered Judgment
Chua Lee MingJudgeYes

4. Counsels

Counsel NameOrganization
Chow Jian HongMirandah Law LLP
Suhami Bin LazimMirandah Law LLP
Wah Hsien-Wen TerenceDentons Rodyk & Davidson LLP
Chew Di Shun DicksonDentons Rodyk & Davidson LLP
Ling Tien WahDentons Rodyk & Davidson LLP

4. Facts

  1. SMRT Alpha leased premises at Kallang Wave Mall to Strait Colonies for a pub and F&B business.
  2. The lease agreement permitted live music and dance.
  3. URA initially granted permission for a restaurant with an ancillary bar, not a pub.
  4. Strait Colonies alleged misrepresentations regarding live entertainment, operating hours, catering, and take-out.
  5. Strait Colonies took possession, carried out fitting works, and commenced business.
  6. Strait Colonies failed to pay rent, leading to termination of the lease by SMRT Alpha.
  7. URA later granted permission for ancillary live entertainment, subject to review.

5. Formal Citations

  1. SMRT Alpha Pte Ltd v Strait Colonies Pte Ltd, Suit No 1080 of 2015, [2017] SGHC 243

6. Timeline

DateEvent
Strait Colonies submitted a concept proposal and business budget plan.
SMRT Alpha gave Strait Colonies a letter of offer for the lease of units.
Temporary Occupation Permit for the Sports Hub was issued.
Strait Colonies accepted the letter of offer.
SMRT Alpha and Strait Colonies entered into a lease agreement.
SMRT Alpha applied for planning permission to change the use of the Premises.
URA advised SMRT Alpha that it could not support the proposal.
URA granted planning permission to change the use of the Premises.
SMRT Alpha informed Strait Colonies of the URA’s decision.
Alleged settlement agreement date.
SMRT Alpha gave Strait Colonies notice to take possession of the Premises.
Strait Colonies took possession of the Premises.
Strait Colonies informed SMRT Alpha that the URA was willing to approve the Premises for use as a restaurant with ancillary bar and ancillary live entertainment.
Strait Colonies obtained a liquor licence from the Police Licensing & Regulatory Department.
Strait Colonies officially commenced business at the Premises.
SMRT Alpha gave the consent and undertaking that was required by the URA.
URA gave its formal planning permission for the Premises to be used as a restaurant with ancillary bar and ancillary live entertainment.
PLRD revised the operating hours for the liquor licence.
Strait Colonies’ restaurant, bar and club on the Premises was fully operational.
Strait Colonies paid the balance of the rent for December 2014.
SMRT Alpha issued a supplemental letter to the LOO and the Lease Agreement.
SMRT Alpha demanded payment of the outstanding rent.
Strait Colonies informed SMRT Alpha that it had decided to terminate the lease for the part of the Premises that was used to operate the bar.
Strait Colonies informed SMRT Alpha that it was waiting for payment of its GST claim.
Strait Colonies made partial payment of $64,143.16 towards the outstanding rent.
Strait Colonies confirmed that it was not terminating the lease for the part of the Premises used to operate the bar.
The arrears in rent amounted to $412,508.96.
SMRT Alpha received a cheque dated 20 June 2015 for $10,000 from Strait Colonies as partial payment of the outstanding rent.
SMRT Alpha’s solicitors issued a notice of forfeiture.
SMRT Alpha and Strait Colonies met to negotiate the dispute.
Strait Colonies decided to cease its operations by vacating the Premises.
SMRT Alpha re-entered and repossessed the Premises.
SMRT Alpha found a new tenant to take over the lease of the Premises.
Trial began.
Judgment was delivered.

7. Legal Issues

  1. Misrepresentation
    • Outcome: The court found that the plaintiff made an implied misrepresentation regarding planning permission for live entertainment but the defendant affirmed the lease agreement.
    • Category: Substantive
    • Related Cases:
      • [1978] 1 WLR 1128
      • [1985] Ch 475
  2. Breach of Contract
    • Outcome: The court held that the defendant breached the lease agreement by failing to pay rent.
    • Category: Substantive
  3. Affirmation of Contract
    • Outcome: The court held that the defendant affirmed the lease agreement by taking possession of the premises, carrying out fitting works, commencing business, and paying rent.
    • Category: Substantive
    • Related Cases:
      • [1985] Ch 475
      • [2006] 3 SLR(R) 374
      • [2005] 1 SLR(R) 339
      • [2005] 3 SLR(R) 283

8. Remedies Sought

  1. Outstanding Rental
  2. Damages
  3. Rescission of Contract
  4. Setting Aside of Lease Agreement

9. Cause of Actions

  • Breach of Contract
  • Misrepresentation

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Hospitality
  • Real Estate

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Laurence and another v Lexcourt Holdings LtdEnglish Court of AppealYes[1978] 1 WLR 1128England and WalesCited to support the argument that by offering to lease the Premises to the defendant and permitting the Premises to be used as a pub with live entertainment, the plaintiff had made an implied representation that there was planning permission for such use during the duration of the lease.
Peyman v LanjaniEnglish Court of AppealNo[1985] Ch 475England and WalesCited regarding the principle that a party must know of their right to rescind a contract and choose not to exercise it to be considered to have affirmed the contract. The court ultimately disagreed with the principle in this case.
The Pacific VigorousSingapore High CourtYes[2006] 3 SLR(R) 374SingaporeCited as applying the principle from Peyman v Lanjani that a party must know of their right to rescind a contract and choose not to exercise it to be considered to have affirmed the contract.
Wishing Star Ltd v Jurong Town CorpSingapore High CourtYes[2005] 1 SLR(R) 339SingaporeCited as applying the principle from Peyman v Lanjani that a party must know of their right to rescind a contract and choose not to exercise it to be considered to have affirmed the contract.
Jurong Town Corp v Wishing Star LtdCourt of AppealNo[2005] 3 SLR(R) 283SingaporeCited to show that the Court of Appeal did not opine affirmatively on the point of whether knowledge of the right to rescind was required for affirmation of a contract.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Lease Agreement
  • Misrepresentation
  • Live Entertainment
  • Kallang Wave Mall
  • Sports Hub
  • Planning Permission
  • Affirmation
  • Rent
  • URA
  • Liquor Licence

15.2 Keywords

  • lease agreement
  • misrepresentation
  • contract law
  • singapore
  • commercial dispute
  • real estate
  • rent
  • damages

17. Areas of Law

Area NameRelevance Score
Misrepresentation90
Rescission85
Contract Law80
Breach of Contract75
Damages60

16. Subjects

  • Contract Law
  • Misrepresentation
  • Lease Agreement
  • Commercial Law