Daisho Development v Architects 61: Negligent Misrepresentation in Hotel Sale

Daisho Development Singapore Pte Ltd sued Architects 61 Pte Ltd in the High Court of Singapore, alleging negligent misrepresentation regarding the usage restrictions of facilities at the Westin Hotel, which Daisho purchased from Asia Square Tower 2 Pte Ltd. Daisho claimed that Architects 61, the project architect, had advised Asia Square Tower 2 that public access to certain facilities was permissible, which was then impliedly conveyed to Daisho, leading to a higher purchase price. Justice Tan Siong Thye dismissed Daisho's claim, finding that Architects 61 did not owe a duty of care to Daisho, and that Daisho failed to prove that Architects 61 provided the alleged advice or that Daisho relied on it.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Claim Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Daisho Development sued Architects 61 for negligent misrepresentation regarding hotel facility usage restrictions. The court dismissed the claim, finding no duty of care.

1.7 Decision Date

20 January 2020

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Daisho Development Singapore Pte Ltd	Plaintiff	Corporation	Claim Dismissed	Dismissed	Gabriel Peter of Gabriel Law Corporation Loh Jia Le of Gabriel Law Corporation Loshini d/o Shanker of Gabriel Law Corporation
Architects 61 Pte Ltd	Defendant	Corporation	Judgment for Defendant	Won	Kishan Pillay s/o Rajagopal Pillay of TSMP Law Corporation Thio Shen Yi of TSMP Law Corporation Thara Rubini Gopalan of TSMP Law Corporation Tan Yan Ting Tanya of TSMP Law Corporation

3. Judges

Judge Name	Title	Delivered Judgment
Tan Siong Thye	Judge	Yes

4. Counsels

Counsel Name	Organization
Gabriel Peter	Gabriel Law Corporation
Loh Jia Le	Gabriel Law Corporation
Loshini d/o Shanker	Gabriel Law Corporation
Kishan Pillay s/o Rajagopal Pillay	TSMP Law Corporation
Thio Shen Yi	TSMP Law Corporation
Thara Rubini Gopalan	TSMP Law Corporation
Tan Yan Ting Tanya	TSMP Law Corporation

4. Facts

Daisho bought the Westin Hotel from Asia Square Tower 2 Pte Ltd for approximately $469 million.
Daisho alleged Asia Square Tower 2 made a false misrepresentation about public access to hotel facilities.
Architects 61 was the project architect for the Hotel.
Urban Redevelopment Authority stipulated certain hotel facilities were not accessible to the public.
Asia Square Tower 2 provided letters of undertaking to the Urban Redevelopment Authority regarding usage restrictions.
Daisho claimed it was unaware of the usage restrictions before purchasing the Hotel.
The Hotel facilities have been open to the public since 2013, despite the usage restrictions.

5. Formal Citations

Daisho Development Singapore Pte Ltd v Architects 61 Pte Ltd, Suit No 585 of 2017, [2020] SGHC 16

6. Timeline

Date	Event
2008-04-01	Architects 61 Pte Ltd appointed as architect for the project.
2009-03-01	MGP Kimi Pte Ltd renamed Asia Square Tower 2 Pte Ltd.
2009-07-01	Planning permission granted by the Urban Redevelopment Authority.
2010-10-14	Asia Square Tower 2 Pte Ltd provided the first letter of undertaking to the Urban Redevelopment Authority.
2013-03-27	Asia Square Tower 2 Pte Ltd provided the second letter of undertaking to the Urban Redevelopment Authority.
2013-05-10	Asia Square Tower 2 Pte Ltd provided the third letter of undertaking to the Urban Redevelopment Authority.
2013-07-01	Daisho Development Singapore Pte Ltd expressed interest in buying a five star hotel in Singapore.
2013-10-10	Final grant of written permission issued by the Urban Redevelopment Authority.
2013-10-01	Daisho Development Singapore Pte Ltd began conducting due diligence on the Hotel.
2013-11-04	Draft budget circulated to Daisho Development Singapore Pte Ltd.
2013-12-11	WongPartnership LLP issued its legal due diligence report.
2013-12-15	Daisho Development Singapore Pte Ltd's representatives toured the Hotel.
2013-12-16	Asia Square Tower 2 Pte Ltd sold the Hotel to Daisho Development Singapore Pte Ltd.
2014-05-14	Certificate of Statutory Completion for the Development obtained.
2014-11-01	Daisho Development Singapore Pte Ltd commenced arbitration against Asia Square Tower 2 Pte Ltd.
2016-06-01	Tribunal issued the award dismissing Daisho Development Singapore Pte Ltd's claims.
2017-06-01	Daisho Development Singapore Pte Ltd started suit against Architects 61 Pte Ltd.
2019-11-04	Trial began.
2019-12-06	Trial concluded.
2020-01-21	Judgment reserved.

7. Legal Issues

Negligent Misrepresentation
- Outcome: The court found that Architects 61 did not owe a duty of care to Daisho and did not provide negligent advice.
- Category: Substantive
- Related Cases:
  - [2007] 4 SLR(R) 100
Duty of Care
- Outcome: The court held that Architects 61 did not owe a duty of care to Daisho as a subsequent purchaser of the property.
- Category: Substantive
- Related Cases:
  - [2007] 4 SLR(R) 100
Causation
- Outcome: The court found that Daisho failed to establish causation between Architects 61's alleged advice and Daisho's loss.
- Category: Substantive

8. Remedies Sought

Monetary Damages

9. Cause of Actions

Negligent Misrepresentation

10. Practice Areas

Commercial Litigation
Construction Law

11. Industries

Hospitality
Construction

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
BNX v BOE	High Court	Yes	[2017] SGHC 289	Singapore	Cited for the High Court's dismissal of Daisho's application to set aside the arbitral award and striking out of Suit 1097 against AST2.
BNX v BOE and another appeal	Court of Appeal	Yes	[2018] 2 SLR 215	Singapore	Cited for the Court of Appeal's dismissal of the Fresh Evidence Applications.
Spandeck Engineering (S) Pte Ltd v Defence Science & Technology Agency	Court of Appeal	Yes	[2007] 4 SLR(R) 100	Singapore	Cited for the principles to establish a duty of care.
Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric	High Court	Yes	[2007] 1 SLR(R) 853	Singapore	Cited regarding the requirement of reasonable foreseeability from a factual perspective.
Sutherland Shire Council v Heyman	N/A	Yes	(1985) 60 ALR 1	N/A	Cited regarding the concept of proximity.
RSP Architects Planners & Engineers (formerly known as Raglan Squire & Partners FE) v MCST Plan No 1075 and anor	N/A	Yes	[1999] 2 SLR(R) 134	Singapore	Cited regarding economic loss arising from negligent construction.
Hunt and others v Optima (Cambridge) Ltd and others	English Court of Appeal	Yes	[2014] EWCA Civ 714	England and Wales	Cited regarding negligent misstatement.
RSP Architects Planners & Engineers v Ocean Front Pte Ltd and another appeal	Court of Appeal	Yes	[1995] 3 SLR(R) 653	Singapore	Cited regarding the concern of opening the floodgates of liability.
Indian Overseas Bank v Cheng Lai Geok	High Court	Yes	[1991] 2 SLR(R) 574	Singapore	Cited regarding the rule of caveat emptor.
Huang Ching Hwee v Heng Kay Pah and another	Court of Appeal	Yes	[1992] 3 SLR(R) 452	Singapore	Cited regarding breaches of planning regulations.

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

Use Restrictions
Hotel GFA
Letter of Undertaking
Due Diligence
Caveat Emptor
Factual Foreseeability
Proximity
Duty of Care
Novus Actus Interveniens

15.2 Keywords

Negligent Misrepresentation
Hotel
Property
Singapore
Architect
Duty of Care
Usage Restrictions

17. Areas of Law

Area Name	Relevance Score
Misrepresentation	90
Negligence	70
Contract Law	50
Construction Law	30

16. Subjects

Tort Law
Real Estate Law
Construction Law
Misrepresentation