THE lawsuit against the owners of Horizon Towers has been put on the backburner for now, after they extended the deadline for the estate’s collective sale.
The consortium behind the suit, led by developer Hotel Properties (HPL), had the High Court hearing adjourned yesterday.
Its move followed a decision by the owners last week to extend the sale deadline until Dec 11 - a move that has taken some of the heat out of the stand-off, although another legal challenge looms today based on the initial sale process.
The consortium - comprising HPL, Morgan Stanley Real Estate-managed funds and Qatar Investment Authority - signed a deal in February to buy the 99-year leasehold Leonie Hill estate for $500 million. But some owners complained that the price was too low, and their mounting opposition culminated in the Strata Titles Board (STB) throwing out the sale deal, albeit over procedural errors, on Aug 3.
That decision comes under scrutiny today, with the owners asking the High Court to overturn the STB ruling.
The consortium has also filed an affidavit asking that it be allowed to participate in the appeal hearing.
If the appeal succeeds, the STB might have to reassess the Horizon Towers deal. If the STB’s original decision is allowed to stand, it could spell the end of the sale.
The stakes are high. The HPL-led group, represented by law firm Allen & Gledhill, claims that the owners of 177 units who backed the deal have breached the sale contract. It has sued the sellers for $800 million to $1 billion in lost profits arising from the alleged breach. This means that if a sale is not eventually completed - under the original terms - the owners of each unit would have to cough up more than $5 million.
The consortium had indicated that it would drop the case once the sale goes through at the $500 million price. The deadline extension has raised hopes that this might be achieved as it would allow any errors to be corrected and a fresh application to be filed.
Source : Straits Times - 28 Sep 2007
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