Higher Price Not Negotiated Because Of ‘Commission Agreement’, Court Told

Source : TODAY, Thursday , March 20, 2008

THE property agent of a condominium locked in an en bloc tussle had colluded with the potential buyer, and did not seriously negotiate for a higher price because of a “commission agreement”.

So asserted a minority owner of embattled Horizon Towers, and in so doing, Ms Jasmine Tan - who represented herself in the High Court yesterday - applied for the minutes of meetings and correspondences between the consortium and First Tree Properties to be revealed.

The consortium (HPPL) comprises Hotel Properties Limited, Morgan Stanley Real Estate and Qatar Investment Authority.

Ms Tan also asked for documents and minutes of the consortium discussing the $500 million sale price for the development, be revealed. These would show that there was a conflict of interest when First Tree Properties revealed the reserve price to the consortium, failing to “seriously” negotiate for a higher price, she said.

Citing unnamed sources inside the consortium as well as residents, Ms Tan described HPPL as “laughing all the way to the bank” because it was prepared to offer as much as $600 million.

But Justice Choo Han Teck rejected her application.

Two months after the Strata Titles Board (STB) decided that the controversial $500 million sale could proceed, residents and their lawyers met in court again yesterday after its minority owners appealed against the STB’s decision.

The en bloc process for Horizon Towers began in May 2006 and a deal was sealed eight months later. But some majority owners tried to back out of the sale, after seeing how nearby properties, such as Grangeford, had revised their reserve price upwards.

At the height of the wrangle last year, the majority owners managed to stave off a $1-billion lawsuit HPPL had brought against them for loss of profits, when they successfully appealed against the board’s original decision in August to throw out the deal over technical irregularities.

Firing the first salvo in yesterday’s appeal, Senior Counsel Harry Elias, the lawyer for other minority owners, said that the sale committee had not acted in good faith since it “suppressed” a higher offer of $510 million for the estate from a foreign firm. The hearing continues.