http://www.straitstimes.com/Money/St...ry_778508.html

ARA applies to suspend payment on Grange units

Published on Mar 17, 2012


A group of funds managed by ARA Asset Management filed a suit last year against Grange Properties, the developer of Grange Infinite, saying the units they had bought there were not as posh as advertised. -- ST PHOTO: CAROLINE CHIA

By Yasmine Yahya


A GROUP of investors that bought 53 units at upscale condominium Grange Infinite is seeking to suspend further payments on the purchase until its case against the developer is resolved.

The developer - Grange Properties, an associated company of developer Chip Eng Seng - is resisting the application.

The investors - a group of funds managed by ARA Asset Management - took Grange Properties to court last year, claiming that the units they bought were not as luxurious, stylish or elegant as had been promised.

They have now applied for the High Court to order that their remaining payment be 'suspended, deferred and/or postponed until the disposal of the suit'.

Alternatively, they have requested that any outstanding payments they make be held by Grange Properties' lawyers until the suit is resolved.

Further, they have requested that, if their outstanding payments still have to be made to Grange Properties, the court grant an injunction restraining the developer or its agents from 'withdrawing, departing with, selling, charging or in any other way dealing with or disposing of' the money or properties involved.

Grange Properties has been chasing ARA for payment of $37.6 million - 13 per cent of the total purchase price - since Jan 13.

On Feb 23, Grange Properties issued a 21-day notice with respect to two of the units that ARA had purchased - one on the 20th floor, the other on the 36th.

This notice was a warning to ARA that if it did not make the necessary payment by March 15, Grange Properties would be entitled to exercise its rights to resell these units.

ARA argued in its application that Grange Properties might transfer the monies out from the resale of the units and might not be in a financial position to pay any damages awarded to ARA in the suit.

However, Grange Properties has countered that this argument is inconsistent with ARA's own pleaded case that it lost potential buyers and tenants because the units were poorly built.

'Based on the plaintiffs' pleaded case in the suit, the defendants should have difficulties reselling the units, and they would be incurring a huge risk by repossessing the two units,' wrote Grange Properties shareholder Ivan Lim in an affidavit.

ARA had also not shown any evidence that there was a real risk Grange Properties might transfer out monies in order to deprive ARA of any damages it might be awarded, Mr Lim added.

Indeed, he wrote, Grange Properties had the money to pay damages, as one of its shareholders is CEL Development, a listed construction firm with revenues of $360 million last year.