HomeNewsGCB Buyer Loses Lawsuit Against Singapore Property Agency
GCB Buyer Loses Lawsuit Against Property Agency

GCB Buyer Loses Lawsuit Against Singapore Property Agency

GCB Buyer Sued Her Property Agency For Negligent Misrepresentation Over Seller's Brochure

Parties involved:

Buyer – Ms Jane Lam (accompanied by her father Mr Patrick Lam)

Buyer’s appointed agent – Mr Darren Teo from Realstar Premier Group

Seller – Not disclosed

Seller’s appointed agent – Mr Gregory Tan

The parties involved, save for the seller, met on December 15, 2021 to view the external compound of the property on Lewis Road in Dalvey Estate GCBA; they were not allowed to access the house. Mr Teo then sent Mr Lam a link to access the soft copy of a brochure comprising a site plan, a map, photographs of the external compound, and a page depicting three potential layouts when the property is redeveloped. The Lams claimed that Mr Teo had also show them a hardy copy of the brochure but Mr Teo disputed this.

After Exercising The Option To Purchase, The GCB Buyer And Her Father Discovered A Drainage Reserve That Cannot Be Redeveloped

Ms Lam offered $18.68 million for the landed property and paid $186,800 for an option to purchase it. The offer was accepted by the seller on the same day. 

On Dec 29, 2021, Ms Lam paid $747,200 to exercise the option to purchase

On Jan 7, 2022, the Lams discovered via an e-mail from their lawyers that there was a drainage reserve of 25.9 sq m, or 278.8 sq ft, on the property.

After checking with their architect, the Lams learnt that the drainage reserve could not be used in any redevelopment.

On Jan 13, 2022, the Lams were allowed inside the house and saw the drainage reserve for the first time.

In her suit, Ms Lam alleged that Mr Teo had made false representations – via the brochure – that the entire land area could be fully redeveloped, as no drainage reserve was indicated on the layouts.

GCB Buyers Are Experienced Property Developers

Ms Lam’s father, Mr Patrick Lam, is the founder of boutique property developer JBE Holdings.

She asserted that Mr Teo had breached his duty of care as a property agent to ensure that the facts affecting the value of the property were represented accurately and truthfully to her, and that Realstar is vicariously liable for his breach.

But Realstar contended that the brochure does not contain the alleged misrepresentation. The agency argued that even if there was misrepresentation, such representation was made by the seller or the seller’s agent. 

Justice Lai disagreed with Ms Lam’s argument that the brochure implied the entire 12,454 sq ft of the property could be used for redevelopment.

The judge considered that Mr Teo had no knowledge of any drainage reserve.

It appeared that even Mr Tan, who had prepared the brochure, was unaware of the drainage reserve, said Justice Lai.

The judge also considered that Mr Teo had simply been asked by Mr Tan to pass on the soft copy of the brochure, and this was done in the presence of the Lams.

She further considered that with their experience in the real estate industry, the Lams would have known that redevelopment layouts are subject to change.

The judge added that a reasonable person in Ms Lam’s position would not have believed that depictions of potential layouts implied that the entire land area will be available for redevelopment.

In her written judgement, Senior Judge Lai Siu Chiu added that in the present case, the property agent’s role was limited to that of a conduit in passing the brochure to her. The agent’s standard of care did not require him to verify the contents of the brochure, said Justice Lai.