Three trustees of the Beauty World Food Centre have gone to court asking for the power to sell the property, after a potential $17.5 million collective sale hit a snag when four stall owners opposed it.
Their High Court application was heard in chambers yesterday but adjourned to Oct 24 for further hearing as the judge wanted more information about the transaction.
The food centre, which occupies the fourth floor of the strata-titled Beauty World Centre in Bukit Timah, comprises 41 food stalls but the title of the property is contained in a single strata certificate.
Last year, through broker PropNex Realty, a potential buyer expressed interest in the centre, built in the 1980s, for $17.5 million.
According to court documents seen by The Straits Times, the interested buyer paid the trustees $175,000 for an option to purchase the centre. The option money was then distributed to the stall owners but four of them, who together own six stalls, rejected their shares because they were against the sale.
As consensus was not reached, the transaction was put off until the court decides whether the three trustees have the power to sell the food centre.
The three - Mr Lai Chong Lee, Mr Tan Kock Meng and Mr Tan Han Soong - were appointed by the management committee of the Beauty World Centre Merchants Association in 2009 to replace the original two trustees.
The trust arrangement originated in 1998, when the food stall operators wanted to buy over their respective stalls. As there were too many intended buyers, lawyers handling the case devised a scheme for two trustees to buy the property on behalf of all the operators.
The intention then was for the centre to be subdivided into 41 lots, but this was eventually aborted for technical reasons.
In a joint affidavit, the trustees, who are also stall operators, said most of the owners are in their late 60s or 70s, and wish to retire from the business, which is getting increasingly stressful.
They said that in the last few years, most of the stall owners had been in favour of a collective sale, as the only financially feasible way for them to retire was by converting their investment into cash.
The trustees said they found an interested buyer in February last year who was prepared to pay for an option to purchase the property despite knowing that not all the stall owners were in favour of the sale.
Through their lawyer, Mr Jimmy Yap, the trustees are asking the court to enable them to go ahead with the sale, even though trust documents neither spell out nor imply that they have the power to sell the property.