Oei Hong Leong wins long-running court fight over redevelopment of Vancouver property

Singapore

SINGAPORE businessman Oei Hong Leong has won a long-running court battle involving one of Canada's largest property developers and a commercial site in the heart of Vancouver.

The case, which began in October 2015, pitted Mr Oei against Concord Pacific Acquisitions, which is part of Concord Pacific Group.

The firm, led by CEO and president Terry Hui, accused Mr Oei and his associated company of breaching an agreement pertaining to the development of the site and acting in bad faith. But after years of legal wrangling, Supreme Court of British Columbia Justice Peter Voith, in a judgment dated July 19, sided with Mr Oei, dismissing Concord's claim in its entirety.

Concord is considering an appeal, its lawyer J Kenneth McEwan said in a statement on Monday. Mr Oei could not immediately be reached for comment.

The dispute revolved around the Plaza of Nations, an entertainment complex in Vancouver that Mr Oei bought for C$40 million in 1989.

By 2015, Mr Oei was looking to develop the site with local partners. Over dinner on May 3 of that year, he told Mr Hui that his "happy price" for the multi-phase redevelopment was C$500 million, according to the judgment. By May 14, and after some other meetings in Singapore, a heads of agreement between the two parties was struck in the business lounge of Hong Kong's Four Seasons Hotel.

It outlined a payment plan for Concord, with C$10 million to be paid to Mr Oei within three business days, C$40 million within 60 business days and a further C$75 million within 14 business days of the site being rezoned.

But over the coming months, negotiations broke down. There were disputes over key details of the redevelopment plan and the C$40 million was never paid to Mr Oei. On Aug 3, 2015, Mr Oei demanded Concord pay the funds by Aug 6 or face legal action. One day after the deadline expired, he commenced legal action.

After negotiations stalled, Concord paid C$40 million into trust rather than to Mr Oei personally, Mr McEwan said in the statement.

"Concord believed that step was commercially reasonable in the circumstances," he said. Mr Oei continues to hold the initial C$10 million payment despite alleging there was no agreement, he said.

Both parties met several times, including over dinners at Mr Hui's house and Vancouver's La Terrazza restaurant, but could not resolve their differences. On Oct 4, Concord was served with a claim over breach of contract in the High Court of Singapore and Mr Oei's brother-in-law told Concord on Oct 21 the original heads of agreement had been terminated.

Nine days later, Concord began its own action in British Columbia that was eventually concluded last Friday in which it claimed Mr Oei had breached an oral agreement not to negotiate with other property developers and to keep the deal confidential. (Mr Oei had met rival real-estate firm Aquilini Investment Group and the family behind that company.)

Concord further claimed that Mr Oei had not negotiated in good faith.

Justice Voith, however, ruled that comments and text messages between the two parties and Mr Oei's open admissions to Mr Hui at several points that he was meeting other firms meant the two had never agreed to exclusive negotiations.

Concord and one of its employees were also dishonest in their testimonies at various points, he added.

"I do not consider that the Heads gave rise to a 'binding obligation to negotiate' or to do so in 'good faith'," Justice Voith wrote. "Concord was, at times, dishonest."

Concord wrote to Mr Oei in mid-July promising the C$40 million payments "for sure" by a given date, knowing that this was not true, the judge added. Justice Voith also noted that "it is clear, based on the findings I have made, that Concord cannot establish significant aspects of either the 14 May contract or the 14 May agreement."

Mr Oei was awarded costs. BLOOMBERG