The claims involve alleged deficiencies in the design and construction of Macquarie Park Village
[SINGAPORE] Stamford Land on Friday (Jan 16) announced that its wholly owned subsidiary HSH Hotels (Australia) is facing legal action by the owners corporations of Macquarie Park Village over alleged construction defects.
The Macquarie Park Village project is a large-scale residential mixed-use development in Macquarie Park, New South Wales.
HSH Hotels and the design and construct contractor for the project, Parkview Construction, are facing legal proceedings in the Supreme Court of New South Wales, said Stamford Land in a bourse filing.
The claims involve alleged deficiencies in the design and construction of the project. This includes alleged defects relating to concrete works, the facade, drainage, tiling and fire utilities, among other things, noted Stamford Land.
The claims also include allegations of breaches of statutory warranties under the New South Wales Home Building Act 1989, said the company.
It noted that the proceedings have been adjourned since commencement to “allow the parties to engage in without prejudice discussions in relation to the alleged defects identified in expert reports served by the owners corporations”.
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In connection with the proceedings, HSH Hotels has filed a cross-claim against Parkview Construction for an alleged breach of contract, breach of statutory warranties and indemnification pursuant to the relevant building contract.
As the proceedings are in the early stages, the owners corporations have not yet quantified the damages sought.
Currently, HSH Hotels is acting as trustee of the Macquarie Park Village Trust. Stamford Land said that any liability would be limited to the assets of the Macquarie Park Village Trust and is not expected to have a direct financial impact on the wider group.
However, if HSH Hotels is required to be replaced as trustee for other trusts as a result of the legal proceedings, “substantive” stamp duty may be payable, noted Stamford Land.
The company added that it will “keep shareholders informed if there is any material development”.
In 2015, HSH Hotels, as trustee for a trust that it wholly owns, signed a loan agreement with a major commercial bank for a secured term loan facility of A$265 million (S$277 million, at the time) to fund the construction of Macquarie Park Village.
Shares of Stamford Land closed flat at S$0.50 on Friday.
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