DASIN RETAIL TRUST MANAGEMENT PTE. LTD.

Facts

Dasin Retail Trust Management Pte Ltd (DRTM) is the trustee-manager of Dasin Retail Trust (DRT), a business trust listed on the SGX-ST that owns retail malls in China through subsidiaries. As trustee-manager, DRTM borrowed under offshore syndicated facilities from banks in Singapore, Hong Kong and Macau and under a loan from Luso Bank, while Chinese subsidiaries borrowed under onshore facilities. All the facilities were in default. Because of the defaults, mall rental income held with the onshore lenders could not be moved out of China.

DRTM's shareholders, Mr Zhang Zhencheng (ZZC, about 30%) and a Sino-Ocean Capital company (about 70%), fell out around 2022; ZZC was also the largest unitholder of DRT. ZZC and his associates started winding-up applications against DRTM, including HC/CWU 133/2024. On 2 December 2024, a day before the resumed hearing of CWU 133, DRTM filed Originating Application No 1257 of 2024. It sought a six-month moratorium under s 64 of the Insolvency, Restructuring and Dissolution Act 2018, an order extending it to acts outside Singapore, and liberty to apply. It intended a Singapore scheme with the offshore lenders and certain unsecured creditors, alongside a consensual restructuring with the onshore lenders, based on a term sheet that had gone through 16 drafts. ZZC and several individual creditors opposed. Four offshore lenders supported the moratorium.

Issues

1. Whether a trustee-manager may apply for a moratorium for a scheme covering debts incurred as trustee-manager of a business trust
2. Whether the application was made in good faith
3. Whether there was a reasonable prospect of the intended scheme working and being acceptable to the general run of creditors
4. On what terms any moratorium should be granted

Holding

The court allowed the application in part. It granted a six-month moratorium in terms of Prayer 1 and liberty to apply under Prayer 3, but made no order on Prayer 2, declining the omnibus extension to acts outside Singapore. It also ordered DRTM to file the mall valuation reports within two weeks, disclose any acquisition, disposal or grant of security within 14 days, and give quarterly company-level financial statements. Costs were to be heard later.

Reasoning

A trust is not a legal person; a trustee contracts as principal, so debts incurred as trustee-manager are DRTM's own debts and the lenders are its creditors. The Business Trusts Act definitions of creditor and liabilities confirm this. A clause limiting the lenders' recourse to trust assets partitions assets, not liabilities. Re Tantleff concerned whether a trust fell within the Model Law and did not decide this question. DRTM is a company liable to be wound up and is not excluded from Part 5 of the Act by the ministerial order, which, unlike the Model Law exclusions, does not list trustee-managers.

The procedural requirements were met. On good faith, negotiations had run since 2023 and four offshore lenders backed the moratorium. The vague plan for unsecured creditors was reasonably explained because it depended on releasing cash from China; this was unlike All Measure Technology. Filing just before the winding-up hearing was a natural response to threatened proceedings, and the court refused to speculate about privileged legal advice.

On feasibility, lenders owed approximately 53.06% of the offshore debt supported the moratorium, and the offshore lenders were not related parties. The court declined to count votes at this stage. Onshore lender support was relevant, but intercreditor arrangements gave them reasons to cooperate. The bank emails ZZC relied on showed openness to restructuring rather than hostility, though more concrete evidence may be needed later.

Six months suited a complex cross-border restructuring. Following IM Skaugen, the extraterritorial order was refused because DRTM pointed only vaguely to possible foreign proceedings.

From the judgment