Oral Answer by 2M for Law, Mr Edwin Tong, to Parliamentary Question on the Measures Protecting Sole Proprietors of Micro SMEs from Rogue Landlords

02 FEB 2021

02 Feb 2021 Posted in Parliamentary speeches and responses

Dr Tan Wu Meng (Member of Parliament for Jurong GRC)

Question

To ask the Minister for Law (a) what measures protect sole proprietors of micro SMEs from rogue landlords in the event of landlord-tenant disputes where such disputes are not handled by the Small Claims Tribunal; and (b) what are the avenues by which micro SME sole proprietors of limited means can access legal services at affordable cost especially if they do not qualify for pro bono legal services.

Oral Answer

  1. The Small Claims Tribunal’s jurisdiction does not extend to disputes involving non-residential tenancies. In such cases, small and micro SME tenants who wish to enforce their contractual rights may do so and bring their actions in Court. Where the claim involves sums of no more than $250,000, this tenant may commence an action in the State Courts.
  1. The Courts have put in place simplified processes and procedures and schemes also to help the parties, particularly the SME tenants, to navigate the Court process, even without legal representation. For example, for claims brought in the Magistrate’s Court, parties may opt for a simplified process under the Rules of Court to obtain early resolution of the dispute.
  1. In addition, parties can also resolve disputes efficiently through alternative dispute resolution. If the matter is already before the Court, the party may request, or be referred by a judge, for mediation at the State Courts Centre for Dispute Resolution. Tenants may also consider mediation even before commencing court action. Mediation is available at a relatively low cost, for example, through the Singapore Mediation Centre’s Small Case Commercial Mediation Scheme.
  1. There are avenues also available for micro SMEs to access legal services at an affordable cost, if it transpires that the court process is what the SME wants to go through. While pro bono legal advice and legal aid are not generally intended for commercial matters, micro SME tenants who are sole proprietorships and cannot afford their own lawyers may approach the Legal Aid Bureau for assistance, and this can be considered on a case-by-case basis.
  1. In addition, last year, against the backdrop of the Covid-19 pandemic, the Ministry also stepped in to introduce various relief measures to alleviate potentially unfair outcomes, whilst ensuring fairness to parties, including landlords and tenants.
    a. We introduced the Rental Relief Framework in June 2020, to help affected SMEs with their cash flow by mandating the passing on of up to 4 months of rental waiver for the months of April through to July 2020. b. In November 2020, we introduced the Re-Align Framework, which will help eligible small and micro businesses severely impacted by COVID-19 to renegotiate certain contracts on fairer terms. These contracts include leases or licences for non-residential property of a duration of up to 5 years. The Framework has been in operation since 15 January 2021 and will last for 6 weeks.
  1. It is in the same spirit that the Fair Tenancy Pro Tem Committee was formed in June 2020 under the auspices of the Singapore Business Federation (SBF) to establish industry norms on tenancy practices and terms on which tenancies are entered into. Key industry representatives from the landlord and tenant communities have been discussing issues relating to fair conduct on the part of landlords and tenants, as well as enforcement and dispute resolution, should that be necessary. MTI and ESG are closely involved in the process and are working with SBF to help to facilitate these discussions. The Committee is expected to issue its preliminary report on these findings to the Government shortly.

Last updated on 02 Feb 2021