Ministry of Food abruptly shuts 5 outlets in S’pore as owner unable to pay landlords & suppliers

The owner has since spoken up about allegations against her.

Syahindah Ishak | March 07, 2020, 01:40 PM

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Local restaurant chain Ministry of Food (MOF) had 80 restaurants in Singapore.

Now, it is left with only 26, after five more outlets closed down on the weekend of Feb. 29 and Mar. 1, according to The Straits Times.

Funds frozen by banks

On the night of Feb. 28 night, two of the chain's outlets — Ju Hao at Bukit Panjang Plaza and MOF Izakaya at Lot One — were repossessed by CapitaLand after chief executive of MOF, Lena Sim, failed to pay the rent.

All of Sim's funds are currently frozen by the banks due to a Mareva injunction that was issued to her on February 2020.

A Mareva injunction freezes the assets of the defendant.

This prevents the defendant from anticipating her loss of a lawsuit and dissipating her assets so that the plaintiff is left with no assets to enforce against.

On top of failing to pay her landlords, Sim was also unable to make payments to her food suppliers as a result of the injunction.

Some suppliers have stopped delivering ingredients to her restaurants, ST reveals.

However, Sim's biggest concern at the moment is the livelihood of 400 staff.

With the closing of every outlet, 15 to 20 workers will lose their jobs.

Sim had already faced some troubles after being questioned by the Ministry of Manpower (MOM) last week, reported ST.

Her passport was impounded after she failed to pay wages to her staff.

She told ST that she has been going from "one bank to another" in the past week to no avail.

Sim also felt that the banks are "overreacting" as her personal accounts were apparently terminated as well.

“The injunction blocks me from disposing of my assets, but it's not supposed to disrupt my daily life and business operations," she said.

Sued for outstanding payment in 2017

The Mareva injunction was a result of a 2017 case.

During that year, Sim was sued for an outstanding payment of S$4.8 million for the sale of a chain of Korean restaurants.

Sim had initially agreed to purchase the restaurants that year for S$5.5 million.

However, she only paid S$700,000.

Sim had apparently said that she would buy the restaurants only if she could resell them together with her other restaurants to a Thai conglomerate.

At that time, a Thai conglomerate had shown interest in acquiring the MOF.

But the deal eventually fell through.

The dispute was not litigated in court since an arbitration clause was incorporated as part of the sale-and-purchase contract.

After the acquisition fell through, Sim had apparently replaced herself with her allegedly elderly, illiterate mother as the sole director of her 20 companies.

She also put up her Wilkinson Road bungalow for sale.

According to ST, she had done so after seeking advice from a fengshui master.

This was why in February 2020, the plaintiff's lawyer obtained a Mareva injunction against Sim in case she dissipates everything.

The injunction froze her assets of up to a value of S$4.8 million, equivalent to the outstanding amount she owed.

Shut down 40 outlets in 2019

Sim's business went through a major revamp in that time of crisis.

She shut down about 40 outlets in 2019.

By the last quarter of 2019, her company was operationally profitable.

But the Covid-19 outbreak caused another significant problem for her business.

Sales at eight of her outlets dropped about 80 to 90 per cent and the overall group performance decreased by about 35 per cent.

However, some outlets were still doing well.

Allegedly did not return deposit money to Takagi Ramen in January 2020

On Jan. 22, 2020, Sim landed herself in another dispute.

The owner of ramen chain Takagi Ramen, Yang Kaiheng, lodged a police report against MOF.

MOF allegedly did not return S$16,000 worth of deposit to Yang.

However, in response to Mothership‘s queries, MOF had denied the allegations made by Yang.

Plaintiff's accusations were inaccurate

Responding to queries from Mothership, Sim said that the plaintiff's accusations were inaccurate.

For example, she clarified that her mother is actually literate, unlike what the Korean partners stated.

She said: “My mum is super literate, just that she's Chinese-educated. She's from River Valley, how can she be illiterate?"

Sim also said that she was issued the Mareva injunction because the plaintiff assumed she was disposing her assets after they found out she was selling her house in January 2020.

However, she explained that her house has been on the market for sale for at least three years. It wasn't something new.

In addition, Sim also stated that the arbitration process she had with the Korean partners began in 2017 and ended in November 2019.

She claimed:

"The arbitration should not take so long... But halfway through, the Koreans went missing. They disappeared for quite a while so that's why the whole arbitration took three good years... They even owe their own lawyers money. How true? I don't know."

According to Sim, the arbitration verdict will be out in May 2020.

She added that regardless who wins the verdict, she was told by her lawyers that the Mareva injunction will be automatically discharged.

Top image from Ministry of Food/FB.


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