Mediation ends Jungceylon deadlock
PHUKET: The deadlock that resulted in a complete halt to construction of the Jungceylon complex in Patong has finally been broken, and the complex is expected to be open for next high season, Samrarn Yothayai, Chief Judge of Phuket Provincial Court, has told the Gazette.
Jungceylon, which occupies 55 rai of land off Rat-U-Thit 200 Pi Rd, was due to open in November last year, but partners Thanit Rattana-Kamchai – who owns the site – and Manit Udomkunnatum – who owns 53% of the project’s operating company, Phuket Square Co – have been involved in a protracted legal dispute since early 2004.
The dispute revolved around the estimated cost of the project. Originally this was 1.7 billion baht, but it ballooned to 3 billion baht, so K. Manit started looking for new investors to join the project.
K. Thanit, however, disagreed with this strategy, saying that he could accept neither the inflated cost nor changes to the management committee of Phuket Square Co. He refused to countersign checks issued by K. Manit to pay the main Jungceylon contractor, Powerline Co.
Powerline stopped work and, as a result, Krung Thai Bank declared its loan to K. Manit to be in default. It filed a complaint with the Bankruptcy Court in Bangkok, asking for him to be declared bankrupt.
However, Judge Samrarn said that, following mediation, the two signed a deal on January 26. “Under the agreement,” he explained, “K. Manit will sell his 53% share in Phuket Square to K. Thanit, and K. Thanit already has a new partner to join [the project].
The two parties met at the Bankruptcy Court [on Wednesday] to forge an agreement with the bank whereby K. Thanit will take authority over all [Phuket Square Co] operations.
The result of that hearing has not yet been announced but, said Judge Samrarn, “It is expected that Powerline will resume construction [soon] and that Jungceylon will open in time for next high season.”
