A Shanghai court will start hearing a dispute tomorrow between a Hong Kong businessman and the city's biggest electrical goods maker. Sun Yin-piu is battling for compensation for a never-occupied residential development that is being demolished. The No1 Intermediate People's Court will decide whether he has legal grounds to demand redress from the SVA Group over the land in Shanghai's upmarket Xuhui district, which is being turned into a medical research and education centre by the district government. The case is the latest development in a complex legal battle between SVA and Mr Sun, who was ordered to pay compensation to the company in 2003 for illegal occupation of the site. It stems from a 1995 contract to develop the 18,000 square metre site jointly, signed between the businessman and an SVA subsidiary that later went bankrupt. In a further twist yesterday, the Xuhui government - which bought the land from SVA in January for 230 million yuan - said it reserved the right to sue Mr Sun. It said it had compensated six construction companies on his behalf after finding the businessman owed them 30 million yuan. But Mr Sun denied he owed construction companies any money. District Vice-Mayor Bao Bing- zhang said the government had bought the land and had the right to demolish the buildings, which it was doing 'bit by bit'. Four of the development's seven towers, in which Mr Sun claimed to have invested 280 million yuan since 1997, were demolished by the district government in March. The rest of the development, the Shanghai International Notable Square, was due to be knocked down late last month. But the demolition was postponed after Mr Sun's wife staged an all-night protest at the site, threatening to kill herself if it was carried out. Mr Bao said documents from a previous court case showed Mr Sun invested only about 36 million yuan in the project. Mr Sun said he had been unable to obtain legal rights to the land as a result of the bankruptcy of the SVA subsidiary in 1997, three months after construction began. As a result, he could not sell the properties in the development, which also included a shopping mall. 'I continued the construction because I thought it would save me some time,' said Mr Sun, who made his fortune in property and stocks. 'I thought I would be able to get the land permit. If I knew it would get me into deep trouble, I would simply have stopped the whole project.' He was in Hong Kong when Shanghai media reported in March that the Xuhui government had bought the land and planned to demolish the buildings with explosives. 'I learned about it after my wife read the newspaper and called me from Shanghai. But by the time I reached Shanghai, four buildings were already gone,' he said. 'My wife stayed outside the site overnight, threatening to kill herself if they blew up the remaining three buildings. They didn't blow up the buildings as planned.' Now, the site is locked and Mr Sun is barred from entering. He has sought help from the Hong Kong Economic and Trade Office in Shanghai. A spokesman for the office said it had referred Mr Sun's requests to the relevant authorities several times. The SVA Group could not be reached for comment. Mr Bao said he hoped the two parties would resolve the dispute rationally soon and the government would offer any necessary assistance to help them do so. But he denied any buildings had been demolished with explosives so far. 'We have placed explosives in one building, which will be blown up as it is too tall, about 10 storeys,' he said, refusing to disclose when it would be done. He said the government did not know of the dispute until March. 'We feel sorry for Mr Sun and his wife, but we must make clear it is not a land dispute; it is an economic dispute between Mr Sun and the SVA Group.'
