Chee Yin Meh v Ong Kian Guan

• Jurisdiction: Singapore
• Judge: Kannan Ramesh JAD,Debbie Ong Siew Ling JAD,Andre Maniam J
• Judgment Date: 27 October 2023
• Docket Number: Civil Appeal No 113 of 2022
• Court: High Court Appellate Division (Singapore)

Chee Yin Meh

and

Ong Kian Guan and others

[2023] SGHC(A) 34

Kannan Ramesh JAD, Debbie Ong Siew Ling JAD and Andre Maniam J

Civil Appeal No 113 of 2022

Appellate Division of the High Court

Equity — Estoppel — Proprietary estoppel — Foreign person seeking to acquire beneficial interest in residential property by way of proprietary estoppel — Whether proprietary estoppel could arise in favour of foreign person under Residential Property Act (Cap 274, 2009 Rev Ed) — Residential Property Act (Cap 274, 2009 Rev Ed)

Trusts — Constructive trusts — Common intention constructive trusts — Singapore citizen holding residential property on common intention constructive trust for foreign person — Whether common intention constructive trust void under Residential Property Act (Cap 274, 2009 Rev Ed) — Residential Property Act (Cap 274, 2009 Rev Ed)

Held, dismissing the appeal:

(1) The RPA barred foreign persons from acquiring an interest in residential property under a common intention constructive trust: at [11].

(2) Section 23(1)(a) of the RPA barred Singapore citizens from purchasing or acquiring an interest in residential property with the intention of holding it on trust for any foreign person, while s 23(1)(b) of the RPA prohibited foreign persons from authorising or appointing any citizen as a nominee to acquire an interest in residential property with the intention of having the citizen hold the interest on trust for the foreign person: at [17].

(3) The bankrupt and appellant's purported common intention constructive trust fell within the ambit of s 23 of the RPA given that it arose from their intentional conduct: at [23].

(4) Moreover, the appellant's argument that she had applied for citizenship did not take her out of the statutory definition of a “foreign person”. Thus, a common intention constructive trust in favour of the appellant, a foreign person, was void under the RPA: at [25].

(5) Section 3(1)(c) of the RPA prohibited a foreign person from purchasing or acquiring an interest in residential property except by way of a mortgage, charge or reconveyance. Any purchase or acquisition prohibited by s 3(1)(c) would be rendered void by s 3(2)(c) of the RPA: at [26].

(6) The appellant's attempt to purchase or acquire a beneficial interest in the Property by way of a trust was thus in contravention of s 3(1)(c) and was therefore void under s 3(2)(c) of the RPA: at [28].

(7) The appellant's claim under proprietary estoppel also failed as allowing her to acquire an interest in the Property would permit her to circumvent the RPA. In any event, the appellant's acquisition of a beneficial interest by proprietary estoppel would itself be an acquisition prohibited by s 3(1)(c) and thus void under s 3(2)(c) of the RPA: at [36].

(8) Finally, the Judge's award of indemnity costs against the appellant in the proceedings below was justified as the appellant's conduct indicated a lack of integrity on her part. On this same basis, an award of indemnity costs against the appellant was also warranted for the appeal: at [50] and [51].

Case(s) referred to

Foo Jee Seng v Foo Jhee Tuang [2012] 1 SLR 211 (folld)

Joshua Steven v Joshua Deborah Steven [2004] 4 SLR(R) 403; [2004] 4 SLR 403 (refd)

PP v Intra Group (Holdings) Co Inc [1999] 1 SLR(R) 154; [1999] 1 SLR 803 (distd)

Facts

The main issue in this appeal was whether a foreign person could acquire an interest in residential property under a common intention constructive trust or by proprietary estoppel. The appellant was the wife of a bankrupt while the respondents were the bankrupt's trustees in bankruptcy.

The bankrupt was the sole registered owner of a residential property (“the Property”). In the proceedings below, the appellant sought a declaration that the bankrupt held 50% of the beneficial interest in the Property for her and an order that the respondents transfer 50% of the net proceeds to her. The appellant's claim was premised on a common intention constructive trust; and in the alternative, proprietary estoppel.

At the material time, the appellant was a foreign person as defined within s 2 of the Residential Property Act (Cap 274, 2009 Rev Ed) (the “RPA”) and had not applied or obtained the Minister's approval to acquire an interest in the Property under s 25 of the RPA.

The judge below (the “Judge”) dismissed the appellant's claim and agreed with the respondents that the RPA operated to prevent her from acquiring an interest in the Property as she was a foreign person at the material time. The appellant appealed against the entirety of the Judge's decision.

Legislation referred to

Residential Property Act (Cap 274, 2009 Rev Ed) ss 2, 3, 23 (consd); ss 2(1), 3(1), 3(1)(b), 3(1)(c), 3(2), 3(2)(b), 3(2)(c), 23(1), 23(1)(a), 23(1)(b), 23(2), 23(4), 25, 25(2)

Goh Kok Leong, Fu Xiangming MaxandNavin Kumars/oTamil Selvan (Ang & Partners) for the appellant;

Chan Chee Yin Andrew, Tay Yu Xi, Yeo Alexander Lawrence Han Tiong, Chew Jing Wei, Lee Suet Yean CherlynandEdwin Teong Ying Keat (Allen & Gledhill LLP) for the respondents.

27 October 2023

Andre Maniam J (delivering the grounds of decision of the court):

Introduction

1 Under the Residential Property Act (Cap 274, 2009 Rev Ed) (“RPA”), can a foreign person acquire an estate or interest in residential property by way of a common intention constructive trust or proprietary estoppel? In AD/CA 113/2022 (“AD 113”), we upheld the decision of the trial judge (“the Judge”) that this was not permissible under the RPA.

Background

2 The appellant, Mdm Chee Yin Meh (“Mdm Chee”), is married to Mr Fan Kow Hin (“Mr Fan”) (now a bankrupt). Their residence at Sunrise Drive (the “Sunrise Drive property”) was acquired in the sole name of Mr Fan. In May 2017, Mr Fan's trustees in bankruptcy sold the Sunrise Drive property (the respondents are his present trustees). Mdm Chee filed HC/OS 906/2018 (“OS 906”) seeking a declaration that Mr Fan held half of the beneficial interest in the property on trust for her, and an order that the trustees transfer 50% of the net proceeds to her. OS 906 was converted to HC/S 350/2019 (“Suit 350”) and proceeded to trial.

3 When the Sunrise Drive property was transferred to Mr Fan on 11 August 2011, Mdm Chee was not a Singapore citizen, although she had applied for citizenship two months prior on 10 June 2011. It is common ground that as at 11 August 2011:

(a) she was a “foreign person” within s 2 of the RPA;

(b) the Sunrise Drive property was “residential property” under s 2 of the RPA; and

(c) she had not obtained the Minister's approval “to purchase, acquire or retain any estate or interest in any residential property” under s 25 of the RPA.

4 Mdm Chee knew about such approvals under the RPA – she had previously obtained approval under the RPA to purchase and acquire an interest as a joint tenant with Mr Fan for their previous matrimonial home at Sunrise Terrace (the “Sunrise Terrace property”).

5 For the Sunrise Drive property, however, Mdm Chee did not apply for and obtain the Minister's approval under the RPA. In Mdm Chee's affidavit of evidence-in-chief (“AEIC”), she said that the lawyer who handled her husband's purchase of the Sunrise Drive property had advised that it would be difficult for her to buy the Sunrise Drive property as she was not a Singapore citizen and she was already an owner of the Sunrise Terrace property. Mdm Chee says the lawyer advised that:

(a) Mdm Chee should apply for Singapore citizenship (which she did on 10 June 2011); and

(b) pending approval of her citizenship application, Mdm Chee should ask Mr Fan to hold 50% of the Sunrise Drive property on trust for her.

The lawyer denied giving such advice – she said that she would not have given such advice as it would have been in contravention of the RPA.

6 Mdm Chee said that after she shared the...