Choo Liang Haw @ Choo Liang Hoa and others v Chua Seet Mui and others and another matter

• Jurisdiction: Singapore
• Judge: Quentin Loh J
• Judgment Date: 13 February 2015
• Neutral Citation: [2015] SGHC 47
• Plaintiff Counsel: Lim Seng Siew and Naidu Devadas (instructed) (Metropolitan Law Corporation),Michael Khoo SC, Andy Chiok, Josephine Low, Ong Lee Woei and Joel Yeow (Michael Khoo & Partners)
• Docket Number: Originating Summons Nos 941 and 982 of 2013
• Date: 13 February 2015
• Hearing Date: 03 November 2014,01 September 2014,07 July 2014,25 August 2014,11 August 2014,07 April 2014
• Subject Matter: Collective sales,Land,Strata titles
• Published date: 09 October 2015
• Citation: [2015] SGHC 47
• Defendant Counsel: Davinder Singh SC, Jaikanth Shankar and Jarod Kok (Drew & Napier LLC),Adrian Tan and Roy Mukkam (Stamford Law Corporation),Winnifred Gomez and Rakesh s/o Pokkan Vasu (Gomez & Vasu LLC)
• Court: High Court (Singapore)
• Year: 2015

Quentin Loh J:

This case involves the collective sale of the condominium development known as “Gilstead Court” (Strata Title Plan No 464) comprised in Land Lot No TS28-578K (“the Development”). Unlike most collective sale disputes (at least until the hearing before me), there were no parties directly opposing this sale. Rather, the objectors in this case were unhappy about certain “penalty clauses” in the Collective Sale Agreement (“CSA”) which were expressed to be applicable to them. The matter eventually culminated in two Originating Summonses before this court—Originating Summons No 941 of 2013 (“OS 941”) and Originating Summons No 982 of 2013 (“OS 982”).

OS 941 was commenced on 7 October 2013 by four plaintiffs (Choo Liang Haw @ Choo Liang Hoa (“Choo Liang Haw”), Loke Wan Tche, Charles Ng Pooh Cheok and Lok Kok Poh, all of whom are members of the 7-person Collective Sales Committee (“CSC”)), against six defendants (Chua Seet Mui (owner of Unit 50P), Lim Sui May Petrina and Lim Li Meng Dominic (owners of Unit 52C), Loke Ah Meng and Soh Lay Bee (owners of Unit 52A) and Koh Nai Hock @ Koh Chou Toh (“Koh Nai Hock”) (owner of Unit 54K)), the subsidiary proprietors (“SPs”) who had chosen not to sign the CSA. The prayers sought were: a declaration that the “penalty clauses” of the CSA do not apply to the six defendants if they sign the CSA; a declaration that any offer by Dillenia Land Pte Ltd (“DLPL”), the intending purchaser of the Development, to contribute to the six defendants’ liability under the CSA is permissible and does not offend the CSA; a declaration that upon the six defendants signing the CSA, the collective sale of the Development shall proceed on the basis that there is unanimous consent under the Sale and Purchase Agreement signed between the majority of subsidiary proprietors and DLPL; such further orders as the court may consider just and equitable; and that the costs of the application be provided for.

OS 982 was commenced slightly over a week later on 16 October 2013, originally by three plaintiffs, Sally Ching Pui Sim (“Sally Ching”), chairperson of the CSC, Warren Khoo, secretary of the CSC, and Choo Liang Haw, treasurer of the CSC. These three formed the Executive Committee of the CSC (“the Exco”). Subsequently, some four months later, on 14 February 2014, under circumstances that I shall come to, Choo Liang Haw was removed as a plaintiff and added in as the 13th defendant and Gary Michael Darwin (“Gary Darwin”) was added as the 14th defendant. There were originally 12 defendants in the following order: Pan Xingzheng Edric (“Edric Pan”) and Quek Chia-Min Valeria (Unit 50A), Chua Seet Mui (Unit 50P), Loke Ah Meng and Soh Lay Bee (Unit 52A), Lim Sui May Petrina and Lim Li Meng Dominic (Unit 52C), Koh Nai Hock (Unit 54K), (the owners of the five units who did not sign the CSA (“the non-signatory SPs”)), DLPL, and three members of the CSC, Loke Wan Tche, Lok Kok Poh and Charles Ng Pooh Geok. This OS was amended on 17 February 2014 and the amended prayers sought were as follows: An order that all the lots and common property in the Development be sold collectively to DLPL according to the terms and conditions of the conditional contract of sale concluded by the acceptance of DLPL’s tender on 17 June 2013 in accordance with, and subject to, the Final Terms and Conditions of Tender dated 29 May 2013 and subject to any orders that may be made in these proceedings. An order that the non-signatory SPs be bound by all the terms of the CSA as if they were parties thereto. A declaration that Cll 7.5 (Default Contribution) and 11 (Abuse of Process) of the CSA are valid and that, in the events that have happened, Cll 7.5 and 11 are applicable, enforceable, and in full force and effect against each of the non-signatory SPs. An order that the non-signatory SPs jointly and/or severally (as may be applicable): pay in respect of their five units to the plaintiffs the sum of $2,000 each per unit under cl 7.5 (Default Contribution) of the CSA; and bear or contribute to the Strata Titles Board (“STB”) proceedings under cl 11 of the CSA in such sum or sums as the Court may think just and appropriate (the original prayer was for the non-signatory SPs to each bear $27,000 for the $135,000 incurred in costs). The payments to be made within seven days from the date of the court order by cashier’s orders drawn in favour of “MCST 464 – Collective Sale Common Fund”, with the proceeds to be used in the manner provided for in the relevant provisions of the CSA. An order that the first and second plaintiffs, being the chairperson and secretary respectively of the CSC and members of the Exco, be authorised to take any action, make any decision and do anything else required or allowed to be taken made or done under the CSA or the conditional contract of sale or in relation to the Collective Sale generally, and that any action, decision and thing taken, made or done in good faith by the first and second plaintiffs shall be deemed to be as effectively taken, made or done as if such action, decision and thing were done by the Exco as a whole or the CSC as a whole, including but not limited to: signing with DLPL and on behalf of all the SPs the Sale and Purchase Agreement in terms of the draft annexed to the Final Terms and Conditions of Tender; receiving deposits and payments towards the purchase price and giving a valid receipt and discharge therefor; signing any documents (other than for the operation of bank accounts as provided below) required or allowed to be signed; and appointing solicitors and counsel and giving instructions to them for any proceedings for enforcement of the conditional contract of sale or the CSA, and defending or taking action in or in relation to any proceedings brought against them in connection with or arising from the Collective Sale. An Order that notwithstanding anything to the contrary in the mandate to DBS Bank (the bank with which the management corporation held accounts), the first and second plaintiffs, being the chairperson and secretary respectively of the CSC and members of the Exco, be authorised and empowered to operate the two bank accounts (ie, “MCST 464 – Collective Sale Common Fund” and “MCST 464 – Collective Sale Proceeds”) maintained by the CSC for the purposes of the Collective Sale of the Development and for that purpose to comply with all the terms and conditions required by DBS Bank Ltd to the intent that the first and second plaintiffs shall be the only two authorised signatories to the two bank accounts from the date of the court order. A declaration that any action, decision or thing taken made or done by the first and second plaintiffs in good faith performance of their duty under the CSA without the participation of the 13th defendant since 1 October 2014 is deemed to be as effectively taken, made or done as if with the participation of the 13th defendant. A declaration that DLPL has committed a breach of cl 37 (Illicit Payments) of the Final Terms and Conditions of Tender by making, albeit indirectly, an offer of extraneous consideration in the sum of $135,000 (“the Extraneous Offer”) to relieve the non-signatory SPs of their liability under Cll 7.5 (Default Contribution) and 11 (Abuse of Process) of the CSA as an inducement for the non-signatory SPs to withdraw their objections in the sale approval proceedings before the STB or the High Court. An order, consequential on the declaration under the preceding paragraph (h), that DLPL pay to the plaintiffs to the use of such signatory SPs as the Court may adjudge appropriate liquidated damages in the sum of $15,016,800 as provided in cl 37 (Illicit Payments) of the Final Terms and Conditions of Tender. A declaration that the 10th to 13th defendants have committed a breach of their duty as CSC members to act faithfully as agents of the signatory SPs, including to observe and uphold all the provisions of the CSA and the Final Terms and Conditions of Tender, especially Cll 7.5 (Default Contribution), 11 (Abuse of Process) and 12 (Anti-Corruption) of the CSA and cl 37 of the Final Terms and Conditions, and not to subvert or attempt to subvert them. A declaration that the 10th to 13th defendants as signatory SPs have committed a breach of their obligations to other signatory SPs to observe and uphold all the provisions of the CSA and the Final Terms and Conditions of Tender, especially Cll 7.5 (Default Contribution), 11 (Abuse of Process) and 12 (Anti-Corruption) of the CSA and cl 37 of the Final Terms and Conditions, and not to subvert or attempt to subvert them. An injunction restraining the 10th to 13th defendants from engaging in any activity incompatible with their position as CSC members and signatories to the CSA, including but not limited to applications to court, calling meetings of owners or otherwise to alter the provisions of the CSA or the Final Terms and Conditions of Tender. A declaration that the 14th defendant as a signatory SP has committed a breach of his obligations to other signatory SPs to observe and uphold all the provisions of the CSA and the Final Terms and Conditions of Tender, especially Cll 7.5 (Default Contribution), 11 (Abuse of Process) and 12 (Anti-Corruption) of the CSA and cl 37 of the Final Terms and Conditions, and not to subvert or attempt to subvert them. An injunction restraining the 14th defendant from engaging in any activity incompatible with his position as signatory to the CSA, including but not limited to calling meetings of owners or otherwise to alter the provisions of the CSA or the Final Terms and Conditions of Tender. A declaration that the purported requisition by the 10th to 14th defendants together with others for an Extraordinary General Meeting (“EOGM”) of the SPs submitted on 22 November 2013 is invalid for lack of proper legal authority, and that any resolutions purporting to be passed at...