Goh Teh Lee v Lim Li Pheng Maria and Others

• Jurisdiction: Singapore
• Judge: Andrew Ang J
• Judgment Date: 27 October 2009
• Neutral Citation: [2009] SGHC 242
• Docket Number: Originating Summons No 1627 of 2008
• Date: 27 October 2009
• Year: 2009
• Published date: 29 October 2009
• Plaintiff Counsel: The plaintiff in person
• Citation: [2009] SGHC 242
• Defendant Counsel: Cheah Kok Lim (Sng & Co) and Leong Kwok Yan (Leong Kwok Yan)
• Court: High Court (Singapore)
• Subject Matter: Strata Titles,Land,Collective Sales

27 October 2009

Andrew Ang J:

Introduction

1 This was an appeal against the Order of the Strata Titles Board (“the Board”) dated 4 December 2008 in Strata Titles Board No 33 of 2008 (“STB 33/2008”) pursuant to an application under s 84E of the Land Titles (Strata) Act (Cap 158, 1999 Rev Ed) (“the Act”) (as it stood prior to the Land Titles (Strata) (Amendment) Act 2007 (No 46 of 2007) and the Statutes (Miscellaneous Amendments) (No 2) Act 2008 (No 30 of 2008)) in respect of the development known as Nos 134/134A/B/C/D/E/F/G/H/J/K/L and Nos 136/136A/B/C/D/E/F/G/H/J/K/L (known as Koon Seng House) and Nos 124/126/128/130/132/138/140/142/144 Koon Seng Road (“the terrace houses”) comprised in Land Lot No 6329V of Mukim 26 (“the Development”).

2 The plaintiff, Goh Teh Lee, sought the following orders in these proceedings:

(a) that the order of the Board under s 84E of the Act in respect of the Development on 4 December 2008 in STB 33/2008 be set aside;

(b) that the costs of and incidental to this application and at the Tribunal below be paid by the defendants to the plaintiff; and

(c) such further and/or other relief as the court deems fit.

3 The Development comprised Koon Seng House, a 4-storey block containing 24 flats, and nine terrace houses on one piece of freehold land that was not subdivided. The flats were not strata subdivided but were comprised in 999,999 year leases with no share in the land. Koon Seng House Residents’ Association (the “Residents’ Association”), whose members were the owners of the 24 flats, provided for the maintenance of the flats and the car parks. The nine terrace houses were owned by the landowner.

4 To understand how the mixed development came about, it would be best to set out a brief history. The nine terrace houses were already sitting on freehold land comprised in Lot 2139 Mukim 26 (from which the present Lot 6329 is derived from) prior to the 1960s. On 2 December 1960, Lot 2139 was conveyed by Asia Realty Company Ltd to Ng Guan Cheong. Ng Guan Cheong erected a block of 4-storey flats comprising 24 flats on the said lot. Subsequently, Lot 2139 was conveyed to Tai Hong Realty Co Ltd which then applied to subdivide the block of flats into 24 separate units. As the law then stood (prior to the introduction of strata subdivision) that could only be done by creating long leases of each flat, in this case for 999,999 years. Lot 2139 was thereafter conveyed to Tan Tok Phuang “together with the houses erected thereon … subject to the existing leases for 999,999 years granted to the owners of the 24 flats …”. Lot 2139 was later sub-divided into Lots 2147 and 2148 Mukim 26. On 29 August 1968, Lot 2147 Mukim 26 was conveyed by Tan Tok Phuang to Lim Cher Joo, “TOGETHER with the houses erected thereon … Subject to the existing leases for 999,999 years granted to the owners of the 24 flats …”. Eventually Lot 2147 Mukim 26 itself was subdivided into Lots 6328 and 6329 Mukim 26 with Lot 6329 being that upon which the flats and terrace houses stand.

5 The plaintiff was the co-owner of unit 136D Koon Seng Road (one of the flats) and sole dissenter in the collective sale of the Development. (The plaintiff is currently involved in divorce proceedings with his wife, the other co-owner of unit 136D, who agreed to the collective sale.) The defendants were members of the sale committee and representatives of the proprietors forming the majority in the application for the collective sale of the Development.

6 The idea of a collective sale was first mooted in the last quarter of 2006 when a real estate agent approached certain owners of the flats to consider the matter. At a meeting (loosely described as an “Extraordinary General Meeting”) held on 18 November 2006, 18 flat owners agreed to proceed with the matter by appointing the second and third defendants to form part of the sale committee. At the first meeting on 23 November 2006 convened by the Residents’ Association to discuss a possible collective sale of the flats together with the terrace houses, the owner of the nine terrace houses and 18 owners of the flats agreed to a collective sale of the property. The first defendant, representing the estate of the landowner Lim Cher Joo (deceased), was therefore appointed to the sale committee. Subsequently, a team headed by Lim Choo Koon from ERA Realty Network was appointed to market the property. There was a second meeting on 29 December 2006 where the marketing agents explained the collective sale procedure. The first collective sale agreement (“CSA”) stipulated an initial reserve price of $21,780,000. The first signature was thereunto appended on 29 December 2006. By 29 January 2007, the owners of 27 out of 33 units (including the nine terrace houses) had signed the agreement.

7 Subsequently, however, when bids were invited for purchase of the property, there was only one offer for $18,800,000. Realising that the reserve price then was too high, the owners agreed (after discussion) to reduce the reserve price to $19,800,000. To effect this variation in the CSA, a supplemental agreement was signed. The first signature to the supplemental agreement was appended on 24 March 2007. By 7 May 2007, the owners of 27 out of 33 units (including the nine terrace houses) had signed the agreement. Other owners progressively added their signatures so that by 6 September 2007, the owners of 30 out of 33 units had validly signed the supplemental agreement. This included the owners of 21 out of 24 flats.

8 On 29 May 2007, an option to purchase (“the Option”) for $21,200,000 was granted to KS Development Pte Ltd.

9 Sometime in September 2007, the majority owners recognised that despite the additional signatures, they were unlikely to obtain unanimous agreement to the CSA and that there might be the need to apply for a collective sale order. On 20 September 2007, there was a third owners’ meeting convened by the sale committee to discuss this issue.

10 On or about November 2007, the majority owners took steps with a view to applying for a collective sale order. As there were no share values attaching to the flats units, they applied for an allotment of notional share value for each unit with the Singapore Land Authority (“SLA”) pursuant to s 84E(2) of the Act. In such application, they also asked for allocation of a notional share value for each of the terrace houses. Upon valuation and survey of the Development, the proposed share values were approved by the SLA on 7 March 2008. The allocation was seven share values for each flat and six for each terrace house. On 14 March 2008, an application to the Registrar of Titles pursuant to s 84E(2) and approval for notional shares in land under s 84E of the Act was made.

11 On 16 April 2008, an application to the Board for a collective sale order was lodged. On 24 April 2008, the plaintiff, together with Han Jung Kuang Lawrence and Lee Woei Shyuan (the co-owners of unit 136H) objected to the application. However, on the day of the hearing before the Board, Han Jung Kuang Lawrence and Lee Woei Shyuan withdrew their objections.

12 The Board made an order for the collective sale of the Development on 4 December 2008. The Board applied to the Minister, under s 92(9) of the Building Maintenance and Strata Management Act 2004 (No 47 of 2004) (“BMSMA”), and obtained an extension of time to issue its grounds. The Board delivered its grounds of decision on 4 February 2009.

13 Being dissatisfied with the order of the Board, the plaintiff brought this action. On 24 February 2009, the plaintiff and defendants entered into a consent order (Summons No 581 of 2009) that the order of the Board be stayed pending the outcome of this hearing.

14 The plaintiff’s grounds of objection to the collective sale were as follows:

(a) whether it was possible to determine if the requisite majority had been obtained if notional share values were assigned after the execution of the CSA by the majority owners;

(b) that the method of distribution for the sale proceeds stipulated in the CSA (which was that each unit share equally the sale proceeds) was unfair because it did not take into account the notional share value or floor area of each unit and, pursuant to s 84E(11) of the Act, the single owner of the nine terrace houses was not entitled to the proceeds of the collective sale;

(c) that the application to the Board for a collective sale order was out of time because the application was not made within 12 months from the date the agreement of the owners representing 80% of the notional share values to the first CSA was reached;

(d) that there were numerous instances of serious non-compliance with the mandatory statutory provisions of the Act which could not be waived by the Board; and

(e) that the STB did not have the power to override the order of a Subordinate Court ordering that the plaintiff be prevented from disposing of his assets (including the flat).

15 During the hearing, I asked for submissions to include consideration of the issue whether the application for a collective sale order in respect of the Development came within the provisions of s 84E of the Act, given that the sale included the nine terrace houses standing on the land.

Purposive interpretation of the Act

16 The courts have taken a purposive approach towards interpreting the statutory provisions of the Act. Section 9A(1) of the Interpretation Act (Cap 1, 2002 Rev Ed) mandates as follows:

Purposive interpretation of written law and use of extrinsic materials 9A. — (1) In the interpretation of a provision of a written law, an interpretation that would promote the purpose or object underlying the written law (whether that purpose or object is expressly stated in the written law or not) shall be preferred to an interpretation that would not promote that purpose or object.

17 The purposive interpretation of statutory provisions was considered in PP v Low Kok Heng [2007] 4 SLR 183 (“Low Kok Heng”). V K Rajah...