Goi Wang Firn (Ni Wanfen) and others v Chee Kow Ngee Sing (Pte) Ltd

• Jurisdiction: Singapore
• Judge: Steven Chong J
• Judgment Date: 17 December 2014
• Neutral Citation: [2014] SGHC 261
• Date: 17 December 2014
• Docket Number: Suit No 1016 of 2013 (Registrar’s Appeal No 329 of 2014)
• Published date: 22 December 2014
• Plaintiff Counsel: James Ponniah and Leong Sue Lynn (Wong & Lim)
• Hearing Date: 23 October 2014
• Defendant Counsel: Tan Hsuan Boon and Yeo Zhen Xiong (Wee Swee Teow & Co)
• Court: High Court (Singapore)
• Subject Matter: Admissibility of evidence,Hearsay,Evidence,Corporate beneficiary,Rule against perpetuities,Trusts,Express trusts

Steven Chong J: Introduction

The facts of this case are not complicated. Property registered in the name of a man who has since passed on is now the subject of an ownership dispute between parties seeking opposing declarations from the court. On the one hand, the executors and trustees named in the deceased’s will claim that the property is wholly owned by his estate and available for distribution as a part thereof. On the other hand, a company (of which the deceased was previously a director) asserts that the property is held on express trust for it and therefore did not fall within his estate for distribution. The company adduced documentary proof to show that the deceased had made clear and unequivocal declarations of trust in its favour during the course of his lifetime and, on the basis of such evidence, succeeded in striking out the executors’ claim before the Assistant Registrar. The executors appealed against the Assistant Registrar’s decision, and this came up for hearing before me.

While the facts of this case may not be particularly remarkable, they did generate some interesting legal arguments from counsel for the executors, Mr James Ponniah (“Mr Ponniah”), in his attempt to undermine the otherwise unquestionable validity of the purported express trust. First, he began by arguing that the well-established “beneficiary principle” in trusts law prohibited the creation of an express trust for the benefit of a non-human entity such as the company in this case. That struck me as a rather startling submission for I have never understood the “beneficiary principle” to draw a distinction between trusts for human and non-human beneficiaries so long as it was capable of enforcement. However, as I was not pointed to any specific authority which has dealt squarely with this point, I considered that it would be beneficial to examine Mr Ponniah’s submission more closely.

Second, Mr Ponniah also further submitted, in the course of developing the above argument, that a company could exceptionally be the beneficiary under an express trust if the trust was (a) expressed to be for the purpose of benefitting human beings, and (b) limited in duration within the common law perpetuity period of a life in being plus 21 years. He argued that these two qualifications could be drawn from the oft-cited authority of In re Denley’s Trust Deed [1969] 1 Ch 373 (“Re Denley’s Trust”) which, by his understanding, was similarly a case involving an express trust for the benefit of a company. On this view, it was submitted that the deceased’s declarations fell short as they neither specified the purpose nor the duration for which the property was to be held on trust. Again, I found this argument rather intriguing because Mr Ponniah’s interpretation of Re Denley’s Trust, viz, that it was a trust for a company, did not accord with my understanding of the decision.

The arguments as broadly outlined above clearly touch on several fundamental and interconnected concepts of trusts law which, in my view, merit closer examination. To provide a more complete picture of the analysis which follows, however, I should add that Mr Ponniah also attacked the existence of the alleged express trust on several other fronts. In this regard, it was argued that, apart from the legal objections stated above, the trust was also invalid because the deceased lacked the necessary intention to create it. Further, it was also argued that, as a matter of evidence, certain classes of documents which the company sought to rely on to prove the express declarations of trust were in any event either inadmissible as proof of the express trust or should be given little weight.

These arguments will be fleshed out in greater detail below. For now, I shall proceed to set out the background to the parties’ dispute and the procedural history leading to the present appeal.

Background to the appeal The parties’ dispute

The plaintiffs are the children of one Mr Goi Lai Soon (“the Deceased”) who passed away on 16 September 2011.¹ They were named in the Deceased’s will as the joint trustees and executors of his estate.² They were each also bequeathed a one-third share in 50% of the estate with the other 50% to be distributed to the Deceased’s wife.³

The defendant is a family-run company which was incorporated in Singapore on or about 13 October 1969 and carries on the business of operating department stores cum supermarkets.⁴ The Deceased was one of its four original directors and shareholders and remained as such until his death.⁵ The remaining three original shareholder-directors of the defendant were the Deceased’s father, Goi Chong Siak (“GCS”), and the latter’s two younger brothers, Goy Chong Ngee (“GCN”) and Goy Seng Tee (“GST”).⁶

The parties’ dispute is over the ownership of a 999-year leasehold property commencing from 1 January 1970⁷ known as 153 Thomson Road, Goldhill Shopping Centre, Singapore 307607 (“the Leasehold”).⁸ The Leasehold is registered in the name of the Deceased. The transaction-history of the Leasehold leading up to the Deceased’s acquisition of the legal title in the Leasehold is evidenced by the following: First, there was a sale and purchase agreement of the Leasehold dated 19 June 1968 between Goldhill Properties Limited (“GPL”) as vendor and Ang Peow Tian (“Ang”) and Lim Poo @ Lim Guat Poo (“Lim”) as purchasers.⁹ The total purchase price was stated as $58,500 and was to be paid by Ang and Lim to GPL in instalments. On 12 February 1969, the Deceased entered into an agreement with Ang and Lim who had, by this time, made partial progress payments amounting to $20,475 to GPL.¹⁰ Pursuant to this agreement, Ang and Lim assigned all their rights, interests and obligations under the existing sale and purchase agreement with GPL to the Deceased. This assignment was in consideration of the Deceased paying them $20,475 and the balance purchase price of the Leasehold to GPL. On 2 August 1973, the Deceased entered into a separate agreement with GPL whereby the latter agreed to transfer the Leasehold to the Deceased in consideration of the Deceased paying the balance purchase price.¹¹ On 3 September 1981, the Subsidiary Certificate of Title to the Leasehold was issued in the name of the Deceased and registered in Subsidiary Land Register Volume 73 Folium 158.¹²

I pause here to note that the parties’ pleaded positions differed as to who had paid for the purchase of the Leasehold pursuant to the agreements in (b) and (c) above. The plaintiffs contended that the entire purchase price was paid by the Deceased partly upon taking the assignment from Ang and Lim and the balance thereof directly to GPL.¹³ The defendant, however, denied this and pleaded that it had given valuable consideration and/or had paid for the Leasehold.¹⁴ It would ordinarily be material in the context of such ownership disputes to investigate into the true source of funds for the purchase of the property. This exercise is conducted in order to determine whether a resulting trust operates in favour of the payor who would generally seek to argue a split between the beneficial and legal title. However, I was not required to undertake such an inquiry here because, during the hearing before me, counsel for the defendant, Mr Tan Hsuan Boon (“Mr Tan”), did not seriously pursue this point. He was content to take the plaintiffs’ case at its highest by accepting (without prejudice to his position in the underlying action) that the Deceased had indeed paid for the entire purchase because that accorded with his primary case which was premised on the existence of an express trust – the fact that beneficial ownership vested with the Deceased was consistent with him being competent, by express declaration, to divest himself of the same. The defendant’s case based on an express trust will be elaborated upon below.

The Leasehold was initially used in the early 1980s by the defendant for its business operations.¹⁵ Subsequently, from 1990 onwards, it was rented out to various tenants with the defendant being named as the landlord under the successive tenancy agreements.¹⁶ The execution of these tenancy agreements by the defendant was typically approved by directors’ resolutions (signed, inter alia, by the Deceased) stating that the defendant would “let out its property known as No 153 Goldhill Centre Thomson Road, Singapore … and that [the Deceased], a director of [the defendant] be authorised to sign the lease for and on behalf of [the defendant]” [emphasis added].¹⁷ The defendant collected the rental proceeds in respect of these agreements which was paid into its bank account and reflected in its audited accounts.¹⁸ The defendant also settled the property tax and other outgoings and maintained the Leasehold.¹⁹ This state of affairs continued even after the Deceased’s demise in September 2011.

Probate of the Deceased’s will was granted to the plaintiffs as the executors jointly on 23 July 2013 and extracted on 26 July 2013.²⁰ The plaintiffs subsequently sought legal advice and were informed that they now stood in the shoes of the Deceased as the registered proprietor of the Leasehold whose title was paramount.²¹ Consequently, the plaintiffs sought to distribute the Leasehold in accordance with the Deceased’s testamentary wishes.²²

The plaintiffs aver, however, that the second plaintiff was then informed by a director of the defendant, Mr Goy Siang Boon, that the Deceased held the Leasehold on trust for the defendant.²³ The second plaintiff, who was and still is a director of the defendant, was also informed that he would be acting in breach of his fiduciary duty to the defendant and acting in conflict of interest if the Leasehold was distributed according to the Deceased’s will. In light of such opposition, the plaintiffs decided that they had no choice but to commence the underlying action in Suit No 1016 of 2013 to resolve the dispute over the...