Ho Seek Yueng Novel and Another v J & V Development Pte Ltd

JudgeAndrew Phang Boon Leong J
Judgment Date18 April 2006
Neutral Citation[2006] SGHC 63
Docket NumberOriginating Summons No 1569 of 2004
Date18 April 2006
Published date19 April 2006
Plaintiff CounselRonnie Tan Siew Bin and Noelle Seet Siok Lin (Central Chambers Law Corporation)
Citation[2006] SGHC 63
Defendant CounselHri Kumar, Gary Leonard Low and Benedict Teo Chun-Wei (Drew & Napier LLC)
CourtHigh Court (Singapore)
Subject MatterWhether oral loan unenforceable under s 6(d) Civil Law Act,Formalities,Whether oral agreement for interest-free loan in respect of purchase and sale of land existing between plaintiffs and defendant,Contract,Section 6(d) Civil Law Act (Cap 43, 1999 Rev Ed),Land,Whether defendant having right to lodge caveat,Whether right of first refusal granted orally unenforceable pursuant to s 6(d) Civil Law Act,Wrongful lodgment,Whether plaintiffs granting defendant right of first refusal for purchase of land,Defendant lodging caveat against land on basis of alleged right of first refusal for purchase of land granted to it by plaintiffs,Defendant lodging caveat against land on basis of alleged oral agreement to grant plaintiffs interest-free loan,Section 115 Land Titles Act (Cap 157, 2004 Rev Ed),Whether right of first refusal for purchase of land constituting caveatable interest in land,Caveats,Whether interest-free loan granted for purchase of land constituting caveatable interest in land

18 April 2006

Andrew Phang Boon Leong J:


1 The basic facts in the present case were exceedingly simple. This is in contrast to the raw emotions that constituted a central (and unpleasant) strand throughout the proceedings, which were (in many ways) the very antithesis of the objective nature of the present proceedings (see [3] below). More specifically, this case witnessed nephews being pitted against their uncle. As we shall see, the mother of the former was a key protagonist as well, although she was not a party to the present proceedings as such. Indeed, other members of the same family were aligned in her camp, so to speak. It was the case of “one versus the rest”, although mere numbers alone are of course inconclusive, as the focus of the court was necessarily to be based on an objective analysis of the relevant facts and the law in order to arrive at a fair and just decision (see [3] below), ignoring the surrounding emotions (both express and implicit) in the process.

2 The “one” comprised one Mr Tan Hock Keng (“Mr Tan”). He is in fact the owner of the defendant company in the present proceedings. Indeed, throughout these proceedings as well as in all the pleadings and submissions, both were referred to interchangeably by all concerned. This is not surprising because, for all intents and purposes, Mr Tan and his companies were one and the same. No issue or objection was therefore taken by either party with regard to this mode of reference and I shall adopt this approach in this judgment as well. Amongst the “many”, as I have just mentioned, are the two nephews, who are the plaintiffs in the present proceedings. The first plaintiff is Mr Novel Ho. The second, Mr Jeffrey Ho, is his younger brother.

3 The task of this court is simple. It is to assess, objectively, the evidence (in particular, the credibility of the respective witnesses) in relation to the relevant law and arrive at a decision consistent with the justice and fairness of the case.

4 The background to this case begins with Mr Tan finding himself in financial difficulties. This much was not in dispute.

5 Mr Tan then approached the plaintiffs to ascertain whether they desired to purchase properties he owned. As it turned out, the plaintiffs purchased twelve properties from him and companies within his group (including the defendant) between December 2001 and June 2002.

6 Amongst the twelve properties are two properties (“the subject properties”) located at 696 and 698 Geylang Road (and purchased in the name of the first plaintiff and the second plaintiff, respectively). Mr Tan had caused caveats to be lodged against the twelve properties (including the subject properties) on two grounds. Indeed, what in fact triggered the lodging of the said caveats was the fact that Mr Tan had discovered, by chance, that the first plaintiff had, in respect of 696 Geylang Road, entered into a sale and purchase agreement with third parties without first offering the same to either him or the defendant, or even notifying them of the sale.

7 Mr Tan claimed, first, that he had, via a private oral agreement entered into on behalf of himself and his companies (including the present defendant), granted the plaintiffs a loan in respect of the sale and purchase of the twelve properties, including the subject properties. More specifically, he alleged that the plaintiffs were not required to pay the deposit or the balance purchase price which was not financed by a bank loan with respect to each of the twelve properties; this was, in effect, treated as an interest-free loan to the plaintiffs. And this, he argued, conferred a caveatable interest over the subject properties. I pause here to note that it was not unreasonable for this agreement to have been made orally, especially if we take into account previous dealings which were also made in a family (and, on occasion, even non-family) context. I also note that the defendant had furnished satisfactory reasons as to why certain other specific transactions the plaintiffs referred to were, on the other hand, in writing.

8 Secondly, Mr Tan claimed that, pursuant to the same private oral agreement referred to in the preceding paragraph, the plaintiffs had also granted him and his companies a right of first refusal in respect of the twelve properties, including the subject properties. This, too (he argued), conferred a caveatable interest over the subject properties. More specifically, Mr Tan claimed that it was agreed that should the plaintiffs decide subsequently to sell any of the twelve properties, they were obliged to first offer the same to Mr Tan and/or his nominee. Mr Tan further claimed that in the event that he agreed to purchase the property concerned, the loan granted to the plaintiffs in respect of the said property would be set off against the sale price but if he did not desire to purchase the property and the property was sold to a third party, the loan concerned would then be repaid by the plaintiffs from the sale proceeds. Finally, Mr Tan claimed that it was further agreed between him and the plaintiffs that if he should call on the loans, the plaintiffs were obliged to repay the loans or, if they were unable to do so, they (the plaintiffs) were to sell the property concerned back to Mr Tan and/or his nominee at a price to be agreed or at the prevailing market price.

9 The present proceedings were originally commenced by the plaintiffs under an originating summons in order to compel the defendant to remove the caveats it had lodged, as well as for orders that the defendant and Mr Tan, respectively, be liable for the damage and/or losses allegedly caused to the plaintiffs by the lodgement of the said caveats. This was later converted into a writ action, which comprise the present proceedings before this court.

10 The defendant also mounted, in these proceedings, a counterclaim against the plaintiffs, asking for recovery of the alleged amounts lent pursuant to the alleged loan arrangement mentioned above.

11 One more matter ought to be mentioned briefly.

12 There had been an earlier action involving the first plaintiff and Mr Tan. Mr Tan was the plaintiff in those proceedings. He was seeking to recover shares of a printing company held by Mr Novel Ho and a couple of other employees, which shares were transferred during a period when Mr Tan was himself critically ill with an acute liver ailment (ultimately requiring a liver transplant). Mr Novel Ho claimed, inter alia, that he was the owner of the company and, hence, the shares.

13 The matter referred to in the preceding paragraph was ultimately settled, with Mr Novel Ho and the other employees transferring the shares back to Mr Tan without consideration. In my view, the seeds of acrimony had already been sown. Indeed, from the relevant testimony as well as the overall tenor of the present proceedings, the claim by counsel for the defendant, Mr Hri Kumar, in his closing submissions, that the plaintiffs’ conduct in the present action was part of a wider conspiracy to deprive Mr Tan of his business interests and assets had the ring of truth about them. However, to be fair to the plaintiffs, I did not rest my decision on this as the earlier action was not within the direct purview of this court.

The issues

14 There were, in essence, just a few simple issues in the present case. The main factual and legal issues were as follows.

15 First, did Mr Tan grant the plaintiffs, his nephews, an interest-free loan by not collecting the deposit as well as the balance of the purchase price that was due to his company as vendor of the subject properties? If so, did this loan involve an interest in land that was caveatable under s 115 of the Land Titles Act (Cap 157, 2004 Ed) (“LTA”)? Further, does the fact that this loan was oral in nature render the entire transaction unenforceable pursuant to s 6(d) of the Civil Law Act (Cap 43, 1999 Ed) (“the Civil Law Act”)? If so, what was the legal effect on the caveats lodged?

16 Secondly, was there a right of first refusal accorded to Mr Tan by the plaintiffs in so far as, inter alia, the purchase of the subject properties considered in this case were concerned? If so, did such a right constitute, in law, a caveatable interest, thus justifying the caveats caused by Mr Tan to be placed over the subject properties? A related issue is whether or not a right of first refusal given orally was unenforceable pursuant to s 6(d) of the Civil Law Act and, if so, what was the legal effect on the caveats lodged.

The first issue – the alleged loan

Was there a loan granted to the plaintiffs by the defendant?

17 Turning to the first main issue, this was primarily an issue of credibility. Both parties adopted diametrically opposed stands. The plaintiffs argued that they had – through their mother and her younger brother – paid Mr Tan in full. They argued, in particular, that cash had been paid to Mr Tan. This explains why there are no cheques made out in Mr Tan’s name. However, there are receipts, all signed (in the case of the subject properties in the instant proceedings at least) by Mr Tan himself. I find the existence of these receipts to be the most powerful argument in the plaintiffs’ favour in so far as this first issue is concerned. In other words, why would Mr Tan issue receipts to the effect that the money had been received when he claimed that the very same sums had not been collected and had, as I have mentioned, been treated as a loan to the plaintiffs instead?

18 Had I stopped at this juncture, I would have found in favour of the plaintiffs on this particular issue. However, I found Mr Tan’s explanation for the seemingly inconsistent conduct on his part to be persuasive. In essence, Mr Tan stated that he was told by the second plaintiff, Mr Jeffrey Ho, that the receipts were required for the completion of the respective sale and purchase agreements with regard to the subject properties. In other words,...

To continue reading

Request your trial
10 cases
  • Ong Chay Tong & Sons (Pte) Ltd v Ong Hoo Eng
    • Singapore
    • Court of Appeal (Singapore)
    • 24 October 2008
    ...whether what is provided in SC3, or the new SC3, constitutes a caveatable interest. In Ho Seek Yueng Novel v J & V Development Pte Ltd [2006] 2 SLR 742 (“Novel Ho”), a decision of the High Court, Andrew Phang Boon Leong J was of the view that it was eminently fair, logical and commonsensica......
  • Joseph Mathew and Another v Singh Chiranjeev and Another
    • Singapore
    • Court of Appeal (Singapore)
    • 29 October 2009
    ...decisions of Eng Bee Properties Pte Ltd v Lee Foong Fatt [1993] 3 SLR 837 at [26] and Ho Seek Yueng Novel v J & V Development Pte Ltd [2006] 2 SLR 742 at [52]; as well as Martin Dray and Adam Rosenthal, Barnsley’s Land Options (Sweet & Maxwell, 4th Ed, 2005) at pp Were the requirements unde......
  • Salbiah bte Adnan v Micro Credit Pte Ltd
    • Singapore
    • High Court (Singapore)
    • 26 November 2014
    ...Dykstra v Dysktra (1991) 22 NSWLR 556 (refd) Epple v Wilson [1972] VR 440 (refd) Ho Seek Yueng Novel v J & V Development Pte Ltd [2006] 2 SLR (R) 742; [2006] 2 SLR 742 (refd) Irani Finance Ltd v Singh [1971] Ch 59 (refd) Kua Hui Li v Prosper Credit Pte Ltd [2014] 3 SLR 1007 (refd) Ong Chay ......
  • Lew, Solomon v Kaikhushru Shiavax Nargolwala and others
    • Singapore
    • International Commercial Court (Singapore)
    • 5 February 2020
    ...156 ER 424 and a more recent decision of Andrew Phang Boon Leong J (as he then was) in Ho Seek Yueng Novel v J&V Development Pte [2006] 2 SLR(R) 742 at [50]. In the latter case Phang J held (obiter) that a right of first refusal to purchase real property did not fall within s 6(d) on the ba......
  • Request a trial to view additional results
2 books & journal articles
  • Land Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2008, December 2008
    • 1 December 2008
    ...to benefit Lot 111-34 in the manner intended by the grant. Caveatable interest 18.20 In Ho Seek Yueng Novel v J & V Development Pte Ltd[2006] 2 SLR 742, the High Court had ruled that a right of first refusal is an interest in land for the purpose of lodging a caveat under the Land Titles Ac......
  • Land Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2006, December 2006
    • 1 December 2006
    ...the net sale proceeds of the flat when it was sold. Caveats Caveatable interest 18.52 In Ho Seek Yueng Novel v J & V Development Pte Ltd[2006] 2 SLR 742, the owner (‘B’) of the defendant company caused caveats to be lodged against 12 properties purchased by the plaintiffs. Among the 12 prop......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT