Howe Yoon Chong v Chief Assessor and Another

• Jurisdiction: Singapore
• Judge: Lord Ackner
• Judgment Date: 06 February 1990
• Neutral Citation: [1990] SGPC 2
• Date: 06 February 1990
• Subject Matter: Equal protection of the law,Increase in 'reduced' area,Constitution of the Republic of Singapore art 12(1),Method of arriving at rate per sq ft of property,Annual value,Intentional and arbitrary discrimination,Validity of valuation list,ss 2, 4(2), 8, 9, 10, 18(1) & (7) Property Tax Act 1961,Constitutional Law,Property tax,Whether valuation of property discriminatory and unconstitutional,Revenue Law
• Docket Number: Privy Council Appeal No 39 of 1988
• Published date: 19 September 2003
• Defendant Counsel: George Newman QC, Lucy Hang Chi and Michael Lazarus (Jaques & Lewis)
• Court: Privy Council
• Plaintiff Counsel: David Widdicombe QC and Pathma Selvadurai (Clifford Chance)

Cur Adv Vult

This appeal is concerned with the valuation for property tax purposes of the appellant`s dwelling house at 9 Binjai Park, Singapore, for the year 1976. The house was built in 1966, and was then ascribed an annual value of $2,400. In 1970, following a general revaluation of properties in Binjai Park, the annual value was increased to $8,400. In 1975, the appellant carried out extensive alterations and additions to the house, which resulted in the `reduced` floor area being increased from 2,340 sq ft to 4,526 sq ft. A `reduced` area is ascertained by discounting space occupied by passages and bathrooms and the like. The alterations were reported to the Chief Assessor who, by notice dated 30 November 1976, increased the annual value to $28,000. He arrived at this figure by reference to current rentals passing for comparable houses in Binjai Park, which brought out rates of between $6.83 and $10.63 per sq ft of `reduced` area. He considered a rate of $6.37 per sq ft, in the light of these comparisons, to be a fair and reasonable rate for the appellant`s house, and this, when applied to the `reduced` floor area of 4,526 sq ft, brought out his figure of $28,000.

The appellant appealed to the Valuation Review Board which, on 15 September 1980, dismissed his appeal. Various matters were canvassed in the course of the appeal but only one issue has been persisted with in subsequent proceedings. That issue arises out of the circumstance that, although there was a very substantial increase in the general level of rental values in Singapore between 1970 and 1976, the valuations of owner-occupied houses in Binjai Park which did not undergo any structural alterations during that period remained the same throughout. Thus the increased valuation placed upon the appellant`s house for 1976 resulted in the rate per square foot of `reduced` floor area for that house being very much higher than the equivalent rate in that year for those unaltered houses. It was contended for the appellant that this situation contravened art 12(1) of the Constitution of Singapore, which provides:

All persons are equal before the law and entitled to the equal protection of the law.

In order to avoid any such contravention, so it was argued, there should be applied to the floor area of the house, as increased by the alterations and additions, the same rate per sq ft as was brought out by dividing the 1970 annual value by the 1970 floor area. That rate was $3.59, which brought out a valuation for 1976 of $16,240.

The appellant appealed to the High Court, where Lai Kew Chai J accepted his argument and by judgment dated 24 October 1984, allowed the appeal and reduced the annual value of 9 Binjai Park for the year 1976 to $16,240. [See [1985] 1 MLJ 182 .]

However, on appeal by the Chief Assessor the Court of Appeal (Wee Chong Jin CJ, TS Sinnathuray and LP Thean JJ) set aside the judgement of Lai Kew Chai J and restored the order of the Valuation Review Board. [See [1988] 1 MLJ 139 .] The appellant now appeals to this Board.

At the material time, property tax in Singapore was regulated by the Property Tax Act 1961, as amended in 1973. That Act, with its amendments, has been repealed and re-enacted as the Property Tax Act 1985. The references which their Lordships shall make are to the sections in the former Act, which bear different numbers to those in the Act of 1985.

By s 9 of the Act of 1961, the Chief Assessor is required to cause to be prepared a list, to be known as the Valuation List, of all houses, buildings, land and tenements, containing certain information about each property, including its description and the annual value ascribed to it. Under s 4(2), the Chief Assessor is responsible, for the assessment of the annual values of properties for purposes of the Act. Section 8 fixes the property tax as a percentage of annual value. `Annual value` is defined in s 2 as being, so far as houses are concerned:

... the gross amount at which the same can reasonably be expected to be let from year to year, the landlord paying the expenses of repair, insurance, maintenance or upkeep and all taxes.

The definition is subject to certain provisos, two of which are in these terms:

(b) in assessing the annual value of any property, the `annual value` of such property shall, at the option of the Chief Assessor, be deemed to be the annual value as hereinbefore defined or the sum which is equivalent to the annual interest at five per cent -

(i) on the estimated value of such property, including buildings, if any, thereon; or

(ii) on the estimated value of the land as if it were vacant land with no buildings erected, or being erected, thereon;

(c) in estimating the annual value of any house, building, land or tenement, the `annual value` of such house, building, land or tenement shall, at the option of the Chief Assessor, mean the annual equivalent of the gross rent at which the same is let or licensed to the occupier or occupiers, as the case may be, and in arriving at such annual equivalent the Chief Assessor may also give consideration to any capital or periodical sums or any other consideration whatsoever, if any, which, it appears to the Chief Assessor, may have also been paid;

Other provisions of the...