Jocelyn Rita d/o Lawrence Stanley v Tan Gark Chong

• Court: High Court (Singapore)
• Judge: Audrey Lim JC
• Judgment Date: 14 May 2019
• Neutral Citation: [2019] SGHC 125
• Citation: [2019] SGHC 125
• Hearing Date: 01 March 2019,03 April 2019,05 March 2019,27 February 2019,26 February 2019
• Published date: 23 January 2020
• Docket Number: Suit No 872 of 2017
• Plaintiff Counsel: Nichol Yeo Lai Hock, Nicholas Narayanan, Chan Bi Qing (JLC Advisors LLP)
• Defendant Counsel: Andy Chiok Beng Piow (JHT Law Corporation)
• Subject Matter: Deeds and Other Instruments,Deeds,Duress,Illegality,Trusts,Trustees,Duties,Duty to let trust property

Audrey Lim JC: Introduction

The plaintiff (“Jocelyn”) and the defendant (“Richard”) were husband and wife. Jocelyn commenced this action against Richard alleging a breach of a declaration of trust executed on 17 April 2012 (“DOT”) in which it was declared that Richard held two properties at Jalan Ampang (“the Ampang Property”) and Jalan Wajek (“the Wajek Property”) (collectively, “the Properties”) on trust for Jocelyn. She alleged that Richard failed to rent out the Properties and failed to execute an option to purchase (“OTP”) for the Ampang Property when she had found a buyer for it. She thus claimed, inter alia, for loss of rental income for the Properties and damages as a result of the diminution in value of the Ampang Property.

Background matters

The parties were married in 1965. Jocelyn was a Malaysian citizen who became a Singapore permanent resident in 1976 and then a Singapore citizen in February 2001.

In April or May 1990, the parties purchased the Ampang Property in their joint names, having obtained permission from the relevant authorities for Jocelyn to be registered as a co-owner as she was then not a Singapore citizen. Subsequently they decided to purchase the Wajek Property to live in and to rent out the Ampang Property. As Jocelyn did not receive approval from the authorities to rent out the Ampang Property, and the parties could not jointly purchase the Wajek Property, she transferred her interest in the Ampang Property to Richard in July 1998. In September 1999, the Wajek Property was purchased in Richard’s name.

In early 2012, the parties’ relationship took a turn for the worse. It was during this time that the DOT was executed and signed by the both of them on 17 April 2012. I set out the material terms of the DOT below:¹

THIS DECLARATION OF TRUST is made [17 April 2012] by [Richard] (hereinafter called “the Trustee”).

WHEREAS:- (1) This declaration is supplemental to the purchase of the properties known as [the Wajek Property] and [the Ampang Property] (hereinafter collectively called “the Properties”) (2) The Trustee hereby declare [sic] that the purchase prices of the Properties said to have been paid by the Trustee … were in fact provided by [Jocelyn] (hereinafter called “the Beneficiary”) and the Properties has been held [sic] by the Trustee as trustee for the Beneficiary as the Trustee hereby acknowledges.

NOW THIS DEED WITNESSETH that the Trustee hereby declares that he holds the Properties in trust for the Beneficiary absolutely and hereby agree [sic] that he will at the request and cost of the Beneficiary transfer the Properties to the Beneficiary or to such person or persons at such time and in such manner or otherwise deal with the same as the Beneficiary shall direct or appoint.

The Trustee and the Beneficiary hereby covenant with each other as follows: (a) all income, rental and/or investment derived from the Properties shall be deposited in the joint bank account which the Trustee and the Beneficiary have with a Bank; (b) to pay or contribute all due proportion of all rates taxes premiums of insurance and other outgoings payable in respect of the Properties and all other expenses as may be paid for by the Beneficiary from the joint bank account; (c) to keep indemnified each other from all actions claims and demands incurred or to be incurred by such last mentioned party by reason for any default on the part of the covenanting party in performing his/her obligations under this clause …

[emphasis added in bold]

In August 2013, Richard filed for divorce (“the First Divorce Proceedings”) but this was withdrawn. He again filed for divorce in 2016 but this was also withdrawn. Richard filed the final divorce proceedings in 2017 leading to interim judgment being granted in May 2017, with the ancillary matters pending to be heard after this suit.

Plaintiff’s case

Jocelyn claimed that the marriage broke down as Richard was having an affair, which she discovered in around February 2012.² Throughout their marriage, they had agreed to leave the family’s wealth to their children and grandchildren. Worried that in the event of a divorce, Richard would get a share of the matrimonial assets and spend it rather than preserve it for future generations, she wanted him to transfer his beneficial interest in the Properties to her.

Hence in early April 2012, Jocelyn instructed Gabriel Law Corporation (“Gabriel Law”) to prepare a draft trust deed for Richard to transfer the beneficial interest in the Properties to her. Richard refused to sign this trust deed as it did not stipulate that he was to receive any rental income from the Ampang Property. Jocelyn then instructed Mr Jeffrey Beh (“Beh”), a family friend and lawyer from Lee Bon Leong & Co, to prepare another trust deed to transfer the beneficial interest in the Properties to her and to provide for rental income from the Properties to be deposited into a joint bank account.³ On 16 April 2012, Beh went to the matrimonial home (then the Wajek Property) and spoke to Richard about the trust deed. The next day Beh returned with the DOT which Richard signed.

On 24 October 2012, Richard moved out of the Wajek Property to stay with the parties’ daughter Shona. Jocelyn remained at the Wajek Property until August 2013, when she moved to the Ampang Property.

Jocelyn alleged that there was an implied term in the DOT that the trustee (Richard) would rent out the Properties and deposit the income or rental into the parties’ joint account to pay for outgoings related to the Properties for the beneficiary’s (Jocelyn’s) benefit. Richard failed in his duties to rent out the Properties after he moved out from the Wajek Property, and Jocelyn thus claimed for loss of rental from the Properties. Further, in July 2013, Jocelyn found a buyer for the Ampang Property for $8.8m but Richard refused to sign the OTP for the intended sale. Consequently, the intended sale did not materialise and the Ampang Property has since diminished in value.

Defendant’s case

Richard claimed that he signed the DOT under duress. He denied that he was having an affair but Jocelyn repeatedly harassed, nagged and ranted at him regarding the alleged affair. In early April 2012 (before the DOT was executed), he was also suffering from poor health. To obtain respite from Jocelyn’s behaviour, he moved out to stay with Shona for three nights before moving back to the Wajek Property again.⁴

Richard confirmed that he was initially given a document prepared by Gabriel Law that Jocelyn wanted him to sign. He refused to sign the document as he disagreed with its terms, which stated that the Properties were acquired using Jocelyn’s moneys. Richard denied that Beh, a mutual friend, had met him on 16 April 2012. However, he did sign the DOT on 17 April 2012 when Beh went to the matrimonial home with it. Richard was surprised by Beh’s visit that day as he did not know that Jocelyn had asked Beh to prepare a trust deed. When Richard saw that the DOT stated that the Properties were purchased with Jocelyn’s moneys and that he was all along a trustee of the Properties for her, he told Beh that he disagreed with the terms of the DOT as the Ampang Property was paid for partly with his CPF moneys. Nevertheless, because of the unpleasant situation at home, he felt compelled to sign the DOT in the hope that some peace and normalcy would return to his life. On 24 October 2012, Richard left the matrimonial home permanently to stay with Shona as Jocelyn continued to harass him.

Richard also claimed that the trust arrangement under the DOT was illegal, null, void and unenforceable under ss 3 and 23 of the Residential Property Act (Cap 274, 2009 Rev Ed) (“the RPA”).⁵ Even if the DOT was valid, Richard denied being in breach of his duties as a trustee under the DOT.

Richard also called Shona and Kelvin (the parties’ son) to testify, and I will refer to their evidence in my findings below where necessary.

The issues

The main issues for consideration are as follows: whether the DOT was vitiated by duress or illegality due to contravention of the RPA; and if the DOT is valid and enforceable, whether Jocelyn can succeed in her claims for lost rental in respect of the Properties, and diminution in value due to the aborted sale of the Ampang Property.

Preliminary issue – Application for hearing in camera

At the outset, Richard’s counsel (Mr Chiok) applied for the matter to be heard in camera pursuant to s 8(2) of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) (“the SCJA”), and relying on BOK v BOL and another [2017] SGHC 316 (“BOK”). This was a private dispute between family members and that the defendant’s witnesses were the parties’ children who were “prominent professionals”. Also, there were ancillary matters in separate divorce proceedings between the parties. Finally, a hearing in camera would decrease the acrimony between the parties. Jocelyn objected to the application.

I disallowed the application because there was no reason to depart from the position that a civil matter is to be heard in open court under s 8(1) of the SCJA, and I was not satisfied that there was any sufficient reason to order the hearing to be in camera. In BOK, one of the defendants, who was a party to the suit, was an infant. Unlike in BOK, there were no minor children involved and the witnesses who Richard intended to call were adults. Moreover, the mere fact that the action concerned a dispute between family members was unexceptional and did not per se justify a hearing in camera, even if the same parties were embroiled in a pending matrimonial case. That the witnesses were professionals or family members did not mean that they should be afforded privacy from open court proceedings. Many civil proceedings involve disputes between family members, in which family members are called as witnesses. Finally, I was not convinced that a hearing in camera would...