Koh Joo Ann (alias Koh Choon Teck) v First Grade Agency Pte Ltd

• Jurisdiction: Singapore
• Judge: Woo Bih Li J
• Judgment Date: 09 April 2009
• Neutral Citation: [2009] SGHC 87
• Plaintiff Counsel: Tan Yew Cheng (Leong Partnership)
• Published date: 20 April 2009
• Court: High Court (Singapore)
• Defendant Counsel: Adrian Wong and Ho Hua Chyi (Rajah & Tann LLP)
• Subject Matter: Land,Equity,Trusts

9 April 2009

Woo Bih Li J:

Introduction

1 At the heart of this action is the property known as 88 Stevens Road, Stevens Court, #02-02, Singapore 257865 (“the Property”). The plaintiff, Koh Joo Ann @ Koh Choon Teck (“Koh”), is the registered proprietor of the Property. On 22 August 2007, the defendant, First Grade Agency Pte Ltd (“First Grade”), lodged a caveat against the Property (“the Caveat”) on the basis that Koh is not the beneficial owner of the Property and holds the Property on trust and that the legal title to the Property was to be transferred by Koh upon demand. In this action, Koh sought the removal of the Caveat and a declaration that Koh is the beneficial owner of the Property (“the Declaration”). First Grade and another company, Inhil Investment Pte Ltd (“Inhil”), counterclaimed for an order for Koh to transfer the Property to yet another company, Yeo Siak Hor Pte Ltd (“YSHPL”) or such other nominee as may be nominated.

Facts of the case

Background

2 First Grade is a company incorporated in Singapore, and is the marketing arm for the Sambu group of companies (“the Sambu Group”), which are family companies in the business of the production of coconut-based products in Indonesia. The President of the Sambu Group is Tay Juhana. Tay Juhana is the second maternal uncle of Koh. Inhil and YSHPL are companies in the Sambu Group. In fact, YSHPL is named after the mother of Tay Juhana.

3 In 1967, Tay Juhana started a coconut oil processing plant under PT Pulau Sambu (“PSK”) on Kuala Enok, an island in the Riau province of Sumatra, Indonesia. The business grew over the years and expanded into the Sambu Group which has more than a dozen companies.

4 Koh’s mother died when he was seven years of age. He then went to stay with his grandmother Yeo Siak Hor (Tay Juhana’s mother) at 36 Jalan Arnap, Singapore. Koh was financially supported by Tay Juhana. In 1976, six months after he completed national service, Koh commenced work as a supervisor at PSK. Over the years, Koh worked his way up through the ranks and eventually was appointed managing director of PSK in 1994.

The Property

5 In the early 1980s, Inhil, a company run by Tay Juhana’s sister, Tay Ban Geok @ Tay Teng Hoei (“Mdm Tay”), developed units in an apartment project known as Stevens Court (“the Project”) for commercial sale. In total, there were six units, from levels two to four, developed within the Project. The units were eventually not sold, however, and ownership was placed in the names of various members of the Tay family. In this regard, the legal title for three of the units was transferred in 1994 and the legal title for the remaining three units, which included the Property, was transferred in 1996. The registered proprietors of the units by end-1996 were:

Unit number	Name of registered proprietor
#02-01	Mdm Tay
#02-02 (the Property)	Koh
#03-01	Tay Chuan Yao (son of Tay Juhana)
#03-02	Tay Tuan Lee Melvin Tay Kia Hui Joanna (children of Tay Jui Cheow, brother of Tay Juhana)
#04-01	Wong Choon Lan (wife of Tay Juhana)
#04-02	Teh Jui Kern (brother of Tay Juhana)

6 There was documentary evidence that showed that the transfer of each unit in Stevens Court, including the Property, was structured as a sale of the property to the transferee. This included the director’s resolution of Inhil dated 22 February 1996 entitled “Sale of Properties at No. 88 Stevens Road”. It was not in dispute that none of the registered proprietors paid any money for his or her respective unit. For the units transferred in 1994, the stated consideration in the transfer documents was S$550,000. For the units transferred in 1996, the stated consideration in the transfer documents was S$700,000. With regards to the S$700,000 being the purported consideration for the Property, First Grade alleged that it had paid S$550,000 for each of the units and Inhil paid the balance of S$150,000. At trial, Mdm Tay admitted that the $150,000 had been borrowed from Tay Juhana^{[note: 1]}.

7 The Property was not used by Koh for residence, but was used as an informal office and a meeting place for meetings called by Tay Juhana. Koh was not given the title deeds for the Property. He did not pay for the property tax, management fees and utilities. He did not hold the keys to the Property. In 2002 and 2003, the Property was used to secure loans made to First Grade and/or a subsidiary company, Fairteck Holdings Pte Ltd (“Fairteck”).

Events leading to this action

8 In 2004, Koh and Tay Juhana had a falling out in their relationship. It is First Grade’s case that Koh had managed the Sambu group poorly or improperly in the absence of Tay Juhana. The truth of this, however, is disputed by Koh. In any event, in a series of actions, Tay Juhana stripped Koh of most of the authority he had. This led to the resignation of Koh on 16 August 2004 from his various positions in the Sambu Group.

9 On 25 August 2004, Koh had a meeting with Tay Juhana at his home. According to First Grade, at this meeting, Koh indicated that he was resigning from his positions in the Sambu Group and would return everything to the family, ie, Koh would resign and return shares in the Sambu Group which he held on trust for the Sambu Group and that the legal title of the Property would be transferred to First Grade or its nominees. Koh’s version is that he had no choice but to agree to return the shares in the Sambu Group held by him as Tay Juhana had demanded it in return for Koh’s release as guarantor for certain bank loans granted by Bank Negara Indonesia to the Sambu Group. Koh had signed the said guarantee sometime in 1997. Following this, Tay Juhana demanded that Koh agree to sign a transfer of the Property. Koh said he agreed as he feared Tay Juhana’s power and ability to make life difficult for him and his family. He alleged that on hearing that Koh would consent, Tay Juhana immediately said that he would give Koh a written undertaking to support him for the rest of his life if the transfer was signed.

10 On 13 September 2004, Koh signed the transfer forms for all his shareholdings in the Sambu Group. Koh also signed a letter of release of all claims against First Grade and a letter appointing Mdm Tay, inter alia, to sell or dispose of the Property. Meanwhile, Koh continued to receive his last-drawn salary (viz, S$40,000 per month) and bonuses up to December 2004. From January 2005 to July 2007, Koh received S$25,000 per month. According to First Grade, Tay Juhana allowed such payments for the sake of Koh’s mother and knowing that Koh had a family to feed. Koh’s version was that Tay Juhana was simply following up on his undertaking given at the meeting of 25 August 2004 to provide financial support in exchange for the transfer of the Property.

11 In May 2007, Mdm Tay made arrangements for Koh to sign the transfer instrument to transfer the Property by way of a gift to YSHPL . On 28 May 2007, Koh received a copy of the transfer instrument through email from Tay Juhana’s secretary. On 13 June 2007, Koh’s solicitor received a copy of the same document. Koh insisted on meeting Tay Juhana to obtain a written undertaking to support him financially in exchange for signing the transfer instrument. Tay Juhana refused to meet him until the transfer instrument was signed. Following this turn of events, the monthly remittance of $25,000 ceased altogether in July 2007, and on 22 August 2007, First Grade lodged the Caveat. The grounds for the Caveat appeared as follows:

By virtue of an agreement between the Registered Proprietor and the Caveator that the Registered Proprietor would hold (the Property) on trust for the Caveator and that the legal title to the Property would be transferred to the Caveator upon demand made by the Caveator on the Registered Proprietor.

12 On 7 September 2007, Koh through his solicitors demanded that First Grade remove the Caveat. An exchange of correspondence between the parties yielded no results, with First Grade threatening legal proceedings to claim the Property. However, no legal action was commenced then. On 11 January 2008, Koh lodged a Statutory Declaration with the Singapore Land Authority pursuant to s 127(2) of the Land Titles Act, claiming that the lodging of the Caveat had been vexatious, frivolous, or not in good faith. On 18 January 2008, the Registrar of Titles issued a notice to First Grade, notifying it that the caveat would be cancelled upon expiry of 30 days unless an order of court to the contrary was served or unless satisfactory evidence was furnished to show that the cancellation should be withheld or deferred. First Grade through its solicitors Rajah & Tann submitted written representations dated 13 February 2008 alleging, inter alia, that First Grade had paid part of the purchase price for the Property and that the balance of the purchase price had been paid by Inhil. The Registrar of Titles’ reply on 14 February 2008 was that the withdrawal of the Caveat would be withheld pending any orders made by the court.

13 Subsequently, Koh commenced this action for various orders including an order for the removal of the Caveat. I ordered the removal of the Caveat. There is an appeal against this decision.

14 I should also mention that in the course of the trial, there was an application to add Inhil and Tay Juhana as plaintiffs to the counterclaim. I allowed only Inhil to be added because Tay Juhana was undisputedly a “foreign person” within the meaning of the Residential Property Act (Cap 274, 1985 Rev Ed) (“RPA”) and, in my view, could not be entitled beneficially to the Property, in any event. There is also an appeal against my decision not to allow him to be added.

Koh’s case

15 Koh’s case in his pleadings was that the transfer of the Property to his name on 11 April 1996 was a gift and not on trust for anyone else. According to Koh, sometime in 1993 or 1994, Tay Juhana had told him that he (ie, Tay Juhana) was...