Loo Chay Sit v Estate of Loo Chay Loo, deceased

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 07 October 2009
• Neutral Citation: [2009] SGCA 47
• Docket Number: Civil Appeal No 30 of 2009
• Date: 07 October 2009
• Year: 2009
• Published date: 14 October 2009
• Plaintiff Counsel: Low Chai Chong, Mark Seah and Zhulkarnain Abdul Rahim (Rodyk & Davidson LLP)
• Citation: [2009] SGCA 47
• Defendant Counsel: Chiah Kok Khun and Diana Ho (Wee Swee Teow & Co)
• Court: Court of Appeal (Singapore)
• Subject Matter: Resulting trusts,Proof of evidence,Evidence,Trusts

7 October 2009 Judgment reserved.

Andrew Phang Boon Leong JA (delivering the judgment of the court):

Introduction

1 This appeal was filed by Loo Chay Sit (the plaintiff in Suit No 265 of 2005 (“Suit 265/2005”)) against the decision of the trial judge (“the Judge”) in Tan Chan Tee v Chen Tsui Yu [2009] SGHC 36 (“the Judgment”). The Judge had allowed the respondent’s counterclaim against the appellant for the sale proceeds of the property at 7 Margate Road (“the Property”).

Background

The facts

2 The present appeal concerns a dispute between members of the same family, the Loo family. The appellant, Loo Chay Sit, is the elder brother, being five years the senior of the late Loo Chay Loo (we shall refer to them collectively as “the brothers”). The respondent is Loo Chay Loo’s estate (“the Estate”) and it is represented by Loo Chay Loo’s wife, Mdm Chen Tsui Yu (“Mdm Chen”), and her brother, Chen John-son, who were appointed administrators after Loo Chay Loo passed away on or about 16 May 2005.

3 The genesis of the present appeal is an unfortunate and, indeed, tragic one. In September 2004, while in the United States, Loo Chay Loo killed his adopted son, attempted suicide and was arrested and charged for murder. On 26 February 2005, while in custody awaiting his trial, Loo Chay Loo attempted suicide again and slipped into a coma. While Loo Chay Loo was in a coma, the appellant initiated Suit 265/2005 on 21 April 2005 and named his brother as defendant, giving his hospital bed as one of the addresses. The writ was, however, not served. Less than a month later, on 16 May 2005, Loo Chay Loo succumbed to his injuries and passed away. The appellant then amended the writ to name the Estate as defendant. In his eagerness, he served the writ on Mdm Chen even before there was time to appoint her as administratrix (although she was eventually so appointed along with her brother as co-administrator).

4 The appellant claimed that the Property, which was registered in Loo Chay Loo’s name, was held by the Estate for him on a resulting trust because he had paid for it. The Property was, at one time, Loo Chay Loo and Mdm Chen’s matrimonial home and, after the couple had migrated to the United States in 1993, the residence of the appellant and his parents. The Loo family did not always reside at the Property. They initially occupied a neighbouring property, 11 Margate Road, which was a stone’s throw away from the Property. In 1978, while the family was still residing at 11 Margate Road, the brothers’ mother, Mdm Tan Chan Tee (“Mdm Tan”), came to learn through the neighbourhood grapevine that the owners of the Property intended to sell it. Her elder son, the appellant, then stepped in to conduct the negotiations for its purchase. At the time when these negotiations were under way, the appellant was going through divorce proceedings with his first wife.

5 Although the appellant was involved in the negotiations with the sellers of the Property, the Property was eventually conveyed to Loo Chay Loo in early 1979 for $195,000. Documentary evidence suggested that Loo Chay Loo had paid for the Property. Tendered in evidence were three receipts from M/s Tang & Tan, solicitors for the purchaser of the Property. The first receipt dated 9 November 1978 was for the sum of $19,500 “being payment of 10% purchase price Re: No. 7, Margate Rd., S’pore 15”^{[note: 1]} and the other two receipts dated 3 January 1979 were for the sums of $85,510.65 described as “Completion money” and $7,150.50 being payment of solicitor’s fees and disbursements.^{[note: 2]} All three receipts reflected the source of the moneys as Loo Chay Loo’s account with Lian Cheong (Loo Kee) (“LCLK”).^{[note: 3]}

6 LCLK was a business partnership first entered into between Loo Siong Loo, the brothers’ uncle, and the appellant in 1971. The younger brother, Loo Chay Loo, joined as a partner in 1975 after his National Service. The receipts reflected the purchase moneys and the payment of solicitor’s fees as coming from Loo Chay Loo’s account with LCLK. Due to the passage of time, perhaps, some of the other receipts were lost. This is why the purchase moneys stated in the receipts (for $19,500 and the $85,510.65) do not add up to $195,000 (the purchase price of the Property); they add up only to $105,010.65. Unfortunately, there is no documentary evidence of the origins of the remaining $89,989.35 of the purchase moneys.

7 After the Property was conveyed to Loo Chay Loo in early 1979, it was (curiously) the appellant who moved into it. Loo Chay Loo continued to reside at 11 Margate Road. However, a year and a half later, in June 1980, Loo Chay Loo married Mdm Chen and they moved into the Property; the appellant moved back to 11 Margate Road. Loo Chay Loo and his wife occupied the Property until their migration to the United States in 1993. In the period before their migration, the Property was mortgaged twice: first, in September 1983 to United Overseas Bank Ltd (“UOB”) to secure a facility granted by UOB to Lian Cheong Travel Services Pte Ltd, a travel company incorporated by the brothers as well as other members of the Loo family and in which Loo Chay Loo had the largest shareholding; and, secondly, in May 1990 in favour of Asia Commercial Bank to secure facilities granted to Loo Chay Loo. This second mortgage was eventually discharged using moneys remitted by Loo Chay Loo and Mdm Chen from the United States.

8 In 1999, six years after Loo Chay Loo’s move to the United States, the appellant and his parents moved into the Property and resided there till its sale on 1 September 2006. After the tragic event mentioned earlier (at [3] above) had happened, the appellant brought the claim in Suit 265/2005 against the respondent and obtained, on 29 March 2006, judgment in default of appearance. He procured the transfer of the Property to himself and sold it for $4.8m in a contract dated 1 September 2006. A year later, on 27 July 2007, the respondent successfully set aside the default judgment, and, on 3 August 2007, filed a counterclaim for the sale proceeds of the Property. On 18 January 2008, the respondent obtained an “unless order” against the appellant for he had failed to disclose, as required in an earlier court order, the details of the sale proceeds of the Property and to pay the amount into Court. The appellant failed to set aside the “unless order” and did not comply with it. In the result, his claim to the Property was dismissed.

9 The respondent’s counterclaim for the sale proceeds of the Property thus fell to be decided by the Judge in the present proceedings.

The Judge’s decision

10 On the preliminary question as to whether the respondent was entitled to adduce evidence to prove that Loo Chay Loo had paid for the Property, the appellant had objected to the adduction of such evidence on the ground that the respondent had failed to plead that Loo Chay Loo had paid for the property. The Judge acknowledged this omission in the respondent’s pleadings but held that because the respondent had denied the appellant’s plea that he had paid for the Property, the respondent was entitled to adduce evidence to show that Loo Chay Loo had paid for the Property.

11 The Judge then proceeded to consider the merits of the appellant’s claim and, in particular, the following arguments:

Arguments for the appellant’s claim

(a) The appellant had sufficient funds to purchase the Property. His current account with LCLK in 31 December 1978 had fallen by approximately $193,400 from $248,925.77 to $55,522.83. This amount was close to that paid for the Property ($195,000 was provided as the purchase price).

(b) The appellant had moved into the property on the completion of the purchase in early 1979 and only moved out in October 1980 after his brother married Mdm Chen.

(c) The title deed to the Property was kept by Mdm Tan and both the appellant and Mdm Tan herself confirmed that Loo Chay Loo had given her the title deeds for safe keeping.

(d) The relatives of the brothers had testified that the Property belonged to the appellant. The common understanding was that the appellant had bought the property and it was being held on trust for him by Loo Chay Loo.

(e) The appellant’s evidence that he had conducted the negotiations for the purchase of the Property in 1978 with its then owners had not been challenged. Loo Chay Loo had not been involved in the negotiations.

(f) The Property was also used to store the business merchandise of LCLK even after the appellant moved out in 1980.

(g) Some years after Loo Chay Loo migrated to the United States, the appellant and his parents moved into the Property and remained there until the property was sold in 2006. Loo Chay Loo made no attempt to collect rental from either his brother or his parents.

(h) In June 1999, the appellant in a letter to Loo Chay Loo and Mdm Chen had stated “if you want to talk about No 7 Margate Road, I want to say that I came up with most of the money for the purchase of the property”.^{[note: 4]} Mdm Chen, in a reply to this letter, did not deny this claim but stated instead that: “As for the property at 7 Margate Road, grandfather told us personally when he was still alive that no 7 was for Chay Loo and no 11 was for Chay Sit, but you said [illegible text] money.”^{[note: 5]}

(i) Loo Chay Loo was, at the time of the purchase of the Property, barely 24 years old and had only started working at LCLK after he had finished serving National Service. By 31 December 1978, Loo Chay Loo’s gross earnings totalled less than $195,000 (which was, it will be recalled, the cost of the Property).

Arguments against the appellant’s claim

(a) The two receipts stating a total of $105,010.65 as going towards the payment of the Property issued by M/s Tang & Tan reflects the origins of the payment as Loo Chay Loo’s account with LCLK. This is also the case for the receipt for $7,150.50 for payment of solicitors’ fees and disbursements.

(b) The Property was...