LS Investment Pte Ltd v Majlis Ugama Islam Singapura

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 23 February 1998
• Neutral Citation: [1998] SGHC 51
• Docket Number: Originating Summons No 285 of 1995
• Date: 23 February 1998
• Published date: 19 September 2003
• Year: 1998
• Plaintiff Counsel: TPB Menon and William Koh (Koh & Partners)
• Citation: [1998] SGHC 51
• Defendant Counsel: TM Tan and Parhana Moreta (Mallal & Namazie)
• Court: High Court (Singapore)
• Subject Matter: Construction,Application and ensuing order made under Trustees Act,Trusts and settlements,Determination of meaning of any instrument creating or affecting Muslim charitable trust under Muslim law,Doctrine only aided those without notice of competing interest,Whether purchaser acquired title to property as result of order,Whether finding of Legal Committee satisfactory,Trust estate,Muslim charitable trust,Muslim Law,Property vested in MUIS as Muslim charitable trust at time of application for order,Whether wakaf vested in MUIS,Trusts,Constructive knowledge of solicitors translated into constructive notice of purchasers,Whether trustees of wakaf had title to deal with trust property,Property sold by vendors without title,s 59 Trustees Act (Cap 337),Sale of land,Sale by trustees of trust property to plaintiffs,Finding of valid wakaf under Muslim law by Legal Committee,Relevant considerations,Referral of matter by Majlis Ugama Islam Singapura to Legal Committee,Time when question of construction arose of relevance,Sale to purchasers void,Whether valid Muslim charitable trust created,Whether order obtained conferred on trustees power to pass good title to plaintiffs,Whether purported sale of property by trustees to plaintiffs valid,Application and ensuing order made under Trustees Act (Cap 337),No further reference to court for determination of matter,Succession and Wills,Will,Wakaf created by will,Procedure for such determination,Non-applicability of common law,Land,Purchaser obtained Order of Court to sanction sale,Wakaf,s 59 Administration of Muslim Law Act (Cap 3),Whether doctrine of bona fide purchaser for value applicable- Requirements of doctrine not fulfilled,Proper and reasonable course for purchasers' solicitors to have taken in investigating title prior to purchase,Death of testatrix before advent of Administration of Muslim Law Act- Time when question of construction arose of relevance,Death of testatrix before advent of Administration of Muslim Law Act,Method applicable for construction of Muslim will,s 63 Administration of Muslim Law Act (Cap 3),Plaintiffs obtained Order of Court to sanction sale

Judgment:

JUDITH PRAKASH J

This case involved the ownership of the leasehold premises known as No 49 Temple Street, Singapore (the property). The plaintiffs claimed to be the legal and beneficial owners of the property for the remainder of the leasehold term on the basis of an indenture of assignment executed in their favour on 29 November 1993. The defendants claimed legal title by virtue of the provisions of ss 58 and 59 of the Administration of Muslim Law Act (Cap 3) (AMLA).

2.The case arose out of a will made on 21 November 1911 by one Sharifah Shaikah bte Syed Omar bin Ali Aljunied (the testatrix). The material part of this will read as follows:

She [ie the testatrix] directs to distribute her estate according to Islamic law and after settling her debts, if she is indebted, to purchase with the balance of the one third of her estate a house or a shop and apply the net income of same for payments for holding celebration of the memorials of her, her father the late Syed Omar bin Ali Aljunied, her mother the late Sharifah Alaweyyah bte Abdullah Alkaff and her daughter Sharifah Baheyyah bte Ali Aljunied, free supply of ten vessels of zamzam water in the holy mosque of Mecca, furnishing a mat for Kor`an reciters every night for the period between the third and the fourth prayers and engaging annually somebody to perform the pilgrimage and al-omrah (homage) on her behalf.

She directs that dollars three hundred only $300 out of the nett income of her trusted property in Singapore be added to the nett income of the property purchased for the balance of the one third mentioned above if the latter income is not sufficient to carry all her said directions and the balance after the fulfillment of such directions is to be applied for charity and benevolence in general.

3.After the death of the testatrix on 11 September 1912, the executrix and executor of the will, pursuant to her testamentary directions, purchased two lots of leasehold land to be held on trust for the purposes set out in her will. One of these was the property which was purchased on 9 July 1913. The trustees of the testatrix administered both properties until one was acquired by the Collector of Land Revenue in 1978. Thereafter, the property was the single real asset of the trust created by the testatrix.

4.In June 1992, Syed Hamid bin Junid and his elder brother, distant relatives of the testatrix, were the trustees of the property. On 4 June 1992, the defendants, a body corporate established under AMLA to administer all Muslim charitable trusts, wrote to Syed Hamid asking him for a copy of the will of the testatrix in order that they would be able to ascertain whether the property was a wakaf property ie belonged to a Muslim charitable trust. Syed Hamid was not helpful and further correspondence ensued. In November 1992, his solicitors, M/s Bernard Rada & Lee, informed the defendants` solicitors that he did not have the will of the testatrix in his possession. A month later, his solicitors sent a further letter reiterating that their clients did not have the original nor a copy of the will in their possession and stating that they had written to the solicitors previously acting for the trustees asking for a copy of the will and were waiting for a reply. From then up to December 1993, nothing further was heard from Syed Hamid or his then solicitors as to the whereabouts of the will.

5.The plaintiffs now make their first appearance in the story. On 9 July 1993, they entered into an agreement with Syed Hamid and Syed Hashim bin Abdulkader Alhadad (whom I shall hereinafter collectively call `the trustees`) as the then executors and trustees of the will of the testatrix to purchase the property free from encumbrances and with vacant possession for $800,000. The purchase was to be completed at the office of the trustees` new solicitors, M/s S Nabham, two months after the trustees had obtained an order of court enabling them to sell the property.

6.An application to the High Court to sanction the sale was made shortly thereafter by OS 849/93. The summons was heard on 11 October 1993 and an order in terms of the trustees` application was made. The completion of the sale and purchase of the property took place on 29 November 1993 when the trustees executed an indenture of assignment in favour of the plaintiffs assigning the property to the plaintiffs free and discharged from all trusts and provisions of the will of the testatrix. The indenture of assignment was lodged at the Registry of Deeds, Singapore and registered on 1 December 1993.

7.In the meantime the defendants had come to know that the trustees had sold the property. They decided to lodge a caveat against the property on the basis that they were the lawful owners of the property because under the provisions of s 59 of AMLA, all properties forming part of Muslim charitable trusts and subject to provisions of s 58 of AMLA, vested in them. This caveat was lodged at the Registry of Deeds on 2 December 1993.

8.The plaintiffs came to learn of the defendants` caveat some time in February 1995. On 23 March that year they filed this originating summons whereby they prayed for an order that the defendants` caveat be expunged and the defendants be injuncted from lodging any further caveats against the property. They also wanted damages. The defendants` response was to assert that they were the lawful owners of the property and that the plaintiffs had no title thereto as they had purchased it from the trustees who themselves did not have a valid title. The defendants counterclaimed for an order confirming that the property had vested in the defendants and that all entries in the Register of Deeds and other record books relating to the deed of assignment in respect of the property between the trustees and the plaintiffs and any other instruments purporting to assign the plaintiffs` purported interest in the property be expunged.

9. The issues

The main issues which I had to decide were as follows: (a). whether prior to the deed of assignment between the plaintiffs and the trustees, legal title to the property was vested in the trustees or in the defendants. This involved a consideration of two sub issues:

(i). whether by her will the testatrix had created a valid Muslim charitable trust or wakaf covered by AMLA; and

(ii). whether the effect of AMLA was to automatically vest in the defendants the legal title to properties in respect of which a charitable trust had been created under Muslim law where the testatrix had died before AMLA came into effect;

(b). whether the fact that the sale to the plaintiffs was sanctioned by an order of court meant that the defendants` claim had been transferred to the proceeds of that sale and the apartment which the trustees had bought with it and could no longer be maintained against the property; and

(c). whether the plaintiffs were entitled to rely on the doctrine of bona fide purchaser for value without notice.

(a) What was the effect and result of the will of the testatrix?

10.The plaintiffs pointed out that by her will the testatrix directed that the income of the property to be purchased by the trustees should be applied to: (a). pay for ceremonies in memory of herself, her late parents and her late daughter;

(b). the free supply of ten vessels of zamzam water in the mosque at Mecca;

(c). furnishing a mat for Kor`an reciters every night; and

(d). engaging someone to perform the haj and al-omrah pilgrimages on her behalf.

They argued that as the testatrix died in 1912, the law applicable was the law existing in 1912 and that items (a) and (d) were not recognised as charitable purposes and that, consequently, the objects of the gift being partly charitable and partly not, the whole gift failed for uncertainty. They relied on Re Hadjee Esmail bin Kassim, deceased [1911] 12 SSLR 74.

11.In that case, the testator had directed that one third of his property be held upon trust for a named period as a wakaf and that the income from it should from time to time be applied for five defined purposes among which were (1) the payment of monthly, yearly and other ceremonies in his memory and (2) for pilgrimages to Mecca. It was held by Hyndman-Jones CJ that ceremonies prima facie intended in honour of an individual could in no sense be charitable since their observance did not lead to any public advantage or usefulness and that the sponsoring of pilgrimages was not charitable either since there was no evidence that they achieved anything more than merely solacing the pilgrim and possibly his family. It would be noted that in coming to this decision, his Lordship relied on the principles of the English law of charitable trusts.

12.The plaintiffs were aware that in putting forward the above argument they had to deal with the formidable obstacle of the decision of the Court of Appeal in Abdul Rahman bin Mohamed Yunoos v Majlis Ugama Islam Singapura [1995] 2 SLR 705 and they sought to distinguish that decision on the basis that it did not consider nor overrule Haji Esmail `s case. In my judgment, however, even if Haji Esmail `s case was not expressly overruled by Abdul Rahman bin Mohamed Yunoos , the latter case made clear that the method of approach which had been used in Haji Esmail was no longer available to a Singapore court faced with the issue of...