Regenthill Properties Pte Ltd v Management Corporation Strata Title Plan No 2192

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 05 July 2002
• Neutral Citation: [2002] SGCA 32
• Date: 05 July 2002
• Subject Matter: Statutory Interpretation,Whether failure to itemise specific documents sought for fatal to application,Whether documents relating to maintenance fund relate to condominium developer's 'transaction and financial position',Whether sufficient particulars to identify cause of action,Civil Procedure,O 7 r 3(1) Rules of Court,Whether successor trustee can require outgoing trustee to deliver up records pertaining to trust,Originating processes,Regularity,s 199 Companies Act (Cap 50, 1994 Ed),s 37(4) Land Titles (Strata) Act (Cap 158, 1999 Ed),Irregularity,Whether s 39 of Interpretation Act (Cap 1, 1999 Ed) precludes civil action based on penal provision when plaintiff suffers no injury,Originating summons,Right to institute proceedings,Setting aside for non-compliance with rules,Trustees,Trusts,Whether developers of condominium have to hand over accounting documents pertaining to maintenance fund,Land,Determination of trusteeship,s 39 Interpretation Act (Cap 1, 1999 Ed),Fresh step in proceedings constituting waiver of irregularity,Delivery of documents,Management corporation,O 2 r 2 Rules of Court,Construction of statute,Strata titles,Trust documents,Whether irregularity serious or prejudicial to opposing party
• Docket Number: Civil Appeal No 600153 of 2001
• Published date: 19 September 2003
• Defendant Counsel: Leo Cheng Suan ( Infinitus Law Corp )
• Court: Court of Appeal (Singapore)
• Plaintiff Counsel: Chuah Chee Kian Christopher And Dawn Ho (Drew & Napier )

Judgment

GROUNDS OF DECISION Curia Advisari Vult

1 This appeal raises the single issue as to whether a developer of a condominium is obliged under s 37(4)(b) of the Land Titles Strata Act, Cap 158 (LTSA) or any other law, to surrender the original accounting records and contracts relating to the maintenance fund to the management corporation (MC), after the latter has been established. At the High Court, Lai Siu Chiu J ruled in favour of the MC, the respondent in this appeal.

The facts

2 The appellants, Regenthill Properties Pte Ltd (Regenthill), were the developers of a condominium located along Yio Chu Kang Road known as "Regent Park Development". By the end of December 1996 the construction of the condominium was completed. On 6 January 1997, a temporary occupation permit (TOP) for the condominium was issued by the relevant authority. The effect of the issue of the TOP was that the subsidiary proprietors were obliged and did pay contributions to a maintenance fund which Regenthill were required to set up under s 9 of the Building and Common Property (Maintenance and Management) Act (BCP Act).

3 On 20 April 1998, pursuant to s 33 of the LTSA, the MC for the condominium was constituted. Its first annual meeting was held on 6 May 2000. Shortly after, Regenthill handed over to the MC all the documents (including accounting documents) in respect of the period after the constitution of the MC. The dispute concerns the documents relating to the maintenance fund for the period from TOP to the formation of the MC.

4 We should explain here that even after the establishment of the MC, the developer is still obliged under s 34 of the LTSA to undertake the following duties:-

(a) open a bank account in the name of the MC;

(b) cause to be kept such accounting and other records as well, inter alia, as would sufficiently explain the transactions and financial position of the MC up to the first annual general meeting.

The rationale for this provision would appear to be the recognition by the legislature that while a MC might have been set up it may not have, until the first AGM, the means to discharge its duties. Thus the developer is made to operate the MC account.

5 There are therefore three distinct periods which one has to bear in mind:-

(i) first period : from TOP to the establishment of the MC where contributions by subsidiary proprietors are paid into a maintenance fund managed by the developer.

(ii) second period : from the establishment of the MC up to approximately the holding of the first AGM, where contributions are paid by the subsidiary proprietor into an account in the name of the MC but managed by the developer.

(iii) third period : on and after the first AGM: the MC will assume all charge of the financial affairs of the condominium.

6 On 11 January 2001, the solicitors for the MC wrote to Regenthill, asking, pursuant to s 37(4) of the Act, for the delivery of the following documents:-

(a) all plans, specifications, certificates (other than certificates of title for lots), diagrams and other documents obtained or received by you and relating to the parcel or building; and

(b) if they are in your possession or under your control, any notices or other records relating to the subdivided building.

7 In response to Regenthill’s request for particulars of the documents, the solicitor for the MC furnished a list. This was followed by a series of correspondence between them. The upshot of it all was that the parties could not agree whether the MC is entitled to the originals of the accounting records relating to the management fund (the first period). They included payment vouchers, journal vouchers, cash book, cheque butts, bank statements (current and multi-link), financial statements, invoice, official receipt, accounts receivable, audit reports, fixed deposit slips/statements and bank-in slips. Regenthill even sought the assistance of the Commissioner of Buildings (under the BCP Act) on the dispute but the latter was not able to assist. Eventually, Regenthill indicated that they were prepared to allow the MC to inspect the accounting documents at their premises but the documents could not be transferred as the property in the documents remained vested in them.

8 It soon became inevitable that the MC had to file an Originating Summons to have the issue determined, which it did. At the hearing, the MC also orally asked for the contracts relating to various matters (cleaning, security, management and staff). Giving it a purposive interpretation, the judge ruled that most of the documents asked for by the MC came within the scope of s 37(4)(b). She said:-

"On a purposive interpretation, it is hard to envisage that Parliament, in enacting the section, intended only for documents such as plans, certificates and diagrams and other documents ejusdem generis with this class of documents to be handed over to the management corporations. Under the Act, upon the formation of a management corporation, the same takes over control, management and administration of the common property as well as its records and accounts. In order to properly exercise its powers and perform its duties and functions, a management corporation would need to have possession of necessary records relating to the subdivided building, including accounting records."

9 The trial judge held that the originals of the following documents be delivered to the MC:-

(a) Contract on cleaning services

(b) Contract on Security

(c) Water and electricity bills

(d) Contract on management fees

(e) Contract on staff costs

(f) Printing/stationery and postages

(i) payment vouchers

(ii) journal vouchers

(iii) cash book (soft copies or print out copies)

(iv) invoices/statements

(v) official receipts

(vi) accounts receivables/interest computation

(vii) fixed deposit slips (photocopies only)

(viii) bank-in slips

Issues

10 The substantive issue formulated by Regenthill is as follows:-

"Whether Regenthill are obliged under s 37(4) to deliver up the original copies of the contracts and accounting records relating to the maintenance fund to the MC."

Regenthill accept that they are obliged in law to allow the MC to inspect the accounting records and to make copies thereof. So the battle line is drawn on just the narrower issue as to whether Regenthill are obliged to hand over the originals of the accounting documents to the MC.

11 However, beside this, Regenthill have also raised two preliminary/procedural issues, which they also did in the hearing below. First, they say that the Originating Summons (OS) instituting the proceeding is flawed because it did not identify the specific classes of documents which the MC would want Regenthill to deliver, thus contravening O 7 r 3(1) of the Rules of Court. Second, they contend that the MC does not have the right to commence an action under s 37(4). Before the court below, both issues failed. We shall deal with them in turn.

Regularity of OS

12 To determine this issue, it is necessary for us to set out the provisions of O 7 r 3(1) as well as the precise formulation of the OS:-

"3(1) Every originating summons must include a statement of the questions on which the plaintiff seeks the determination or direction of the Court or, as the case may be, a concise statement of the relief or remedy claimed in the proceedings begun by the originating summons with sufficient particulars to identify the cause or causes of action in respect of which the plaintiff claims that relief or remedy."

13 In the OS, after reciting ss 37(4), 65 and 121 of the LTSA at the heading, the MC sought an order to compel Regenthill to deliver the following:-

"(i) all plans, specifications, certificates (other than certificates of titles for the lots), diagrams and other documents obtained or received by the Defendants relating to Regent Park Condominium;

(ii) any notices or other records relating to Regent Park Condominium, other than any such documents which exclusively evidence rights or obligations of the Defendants and which are not capable of being used for the benefit of the Plaintiffs or any of the subsidiary proprietors, other than the Defendants."

14 Essentially, the point made by Regenthill is that the OS only stated in very vague and broad terms what the MC wanted and did not identify the specific classes of documents which Regenthill are required to deliver. They relied upon the High Court decision in Engineering Construction Pte Ltd v AG [1993] 1 SLR 390.

15 It will be seen that under O 7 r 3(1) there are two alternative manners in which a plaintiff in an OS could formulate his case. One is to include a statement as to the question on which the court’s determination is sought (first limb). The other is to set out concisely the relief or remedy claimed, with sufficient particulars to identify the cause or causes of action (second limb). Having regard to the manner in which the present OS is formulated it is clear that it does not fall under the first limb.

16 The question is: does the OS, as filed, fulfil the second limb? Regenthill contend that it was only in the affidavit filed in support of the OS did the MC list out the classes of document which the MC wanted. They submit that these particulars should have been stated in the OS. While in a broad sense the basis of the claim is indicated, as the OS has cited s 37(4), we would agree with Regenthill that the relief claimed lacks sufficient particulars. Comparing the two prayers in the OS with s 37(4) (set out later at 29), it is apparent that the MC had merely copied the provisions of that section. It should have identified the classes of documents which it required Regenthill to deliver. It did this only in the affidavit in support. Any person reading the OS would not know the specific types of documents which the MC is seeking. Accordingly, the OS is defective. The fact that the specifics were given in the affidavit does not cure the...