Protax Co-operative Society Ltd v Toh Teng Seng and Another

• Jurisdiction: Singapore
• Judge: Chan Seng Onn JC
• Judgment Date: 30 April 2001
• Neutral Citation: [2001] SGHC 84
• Court: High Court (Singapore)
• Year: 2001
• Published date: 26 March 2013
• Plaintiff Counsel: Andrew Ee (Andrew Ee & Co)
• Defendant Counsel: Harbajan Singh (Daisy Yeo & Co)
• Citation: [2001] SGHC 84

JUDGMENT:

Grounds of Judgment

Background

1. Protax Co-operative Society Limited (the plaintiffs) is a registered co-operative society with over 400 Muslim taxi-drivers as members. They carried on business previously at Nos. 357, 359 and 359A Bedok Road, Singapore (the premises) and operated a coffee shop under the name of Protax Caf at Nos. 357 and 359 (1^st storey units). Their office was at No 359A (the 2^nd storey unit above). The plaintiffs rented out a number of the food stalls in the coffee shop including some spare rooms at the 2^nd storey unit.

2. By a deed of assignment made on 15 November 1998, the plaintiffs took over a sublease from Mr Syed Ali Bin Syed Abdullah Sidek, who had leased the entire premises from Mr Ng Tiong Kiat (the head lessee). Sometime in September 1999, Mr Toh Teng Seng and Mr Sng Soon Heng (the defendants) purchased the said premises subject to two existing head leases granted to the head lessee by the former owners, Mr Lim Sing Kok and Mr Yong Kum Thong.

3. In respect of the 1^st storey units, the head lease dated 1 June 1997 was for a period of 7 years expiring on 31 May 2004. The rental was $10,800 per month payable in advance and due on the 1^st day of the month.

4. The head lease for the 2^nd storey unit, dated 4 March 1998, was for a period of 6 years and 5 months from 15 December 1997 to 14 May 2004. The rent was $2,000 per month also payable in advance and would fall due on the 15^th day of each month.

Claim

5. The plaintiffs alleged that the defendants entered the premises on 15 February 2000 without their permission. The plaintiffs and various other stallholders were told to leave the premises within 24 hours. On the following day, the defendants changed the locks and locked the premises.

6. The defendants then handed possession of the premises to their new tenants, Mdm Fariday Awall Walter and Mr Amin Awall, who proceeded to carry out renovations.

7. The plaintiffs averred that the defendants had committed trespass. The following damages were claimed:

(a) Loss of rental from various stallholders at $15,300 per month from 16 February 2000 to 31 July 2003;

(b) Loss of profit from the plaintiffs drink stall;

(c) Loss of profit from the plaintiffs chicken rice stall;

(d) Loss of rental of 3 rooms at the 2^nd storey unit;

(e) Loss or removal of various chattels at the premises; and

(f) Punitive or alternatively aggravated damages due to the mental distress and humiliation suffered by the plaintiffs representatives.

Defence and Reply

8. The defendants relied on the fact that they had served a writ of possession (DC Suit No. 5500/1999) on the head lessee for defaulting in payment of his rent. The head lessee in his defence in the DC Suit admitted the rent arrears and the defendants determination of the leases. The head lessee further counterclaimed for a refund of his rental deposit. The defendants regarded this as a wrongful repudiation on the part of the head lessee but accepted that repudiation nevertheless. Accordingly, the defendants re-entered the premises. To mitigate their loss, they re-let the premises to new tenants.

9. On 27 March 2000, about 6 weeks after the re-entry, the head lessee obtained a grant of relief against forfeiture from the court. The defendants appeal against that order was dismissed on 25 April 2000. Soon thereafter on 3 May 2000, the defendants returned the keys to the head lessee. There was no undue delay.

10. On these facts, Mr Harbajan Singh acting for the defendants, submitted that there was no trespass. Until the head lessee obtained relief, the head lessee had no status on the property. Mr Singh contended that the defendants had acted throughout in good faith on their right to forfeit under the leases for non-payment of rent, whereas the head lessee obtained relief against that forfeiture not on a right he had, but on an exercise of the Courts discretion based on equitable principles.

11. In answer to that, counsel for the plaintiffs, Mr Andrew Ee, argued that the defendants had waived their right to re-enter the premises by accepting the outstanding rent, which was paid directly into defendants joint bank account. Once that right was lost, the re-entry became unlawful and hence, the defendants had committed trespass.

12. Mr Ee submitted that the contemporaneous book entries recorded by the defendants showed that the deposits of money by the head lessee into the defendants joint account were accepted and treated by the defendants as payment towards the rent on a first-in-first-out basis. For simplicity, I have collated the particulars of the various payments in the table below:

(a) Rent payments for Unit Nos 357 and 359

Due Date	Amount	Right to re-enter and determine lease if unpaid by	Date of Payment into Bank Acct	Defendants came to know on
1.10.1999	$10,800	22.10.1999	18.10.1999	1
1.11.1999	$10,800	22.11.1999	18.12.1999	1
1.12.1999	$10,800	22.12.1999	08.02.2000	15.02.2000
1.01.2000	$10,800	22.01.2000	12.02.2000	17 or 18.02.2000
1.02.2000	$10,800	22.02.2000	12.02.2000	17 or 18.02.2000
1.03.2000	$10,800	22.03.2000	03.03.2000	1

(b) Rent payments for Unit No 359A

Due Date	Amount	Right to re-enter and determine lease if unpaid by	Date of Payment into Bank Acct	Defendants came to know on
15.09.1999	$2,000	29.09.1999	24.09.1999	1
15.10.1999	$2,000	29.10.1999	26.10.1999	1
15.11.1999	$2,000	29.11.1999	03.01.2000	1
15.12.1999	$2,000	29.12.1999	12.02.2000	17 or 18.02.2000
15.01.2000	$2,000	29.01.2000	17.02.2000	1
15.02.2000	$2,000	29.02.2000	10.03.2000	1
15.03.2000	$2,000	29.03.2000	31.03.2000	1

Counsels submissions and the law

13. Mr Ee conceded that if the head lease had been validly determined by forfeiture, then the sublease, which depended on the head lease, would automatically determine. He rightly acknowledged that there would be no trespass if the re-entry took place after the head lease had been forfeited unless that forfeiture was waived.

14. On the facts, Mr Ee submitted that the defendants had waived their right of re-entry and forfeiture by accepting all the outstanding rent due on the 1^st storey units on 12 February 2000 (i.e. 3 days before the date of re-entry).

15. Mr Ee referred me to Sections 18 and 18A of the Conveyancing of Law and Property Act (Cap. 61) in relation to the statutory restrictions on and relief against forfeiture of leases. Mr Ee correctly pointed out that Section 18 was not applicable to a re-entry or forfeiture due to non-payment of rent: see Section 18(9). However, he said that Section 18A applies where the lessor is proceeding by writ action to enforce a right of re-entry or forfeiture for non-payment of rent. I observed however that Section 18A does not deal with the central issues here, namely, when and how a right of re-entry and forfeiture for non-payment of rent may lawfully be exercised. Neither does it deal with the circumstances under which a wavier arises. These are governed by the common law.

16. As I will explain later, I found on the facts that the physical re-entry was peaceably effected. The defendants regained possession of the premises. The two head leases were lawfully forfeited for non-payment of rent. Although the defendants succeeded in their self-help remedy of physical re-entry without resorting to legal action, nevertheless the court can still grant relief on equitable grounds by restoring possession to the head lessee and on whatever terms it deems fit. However, it does not follow that a subsequent grant of relief against forfeiture necessarily converts an earlier lawful re-entry into a trespass.

17. Mr Ee contended that a lease can only be forfeited after a judgment or order for possession is obtained. Until such time that the landlord obtains an order or judgment for possession, the tenants lease has not been forfeited. On that basis, the re-entry was unlawful because no judgment or order for possession was obtained by the defendants prior to the re-entry.

18. I did not agree. In my judgment, the lessor may re-enter physically and peaceably, provided that his right to re-enter and forfeit has arisen under the terms of the lease and that right has not in the meantime been waived by him, whether inadvertently or otherwise. Where the landlord manages to secure actual possession without the assistance of the court, why must there always be a supporting order or judgment for possession before the lease can be forfeited? Regaining physical possession is clear proof of the landlords intention and election to forfeit and end the tenancy, subject of course to the courts discretion to grant equitable relief against the forfeiture.

19. Similarly, service of the writ of possession on the tenant is an unequivocal act amounting to a constructive re-entry and forfeiture. Mr Ees proposition that a judgment for possession is a pre-requisite for a lawful re-entry and forfeiture has no basis whatsoever in law.

20. Before I delve into the application of the law to the unique facts of this case, it is appropriate to examine the rather technical doctrine of re-entry and waiver in the law of landlord and tenant. The Law Commission in England in 1985 stated, quite justifiably, in para. 1.3 of its report, (1985) Law Com. No. 142, that the present law, "besides being unnecessarily complicated, is no longer coherent and may give rise to injustice". The Law Commission examined the various deficiencies and recommended a replacement with a new statutory scheme to simplify this area of the law. Be that as it may, the common law in Singapore mirrors that in England in this area.

(a) Doctrine of Waiver

21. Hill & Redmans Law of Landlord & Tenant 17^th Edn succinctly summarises at p 451 the law in relation to waiver of a right of forfeiture:

Waiver of Forfeiture Rule 131

(1) A right of re-entry may be waived either expressly or...