Tan Chan Tee v Chen Tsui Yu and Another Suit

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 17 February 2009
• Neutral Citation: [2009] SGHC 36
• Court: High Court (Singapore)
• Year: 2009
• Citation: [2009] SGHC 36
• Plaintiff Counsel: Low Chai Chong, Mark Seah and Zhulkarnain Abdul Rahim (Rodyk & Davidson LLP)
• Defendant Counsel: Chiah Kok Khun, Diana Ho and Melvin Tan (Wee Swee Teow & Co)
• Subject Matter: Trusts,Resulting trusts,Presumed resulting trusts
• Published date: 19 February 2009

17 February 2009 Judgment reserved

Judith Prakash J:

Introduction

1 These consolidated proceedings concern the true ownership of two houses in Singapore. The parties involved in the disputes are related to each other either by blood or by marriage. The disputes were originally the subject matter of two separate sets of proceedings viz Suit 265/2005 (“S265”) and Suit 457/2006 (“S457”). Although the plaintiffs and defendants in each set of proceedings are distinct, the actions were consolidated because of the parties’ connections with each other and some overlapping facts.

2 The houses involved in the disputes are, respectively, the land and premises known as 7 Margate Road (“the Margate property”) and 7 Seraya Lane (“the Seraya property”). The legal owner of the Margate property until September 2006 was Loo Chay Loo, deceased. The administrators of the estate of Loo Chay Loo deceased (“the Estate”) are his widow, Madam Chen Tsui Yu (“Mdm Chen”), and his son Chen John-son. Mdm Chen is also the legal owner of the Seraya property.

3 The competing claims to the Margate and Seraya properties come from other members of Loo Chay Loo’s family. His elder brother, Loo Chay Sit, is the plaintiff in S265 which was started against Loo Chay Loo on the basis that Loo Chay Loo held the Margate property in trust for Loo Chay Sit and that therefore Loo Chay Sit was then the true beneficial owner of the Margate property. The plaintiff in the other action, S457, is Madam Tan Chan Tee (“Mdm Tan”) who is the mother of Loo Chay Loo and Loo Chay Sit and thus, the mother-in-law of Mdm Chen. Mdm Tan’s claim is that Mdm Chen holds the Seraya property on trust for Mdm Tan, the true beneficial owner thereof.

4 The claims of Loo Chay Sit and Mdm Tan (whom I will sometimes collectively refer to as “the claimants”) to be the true owners of the properties concerned are not based on any express trust created by the registered owners of the properties. Instead, the claimants assert that they provided the purchase monies for the respective properties and that, accordingly, the same became subject to resulting trusts in their favour.

5 The defendants in the respective actions are the Estate and Mdm Chen. Their stand is that Loo Chay Loo was, at all material times, and Mdm Chen is, on the Register of Land Titles the registered owner of the respective properties. As such, they are entitled to the protection of the provisions of s 46 of the Land Titles Act (Cap 157, Revised Edition 2004) (“the Act”), and the onus lies on the claimants to establish grounds that would deprive them of such protection. Further, they deny that the purchase monies for the properties were provided by Loo Chay Sit and Mdm Tan. Thus the main issue that arises is whether the evidence adduced establishes on the balance of probabilities that the claimants paid for the properties. The other issues to be decided really depend on the result of my finding on this issue and therefore I will not enumerate them yet.

6 There is one complication here which I should mention right away. In S265, Loo Chay Sit’s initial claim was for a declaration that he was the true owner of the Margate property and that Loo Chay Loo held it on trust for him. Subsequently Loo Chay Sit, having obtained a judgment to this effect in default of appearance, sold the Margate property. This judgment was set aside thereafter and the Estate filed a counter claim against Loo Chay Sit for the proceeds of sale. Loo Chay Sit’s claim for a declaration having been dismissed on 25 January 2008 for failure to comply with an “unless order”, only the counter claim in S265 remains alive.

Background to the acquisition of the properties

7 The relevant members of the Loo family are as follows:

(a) Loo Siong Toh @ Lir Siong Toh;

(b) Mdm Tan Chan Tee, wife of Loo Siong Toh;

(c) Loo Chay Sit, elder son of Loo Siong Toh;

(c) Loo Chay Loo, younger son of Loo Siong Toh;

(d) Loo Siong Soo, younger brother of Loo Siong Toh;

(e) Mdm Teo Swee Lian, wife of Loo Siong Soo; and

(f) Mdm Chen Tsui Yu, widow of Loo Chay Loo.

8 Apart from the Seraya and Margate properties, another piece of property plays an important part in this saga. This is the land and premises (a bungalow) known as 11 Margate Road (“11 Margate”). In or about 1968 Loo Siong Toh and his family moved into these premises. I do not know when 11 Margate was purchased but at all material times up to April 1987, this property was owned in equal shares by Mdm Tan and Mdm Madam Teo.

9 In 1971, Loo Chay Sit went into business in partnership with his uncle Loo Siong Loo under the firm name, Lian Cheong (Loo Kee) (“the firm”). The firm was in the business of the import and export of goods. In 1974, a third partner was admitted to the firm. In January 1975, Loo Chay Loo who had just completed his national service joined the firm as its fourth partner.

10 In May 1975, Madam Tan and her sister in law, Madam Teo, entered into an agreement to purchase the Seraya property. On the completion of the purchase, they became joint owners, in equal shares, of the Seraya property. The Seraya property was occupied thereafter by Madam Teo and her husband Loo Siong Soo whilst Madam Tan continued to live at 11 Margate with her family.

11 In 1978, Madam Tan learnt that the then owners of the Margate property wanted to sell it. Subsequently, in early 1979, it was conveyed to Loo Chay Loo for a consideration of $195,000. Initially, Loo Chay Sit moved into the Margate property whilst Loo Chay Loo continued to reside at 11 Margate. After Loo Chay Loo’s marriage to Mdm Chen in June 1980, however, the newlyweds moved into the Margate property and Loo Chay Sit moved back to live with his parents. Loo Chay Loo and his wife continued to occupy the Margate property thereafter until they immigrated to the United States with their young son in 1993.

12 In the meantime, Loo Chay Sit had been having matrimonial difficulties. He had married his first wife at the end of 1974 but she left him in early 1976 and thereafter started divorce proceedings against him. Loo Chay Sit officially relinquished his partnership in the firm on 1 June 1977. According to him, however, this was on paper only and his shares were thereafter held in trust for him by his uncle and sister. He was re-admitted to the firm as a partner in November 1980 as his divorce proceedings had been settled by then.

13 On 18 November 1981 a company called Lian Cheong Travel Services Pte Ltd (“LC Travel”) was incorporated to carry on business as a travel agent. Shortly after its incorporation, LC Travel had a paid up capital of $175,000 divided into 175,000 shares of $1 each. The biggest shareholder was Loo Chay Loo (62,999 shares) whilst Loo Chay Sit (34,999 shares) and four other family members held the rest of the shares. The directors of the company were the two brothers, and their aunt Loo Bee Choo. In October 1986, Mdm Chen became a director and a shareholder as well (28,000 shares). Thereafter, together Loo Chay Loo and Mdm Chen held more than 50% of the issued share capital. In 1983, the Margate property was mortgaged to the United Overseas Bank Ltd (“UOB”) to secure a facility granted by UOB to LC Travel.

14 The next development was that towards the end of 1986, Loo Siong Soo indicated that he wanted to retire as a partner of the firm. At that time, the firm and the partners were in financial difficulties. In order to retire, Loo Siong Soo had to pay a sum of $328,817 to the firm to cover his shares of the losses that the firm had incurred. Mdm Teo agreed to sell her interest in 11 Margate and in the Seraya property in order to raise the necessary funds and to have some extra money to acquire a new home. As a result, various transactions took place. The end result of these transactions was that Mdm Tan became the sole owner of 11 Margate and Mdm Chen the sole owner of the Seraya property.

15 The parties have given widely differing accounts of what was agreed and what took place and it may be helpful for me to set out their separate accounts here. According to Mdm Tan, the agreement was Mdm Teo would sell her half share in each of the Seraya property and 11 Margate to Mdm Tan for a total sum of $788,000. Mdm Tan further agreed that she would pay $550,000 from this amount to Loo Siong Soo and Mdm Teo, and would undertake to bear Loo Siong Soo’s debt to the firm to the extent of $238,000. Mdm Chen on the other hand asserted that when Mdm Teo and Mdm Tan had originally tried to sell the Seraya property on the open market, they had been unsuccessful in that a potential buyer who had originally offered $788,000 for the property later backed out of the deal and they were unable to find another buyer. Mdm Chen said that it was at this stage that she and Loo Chay Loo stepped in to help them and to purchase the Seraya property. They paid $238,000 to help cover part of Loo Siong Soo’s share of the firm’s losses and she herself then purchased the Seraya property for $550,000 from Mdm Teo and Mdm Tan.

16 On 8 April 1987, Mdm Teo conveyed her half share in 11 Margate to Mdm Tan. According to the conveyance, the consideration for the purchase was $250,772. At the same time 11 Margate was mortgaged by Mdm Tan to the Kwangtung Provincial Bank Ltd (“KT Bank”) to secure an overdraft facility of $442,000 granted by KT Bank to LC Travel. Mdm Tan stated that a portion of the funds raised through the overdraft facility were used to pay Mdm Teo for her half share in 11 Margate.

17 By a transfer instrument dated 21 April 1987, Mdm Tan and Mdm Teo, in consideration of the sum of $550,000, transferred the Seraya property to Mdm Chen. At about the same time the property was mortgaged to UOB by Mdm Chen to secure an overdraft facility of $550,000 granted by UOB to LC Travel. In June 1990, this mortgage was paid off and the Seraya property was immediately remortgaged to the Asia Commercial Bank. The second mortgage over the Seraya property was discharged on...