Woon Brothers Investments Pte Ltd v Management Corporation Strata Title Plan No 461 and others

• Jurisdiction: Singapore
• Judge: Lai Siu Chiu J
• Judgment Date: 30 November 2010
• Neutral Citation: [2010] SGHC 349
• Plaintiff Counsel: Nicholas Lazarus (Justicius Law Corporation)
• Docket Number: Originating Summons No 499 of 2010 (Registrar’s Appeal No 300 of 2010)
• Date: 30 November 2010
• Hearing Date: 23 August 2010
• Subject Matter: Civil procedure
• Published date: 01 December 2010
• Citation: [2010] SGHC 349
• Defendant Counsel: Boo Moh Cheh (Kurup & Boo),Philip Fong Yeng Fatt and Justin Chia Tze Yung (Harry Elias Partnership LLP)
• Court: High Court (Singapore)
• Year: 2010

Lai Siu Chiu J:

Woon Brothers Investment Pte Ltd (“the plaintiff”) filed Originating Summons No 499 of 2010 (“the OS”) against the management corporation (“the first defendant”) of International Plaza (“the Building”) as well as against Cheong Keng Hooi (“the second defendant”), Cheong Hooi Hong (“the third defendant”) Cheong Sim Lam (“the fourth defendant”) and International Associated Company Pte Ltd (“the fifth defendant”).

The second to fourth defendants (who are siblings) are council members of the first defendant while the fifth defendant was the developer of the Building. The second defendant is also the chairman of the first defendant. The second and third defendants are also shareholders of the fifth defendant as well as shareholders and directors of two other companies, viz, Seiko Architectural Wall Systems Pte Ltd (“Seiko”) and Tian Teck Realty Pte Ltd (“Tian Teck”). The second defendant is also a shareholder and director of another company called Ka$h International Pte Ltd (“Ka$h”). All three companies feature in the OS.

The plaintiff is the subsidiary proprietor of unit #46-15 (“the unit”) in the Building. It sued the defendants in the OS, in particular, the second to fourth defendants, inter alia, for fraud, misappropriation of funds belonging to subsidiary proprietors, failure to act honestly and with reasonable diligence, taking advantage of their positions as council members to gain advantage etc.

By Summons No 2788 of 2010 (“the application”), the second to fifth defendants applied under O 28 r 8 and O 5 rr 2 and 4 of the Rules of Court (Cap 322, R 5 2006 Rev Ed) (“the Rules”) to convert the OS into a writ of summons. The application was supported by an affidavit filed by the third defendant on 18 June 2010 and was opposed by the plaintiff.

The application was heard and dismissed by an assistant registrar (“the Assistant Registrar”) on 29 July 2010 on the ground that the third defendant’s affidavit did not convince the Assistant Registrar that there were substantial disputes of facts that warranted the conversion.

The second to fifth defendants appealed to a judge in chambers against the Assistant Registrar’s decision by way of Registrar’s Appeal No 300 of 2010 (“the Appeal”). This court heard and allowed the Appeal on 23 August 2010. I reversed the decision of the Assistant Registrar below, converted the OS to a writ of summons and gave directions and timelines to the parties for the filing of their pleadings. The plaintiff is dissatisfied with and has filed a Notice of Appeal (in Civil Appeal No 153 of 2010) against my decision. I shall now set out my reasons.

The facts

In support of the OS, the plaintiff’s manager Woon Wee Teng (‘Woon”) filed a lengthy (2,581-page) affidavit although the actual text was 15 pages with the remaining 2,566 pages being exhibits referred to by Woon. The OS itself numbered 58 pages as it contained 20 summaries listing the plaintiff’s complaints against the defendants. The OS concluded with general prayers in which the plaintiff claimed interest on the sums awarded by the court, costs and a liberty to apply provision.

In his affidavit, Woon (a retired lawyer) who occupies the unit deposed that he was motivated to take out the OS as he wanted the court to determine certain issues and make certain orders for the proper management and administration of the first defendant.

Woon explained the relationship between the defendants and the various companies mentioned earlier (at [2] above). He said that Seiko was awarded a contract of $4,975,468 for facade upgrading works at the Building by the defendants as well as a subsequent contract of $1.7m for repair works of hollow and spalling concrete and plaster of window ledges. Tian Teck was the managing agent of the Building from 1975 to November 2003 before Chesterton International Property Consultants Pte Ltd (“Chesterton”) took over. Ka$h was/is the landlord to the first defendant for the swimming pool and jacuzzi on the 36th floor of the Building. The first defendant makes payments to Ka$h for the usage by subsidiary proprietors of the swimming pool and the jacuzzi.

Woon alleged that by reason of the second and third defendants’ vested interests in the three companies mentioned in [2] above, they placed themselves in a position of conflict of interests and failed to comply with statutory requirements set out in the Building Maintenance and Strata Management Act (Cap 30C, 2008 Rev Ed) (“the BMSMA”) as well as in the Land Titles (Strata) Act (Cap 158, 2009 Rev Ed). Woon added that the second and third defendants have substantial proprietary interests in the Building either solely or jointly with their families as they own several units. He surmised that that was the reason why the two defendants held onto their position as council members when the Building was completed by the fifth defendant and its management handed over to the first defendant in 1975.

Woon made further serious allegations against the second and third defendants. He alleged that they managed the first defendant as if it was their own private company without regard to the interests of the other subsidiary proprietors or for the need for statutory compliance. They appointed their own people to be the managing agents and put their own people in the council of the first defendant. They bought the...