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

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 25 August 2011
• Neutral Citation: [2011] SGCA 43
• Court: Court of Appeal (Singapore)
• Hearing Date: 11 April 2011
• Docket Number: Originating Summons No 499 of 2010 (Registrar’s Appeal No 300 of 2010)
• Plaintiff Counsel: Nicholas Lazarus (Justicius Law Corporation)
• Defendant Counsel: Boo Moh Cheh (Kurup & Boo),Philip Fong, Justin Chia and Kylie Peh (Harry Elias Partnership LLP)
• Subject Matter: Civil Procedure,Originating Processes
• Published date: 07 October 2011

Chao Hick Tin JA: Introduction

This appeal arose out of an originating summons (“the OS”) taken out by a subsidiary proprietor of a unit within the building known as “International Plaza” against the building’s management corporation, three of the management corporation’s members and the building’s developer. The latter four respondents applied to convert the OS into a writ of summons (“the writ”) but their application was dismissed by an Assistant Registrar (“AR”). However, the AR’s decision was reversed upon appeal to a judge in chambers (“the Judge”). This appeal was from the Judge’s decision which we heard and dismissed on 11 April 2011. As the procedural questions raised in the appeal are of some general interest, these grounds are accordingly issued.

Background

Woon Brothers Investments Pte Ltd (“the Appellant”) is the subsidiary proprietor of Unit #46-15 in International Plaza, 10, Anson Road, Singapore 079908 (“the Building”). It filed the OS against the respondents. The respondents in this Appeal are the defendants in the OS. Management Corporation Strata Title Plan No 461 (“the First Respondent”), a body corporate established under the Land Titles (Strata) Act (Cap 158, 2009 Rev Ed) (“the Strata Act”), consists of the subsidiary proprietors of all the units in the Building. It is the function of the First Respondent to manage the Building. The executive body of the First Respondent is the Council. Its members are elected by the subsidiary proprietors from among themselves as provided in s 53 of the Building Maintenance and Strata Management Act (Cap 30C, 2008 Rev Ed) (“the BMSMA”).

The second to fifth respondents applied to convert the OS into a writ. Cheong Keng Hooi (“the Second Respondent”), Cheong Hooi Hong (“the Third Respondent”) and Cheong Sim Lam (“the Fourth Respondent”) are brothers and at the material time were members of the Council. The Third Respondent was the Chairman of the First Respondent. By the time the OS was instituted, the Fourth Respondent had ceased to be a member of the Council although his other two brothers remained on the Council. The Second and the Third Respondents are shareholders of International Associated Company Pte Ltd (“the Fifth Respondent”), which was the developer of International Plaza. They are also shareholders in Seiko Architectural Wall Systems Pte Ltd, Tian Teck Realty Pte Ltd and Ka$h International Pte Ltd, companies which were also the subjects of allegations made by the Appellant in the OS.

In the OS, which was filed on 20 May 2010, the Appellant alleged, inter alia, fraud, misappropriation of funds belonging to International Plaza’s subsidiary proprietors, the failure to act honestly and with reasonable diligence, and for taking advantage of their positions as Council Members to gain various benefits, against the Respondents. The Appellant averred that the Respondents had acted in breach of the obligations imposed upon them by BMSMA and the Strata Act. The Respondents denied these allegations.

On 18 June 2010, the Second to Fifth Respondents applied, under Summons No 2788 of 2010 and pursuant to O 28 r 8 and O 5 rr 2 and 4 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the ROC”), to convert the OS into a writ and for consequential directions arising from the conversion. In support of this application, the Third Respondent deposed in an affidavit that an OS was not an appropriate process to resolve the dispute, given the numerous contested factual issues in the present action.

The AR, who heard the application, dismissed it for two main reasons. First, she was unconvinced that there was a substantial dispute of facts sufficient to warrant a conversion of originating process. Second, she held that in any event, a dispute on facts did not automatically necessitate a conversion of an OS into a writ as the court had the option under O 28 r 4(4) of ordering deponents of affidavits filed to be cross-examined.

The Second to Fifth Respondents appealed to the Judge against the AR’s decision, by way of Registrar’s Appeal No 300 of 2010. The Judge allowed the appeal: see Woon Brothers Investments Pte Ltd v Management Corporation Strata Titles Plan No 461 and Ors [2011] 2 SLR 405. The Judge converted the OS for three main reasons. First, as the application to court was not an application made under the BMSMA, it was not mandatory to commence the proceedings by OS. Second, there was a high likelihood of substantial disputes of fact. Third, the alternative to conversion of an OS into a writ, by resorting to O 28 r 4 of the ROC of having the deponents of affidavit cross-examined, was unsatisfactory.

The relevant legal provisions

We will begin by referring to the relevant statutory provisions. The first provision is s 124(1) of the BMSMA which reads:

Legal proceedings

124. — (1) Every application to the court under this Act shall be by originating summons.

The other relevant provision is O 5 of the ROC which governs the commencement of legal proceedings.

...

Proceedings which must be begun by writ (O. 5, r. 2)

2. Proceedings in which a substantial dispute of fact is likely to arise shall be begun by writ.

Proceedings which must be begun by originating summons (O. 5, r. 3)

3. Proceedings by which an application is to be made to the Court or a Judge thereof under any written law must be begun by originating summons.

...

[emphasis added]

The Second to Fifth Respondents’ application to convert the OS into a writ was made pursuant to O 28 r 8 of the ROC which reads:

Continuation of proceedings as if cause or matter begun by writ (O. 28, r. 8)

8.—(1) Where, in the case of a cause or matter begun by originating summons, it appears to the Court at any stage of the proceedings that the proceedings should for any reason be continued as if the cause or matter had been begun by writ, it may order the proceedings to continue as if the cause or matter had been so begun and may, in particular, order that pleadings shall be delivered or that any affidavits shall stand as pleadings, with or without liberty to any of the parties to add thereto or to apply for particulars thereof.

...

(3) This Rule applies notwithstanding that the cause or matter in question could not have been begun by writ.

...

[emphasis added]

Where appropriate, instead of converting an OS into a writ, the courts may give directions for the filing of evidence and attendance of deponents for cross-examination on specific areas. These are provided for in O 28 r 4 of the ROC:

Directions, etc., by Court (O. 28, r. 4)

...

(2) Unless on the first hearing of an originating summons the Court disposes of the originating summons altogether or orders the cause or matter begun by it to be transferred to a District Court or makes an order under Rule 8, the Court shall give such directions as to the further conduct of the proceedings as it thinks best adapted to secure the just, expeditious and economical disposal thereof.

(3) Without prejudice to the generality of paragraph (2), the Court shall, at as early a stage of the proceedings on the originating summons as appears to it to be practicable, consider whether there is or may be a dispute as to fact and whether the just, expeditious and economical disposal of the proceedings can accordingly best be secured by hearing the originating summons on oral evidence or mainly on oral evidence and, if it thinks fit, may order that no further evidence shall be filed and that the originating summons shall be heard on oral evidence or partly on oral evidence and partly on affidavit evidence, with or without cross-examination of any of the deponents, as it may direct.

(4) Without prejudice to the generality of paragraph (2), and subject to paragraph (3), the Court may give directions as to the filing of evidence and as to the attendance of deponents for cross-examination and any other directions.

[emphasis added]

Issues

Before us, the Appellant’s basic contention was that since a party who wishes to make an application under s 124(1) of the BMSMA is required to do so by way of an OS, the court does not have the discretion to convert such an OS into a writ. The alternative argument of the Appellant was that even if the court had the discretion to convert the OS into a writ, the Judge had, in the circumstances of this case, wrongly exercised her discretion in so ordering a conversion. Accordingly, the following two issues were raised in this appeal: (a) Whether, notwithstanding s 124(1) of the BMSMA, the court has the jurisdiction to convert the OS into a writ (“the jurisdiction issue”). (b) If the court has the jurisdiction, whether the court’s discretion should, in the present circumstances, be exercised to convert the OS into a writ (“the discretion issue”).

The jurisdiction issue

The jurisdiction issue raised by the Appellant necessitates a consideration of s 124(1) of BMSMA and O 28 rr 8(1) and 8(3) of the ROC (see [10] above). Order 28 r 8(3) clearly provides that an OS may be converted into a writ notwithstanding the fact that the proceeding could not be commenced by writ. This rule notwithstanding, the Appellant contended that it does not apply in the present case. Its reasoning was that the ROC, being a piece of subsidiary legislation, should not be allowed to prevail over the BMSMA, an Act of Parliament. In support of this argument, the Appellant cited s19(c) of the Interpretation Act (Cap 1, 2002 Rev Ed) (“the Interpretation Act”) which reads:

General provisions with respect to power given to any authority to make subsidiary legislation

19. When any Act confers powers on any authority to make subsidiary legislation, the following provisions shall, unless the contrary intention appears, have effect with reference to the making and operation of the subsidiary legislation: ... (c) no subsidiary legislation made under an Act shall be inconsistent with the provisions of any Act.

...