REGENT GARDENS - Strata Board - Part 2
Lim Choo Suan Elizabeth and others v Goh Kok Hwa Richard and others
[2009] 4 SLR(R) 193; [2009] SGHC 114
Suit No: Originating Summons No 664 of 2008
Decision Date: 12 May 2009
Court: High Court
Coram: Woo Bih Li J
Counsel: David Liew (DSH Law Corporation) for the plaintiffs; Gan Hiang
Chye, Edwin Lee, Hazel Tang and Deborah Ho (Rajah & Tann LLP) for the
defendants.
Administrative Law – Natural justice – Excessive interruptions during
hearing – Remarks made by President of Strata Titles Board during hearing
– Failure to subpoena witness – Whether President of Strata Titles Board
was biased or there was reasonable suspicion of bias or he had breached
rules of natural justice
Land – Strata titles – Collective sales – Failure to affix copy of notice
of application on conspicuous part of each building – Failure to file Form
1A listed on Strata Titles Board website – Whether collective sale
agreement was signed by requisite majority in share value – Whether
transaction was in good faith – Whether valuation report flawed – Whether
sales price was obtained at arm's length – Whether conflicting costs
orders made – Whether all subsidiary proprietors should be ordered to be
bound by collective sale agreement – Section 84A(3) and the Schedule para
1(f) Land Titles (Strata) Act (Cap 158, 1999 Rev Ed)
Case Summary
Facts
This was an appeal by minority subsidiary proprietors ("the Minority")
against the decision of a Strata Title Board ("the RG Board") approving
the collective sale of a condominium development called Rainbow Gardens ("RG").
Both the Minority and the subsidiary proprietors ("the Majority") who
signed the Collective Sale Agreement ("the CSA") had filed interlocutory
applications before the RG Board. The RG Board heard both interlocutory
applications simultaneously and dismissed both. It then heard the main
application and eventually granted an order for the collective sale of RG.
Counsel for the Minority ("Mr Liew") raised a number of issues. First, Mr
Liew argued that the Majority failed to comply with s 84A(3) of the Land
Titles (Strata) Act (Cap 158, 1999 Rev Ed) ("LTSA") read with para 1(f) of
the Schedule to the LTSA. Section 84A(3) stated that no application was to
be made unless the requirements in the schedule to the LTSA had been
complied with. Paragraph 1(f) of the Schedule to the LTSA required a copy
of the notice of an application to the Strata Titles Board to be affixed
to a conspicuous part of each building comprised in the strata title plan
or the development. Mr Liew argued there was no compliance because the
notice of the application was not affixed to a conspicuous part or any
part of each of the four residential buildings in RG.
Second, the Majority failed to comply with para 4 of the Schedule to the
LTSA read with the Building Maintenance and Strata Management Act 2004
(Act 47 of 2004) ("BMSMA 2004"). Paragraph 4 required an application for a
collective sale order to be made with "such other documents as the Board
may require". Mr Liew argued that this requirement was not met because the
Majority failed to file Form 1A, a document listed on the Strata Titles
Board website.
Third, the CSA was not signed by subsidiary proprietors holding at least
80% of the share value of RG. Certain subsidiary proprietors had signed
the CSA on the condition that the minimum selling price was to be $76.8m
which was higher than the minimum selling price stated in the CSA.
Fourth, the transaction was not in good faith having regard to the sale
price in the Sale and Purchase Agreement ("SPA"), in that the valuation
report was flawed and the sale price was not obtained at arm's length. The
valuation obtained by the valuer for the Majority was flawed because it
did not take into account several comparable condominium developments, a
possible future mass rapid transit line or the possibility of alienation
of nearby state land. There was no circulation of the sale committee's
minutes of meetings, short notice for a meeting was given to pressurise
the subsidiary proprietors to agree to the CSA, there was no consultation
with the subsidiary proprietors on the appointment of the property
consultant ERA Realty Network Pte Ltd ("ERA") and solicitors Rajah & Tann
("R&T"), the Expression of Interest exercise was conducted in an improper
manner in that undue preference was given to Premier Land Development Pte
Ltd ("Premier"), the purchaser, and a deadline to sign the SPA was
fabricated also to pressurise subsidiary proprietors to sign the SPA as
were representations of roof leakage and water pump problems, and
subsidiary proprietors of a unit had been offered more than others to
persuade them to sign an SPA.
Fifth, the RG Board erred in granting the collective sale order in that
the President of the RG Board was biased or there was a reasonable
suspicion of bias on his part, and that the President of the RG Board had
violated the rules of natural justice in making adverse comments and
excessive interruptions during the examination and cross-examination of
witnesses during the hearing which strongly indicated that he had
predetermined the application even before considering the evidence.
Sixth, the RG Board made wrong findings of fact, failed to give due weight
to evidence that ought to have been considered in making its findings, and
gave weight to evidence that ought to have been disregarded. For instance,
one witness, Mr Gan, was only called as a witness of fact yet he was
allowed to give his opinion on Form 1A. According to Mr Liew, the RG Board
should also have subpoenaed another witness, Poon, but failed to do so.
Lastly, Mr Liew asserted that the RG Board erred in making conflicting
costs orders. The costs orders conflicted because the RG Board on one hand
made no order as to costs but on the other hand ordered all costs to be
borne by all subsidiary proprietors. The RG Board also erred in making an
order that all subsidiary proprietors be bound by the CSA as if they were
parties thereto.
Held, dismissing the appeal:
(1) A technical breach of the LTSA requirements would not invalidate an
application to an STB if there was no prejudice to anyone. While a strict
approach to interpreting the legislation might arguably lead to some
certainty, it would be too harsh to invalidate every application for
non-compliance however slight and inconsequential. Even before the 2007
amendments to the LTSA were enacted, Parliament could not have intended
that applications to a Strata Titles Board should fail for technical
reasons alone: at [37] and [38].
(2) Form 1A was not a specific requirement of legislation. The definition
of "Board" in s 3 of the LTSA meant "a Strata Titles Board constituted
under the BMSMA 2004". Each board was constituted for a specific purpose
which was usually to consider an application for a collective sale order
and upon being constituted, that board becomes "the" Board for the purpose
of the overall scheme under the LTSA and the BMSMA 2004. The reference to
"such other document as the Board may require" was a reference to suchad
hoc document as the RG Board might require and not such document as might
be listed on a website even though that website was referred to as the
Strata Titles Board website: at [47] to [49], [51] and [52].
(3) The requisite percentage of share value had been obtained. The final
sale price of $77.3m with the possibility of an additional $10m if two
parcels of adjacent state land were granted was higher than the minimum
sale price of $76.8m stated in the SPA, thus the condition specified by
certain subsidiary proprietors was fulfilled: at [64].
(4) Under s 98(1) of the BMSMA 2004, no appeal shall lie to the High Court
against a decision of a Strata Titles Board except on a point of law. The
RG Board had rejected Mr Liew's arguments regarding the valuation report
commissioned by the Majority that the approaches used by the valuer were
flawed. This finding by the RG Board was not an error on a point of law
and thus their decision should not be disturbed: at [1] and [89].
(5) With respect to the assertion that the sale price was not obtained at
arm's length or that the transaction was not in good faith, the issue was
not whether the sale committee or the marketing agent could be criticised
for not having done more. Such criticism could be easily levelled at any
sale committee or marketing agent. The issue was whether the overall
conduct of the process resulting in the sale price demonstrated an absence
of good faith: at [117].
(6) The fact that the sale committee did not maintain minutes of their
meetings reflected poorly on their professionalism but there was no
suggestion that this omission was deliberate: at [122].
(7) Mr Liew's criticism about the choice of ERA and R&T as indicative of a
lack of good faith was misplaced. There was no evidence of collusion
between the sale committee and the property consultants ERA or solicitors
R&T. The sale committee had taken the view that these were the appropriate
persons to use: at [126], [127] and [132] to [135].
(8) The decision of the sale committee to fix the meeting for the
subsidiary proprietors at short notice was unwise as the subsidiary
proprietors should have been given more time to consider the CSA. However,
it was not a deliberate attempt to pressurise the subsidiary proprietors
to agree to the CSA. If the subsidiary proprietors were unhappy about that
date, they could have asked for an adjournment but there was no evidence
that such an adjournment was sought. A deadline of 30 April 2007 said to
be imposed by the purchaser was not part of an overall and deliberate
strategy to put pressure on subsidiary proprietors to sign the CSA. While
the tone and substance of a circular dated 20 April 2007 urged the
subsidiary proprietors to sign, it could not be said to be oppressive.
When a person was urged to do something, it might be said that some
pressure was being applied but that in itself was not wrong. The issue was
whether the pressure was such that it affected the validity of any of the
signatures to the CSA or was indicative of an absence of good faith: at
[124] and [162].
(9) There was no undue preference given to Premier. Even though the first
envelope by Premier was returned, it could always have made a higher bid
even after the first envelope was submitted so there was no prejudice to
other bidders. In any event, Premier's eventual bid was not only slightly
higher than other bids but exceeded the next best bid by more than $3m
with the possibility of another $10m for the alienation of nearby state
land. If Premier had been privy to all the bid amounts before they were
opened, Premier would not have made the offer that it did. Eventually the
purchase price was increased by $500,000 when the SPA was signed even
though Premier's eventual bid was already the highest. This was probably
to encourage more subsidiary proprietors to sign the CSA and it lent some
weight to the Majority's version of events that any discussion about an
increase in sale price was in respect of the entire development and not to
certain subsidiary proprietors individually: at [136] to [145] and [169].
(10) Where it was reasonable to do so, a sale committee should try and
create competition between interested purchasers. ERA had already created
competition and interest before the close of the Expression of Interest
exercise through advertisements in three newspapers and contact with
developers. Although Mr Liew argued that there should have been follow-up
with other bidders, no one approach could be said to be categorically
right or wrong. The sale committee was not obliged to follow up on another
bidder's offer to improve: at [151] and [152].
(11) As regards the conduct of the President of the RG Board, the notes of
evidence were considered in their entirety. Verbatim transcripts tended to
give the impression that a tribunal had interrupted much more than it
actually did. Although the President should have been more careful and
restrained in his remarks, a holistic view of the matter taking into
account the qualitative impact of the remarks showed no bias. There was no
denial of justice and a reasonably minded person would not have considered
that there had not been a fair trial: at [202] and [203].
(12) Although Mr Gan was originally a witness of fact, Mr Liew himself
admitted to asking Mr Gan questions on Form 1A. As for calling Dr Poon Lee
Kwee as a witness, the RG Board acted on the basis of an adversarial
process. The RG Board did suggest that the parties call Dr Poon as a
witness, but both Mr Lee and Mr Liew declined to do so. It was not open to
Mr Liew to suggest at this juncture that the RG Board should have
subpoenaed him: at [206] to [210].
(13) There was no conflict in the costs orders. The RG Board's orders
meant that the Minority had to pay their share of the solicitors' costs
for the initial work on the application and of the additional work to
address the Minority's objections, but the Minority did not have to pay
for the brunt of the costs of the additional work. Section 84(11) LTSA
empowered the STB to bind the Minority to the CSA. It was necessary or
expedient to make the Minority bound by the CSA so that R&T could
represent all the subsidiary proprietors to act in the sale. It was also
right that the Minority be bound to pay their share of all disbursements
and fees incurred in respect of the collective sale: at [214] and [224].
[Observation: The Majority had obtained an independent valuation report
dated after the SPA had been entered into. The Court of Appeal in Ng Eng
Ghee v Mamata Kapildev Dave [2009] 3 SLR(R) 109 said at [160] that the
sale committee there had "a duty to obtain an independent valuation prior
to settling on the final sale price. Otherwise, there would have been no
way to gauge whether or not it is obtaining a fair (not to mention the
best) price for the property". However, the applicable provisions of the
LTSA suggested that there was no requirement, as such, for the sale
committee to obtain an independent valuation before the SPA was entered
into. Even an amendment to the LTSA in October 2007 only required the
valuation report to be on the value of the development concerned as at the
date of the close of the public tender or auction. This suggested that the
valuation report might be obtained after that date but the point of
reference had to be as at the date of the close of the public tender or
auction: at [73] to [76].]
Case(s) referred to
Chang Mei Wah Selena v Wiener Robert Lorenz [2008] 4 SLR(R) 385; [2008] 4
SLR 385 (refd)
Liu Chee Ming v Loo-Lim Shirley [2008] 2 SLR(R) 764; [2008] 2 SLR 764 (refd)
Mohammed Ali bin Johari v PP [2008] 4 SLR(R) 1058; [2008] 4 SLR 1058 (refd)
Ng Eng Ghee v Mamata Kapildev Dave [2009] 3 SLR(R) 109; [2009] 3 SLR 109 (refd)
Ng Swee Lang v Sassoon Samuel Bernard [2008] 1 SLR(R) 522; [2008] 1 SLR
522 (folld)
Ng Swee Lang v Sassoon Samuel Bernard [2008] 2 SLR(R) 597; [2008] 2 SLR
597 (folld)
Siow Doreen v Lo Pui Sang [2008] 1 SLR(R) 213; [2008] 1 SLR 213 (refd)
Tan Siew Tian v Lee Khek Ern Ken [2008] 3 SLR(R) 64; [2008] 3 SLR 64 (refd)
Tan Siew Tian v Lee Khek Ern Ken [2008] 3 SLR(R) 941; [2008] 3 SLR 941 (refd)
Legislation referred to
Building Maintenance and Strata Management Act 2004 (Act 47 of 2004) ss
89, 90, 98(1)
Building Maintenance and Strata Management (Strata Titles Board)
Regulations (2005) (S 195/2005)
Land Titles (Strata) Act (Cap 158, 1999 Rev Ed) s 84A(3), Schedule paras
1(f), 4 (consd);
ss 3, 84A, 84A(1)(b), 84A(4), 84A(7C), 84A(9)(a)(i), 84A(9)(a)(iii),
84A(11), 84B(1), 84B(1)(b), Schedule para 1(e)
[Editorial note: The plaintiff's appeal to this decision in Civil Appeal
No 182 of 2008 was withdrawn on 15 July 2009.]
Judgment
12 May 2009
Woo Bih Li J:
Introduction
1 This was an appeal by the plaintiffs against the decision of a Strata
Titles Board approving the collective sale of the development known as
Rainbow Gardens under s 84A of the Land Titles (Strata) Act (Cap 158, 1999
Rev Ed) ("LTSA"). Under s 98(1) of the Building Maintenance and Strata
Management Act 2004 ("the BMSMA 2004"), no appeal shall lie to the High
Court against such a decision except on a point of law. After hearing
arguments, I dismissed the appeal. The plaintiffs have since appealed to
the Court of Appeal.
2 I set out below the following definitions for easy reference:
Definitions
"Ang" - Ang Chin Peng, an SP of RG
"Application" - The application made on or about 3 August 2007 for a
collective sale order of the RG
"Conditional SPs" - The SPs of three units in RG who had signed the CSA
with a condition that their signatures would not be valid if the MSP was
lower than $76.8m
"CSA" - The collective sale agreement signed by the Majority
"Ecco" - Ecco Venture Pte Ltd
"Ee" - Daniel Ee of Savills (Singapore) Pte Ltd
"EOIs" - Expressions of interest
"ERA" - ERA Realty Network Pte Ltd
"First Capital" - First Capital Holdings Pte Ltd
"Gan" - Gan Hiang Chye, a partner with R&T
"GD" - Grounds of Decision of the RG Board
"Goh" - Goh Kok Hwa Richard, Chairman of the SC
"Koh" - Koh Hock Chuan, an SP of RG
"the Majority" - The SPs who signed the CSA
"the Minority" - Lim Choo Suan Elizabeth, Lim Poh Heng, Tan Peck Kheng and
Koh
"MSP" - Minimum selling price
"the Notice" - Notice of the Application
"Poon" - Dr Poon Lee Kwee, an SP of RG
"Premier" - Premier Land Development Pte Ltd
"RG" - The development known as Rainbow Gardens
"RG Board" - The Strata Titles Board which heard the Application
"R&T" - Rajah & Tann
"SC" - The sale committee which were appointed under the CSA to be,inter
alia, the agents of the Majority to negotiate and finalise the collective
sale of RG
"Seah" - Steven Seah of Seah Ong & Partners
"See" - See Moi Kiang @ See Beng Kiang, a senior marketing director of ERA
"Sim Lian" - Sim Lian Land Pte Ltd
"Soh" - Soh Liang Liang, an SC member
"SPs" - Subsidiary proprietors of RG and "SP" is the singular
"SPA" - The Sale and Purchase Agreement with Premier dated 12 May 2007
"STB" - A Strata Titles Board
"Tan" - Dr Tan Kok Yang, an SP who had objected to the collective sale and
also filed an appeal to the High Court but decided not to pursue it.
Background
3 RG is a condominium development with a land area of about 11,094.8m2. It
comprises four walk-up blocks of four-storey height with a total of 64
maisonette units. It is located at the junction of Toh Tuck Road and Jalan
Jurong Kechil.
4 On or about 3 August 2007, the Application was made for an order for the
collective sale of RG under s 84A LTSA. The applicants were three members
of the SC purportedly authorised by the Majority to make the Application.
5 On 15 August 2007, the Minority filed their objections to the
Application. The defendants before me were the applicants before the RG
Board and the plaintiffs before me were the defendants before the RG
Board. I would add that at the time of the hearings before the RG Board,
there were more SPs who objected to the collective sale but they did not
pursue an appeal to the High Court. For example, Tan had appealed to the
High Court but eventually decided not to pursue it.
6 The RG Board held two mediation sessions on 19 and 22 September 2007
without success. The Application was then fixed for hearing on 6 and 7
December 2007. Also, at the second mediation session, the Minority applied
for and were allowed an extension of time to file further objections to
the Application.
7 On 10 October 2007, the Majority filed an interlocutory application.
According to the GD, this application was to object to the Minority's
further objections on the following grounds:
(a) The further objections submitted by the [Minority] are in contumelious
delay of the statutory period provided for the submission of an objection
under s 84A(4) of the LTSA;
(b) further objections are based on matters which could have been raised
earlier;
(c) the further objections raise irrelevant matters with no reasonable
prospect of success;
(d) the [Minority] cannot base any of their objections on the new laws and
regulations which were not in effect at the material times of this
application; and
(e) the allegations as contained in their further objections are
frivolous, vexatious, irrelevant and inconsequential.
8 On 23 October 2007, the Minority filed an interlocutory application for
the Application to be struck out. According to the GD, the main grounds
were as follows:
(a) The Applicants' application for a collective sale order under s 84A of
the LTSA did not fully comply with the statutory requirements of the Act
and is therefore invalid.
(b) The Applicants' application for a collective sale order failed to
comply with the requirements of the LTSA and the Building Maintenance and
Strata Management (Strata Titles Board) Regulations ("BMSMR").
9 On 6 December 2007, the RG Board commenced hearing the two interlocutory
applications simultaneously. The hearing lasted two days. Both parties
were further asked to submit written submissions and the case was
adjourned to 29 January 2008 for the RG Board to deliver its decision in
respect of the two interlocutory applications. On 29 January 2008, the RG
Board dismissed both interlocutory applications with costs.
10 Thereafter, the parties proceeded with the hearing of the Application
over six days on 29 and 31 January 2008, 4 and 5 February 2008 and 17 and
18 March 2008. On 18 May 2008, the Board granted an order for the
collective sale of RG.
11 As mentioned above, the Minority then appealed against the RG Board's
decision, raising various issues which I will come to.
12 The first two issues raised by the Minority before me were the two
grounds they had taken in their interlocutory application before the RG
Board.
13 I should mention that Edwin Lee ("Mr Lee"), counsel for the Majority,
took the point that as the Minority's appeal to the High Court was filed
on 15 May 2008, the Minority could not rely on these two issues because
the appeal was out of time as the RG Board's decision on the Minority's
interlocutory application was given on 29 January 2008. Mr Lee submitted
that the time to appeal against that decision was from the date of that
decision and not from the date of the decision in the Application. David
Liew ("Mr Liew"), counsel for the Minority, submitted that time ran from
the date of the decision in the Application. Both sides referred to
various parts of what the RG Board had said in respect of the time to
appeal from their decision on the Minority's interlocutory application. It
appeared to me that there was some confusion in the proceedings below on
this point and it was arguable that the RG Board had intimated that time
to appeal from that decision had not yet begun to run and the Minority
were led to believe that time did not run until the RG Board's decision on
the Application. In any event, in view of my decision on the substantive
issues, it was unnecessary for me to decide whether the Minority were
precluded from raising the first two issues before me.
Issue No 1 - Failure to comply with section 84A(3) LTSA read with
paragraph 1(f) of the Schedule to the LTSA
14 The first issue was that the Majority had failed to comply with s
84A(3) LTSA read with para 1(f) of the Schedule to the LTSA. Section
84A(3) LTSA states:
No application may be made under subsection (1) by the subsidiary
proprietors referred to in that subsection unless they have complied with
the requirements specified in the Schedule and provided an undertaking to
pay the costs of the Board under subsection (5).
15 The Schedule to the LTSA provides:
REQUIREMENTS UNDER SECTION 84A, 84D OR 84E
1. Before making an application to a Board, the subsidiary proprietors
referred to in section 84A (1) or the proprietors of flats referred to in
section 84D (2) or 84E (3), as the case may be, shall -
...
(e)serve notice of the proposed application on all the subsidiary
proprietors of all the lots and common property in the strata title plan
concerned or on all proprietors of all flats in the development concerned,
as the case may be, by registered post and by placing a copy of the
proposed application under the main door of every lot or flat, together
with a copy each of the following:
(i) the collective sale agreement referred to in sub-paragraph (a);
(ii) the sale and purchase agreement which is to be the subject of the
application to the Board;
(iii) a statutory declaration made by the purchaser under the sale and
purchase agreement on the nature of his relationship (if any) or, if the
purchaser is a body corporate, the nature of the relationship of every one
of its directors (if any), to any subsidiary proprietor of any lot
comprised in that strata title plan or any proprietor of any flat in the
development, as the case may be;
(iv) the minutes of the extraordinary general meeting or meeting referred
to in sub-paragraph (c);
(v) the advertisement referred to in sub-paragraph (d);
(vi) a valuation report that is not more than 3 months old; and
(vii) a report by a valuer on the proposed method of distributing the
proceeds of the sale due under the sale and purchase agreement; and
(f)affix a copy of the notice referred to in sub-paragraph (e) in the 4
official languages to a conspicuous part of each building comprised in the
strata title plan or the development, as the case may be.
[emphasis added]
16 It was undisputed that the Notice (with the requisite documents) was
served on the Minority by registered post and by placing a copy thereof
under the main door of their respective units. The Notice was also affixed
to the only notice board of RG. However, the Notice was not affixed to a
conspicuous part or any part of each of the four residential buildings
comprised in the strata title plan of the development. Therefore, there
was non-compliance as asserted by Mr Liew. I would add that although Mr
Liew sought to suggest that the Minority had suffered prejudice by this
non-compliance, he could not really make out such a prejudice. The
Minority were clearly aware of the intention to make the Application and
had filed their objections. Nevertheless, Mr Liew argued that the
non-compliance went to the jurisdiction of the RG Board to decide on the
Application.
17 In Siow Doreen v Lo Pui Sang [2008] 1 SLR(R) 213 , Choo Han Teck J ("Choo
J") was of the view that an STB has the power to allow an application made
to it for a collective sale order to be amended. However, in that case,
the deficiency was the omission of three pages in the collective sale
agreement which agreement was to be included with the application. The
three pages contained the execution of three of the consenting SPs. It was
not a case of non-compliance with a requirement of the LTSA before the
application was submitted.
18 In Ng Swee Lang v Sassoon Samuel Bernard [2008] 1 SLR(R) 522 ("Ng Swee
Lang-HC"), Andrew Ang J ("Ang J") was dealing with various objections to
an application for a collective sale order. One of the objections was the
omission to state the method of distribution in the sale and purchase
agreement with the purchaser. He was of the view, at [49], that it was
obvious that the main purpose of the LTSA was to make it easier for en
bloc sales to take place. At [51], he said that the procedural
requirements in the LTSA "were not built in as absolute obstacles to be
surmounted on pain of the Board being precluded from exercising
jurisdiction if any of the procedural requirements were not met,
regardless of whether and to what extent the interests of the minority
were affected". He said at [55]:
At the end of the day, each objection must be examined on its own facts
and the particular requirement breached set against the overall purpose of
the legislation. One should then consider whether a strict construction
and the invalidation of the Board's order is what Parliament would have
intended, taking into account any prejudice to the rights of parties and
the public interest (if any).
19 In [23] of Ng Swee Lang v Sassoon Samuel Bernard [2008] 2 SLR(R) 597
("Ng Swee Lang-CA"), Chan Sek Keong CJ ("Chan CJ") said:
We do not think that the Judge was wrong in drawing an analogy between the
mandatory/directory classification and the
jurisdictional/non-jurisdictional classification. All he meant to say was
that the modern approach is to consider whether it is the intention of
Parliament to invalidate any act done in breach of a statutory provision.
Applying this approach to the facts of the present appeal, we should ask
whether Parliament intended the non-stipulation of the distribution method
in the S&P Agreement to deprive the respondents of the capacity to make
the Application. We agree fully with the Judge's approach.
20 At [35], Chan CJ said:
We should further add that, having regard to the policy objectives of the
collective sale scheme, there is no basis for this court to set aside the
collective sale order made by the Board in the present case. Indeed, there
is a very strong basis to uphold it in order to affirm the general
principle that the courts should not allow what is, in the present case, a
truly technical objection to frustrate the wishes of the Majority Owners
when the appellants have suffered no prejudice whatsoever from the failure
of the S&P Agreement to specify the distribution method.
21 Chan CJ also referred to and approved [55] of Ang J's judgment below.
The High Court and the Court of Appeal decisions in that case are
therefore authorities for the proposition that a technical breach of the
LTSA which causes no prejudice should not be allowed to frustrate the
wishes of a majority who wish to obtain a collective sale order.
22 The RG Board relying on Ng Swee Lang-CA was unable to conclude that any
prejudice had been caused by the breach (under Issue No 1) and therefore
ruled against the Minority on this issue.
23 Before me, Mr Liew submitted that in Tan Siew Tian v Lee Khek Ern Ken
[2008] 3 SLR(R) 64 ("Tan Siew Tian-HC"), the High Court had taken a
different approach. In that case, it was argued by the minority that the
requirement of obtaining the consent of SPs, holding at least 80% of the
share values, to a collective sale agreement before an application to an
STB could be made had not been met. The argument revolved around the
subsidiary proprietors of two units which had to be included to make up
the requisite 80%. Apparently, they had signed the collective sale
agreement, within a certain permitted timeframe stipulated in the LTSA,
but they then sold their units to third parties who did not sign the
collective sale agreement before the permitted time expired. In those
circumstances, Lee Seiu Kin J ("Lee J") decided that the requirements of
the LTSA had not been met and the application to the STB for a collective
sale order was invalid.
24 In reaching his decision, Lee J expressed certain observations in [21]
to [26] of his judgment. They covered his concern over the uncertainty,
delay, acrimony and huge costs caused by litigation over collective sales.
He expressed the view that full effort should be given to provisions which
were clear and said that a "regime that promotes greater certainty would
go a long way towards alleviating the pecuniary and human cost of the
exercise" (see [26] of his judgment).
25 Relying on the observations in [21] to [26] of Lee J's judgment, Mr
Liew submitted that Lee J had taken a different approach from that in Ng
Swee Lang-HC and Ng Swee Lang-CA. He also submitted that the Court of
Appeal did not disagree with Lee J when the appeal against his decision
was heard. Before I come to that decision of the Court of Appeal, it is
important to bear in mind that while [21] to [26] of Lee J's judgment may
give the impression that he favoured a stricter approach such that any
non-compliance with any provision of the LTSA would render an application
to an STB invalid, as this would promote more certainty, he did not
actually decide that the stricter approach should prevail.
26 Indeed, in [28] of his judgment, he referred to the endorsement by the
Court of Appeal of Ang J's approach and he noted at [30] the Court of
Appeal's view that a truly technical objection that had not caused any
prejudice to the minority owners should not prevail. At [34] of his
judgment, Lee J appeared to adopt the modern approach to statutory
interpretation endorsed by the Court of Appeal in Ng Swee Lang-CA.
27 Accordingly, contrary to Mr Liew's submission, Lee J's decision is not
authority for the proposition that any and every non-compliance of any
provision in the LTSA will render an application to an STB invalid. The
decision he had reached was that the new subsidiary proprietors of the two
units had to sign the collective sale agreement and since they had not,
the consent of the requisite 80% had not been obtained. In his view, such
a non-compliance made the application to the STB invalid.
28 I come now to the decision of the Court of Appeal on the appeal from
Lee J's decision (see Tan Siew Tian v Lee Khek Ern Ken [2008] 3 SLR(R) 941
) ("Tan Siew Tian-CA"). The Court of Appeal decided that Lee J was wrong
in concluding that the new subsidiary proprietors of the two units had to
sign the collective sale agreement within the permitted time. Accordingly,
the signatures by the previous owners were good enough and would be taken
into account to meet the 80% requirement. In the circumstances, there was
compliance and there was no need for the Court of Appeal to address the
further issue as to the consequence of the particular non-compliance which
Lee J had found.
29 In the circumstances, I did not agree with Mr Liew's suggestion that in
not expressing its disapproval of Lee J's approach or the consequence of
non-compliance, the Court of Appeal had adopted Lee J's stricter approach.
Also, as I have said, I did not agree that Lee J had adopted the stricter
approach although I accepted that the earlier parts of his judgment might
have given that impression.
30 I come now to another decision which Mr Lee relied on. This was a
decision of Choo J delivered on 25 June 2008 which was one day after the
Court of Appeal delivered its decision in Tan Siew Tian-CA. This was the
case of Chang Mei Wah Selena v Wiener Robert Lorenz [2008] 4 SLR(R) 385
("Chang Mei Wah").
31 In that case, one of the complaints was identical to the one before me,
ie, that the notice of the application to the STB was not affixed to a
conspicuous part of every building in the development there, ie, Gillman
Heights, as was required under the LTSA, and consequently, a false
declaration stating that the notices were so affixed was false. The STB
rejected that complaint and Choo J also rejected it. In doing so, Choo J
referred at [31] to a new s 84A(3) and a new s 84A(7C) which was effective
from 4 October 2007.
32 The new s 84A(3) is expressly made subject to the new s 84A(7C). The
latter provision makes it clear that an STB "shall not invalidate an
application to the Board for an order under sub-s (1) or section 84D(2),
84E(3) or 84FA(1) by reason only of non-compliance with any requirement in
the First, Second or Third Schedule if the Board is satisfied that such
non-compliance does not prejudice the interest of any person ...".
33 After referring to these new provisions, Choo J said, also at [31],
that it was therefore open to the Board to find that the placing of the
notices on various notice boards had provided adequate notice about the
collective sale and that no party had been prejudiced. He also referred to
Ng Swee Lang-HC at [51].
34 Mr Lee noted that the case before Choo J actually involved the LTSA
before the amendments in October 2007. He submitted that Choo J was
relying on the approach in Ng Swee Lang-HC and Choo J's reference to the
new provisions was merely to reinforce the decision in Ng Swee Lang-HC.
35 It was not clear to me how much Choo J was influenced by the new
provisions and whether he considered the new provisions as being merely
declaratory of the existing position.
36 In Ng Swee Lang-HC, there was a submission that the new provisions were
to amend the existing positions as they showed that prior thereto an STB
did not have power to disregard any technical irregularity. Ang J said
that it was not permissible to refer to the explanatory statement of the
relevant Bill leading to the introduction of these, and other, provisions.
37 In any event, whether Choo J's decision in Chang Mei Wah can be used as
authority to support the proposition that a technical breach will not
invalidate an application to an STB if there is no prejudice to anyone,
there are still the two decisions in Ng Swee Lang-HC and Ng Swee Lang-CA
which are authorities in support of that proposition and I was bound by
the decision in Ng Swee Lang-CA.
38 Even if I was not bound by any authority, I would have preferred the
approach under such a proposition. While a strict approach may arguably
lead to some certainty, I was of the view that it would be too harsh to
invalidate every application for any non-compliance however slight and
inconsequential. The reality is that there are many procedural
requirements to be complied with before and when an application is made
for a collective sale order. I am driven to conclude from the many cases
that have come before the courts that, notwithstanding the assistance of
marketing agents and solicitors, such requirements are observed more in
the breach than in the compliance. The result then would be that it will
be virtually certain that many applications will fail for technical
reasons alone. I did not think that was what Parliament intended before
the 2007 amendments. I am glad to note that it has since shown, going
forward, that that is not its intention.
39 In the circumstances, I rejected the Minority's complaint under Issue
No 1.
Issue No 2 - Failure to comply with all the relevant regulations in the
LTSA and in the Building Maintenance and Strata Management (Strata Titles
Board) Regulations 2005 ("BMSMR 2005") under the BMSMA 2004, in particular
the requirements relating to Form 1A
40 Paragraph 4 of the Schedule to the LTSA requires an application for a
collective sale order to be made with various documents enclosed with the
application. Paragraph 4(d) refers to the inclusion of "such other
document as the Board may require".
41 Mr Liew submitted that "In the Forms for Matters under Part VA of the [LTSA],
and the [BMSMR 2005], there is a requirement for Form 1A to be filed in
any [a]pplication to the STB".
42 Form 1A is a template of an affidavit of service in which para 3 of the
affidavit states that a copy of the application has been served on each of
the minority owners who have not signed the collective sale agreement:
(a) by placing a copy of the application under the main door of each of
the minority owners' units and
(b) by affixing a copy of the application to a conspicuous part of each
building in the development.
43 Mr Liew stressed that in fact Form 1A, ie, an affidavit of service, was
included with the Application. In so doing, the Majority must have
recognised the need for such an affidavit and could not be heard to say
otherwise. However, he submitted that the affidavit of service was
defective because, apparently, it confirmed the service of the Application
on the Minority (and other objectors) when in fact only the Notice and not
the Application itself had been served. Even then, the Notice had not been
served in strict compliance with the LTSA for the reason stated in Issue
No 1.
44 On the other hand, Mr Lee submitted that although an affidavit of
service was included with the Application, the affidavit of service was
not, strictly speaking, required. The affidavit of service was listed as
one of the documents in a website of the STB but was not specifically
required under the applicable primary or subsidiary legislation. As for
the affidavit of service which had been included, he submitted that it had
erroneously referred to service of the Application when the Application
had admittedly not been served on the Minority. The affidavit of service
should have referred to the service of the Notice instead. Even then, I
reiterate that the Notice was in fact also not served in full compliance
with the procedural requirements and the affidavit of service would still
have been inaccurate even if it had been corrected to refer to service of
the Notice and not service of the Application.
45 The RG Board's conclusion on this issue is stated in [20] of its GD as
follows:
20. The Board is of the opinion that Form 1A is a procedural requirement
but it is not a statutory requirement that parties must file it.
Regulation 28 of the BMSMR empowers the Board to waive procedural
requirements if there are exceptional circumstances justifying such
waiver. Even assuming it is a statutory requirement to file Form 1A, the
Board is of the opinion that failure to file it should not render the
Applicants' application invalid as the procedural irregularity did not
prejudice or significantly impair the objectors' right in filing their
objections. In the Board's opinion, Parliament would not have intended
that the approval of the sale by the Board should be invalidated by reason
of such a procedural irregularity. For the above reasons, the Board is of
the view that the Applicants' failure to file Form 1A or to serve the
application on the minority owners does not invalidate this application.
46 This led Mr Liew to submit that the RG Board was wrong in concluding
that the Majority had failed to file Form 1A. As mentioned above, the
Majority did file Form 1A (by including it with the Application) but the
substance of Form 1A was incorrect, for the reason mentioned above.
47 Although Mr Liew's submissions gave the impression that Form 1A was a
specific requirement of the primary or subsidiary legislation, the fact
was that Form 1A was not a specific requirement of such legislation.
Neither did either of such legislation require the Application to be
served on the Minority although common sense would suggest that it should
be served or, at the minimum, the Notice should stipulate that a copy of
the Application would be sent to any SP requesting the same or could be
inspected (and a copy taken) from a specified location.
48 As mentioned, Form 1A was one of the documents specifically listed on
the STB website. What Mr Liew meant was that because Form 1A was listed on
the STB website, this was a document coming within the meaning of "such
other document as the Board may require" in para 4(d) of the Schedule. It
is therefore appropriate to set out para 4 in its entirety:
4. An application to a Board shall be made by the subsidiary proprietors
referred to in section 84A (1) or the proprietors referred to in section
84D (2) or 84E (3) within 14 days of the publication of the advertisement
referred to in paragraph 1 (d), enclosing -
(a)the documents specified in paragraph 1 (e);
(b)a statutory declaration made by the representatives appointed under
section 84A (2) or their solicitors stating -
(i) the date the permitted time for the collective sale agreement started;
(ii) the date on which collective sale agreement referred to in paragraph
1 (a) was last executed by any subsidiary proprietor or proprietor
referred to in section 84A (1), 84D (2) or 84E (3), as the case may be;
(iii) the date or dates on which the notice or notices referred to in
paragraph 1 (b) were affixed; and
(iv) that sub-paragraphs (c), (d), (e) and (f) of paragraph 1 have been
complied with;
(c)a list of the names of the subsidiary proprietors who have not agreed
in writing to the sale, their mortgagees, chargees, and other persons
(other than lessees) with an estate or interest in the lots or flats whose
interests are notified on the land-register; and
(d)such other document as the Board may require.
[emphasis added]
49 I did not agree with Mr Liew. It is useful to bear in mind that there
is no one permanent entity known as "The Strata Titles Board". The
definition of "Board" in s 3 of the LTSA is that it means "a Strata Titles
Board constituted under the BMSMA 2004". Note that it refers to "a" Strata
Titles Board and not "the" Strata Titles Board.
50 Sections 89 and 90 of the BMSMA 2004 states:
Strata Titles Boards
89.-(1) There shall be one or more Strata Titles Boards to be presided
over by a president or deputy president.
(2) Unless otherwise provided by this Act or the Land Titles (Strata) Act
(Cap. 158), a Board shall determine by mediation-arbitration every dispute
of which it has cognizance and every matter with respect to which it has
jurisdiction under this Act or that Act.
(3) Except where otherwise provided by this Act or the Land Titles
(Strata) Act, a Board shall, in relation to a dispute of which the Board
has cognizance or any other matter with respect to which the Board has
jurisdiction under this Act or that Act, be constituted by -
(a) the president or a deputy president; and
(b) 2 or 4 members selected by the president for the purposes of the
dispute or matter from the panel constituted under section 90(4).
(4) Any party to a dispute of which a Board has cognizance or a matter
with respect to which a Board has jurisdiction under this Act or the Land
Titles (Strata) Act may, within the prescribed period and for any
reasonable cause, object in writing to any member of the Board selected by
the president under subsection (3)(b).
(5) The Board shall be constituted -
(a) upon the expiration of the prescribed period if the registrar
appointed under section 99(1) does not earlier receive any objection under
subsection (4);
(b) if any objection received under subsection (4) is allowed by the
president, upon the selection of another member by the president; or
(c) if any objection received under subsection (4) is disallowed by the
president, upon the decision to disallow the objection.
President, etc., and panel
90.-(1) The Minister shall appoint a president of the Boards.
(2) The Minister may appoint not more than 3 deputy presidents of the
Boards.
(3) No person shall be appointed as the president or a deputy president of
the Boards unless the person is a qualified person within the meaning of
the Legal Profession Act (Cap. 161).
(4) For the purpose of enabling the Boards to be constituted inaccordance
with this Part, a panel consisting of not more than 30 persons shall be
appointed by the Minister and their names shall be notified in the
Gazette.
(5) The president, a deputy president and any person appointed as a member
of the panel constituted under subsection (4) shall, subject to subsection
(6), be appointed for a term of 2 years, and shall be eligible for
reappointment.
(6) The Minister may at any time terminate the appointment of the
president or any deputy president or member of the panel constituted under
subsection (4), and fill any vacancy in its membership.
51 Therefore, it seemed to me that each board is constituted for a
specific purpose which is usually to consider an application for a
collective sale order and upon being constituted, that board becomes "the"
Board for the purpose of the overall scheme under the LTSA and the BMSMA
2004.
52 Likewise, para 4 of the Schedule to the LTSA starts with a reference to
"a" Board and para 4(d) then refers to such other document as "the" Board
may require. I was of the view that the reference to "the" Board in para
4(d) was in turn a reference to the particular board which had been
constituted to hear the Application. In other words, the reference to
"such other document as the Board may require" was a reference to such ad
hoc document as the RG Board might require and not such document as might
be listed on a website even though that website was referred to as the STB
website.
53 In the circumstances, I did not agree that Form 1A was a requirement of
"the" Board for the purpose of para 4(d). Indeed, from the notes of
evidence of the hearing before the RG Board, it seemed that the RG Board
were also attempting to find out how this Form 1A had come about. The fact
that the Majority did in fact include a Form 1A did not add anything. The
fact that a document is included does not mean that it is a mandatory
requirement. It may be that the Majority's solicitors also thought that it
was such a requirement before they were bitten by the Minority's objection
but two wrongs do not make a right. In any event, it would have been safer
to include a form if there was uncertainty or confusion.
54 Since Form 1A was not, strictly speaking, required, non-compliance with
the content of Form 1A could not invalidate the Application.
55 I accepted that the RG Board was wrong in saying that Form 1A was not
filed but that error was immaterial in the circumstances. Even if I was
wrong and Form 1A was one of the required documents to be submitted, that
form was submitted although the contents were inaccurate for the reason
stated above.
56 I come now to Mr Liew's point that contrary to what the submitted Form
1A had stated, the Application was in fact not served at all on the
Minority. Then again, there was no requirement, outside of Form 1A, for
the Application to be served. Assuming that it was a requirement that the
Application was to be served and this was not done, what then?
57 Mr Liew submitted that even up to the time of the hearing before me,
the Minority had not been served with a copy of the Application. It was
then suggested that they and he did not know what orders the Majority were
seeking from the RG Board. I was surprised by such a suggestion. Mr Liew
had vigorously contested the Application before the RG Board. When I asked
Mr Liew whether he had asked for a copy of the Application when he
appeared before the RG Board, he said he had not. Having not done so, it
seemed remarkable to me that he was seeking to make the absence of service
of the Application part of an issue before me. It was quite clear to me
that the reason why Mr Liew had not sought a copy of the Application when
he appeared before the RG Board was that he did not need it to pursue the
objections of the Minority. Apparently, he had still not received a copy
from the Majority's solicitors by the time the hearing before me had
commenced. It was not clear to me whether he had sought the same from the
Majority's solicitors.
58 In any event, I was satisfied that there was no prejudice to the
Minority and in accordance with my decision on Issue No1, I was of the
view that the absence of service of the Application did not invalidate the
Application, even if there was a requirement that the Application be
served.
59 I would add that as Mr Liew had mentioned before me that he still did
not have a copy of the Application, I directed that this be furnished to
him by the Majority's solicitors and this was promptly done.
60 I would also like to add the following. I was informed by Mr Lee that
Form 1A has been removed from the website. I was also informed by him that
an application was supposed to be accompanied by many documents making it
(with the accompanying documents) a rather voluminous and unwieldy bundle.
In any event, I understood from Mr Lee that the enclosures too are no
longer required to be submitted with an application.
Issue No 3 - The CSA was not signed by subsidiary proprietors holding at
least 80% of the share value of RG.
61 Section 84A(1)(b) LTSA provides that an application to the Board for a
collective sale order may be made by the subsidiary proprietors holding
not less than 80% of the share value of a development. The Minority's
third issue was that the CSA was not signed by subsidiary proprietors
holding at least 80% of the share value for the reason stated below.
62 Clause 14(b)(i) of the CSA had stipulated that the MSP was not to be
less than S$68.5m. The close of an EOI exercise was on 18 April 2007 and
it was learned then that Premier's offer of $76.8m was the highest. The
Conditional SPs then signed the CSA and inserted a condition that their
signatures would not be valid if the MSP was lower than $76.8m. Mr Liew
submitted that as this was a different sum from the MSP stipulated under
cl 14(b)(i), the Conditional SPs had not agreed with all the terms of the
CSA.
63 Mr Liew also submitted that although cl 14(b)(ii) of the CSA had stated
that the SC might raise the MSP without seeking the consent of those who
had signed the CSA, the SC was required under that provision to notify the
Majority of the decision to raise the MSP by a written notice. The SC did
not do this until late July 2007, just before the Application was
submitted.
64 Mr Lee submitted that the Conditional SPs had signed the CSA on 28
April 2007 and that the SPA with Premier Land Pte Ltd ("Premier"), the
eventual purchaser, was for a sale price of $77.3m with the possibility of
an additional $10m if two parcels of adjacent state land were granted to
Premier. The condition of the Conditional SPs had been met.
65 As for any breach to notify the others who had signed the CSA about the
higher revision of the MSP, Mr Lee submitted that it was for the other
signatories to complain about such a breach.
66 In Liu Chee Ming v Loo-Lim Shirley [2008] 2 SLR(R) 764 ("Liu Chee
Ming"), I had said at [50]:
The appellants were not parties to the CSA even though eventually, by
virtue of the decision of the Board, they were bound by its terms.
Accordingly, their complaint about a breach of cl 6.1.1 was from the angle
that such a breach established an absence of good faith. The vendors who
had signed the CSA were not opposing the application to the Board.
67 Understandably, none of the other signatories had objected to any
breach of cl 14(b)(ii). They had obtained a price higher than the MSP
stipulated in cl 14(b)(i). However, Mr Liew's argument was that there was
no consensus ad idem among all the Majority at the relevant time. Looking
at cl 14(b)(ii) in a common-sensical way, I was of the view that there
would be consensus ad idem if the SC did not object to the condition,
which was the case. The MSP had been effectively raised to $76.8m. This
condition was met. The notification to the others was an additional step
that should have been taken but the omission to do so did not vitiate the
CSA as between all the Majority.
68 Hence, I was of the view that by the time the Application was made (on
or about 3 August 2007), the requisite percentage of share value had been
obtained.
69 The Minority also sought to object on the basis that the signature of
another SP on the CSA, one Mary Winifred Yii ("MWY") was not valid. She
appeared to have written her name instead of signing it. The Minority
maintained their objection, even though there was affidavit evidence from
MWY that that was her signature, ie, that was the way she signed her name.
They objected on the basis that MWY's affidavit should not have been
admitted.
70 The short point was that even if MWY's signature was invalid, the
requisite percentage of share value had been obtained, ie, the 80% had
been achieved even without her signature.
71 In the circumstances, I ruled against the Minority on Issue No 3.
Issue No 4 - The transaction was not in good faith having regard to the
sale price in the SPA.
72 Mr Liew submitted that the sale price in the SPA was not obtained in
good faith because:
(a) the valuation report obtained by the Majority to support the
application to the Board was biased, inaccurate, not substantiated by
concrete evidence and not representative of the true market value of the
Development and
(b) the sale price was not obtained at arm's length.
Mr Liew raised many arguments in respect of each of these two sub-issues.
73 Before I deal with Mr Liew's arguments, I should mention one point. The
Majority had obtained an independent valuation report dated 20 July 2007,
that is, after the SPA had been entered into. The report valued the land
on which RG stood at $66.65m.
74 In the recent decision of the Court of Appeal in Ng Eng Ghee v Mamata
Kapildev Dave[2009] 3 SLR(R) 109 ("Horizon Towers"), the Court of Appeal
said at [160] that the sale committee there had "a duty to obtain an
independent valuation prior to settling on the final sale price.
Otherwise, it would have no way to gauge whether or not it is obtaining a
fair (not to mention the best) price for the property".
75 While the stated rationale for imposing such a duty is logical, the
applicable provisions of the LTSA suggested that there was no requirement,
as such, for the SC to obtain an independent valuation before the SPA was
entered into. Under para 1(e) of the Schedule to the LTSA, the Majority
need only serve the Notice with a copy of various documents and para
1(e)(vi) in particular requires "a valuation report that is not more than
3 months old" (see also Ng Swee Lang-HC ([18] supra) at [115]).
76 I would add that even an amendment in October 2007 only requires the
valuation report to be on the value of the development concerned as at the
date of the close of the public tender or auction. This suggests that the
valuation report may be obtained after that date but the point of
reference must be as at the date of the close of the public tender or
auction.
77 Indeed, in fairness to Mr Liew, he did not assert before me that
because there was no valuation report at the time the final sale price was
settled, the SC was in breach of any duty. Neither did Mr Liew raise the
absence of such a valuation report as a factor in the overall assessment.
78 The first sub-issue raised by Mr Liew was a criticism of the valuation
done by Ee, the Majority's valuer. As stated above, he had provided a
valuation report dated 20 July 2007 valuing the land on which RG stood at
$66.65m.
79 Before me, Mr Liew pursued his arguments in the following sequence.
80 Ee had adopted the Residual Approach and Market Comparison Approach and
taken the average of the values from each approach. However, his use of
each approach was faulty.
81 As regards the Market Comparison Approach, Ee had used three comparable
transactions: H J Heights in District 21 in August 2006 and Regent Gardens
and Hong Leong Gardens condominium in District 5 in 2007 with some
adjustments made for differences in location and time.
82 Ee said he had not made any adjustment on the price for HJ Heights
because both HJ Heights and RG were in District 21 even though HJ Heights
was nearer to Bukit Batok which Mr Liew argued was a less desirable
location.
83 As for Ee's use of Regent Gardens as a comparison, Mr Liew submitted
that he should not have done so because an application for a collective
sale order for that development had been rejected as the sale price was
below the market price.
84 There was no specific complaint about Ee's use of Hong Leong Gardens
condominium as a comparison. However, Mr Liew submitted that Ee was wrong
to exclude two other developments, Spottiswoode Apartments and Fairways
condominium from comparison because his only reason for excluding them was
a "Sentosa" factor which he did not elaborate on.
85 Mr Liew also submitted that individual units in estates near RG like
Signature Park were fetching prices higher on a per square foot basis than
the collective sale price for RG, that is, $687 per square foot for
Signature Park as compared with about $462 per square foot for RG. He
submitted that the SPs of RG would have been able to achieve higher prices
selling their own units individually.
86 As for the Residual Land Valuation Approach, it was common ground that
this would be based on the Gross Development Value ("GDV") which is the
price at which a new unit on the same land would fetch at the material
time, ie, May 2007. Ee had estimated the GDV for the land in RG at $850
per square foot. However, Mr Liew submitted that Ee did not elaborate to
support his estimate of the GDV at $850 per square foot. He also submitted
that Ee was wrong not to take Garden Vista, which was a new 99-year
leasehold condominium in District 21, into account. Mr Liew said that Ee's
reason that it was in a more superior location because of its Dunearn Road
address was contrary to his position that there would be no adjustment for
developments within the same district number when he was using the
Comparison Approach. Furthermore, Garden Vista was about the same distance
from RG as was HJ Heights although in opposite directions and RG was
equally accessible to good schools and other amenities as was Garden
Vista. Mr Liew also used the website of the Urban Redevelopment Authority
("URA") to show that new units (in three transactions) in Garden Vista (in
District 21) and in One-North Residences (in District 5) were being sold
in June 2007 at median prices of $1,039 per square foot and $1,004 per
square foot respectively but Ee produced a list of caveats for transacted
prices from March to May 2007 (instead of June 2007) for sales of units in
these two developments to show that even if he had used those transactions
in his GDV calculation, they would not affect his calculation. Ee also
alleged that the three transactions which Mr Liew had relied upon was not
a large enough sample to be used.
87 Mr Liew also submitted that Ee should have but did not take into
account a possible future mass rapid transit line and the possibility of
the alienation of nearby state land which would increase the value of the
land at RG.
88 The RG Board rejected Mr Liew's arguments in [60] to [69] of its GD
which I do not propose to repeat. However, I would make the following
observations:
(a) If the SPs could have sold their units individually for a higher price
than what was envisaged under the CSA, then the CSA would not have
attracted so many signatories.
(b) The possibility of alienation of nearby state land had been taken into
account in the SPA under which an additional $10m was to be paid if
Premier obtained alienation of two plots of state land referred to in the
SPA. Indeed, one parcel of state land was eventually made available to
Premier and the purchase price was increased to $81.3m.
(c) For all of Mr Liew's arguments, Premier's EOI price was the highest at
$76.8m when the EOIs were opened. This price was improved to $77.3m when
the SPA was signed and eventually increased to $81.3m, as stated above. I
will elaborate later on the exercise involving the EOIs and disputes
arising therefrom.
(d) The Minority did not obtain their own valuation report to counter the
one obtained by the Majority. While this was not in itself fatal to their
challenge against the valuation obtained by the Majority, it was a factor
against the Minority. They said that they could not afford to pay for a
five figure fee which was quoted for a valuation and no one they had
approached wanted to do a desk-top valuation. The reason about not being
able to afford the fee did not sound convincing to me given the amount of
time and legal fees they would be incurring before the RG Board and any
appeal therefrom. Mr Liew also said that the Minority was told that
valuers did not like to disagree with a fellow valuer. I found that hard
to believe as it is not uncommon for parties to obtain valuations which
differ when there is a dispute over the value of real property or of any
other asset.
89 In any event, I could not say that the Board had erred on a point of
law and I did not disturb its decision on this sub-issue.
90 I come now to the second sub-issue: that the sale price was not
obtained at arm's length. Mr Liew made numerous arguments under this
sub-issue.
91 He submitted that the SC had arbitrarily decided on the MSP to be
$68.5m and did not take into account a rapidly rising market as evidenced
by the fact that Ecco had revised its offer from $59m in January 2007 to
$61m and then to $64 million as at 16 March 2007. The $64m was still
applicable when Ecco submitted its EOI during an exercise which invited
EOIs to be submitted. The SC also did not write to the URA to consider
increasing the plot ratio for redeveloping the land or to apply for
alienation of state land.
92 Mr Liew submitted that there was no circulation of minutes of the SC.
He also submitted that the SC had sent a circular dated 29 March 2007 to
convene a meeting on 31 March 2007 of SPs on a proposed CSA and the MSP of
$68.5m. This was an unreasonable rush to pressurise SPs to agree to the
CSA. Furthermore, the CSA already contained the name of the property
consultant, that is, ERA, and the solicitors, that is, R&T. He submitted
that there was no consultation with SPs on these names and the fees of ERA
and R&T were higher than those quoted by others. The SC had also obtained
the signatures of SPs of eleven units to the CSA before the intended
meeting on 31 March 2007. Together with members of the SC, there would be
more than 20% of the share value in support of the intended CSA. All these
steps were taken to frustrate the attempts of one Ang who had sent an
earlier circular dated 16 March 2007 to the SPs to state his intention to
form an alternative SC. There was also no consultation with SPs on whether
the sale should be by way of EOIs or public tender or private treaty.
93 Mr Liew submitted that the EOI exercise was conducted in an improper
manner for many reasons:
(a) Poon had been allowed to retrieve an envelope which contained an EOI,
from, apparently, Premier which was superseded by another envelope from
Premier which had been submitted on the closing date, ie, 18 April 2007.
It was said that the fact and the substance of the withdrawn EOI was not
disclosed to SPs in the afternoon of 18 April 2007 when various letters of
EOI were opened at R&T's office or in the evening of 18 April 2007 at a
meeting of SPs.
(b) Soh had disclosed to Elizabeth Lim (one of the Minority) that the SC
knew each and every offer before the EOIs tender box was opened on 18
April 2007. It was subsequently learned on or about 24 June 2007, when a
copy of the withdrawn EOI from Premier was eventually made available, that
it was for $73.3m. This was lower than the second highest EOI from First
Capital for $73.6m.
(c) None of the EOIs were circulated to SPs in the evening of 18 April
2007. Also, none of the SPs were told then that in Ecco's EOI, there was a
statement that "... we will consider matching or improving our offer
provided there are other genuine written offers from developers". Neither
were SPs who attended the opening of the EOIs in the afternoon of 18 April
2007 told of this. Neither was Ecco approached to improve its EOIs.
Although See said she did do so, Mr Liew submitted she ought not to be
believed because initially she said she approached Ecco once after the EOI
envelopes were opened and then she said more than once.
(d) The SC had also informed the SPs at the opening of the EOI envelopes
on 18 April 2007 and at the meeting that same evening and in the SC's
circular of 20 April 2007 to the SPs that Premier's EOI would lapse at
midnight of 30 April 2007 but Premier's EOI itself did not contain such a
deadline. Furthermore, the SPA was signed after 30 April 2007, on 12 May
2007. Goh, who was the chairman of the SC, had given evidence that the SC
was informed of this alleged deadline by See after the opening of the EOI
envelopes on 18 April 2007. See herself said she was told orally about the
deadline the day after the opening of the EOI envelopes. Yet, the circular
dated 20 April 2007 from Goh suggested that the deadline of 20 April 2007
was already mentioned at the night meeting of 18 April 2007. Mr Liew's
submission was that there was in fact no such deadline and it was created
by See or the SC to put pressure on the SPs to sign the CSA on or before
30 April 2007.
(e) Mr Liew also submitted that no attempt was made to ask other
interested parties, aside from Ecco, to improve their offers even though
some of them had said that their offers were open to a date after 30 April
2007. He suggested that See's evidence that she had approached others
after the EOIs were opened on 18 April 2007 should not be believed as her
evidence wavered between contacting only Ecco or others as well and she
had not shown documentary evidence to support her contention.
(f) Mr Liew submitted that according to Tan Peck Kheng and Koh who were
members of the Minority, Koh was approached by See together with a
representative from Premier, one Lyon Tan. After See and Koh had learned
from Koh about his recent renovations, Tan offered him $20,000 in an
attempt to get them to sign the CSA. On the other hand, See's version was
that the discussion was on whether Premier was prepared to increase the
price for the entire RG land so that owners of individual units would get
more and there was no offer to pay more to Koh (and Tan Peck Kheng) only.
Mr Liew's point was that See should not be believed because any question
about raising the entire purchase price should be broached with the SC and
not with Koh alone and the price for RG would not be dependent on Koh's
renovations. Also, See had not filed an affidavit to refute the points
which had been raised in the affidavit of Tan Peck Kheng and Koh.
(g) Mr Liew submitted that Goh had misrepresented to the SPs about the
extent of roof leakage and water pump problems and the need to raise funds
in order to pressurise them to sign the CSA.
94 The RG Board noted that there was no objection to the appointment of
R&T and ERA at the meeting of 31 March 2007 even though their fees had
been discussed then. Also, there was no evidence of collusion. The RG
Board was also of the view that there was nothing wrong in allowing Poon
to retrieve the envelope he had tendered at the meeting of 31 March 2007.
There was nothing wrong with the SPs of 11 units signing the CSA before
the meeting of 31 March 2007 in the absence of evidence of bad faith,
deceit or coercion. As for the condition imposed by the Conditional SPs
which raised the MSP, the Board was of the view that only signatories to
the CSA could object to that condition. As for the short interval between
the letter of 29 March and the 31 March 2007 meeting, the RG Board was of
the view that there was no evidence of insufficient notice to the SPs.
95 In order to better understand Mr Liew's arguments on this sub-issue, it
is necessary to set out the background events in some detail.
96 See said that on or about 18 December 2006, she had received an offer
from Ecco to buy RG at $59m.
97 On 30 December 2006, letters were sent or handed by Ang to SPs to
inform them that a sale committee had been formed.
98 On 3 January 2007, ERA sent a letter to SPs to attend a presentation on
6 January 2007. On 6 January 2007, there was a meeting of SPs. A
presentation was made by ERA that day about the offer of $59m.
99 Subsequently, on 16 March 2007, Ang sent or handed letters to SPs to
update them on the latest developments pertaining to the collective sale.
He stated that due to differences, he was no longer a member of the sale
committee and that since 6 January 2007, Ecco had improved on its initial
offer of $59m twice: once to $61m and then to $64m. He suggested that the
sale be by way of a public tender and also suggested an MSP of $68m. He
proposed to form an alternate pro-tem sale committee. He was also pitching
for the job of acting as the solicitor to act for the SPs in the
collective sale. He set out some quotations which I will come back to
later.
100 Two days later, a sale committee (of which Goh was the chairperson)
sent a letter to the SPs dated 18 March 2007. The persons in this
committee were the same persons appointed as members of the SC under the
CSA and I will refer to them as "the SC" even though the first signatures
to the CSA were effected on or about 29 March 2007. The letter stated that
a higher price of $64m had been received (from Ecco). It stated the
intention to seek more offers by way of an EOI because a public tender
needed the agreement of 80% of the owners which in turn required time to
obtain.
101 Another two days later, the SC sent a letter dated 20 March 2007 to
the SPs. The letter stated that they had received an email from Ang
stating his intention to form an alternate pro-tem sale committee. They
also referred to his letter which was distributed to the SPs on 16 and 17
March 2007 but not to members of the SC. The SC's letter reiterated the
SC's intention to proceed by way of an EOI.
102 By a letter dated 29 March 2007, the SC invited all SPs to a meeting
on 31 March 2007 at the Bukit Timah Community Club ("BTCC"). The heading
of the letter stated that the meeting was for the presentation of a
collective sale agreement and the signing thereof. A copy of the
collective sale agreement was attached. The letter stated that because of
the quick rising market conditions, the SC was going to recommend a higher
MSP. Apparently, the MSP of $68.5m was already inserted in the proposed
collective sale agreement as were the names of R&T as the solicitors and
ERA as the marketing agents.
103 Before the meeting on 31 March 2007, SPs of 11 units had already
signed the CSA. At the meeting of 31 March 2007, ERA and R&T made their
presentations. Also, Poon handed over a sealed envelope which he said
contained an offer higher than the MSP. Gan took over custody of this
envelope till he deposited it into a tender box of sorts on 18 April 2007
which was to contain all EOIs. For convenience, I will refer to the
amounts expressed in the EOIs as offers or bids although there is a
technical difference between an EOI and a tender in that a tender is
usually a binding offer which cannot be withdrawn and an EOI may be
considered more of an invitation to treat, as opposed to an offer, in law.
104 Subsequently, the SC sent letters dated 11 April 2007 to the SPs to
invite them to witness the results of the EOI exercise at the office of
R&T on 18 April 2007 at 3pm and to inform the SPs of a meeting in the same
night also of 18 April 2007 to discuss the results of the EOIs and future
direction of the collective sale.
105 In the afternoon of 18 April 2007, various persons attended at the
office of R&T to witness the results of the EOI exercise. As mentioned
above, Gan deposited the earlier envelope handed over by Poon into the
relevant box that day. Four other EOIs were also deposited by various
persons into the box that day. However, a request was made (apparently by
a representative of Premier) for the return of the earlier envelope which
Poon had handed over on 31 March 2007. This envelope apparently had a chop
from the law firm of Seah Ong & Partners as did another envelope which
contained the highest bid. However, the sizes of the envelopes were
different and Gan was able to distinguish between the two. The earlier one
was eventually returned unopened to Poon that same afternoon as he was the
one who had first handed over the earlier envelope on 31 March 2007. The
remaining four EOIs yielded the following results:
(a) Premier - $76.8m (with an additional $10m if two plots of state land
were alienated to it)
(b) First Capital - $73.6m
(c) Ecco - $64m
(d) Sim Lian - $60.5m
106 I should make the following observations as well. Unlike the EOI from
Premier, none of the other EOIs provided for any uplift in the price even
if both or either of two plots of state land were alienated to the
developer concerned. Indeed, Sim Lian's EOI was subject to such alienation
and its offer was already the lowest of the four.
107 I should also mention that although Premier was incorporated only on
16 April 2007, nothing turned on this. According to See, the real party
behind Premier was an entity called LaSalle whom she described as "a very
big company" and the identity of LaSalle had been revealed in the night
meeting of 18 April 2007.
108 In the night of 18 April 2007, there was a meeting of the SPs when the
outcome of the EOI exercise was announced.
109 Subsequently on 20 April 2007, the SC sent another letter to the SPs.
This was to inform the SPs in writing of the highest offer from Premier at
$76.8m or $86.8m if the two plots of state land were obtained. The letter
also informed the SPs that Premier's offer may lapse by 30 April 2007 and
urged them not to miss the boat.
110 On 28 April 2007, the Conditional SPs signed the CSA with the
condition that the MSP was to be $76.8m. I have referred to this condition
under Issue No 3. As I mentioned , the Conditional SPs brought the total
share value of SPs signing the CSA beyond the 80% threshold.
111 On 5 May 2007, the SC sent a letter to all SPs to inform them that the
SPs who had signed the CSA owned 82.8% of the share values. The letter
also referred to the deadline of end April 2007 and said that the SC and
R&T were in the process of finalising a formal sale agreement with
Premier. Significantly, the letter also mentioned that over the last few
days, Ang had learned that the 80% majority had been achieved and he had
sent messages to Goh and to some SPs to say that he had a higher offer.
Ang had held a meeting after his messages which was attended by some SPs
and the SC. However, no offer to purchase was produced by Ang. Ang was
asked to produce a higher offer in writing but had not done so as at the
date of the letter of 5 May 2007.
112 On 12 May 2007, the SC signed the SPA with Premier.
113 On 14 May 2007, the SC sent another letter to inform the SPs that the
SPA had been signed and dated 12 May 2007 and that an extraordinary
general meeting (EOGM) would be held. Some details of the SPA, including
the sale price, completion and the delivery of vacant possession were also
given.
114 On 1 June 2007, the SC sent a letter to notify the SPs about an EOGM
to be held on 24 June 2007. The EOGM was held on 24 June 2007. Copies of
the EOIs were distributed including the earlier one which had been handed
in by Poon and then returned to him.
115 Subsequently, the Notice was forwarded by hand to the SPs on 1 August
2007. An earlier notice dated 27 July 2007 was sent by registered post.
The Application was submitted on or about 3 August 2007.
116 As regards Mr Liew's criticism that the MSP of $68.5m was arbitrarily
derived, the evidence from See was that the SC and her had used the
earlier $64m offer from Ecco as a guide and considered adding 5% to 10%
onto that figure. Eventually, they settled on 7% which brought the figure
to $68.48m and they then rounded it up to $68.5m. Even if the real reason
for the $68.5m was that it was meant to pip Ang's proposed MSP of $68m,
the Minority had not quarrelled with Ang's proposed MSP as being too low
after they had received Ang's letter.
117 Mr Liew was suggesting that more work should have been done before
deciding on the MSP of $68.5m but it seemed to me that the issue was not
whether the SC, or See, could be criticised for not having done more. Such
criticism can be easily levelled at any sale committee or marketing agent.
The issue was whether the overall conduct of the process resulting in the
sale price demonstrated an absence of good faith which was quite different
(see s 84A(9)(a)(i) LTSA).
118 Mr Liew suggested that the SC were in a rush to respond to Ang's
letter of 16 March 2009 but the letter from the SC dated 20 March 2007
showed that the members of the SC were apparently unaware of Ang's letter
(which was not sent to them) until the SC's letter of 20 March 2007,
although I should mention that the MSP of $68.5m was also not mentioned in
either of these two letters. It was only mentioned in the proposed CSA.
119 Mr Liew also criticised the SC for not pursuing the issue of possible
alienation of state land and of increasing the plot ratio to enhance the
value of RG. However, the possibility of alienation of state land had been
mentioned in the advertisements put up by ERA. As for the increase in plot
ratio, Goh admitted that he did not pursue this with the relevant
authority. It is, however, worth noting that the Chief Planner, URA had
sent a letter a few years earlier dated 2 February 2000 to the management
council of RG. The material part stated:
2 Our position on the issue of upping the plot ratios for Rainbow Gardens
has already been explained in the above-mentioned letter to the Management
Council. Mr Tan See Nin has also explained in his phone conversation with
you that piece-meal increases to plot ratios will not be considered.
3 The Master Plan 1998 is a legally binding document. It is statutory
requirement however for it to be reviewed every 5 years. Where there is a
need to change the land use and/or plot ratios at that point in time, it
would certainly be considered, provided there are good reasons to support
it.
4 We have already tried to the best of our ability to respond to your
queries on the issue of reviewing the plot ratios for Rainbow Gardens.
120 There was some suggestion by Mr Liew during the hearing before the RG
Board that the SC should have provided good reasons to increase the plot
ratio. He was focussing on para 3 while Mr Lee focussed on para 2 which
stated that piece-meal increases to plot ratios will not be considered.
Paragraph 3 also stated that the Master Plan would be reviewed every five
years. There was a review in 2003 and the next review would therefore be
in 2008 whereas the intended sale of RG was in April/May 2007. Paragraph 4
of URA's letter also suggested some exasperation on URA's part because
there had already been previous queries on the plot ratio.
121 In addition, it is significant to note that even Ang did not mention
the plot ratio in his letter of 16 March 2007 (to the SPs). At the end of
the day, neither Ang nor anyone else , came up with an offer higher than
Premier's EOI of $76.8m, which was increased to $77.3m when the SPA was
signed or the eventual sale price of $81.3m in view of the alienation of
one plot of state land.
122 The fact that the SC did not maintain minutes of their meetings
reflected poorly on their professionalism but there was no suggestion that
this omission was deliberate.
123 As regards the interval between the letter of 29 March 2007 (for a
presentation of the CSA and the signing thereof) and the meeting on 31
March 2007, this was admittedly a very short timeframe. When pressed
during cross-examination, Goh agreed that the short timeframe was
unreasonable. Mr Liew stressed this short timeframe and Goh's admission to
support his argument about an absence of good faith. He submitted that
this was deliberately done to pressurise the SPs to agree to the CSA and
also to agree to R&T as the solicitors and ERA as the marketing agents. By
31 March 2007, SPs of 11 units had signed the CSA and he submitted that
this was the SC's strategy to present some sort of fait accompli to the
others because the SPs who had signed, together with the members of the
SC, would hold more than 20% of the share value.
124 The email evidence showed that the SC had initially thought of giving
one week's notice for the intended meeting on the CSA as they had been
advised by R&T to give at least one week's notice. It was Soh (a member of
the SC), who suggested that 31 March 2007 be used as that was the date
when the intended venue, ie, BTCC was available on a weekend. If that date
was not taken, then there would be a delay of another two weeks and she
was keen to press on. The SC then agreed to this suggestion and that was
how that meeting came to be fixed on 31 March 2007. In my view, that was
an unwise decision as the SPs should have been given more time to consider
the CSA. However, it seemed to me that the date of 31 March 2007 was not a
deliberate attempt to pressurise the SPs to agree to the CSA. Moreover, if
the SPs were unhappy about that date, they could have asked for an
adjournment. There was no evidence that an adjournment had been sought.
125 I also did not think that the fact that SPs of 11 units had already
signed the CSA was as sinister as Mr Liew was suggesting. The SC were
pushing on. If other SPs were prepared to sign first, that was their
prerogative just as it was the prerogative of others not to sign yet. As
mentioned, the 80% threshold was not achieved until 28 April 2007 when the
Conditional SPs signed.
126 Even if the names of R&T and ERA were already inserted in the CSA as
appeared to be the case, the SC had taken the view that these were the
appropriate persons to use. However, in addition to the short interval, Mr
Liew submitted that the quotations of these persons were not the lowest
and this meant that the Minority also had to pay more. But, if he was
right, this also meant that the Majority, and in particular, the SC as
well, also had to pay more. It ought to have been obvious that the SC
would have wanted to save money for themselves too but yet this criticism
was levelled at the SC without any evidence of collusion with R&T or with
ERA.
127 I come now to some details about the fees. The initial quoted fee of
R&T for the conveyancing aspect was 0.25% of the sale price. This appeared
to be slightly higher than that of another firm of solicitors who quoted
0.24%. R&T's total figure appeared even higher than was actually the case
because they also made provision for appearances before the High Court
which that other firm did not provide for. R&T's initial quote was also
higher than that of Ang's.
128 Ang had quoted a fee of 0.188% of the sale price and was prepared to
waive attendance fees before the RG Board and any appeal thereafter. He
also proposed a consortium of marketing agents "who shall work closely
with my firm" at a graduated scale being:
(a) 0.5% for a sale price of up to $70m
(b) 0.55% for a sale price of between $70 to $75m
(c) 0.6% for a sale price of $75m and above
129 The SC was not minded to use Ang's services or the marketing agents he
had proposed. There had already been differences with him when he was a
member of the earlier sale committee. In Goh's view, Ang had undercut all
other bids after he had had a chance of viewing the bids as a member of
the earlier sale committee. Secondly, the SC did not believe that he had
had the necessary experience. The SC appeared to be particularly impressed
with Gan (of R&T) when Gan made his presentation to them.
130 I should add that eventually R&T reduced their fee for the
conveyancing aspect to 0.22%. There was some suggestion by Mr Liew, when
Goh was being cross-examined by him, that R&T had also undercut the
others, but this might not have been a fair suggestion of R&T because the
circumstances as to how they had come to reduce their fee was not
explored. They might have reduced it after the SC had chosen them in
principle and requested them to reduce their fee. R&T's eventual fee for
the conveyancing aspect turned out to be the lowest, excluding Ang's.
131 As the SC was not minded to appoint Ang, it followed that they could
not have the benefit of the graduated scale of fees he had negotiated from
a consortium of marketing agents. Excluding Ang's consortium, ERA had
quoted the lowest fee among the interested marketing agents.
132 I could not fault the SC for not wanting to appoint Ang in the
circumstances. I would also add that as events turned out, much more work
had to be done before the RG Board and the High Court than might have been
anticipated in view of the many objections raised by the Minority and
other dissenting SPs. If Ang had been appointed, there might well have
been a question about his ability to meet such objections and his
motivation or lack thereof given that he had seemed to assume that not
much work would be needed and had been prepared not to charge for
attendances before the RG Board and the High Court.
133 It is useful to bear in mind that the cheapest is not necessarily the
best option. The trick is in getting the right balance. As events turned
out, the choice of R&T was in a sense vindicated but still that choice was
being criticised by Mr Liew.
134 I should also mention that according to See's evidence, her team also
did not have experience in marketing collective sales although ERA as a
company, did. There was no evidence that the SC knew this and, in any
event, she was the one who had come up with the initial offers from Ecco
as I set out above.
135 In the circumstances, Mr Liew's criticism about the choice of R&T and
ERA as indicative of a lack of good faith was misplaced.
136 The next criticism related to the fact that the envelope handed by
Poon on 31 March 2007 was returned to him on 18 April 2007. The evidence
from Seah was that the envelope contained an earlier letter dated 31 March
2007 from his firm Seah Ong & Partners offering to buy RG at $73.3m. This
was superseded by their second letter dated 18 April 2007 in which they
stated that they acted for Premier and offered $76.8m or $86.8m if the two
parcels of state land were alienated to Premier. As I mentioned, this
second letter which was opened together with three other EOIs on 18 April
2007 turned out to be the highest offer.
137 I was of the view that Mr Liew was making a mountain out of a molehill
in respect of the return of the first envelope to Poon. As Gan had
explained it, any interested purchaser was not obliged to keep its EOI
open. Accordingly, Gan saw no reason to refuse to return the first
envelope. It was Gan, not Goh, who allowed the return. He was the
solicitor in charge then. It was clear to me that he had acted bona fide.
If he had made a mistake, that was a different matter not to be construed
as something more sinister.
138 The Minority or Tan had suggested that the return demonstrated a lack
of transparency in the process and that the first letter should not have
been returned. It seemed to me that either option was justifiable. As I
mentioned, Gan had bona fide thought it was alright to do so and he acted
openly. There was no lack of transparency.
139 Did the return somehow give Premier an unfair advantage over the other
bidders as Mr Liew was suggesting? Mr Liew failed to say how Premier was
given an unfair advantage by the return of the first envelope. Premier
would have been entitled to submit a second and higher offer on 18 April
2007 even if the first envelope had not been returned. Any one else could
have submitted a higher offer even after 18 April 2007 and indeed, that
was what Mr Liew was suggesting the SC should have done, ie, seek a higher
offer even after 18 April 2007. I will come back to this point later.
140 Therefore, whether the return of the first envelope to Poon was
specifically mentioned in the evening meeting of 18 April 2007 or not was
immaterial. Indeed, there was no deliberate attempt to hide the fact of
the return. It would have been foolish to do so because some of the SPs,
including Tan, had attended at R&T's office in the afternoon and had
witnessed the return of the first envelope.
141 Mr Liew's submission that Soh had disclosed to Elizabeth Lim that the
SC knew each and every bid from the other developers before all the
envelopes were opened put a different complexion on the matter. Mr Liew
submitted that because the SC had such information, they, or one of them,
had disclosed the information to Premier thus enabling Premier to put in a
second and higher bid before the close of the EOI exercise. But for this
second and higher bid, Premier's initial bid of $73.3m would have been
marginally below that of the bid from First Capital at $73.6m and Premier
would have lost out to First Capital. Here again, there was a fundamental
flaw in Mr Liew's submission. Even if Premier did not make a second bid on
18 April 2007, they could do so thereafter. As I mentioned above, Premier
and any one else could always make a bid even after 18 April 2007. The
return of the first envelope was therefore immaterial. It was, however,
used to bolster the argument that somehow Premier was being unduly
preferred.
142 If Premier had been unduly preferred, it would be First Capital and
the other bidders who would complain. Except for the principle that there
ought to be fair play, the SPs would not have lost out in receiving a
higher bid.
143 In any event, the evidence did not point to Premier being unduly
favoured.
144 Firstly, it must be remembered that, initially, the only offers came
from Ecco, through See. If the SC or See was minded to favour anyone, it
would have been Ecco, not Premier.
145 Secondly, the second letter from Premier was not only slightly higher
than First Capital's bid. It exceeded First Capital's bid by more than $3m
and the difference was even higher with the possibility of another $10m
which I have mentioned. If Premier had been privy to all the bid amounts
before they were opened, Premier would not have made the offer that it
did.
146 Thirdly, how would any member of the SC know all the other bids before
they were opened? Those bids were only submitted on 18 April 2007 itself
and deposited into the box at R&T's office. That is where they remained
until they were opened in the afternoon. Would each and every offeror
orally disclose to any member of the SC or even Ms See the amount of its
bid before the EOI exercise was concluded? It would have been unwise for
any of them to do so and I did not think that any of them did so, let
alone all of them.
147 If the Minority had carefully reflected on these points, they would
have realised that their suspicion of undue preference for Premier was
unfounded. In my view, Elizabeth Lim had either lied about what she had
heard from Soh or she had been mistaken. Therefore, the fact that she had
alluded to the substance of the conversation (as she remembered it) in a
summary of objections enclosed with an email dated 13 June 2007 was
neither here nor there. It is true that she had also mentioned in that
summary that the first letter from Seah Ong & Partners contained an offer
of $70.3m or $73m (it was actually $73.3m) but that only suggested that
the SC or someone in the SC knew about that figure before the EOGM on 24
June 2007. It did not show that all the bid amounts were known before the
EOIs were opened on 18 April 2007.
148 As for Mr Liew's emphasis that Ecco had qualified in its EOI letter
that "... we will consider matching or improving our offer provided there
are other genuine written offers from developers" ("Ecco's offer to
improve"), See's evidence was that she did approach Ecco to see if it
would improve on its offer but it did not. True, See's evidence was not
entirely consistent. At one stage, she said she spoke to Ecco once on the
same day after the EOIs was concluded and on another occasion during
cross-examination, she said she also met up with Ecco. She also said she
had spoken to other bidders after 18 April 2007 and none would improve on
their offers.
149 It was also not clear from Goh's evidence whether the SC themselves
gave See any specific instruction to follow up with Ecco. It is arguable
whether they should have but, in any event, I was of the view that even if
they had not and even if See had not followed up with Ecco or any of the
other bidders, their omission did not indicate a lack of good faith. Let
me elaborate.
150 If a bidder's offer from a public exercise is used as a bargaining
chip to get better offers from others, it may cause him to withdraw his
bid. Such a strategy by an offeree may also cause others to distrust the
offeree as they may think that the offeree will also be using their offers
in turn as a bargaining chip with others. That will lead to an unhealthy
situation for the offeree. Indeed, it is pertinent to note that First
Capital's EOI stated specifically that its offer was not to be used to
obtain a more favourable price and Ecco's EOI stated that its contents
should be kept confidential and any breach of confidentiality would cause
its EOI to lapse. I will say more about Ecco's EOI later.
151 In Horizon Towers ([74] supra), the Court of Appeal said at [159] that
where it was reasonable to do so, a sale committee should try and create
competition between interested purchasers. The qualification of
reasonableness to do so ought not to be forgotten. Also, in that case, a
public tender exercise had closed on 15 August 2006 with no bids.
Subsequently, on 3 January 2007, a sale committee member received a
written offer of $510m from Malaysian solicitors acting for a Hong Kong
company. On 4 January 2007, some members of the sale committee met with
representatives of a Singapore listed company, Hotel Properties Ltd
("HPL") who verbally suggested a price of $500m. Eventually, an agreement
was entered into with HPL to sell the property in question to it for
$500m. It was in these circumstances that the Court of Appeal made the
observation I mentioned above. In the case before me, competition and
interest had already been created by ERA before the close of the EOI
exercise. There were four advertisements in three newspapers: the Business
Times, the Straits Times and the Lianhe ZaoBao between 27 March to 3 April
2007. See had contacted 19 developers and met with 17 of them.
152 It seemed to me that, in the circumstances, there were points in
favour of each argument as to whether there should have been follow-up
with Ecco and other bidders. No one approach could be said to be
categorically right or wrong. Yet, that was the submission for the
Minority.
153 Coming back to Ecco's offer to improve, I did not think that the SC
was obliged to follow up on it. It was really an attempt by Ecco to have a
second bite at the cherry. Not only that, it seemed to me that Ecco wanted
to have a second bite with the advantage of knowing what the other
developers were offering. I did not think that that was a fair
qualification especially when Ecco itself did not want its offer to be
disclosed as I have mentioned.
154 Let me now come to another condition which was stated in Ecco's EOI
which Mr Liew had overlooked. That condition was that Ecco had said that
they were extending their offer of $64m (said to be made earlier on 8
March 2007) on the basis that they would have the first priority to
purchase (and if need be, to match or improve their offer). Bearing in
mind also the condition which I already mentioned, ie, that the contents
of its EOI letter be kept confidential, what Ecco therefore wanted was the
opportunity to out-bid others but not for others to out-bid them. In the
light of the totality of Ecco's EOI , I would not have blamed the SC even
if no one had in fact followed up with Ecco.
155 It also seemed to me ironical that, on the one hand, Mr Liew was
submitting that Premier was being given undue preference and yet, on the
other hand, he was effectively suggesting that Ecco be given undue
preference (if their conditions were followed).
156 There was also a suggestion by Mr Liew that Ecco's offer to improve
was deliberately suppressed as it was apparently not mentioned in the
afternoon of 18 March 2008 even though the bids were read out (perhaps
only the bid amounts were read out) or in the meeting that same night. As
I mentioned, copies of the various EOIs were distributed only at the
meeting on 24 June 2007 (after the SPA was signed) apparently in response
to inquiries made after 18 April 2007. Having considered all the evidence,
I was not persuaded that Ecco's offer to improve was deliberately
suppressed.
157 As for following up with other bidders, I was of the view, as I
intimated, that even if there was no follow up with any of them, this did
not indicate an absence of good faith.
158 Furthermore, at the end of the day, Ecco and each of the other bidders
must have known soon enough that its bid was not the highest one as at 18
April 2007. None came up with a higher offer.
159 I come now to Mr Liew's submission about the deadline of 30 April 2007
to accept Premier's offer. He had submitted that the deadline had been
fabricated to put pressure on the SPs who had not yet signed the CSA to do
so. It is undisputed that the second letter from Seah Ong & Partners (ie,
the one dated 18 April 2007) did not mention this deadline. Goh said he
had learned about the deadline from See after the conclusion of the EOI
exercise. He could not remember when he learned about the deadline. The
relevant part of the letter he sent on 20 April 2007 to the SPs stated:
20 April 2007
Dear Fellow SPs
...
OWNERS' MEETING
We held the Owners' Meeting on the same evening [ie, 18 April 2007] at
8.00p.m. at the Bukit Timah Community Club. At this meeting, the lawyer
announced to all SPs present, the 4 bids received from the developers.
The lawyer explained that to enter into an agreement with Premier Land
Development, we must have at least 80% SPs to sign the CSA. If we do not
have 80% signatures by 30 April 2007, the offer may lapse.
...
SIGNING OF CSA
About 67% of owners have signed the CSA. We need another 13% owners'
signatures within the next ten days.
Premier Land's offer of $76.8 million works out to a gross amount of
$1,200,000.00 per SP and they have even factored in $10 million to all SPs
in the event that they are successful in obtaining the two plots of land
for development. Premier Land is generous enough to pay each SP $156,250
for a land we do not own!
The committee trust that you will find this offer attractive and we urge
all SPs who have not signed the agreement to do so before the offer lapse.
You may contact Ms See ... to arrange the signing of the CSA.
Do not miss the boat!
160 As can be seen, the circular did not make it clear whether the
deadline of 30 April 2007 was mentioned at the meeting (of 18 April 2007)
although that might have been the impression given.
161 See's evidence on this point was also not very clear. At one stage of
her cross-examination, she said that she learned about the deadline from
Premier's representative, one Lyon Tan the day after 18 April 2007 and at
another stage, she intimidated that it was on the same day. However, it
was not disputed that Goh learned about it from her. He did not concoct it
on his own. Neither side called Lyon Tan to give evidence.
162 Was the deadline part of an overall and deliberate strategy by the SC
to put pressure on the SPs to sign the CSA? I did not think so. As I
mentioned, Goh himself believed the deadline. Also, while the tone and
substance of his circular of 20 April 2007 was urging the SPs to sign, it
could not be said to be oppressive. I accepted that when a person is urged
to do something, it may be said that some pressure is being applied but
that in itself is not wrong. The issue was whether the pressure was such
that it affected the validity of any of the signatures to the CSA or was
indicative of an absence of good faith. None of the signatories sought to
set aside their agreement to the CSA. Neither was I persuaded that See had
lied about the deadline even though Lyon Tan should have been called by
the Majority to give evidence. Even if See had lied about the deadline, I
was not persuaded that it should affect the validity of the sale to
Premier in the circumstances.
163 It is appropriate to deal at this point with Mr Liew's submission that
Goh had misrepresented to the SPs the extent of roof leakage and water
pump problems and the need to raise funds as part of an overall and
deliberate strategy to put pressure on the SPs to sign the CSA. Goh did
not deny that he had mentioned such problems but said it was in response
to a question.
164 Looking at the evidence in totality, I was of the view that there was
no such strategy as alleged.
165 I come now to a more serious allegation. This was the allegation that
Koh and his wife had been offered $20,000 to persuade them to sign the SPA
which they did not agree to do. As I mentioned, See's version was that she
and Lyon Tan were walking around the estate when they met with Koh and his
wife. Upon hearing about their recent renovations, there was a discussion
about asking Premier to increase its offer so that the SPs of each unit
would get more. In fact, the purchase price was increased from Premier's
EOI offer of $76.8m to the SPA price of $77.3m before the uplift for state
land alienation.
166 Mr Liew submitted that some others in the Majority were likely to have
received the offer to pay them individually more to procure their
signatures to the CSA but he was unable to adduce evidence beyond the
inference he was advocating.
167 I would say that although Mr Liew had submitted that See's affidavit
did not deal with all the specific points raised in the affidavit of Koh
and his wife, See did not have sight of that affidavit before she executed
hers.
168 As for Mr Liew's submission that any discussion about raising the
price for the RG land would have been made with the SC and not the SPs
individually, it must be remembered that the discussion came about because
Koh had raised the issue with See and Lyon Tan about his recent
renovations.
169 It was not in dispute that eventually the purchase price was increased
by $500,000 when the SPA was signed even though Premier's EOI of 18 April
2007 was already the highest. This was probably to encourage more SPs to
sign the CSA and it did lend some weight to See's version that any
discussion about paying more was in respect of the entire development and
not to certain SPs individually.
170 The GD did not address this allegation specifically although the RG
Board must have considered and ruled against the Minority on it. The
burden was on the Minority to prove its allegation of impropriety. I could
not say that the Board had erred in concluding against the Minority on
this point. In any event, in my view, the Minority had failed to establish
it.
171 In all the circumstances, I was of the view that the Minority had not
made out the second sub-issue under Issue No 4.
Issue No 5 - The RG Board erred in law in granting the collective sale
order in that:
(a) the President of the RG Board was biased or there was a reasonable
suspicion of bias on his part; and
(b) the President of the RG Board violated the rules of natural justice in
making adverse comments and in making excessive interruptions during the
examination and cross-examination of witnesses during the hearing which
strongly indicated that he had predetermined the Application even before
considering the evidence.
172 There was a litany of complaints under Issue No 5. Mr Liew grouped
them under 44 sub-headings in his initial submissions before me, many of
which overlapped. In the plaintiffs' reply submissions ("PRS"), ie, the
reply submissions for the Minority, Mr Liew summarised his complaints in
paras 8 to 9 and 69 to 72 as follows:
8. Taking an active part in case management or to intervene in order to
understand the issues and the evidence, is in substance very different
from preventing Counsel or the affected parties from asking questions,
refusing to hear, and making disparaging remarks. In the Plaintiffs'
Written Submissions, it has been clearly pointed out that the [President]
of the Board had gone way beyond taking an active part in managing the
case or intervening in order to understand the issues. The Plaintiffs have
pointed out from the Notes of Evidence that the [President] coached
witnesses, and shut out questions from the Plaintiffs' Counsel as well as
the other respondent who acted in person, showed that the [President] had
in fact entered the arena and was taking sides. This was also evident from
the tone he used and the impatience he displayed. The following are just a
few clear examples of the [President's] apparent bias:
(i) 'Yes, they can. I see no reason why they cannot sign before'
(The [President] was in fact telling the Plaintiffs off in that he was of
the view that it was alright to him that owners had signed the CSA before
it was to have been explained and approved at a subsequent meeting.)
(ii) 'You mean they want to sign earlier, cannot? It must be signed at the
- - '
(as in (i) above)
(iii) '-wasting one whole day hearing the frivolous objections by both
parties'
(The [President] was not inclined to hear the preliminary objections)
(iv) 'What sort of prejudice is there? Suppose the Board allow you further
objections, so where is the prejudice now?
(The [President] was clearly voicing his view that he felt there was no
prejudice to the Plaintiffs)
(v) 'If according to the draft, it there is amendment - if there is not
amendment, that will become the --'
(The [President] was voicing his view that if there were no amendments to
the draft CSA, which was not yet explained and approved at a subsequent
meeting, then to him, the draft CSA would become the actual CSA).
(vi) 'Where? No, prescribed form is but this is not under the rule'
(In response to the Plaintiffs' Counsel's point that Form 1A is a
prescribed form, prescribed by the Strata Titles Boards and found in the
Strata Titles Boards website for prescribed forms to be used for a
collective sale application, the [President] in effect challenged this
point in that he was of the view that the prescribed forms were not
provided for under the LTSA and BMSMR).
(vii) 'It is not requirement it is the direction'
(Again, the [President] was repeating his challenge as in (iii) above.)
(viii) 'so we are suspecting that there may be some contradictory in this
form'
(The [President] was openly supporting the Defendants' contention that
there was something wrong with Form 1A, which was prescribed by the Strata
Titles Boards and in fact, filed by the Defendants.)
(ix) 'Is there anything law to say that I - before the opening, I cannot
withdraw my letter of offer? So otherwise, do not waste time, because he
has - if he has every right to withdraw the bid -'
(The [President] was clearly expressing his view that the offeror has a
right to withdraw his bid)
(x) 'Oh yes, if they do not look at it properly and signed their death
warrant, just too bad, that is their -'
(The [President] was expressing his view when the Plaintiffs' witness, in
answering the Defendants' Counsel's question, said that she did not know
if the 80% SPs who signed the CSA looked at the terms properly)
(xi) 'Is there anything wrong, you sign, it is confidence of the Rajah &
Tann and all the property agents, I close my eyes I sign everything. Is
there anything wrong?'
(The [President] was expressing that there was nothing wrong in signing a
draft CSA before it was voted upon and approved at the meeting called to
vote on and approve the CSA)
9. Such remarks and views which the [President] had openly expressed
during the course of the hearing and the cross examination of witnesses
showed that the [President] had already formed his views and prejudged the
issues, and it was clear that he was in favour of the collective sale.
...
G. Conduct of STB
69. The Plaintiffs disagree that the STB was thorough and patient with
them throughout the hearing. In fact, the Plaintiffs submit that the
[President] of the STB was especially impatient, and refused to hear or
allow many arguments put forth by the Plaintiffs' Counsel.
70. The reason why the Plaintiffs maintain that the [President] has shown
bias or a likelihood of bias is because it was the [President] who
excessively and unnecessarily interrupted and made disparaging remarks,
preventing a fair hearing, whereas the other members of the Board only
raised questions when they needed clarification.
71. Taking an active part in case management or intervening to understand
issues and evidence is vastly different from making derisive remarks of
'wasting time', and entering the arena, as the [President] had obviously
done, as set out in the Plaintiffs' Written Submission, and as elaborated
in paragraph 8 herein regarding evidence as gathered from the Notes of
Evidence of the [President's] prejudgment of issues. In this case, the
[President]:
(i) interrupted the examination of the witnesses by the Plaintiffs'
Counsel;
(ii) treated the witnesses on the Plaintiffs' side in an unequal and
inconsistent manner;
(iii) asked questions that were directed at obtaining concessions from the
Plaintiffs rather than at clarifying points;
(iv) kept on harping on the issue of the Plaintiffs 'wasting time';
(v) made several uncalled for disparaging remarks.
72. The Plaintiffs disagree that the [President's] active role in case
management extended to both the Defendants' and well as the Plaintiff's
Counsels. The [President] allowed the Defendants' Counsel to carry out his
cross examination with minimal interruption and did not make disparaging
remarks the way he did with the Plaintiffs' Counsel. The 3 examples given
by the Defendants in their Reply Submissions pale in comparison to the
numerous occasions the Plaintiff's Counsel and the Plaintiffs as well as
the other Respondents in the Application were interrupted and told off by
the [President]!
173 A number of cases were cited by Mr Liew for the legal principles. He
and Mr Lee had proceeded on the basis that Issue No 5 was to be dealt with
on the basis of an adversarial system and so did I. Since then, the Court
of Appeal has given its judgment in Horizon Towers ([74] supra) in which
it said at [173] and [174] that the proceedings before an STB are
inquisitorial and not adversarial. Nevertheless, as I had dealt with Issue
No 5 on the basis of an adversarial system before the RG Board, I need
refer only to a recent decision of the Court of Appeal in Mohammed Ali bin
Johari v PP [2008] 4 SLR(R) 1058 . In that case, Andrew Phang Boon Leong
JA said at [175]:
It is appropriate, in our view, to summarise the applicable principles
that can be drawn from the various authorities and views considered above,
as follows (bearing in mind, however, that, in the final analysis, each
case must necessarily turn on its precise factual matrix (see also above
at [162])):
(a) The system the courts are governed by under the common law is an
adversarial (as opposed to an inquisitorial) one and, accordingly, the
examination and cross-examination of witnesses are primarily the
responsibility of counsel.
(b) It follows that the judge must be careful not to descend (and/or be
perceived as having descended) into the arena, thereby clouding his or her
vision and compromising his or her impartiality as well as impeding the
fair conduct of the trial by counsel and unsettling the witness concerned.
(c) However, the judge is not obliged to remain silent, and can ask
witnesses or counsel questions if (inter alia):
(i) it is necessary to clarify a point or issue that has been overlooked
or has been left obscure, or to raise an important issue that has been
overlooked by counsel; this is particularly important in criminal cases
where the point or issue relates to the right of the accused to fully
present his or her defence in relation to the charges concerned;
(ii) it enables him or her to follow the points made by counsel;
(iii) it is necessary to exclude irrelevancies and/or discourage
repetition and/or prevent undue evasion and/or obduracy by the witness
concerned (or even by counsel);
(iv) it serves to assist counsel and their clients to be cognisant of what
is troubling the judge, provided it is clear that the judge is keeping an
open mind and has not prejudged the outcome of the particular issue or
issues (and, a fortiori, the result of the case itself).
The judge, preferably, should not engage in sustained questioning until
counsel has completed his questioning of the witness on the issues
concerned. Further, any intervention by the judge during
thecross-examination of a witness should generally be minimal. In
particular, any intervention by the judge should not convey an impression
that the judge is predisposed towards a particular outcome in the matter
concerned (and cf some examples of interventions which are unacceptable
which were referred to in Valley (see [138] above)).
(d) What is crucial is not only the quantity but also the qualitative
impact of the judge's questions or interventions. The ultimate question
for the court is whether or not there has been the possibility of a denial
of justice to a particular party (and, correspondingly, the possibility
that the other party has been unfairly favoured). In this regard, we
gratefully adopt the following observations by Martin JA in Valley
(reproduced above at [138]):
Interventions by the judge creating the appearance of an unfair trial may
be of more than one type and the appearance of a fair trial may be
destroyed by a combination of different types of intervention. The
ultimate question to be answered is not whether the accused was in fact
prejudiced by the interventions but whether he might reasonably consider
that he had not had a fair trial or whether a reasonably minded person who
had been present throughout the trial would consider that the accused had
not had a fair trial ...
[emphasis added in bold italics]
(e) Mere discourtesy by the judge is insufficient to constitute excessive
judicial interference, although any kind of discourtesy by the judge is to
be eschewed.
(f) Each case is both fact-specific as well as context-specific, and no
blanket (let alone inflexible) rule or set of rules can be laid down.
(g) The court will only find that there has been excessive judicial
interference if the situation is an egregious one. Such cases will
necessarily be rare. It bears reiterating what we stated earlier in this
judgment (at [125] above):
[T]he argument from judicial interference cannot - and must not - become
an avenue (still less, a standard avenue) for unsuccessful litigants to
attempt to impugn the decision of the judge concerned. This would be a
flagrant abuse of process and will not be tolerated by this court. Parties
and their counsel should only invoke such an argument where it is clearly
warranted on the facts ...
[emphasis in original]
174 I will now refer to the allegations in PRS about coaching witnesses
and those stated in para 71 of PRS with references to some of the 44
sub-headings and references to illustrations thereunder contained in Mr
Liew's initial submission for Issue No 5. References to the Plaintiff's
(Minority's) Bundle of Documents will begin with the prefix "PBD" and then
the page numbers.
175 As regards the allegation about the President coaching witnesses, this
allegation was covered by, for example, sub-headings (vii), (x), (xiii),
(xiv), (xviii) and (xxx) of Mr Liew's initial submission for Issue No 5.
176 Using sub-heading (x) as an illustration, this referred to the
following exchange on 4 February 2008 (at PBD 2647):
Mr Liew: Now Ms See, just to clarify, on 16th February, why did you
attention this quotation to Mr Richard Goh? That is all.
The [President]: What is that?
Panel Member: Huh?
Mr Liew: Why did you send this quotation to Mr Richard Goh?
The [President]: Why? You want to get the job. Why, like lawyers, if she
sends in, there is nothing wrong in that. Is there anything wrong if you
send it?
A: No.
177 While the above did suggest that the President was answering for the
witness, See and was taking the side of the Majority, as well as being
impatient, it must be remembered that there was actually no issue about
See having sent a quotation (of fees) to Goh unless Mr Liew was fishing to
find some fault with the entire process. Besides, a consideration of the
notes of evidence thereafter shows that Mr Liew was allowed to pursue this
question which See answered by saying that she sent the quotation to Goh
because he was the one she had liaised with.
178 Another illustration was sub-heading (xxx). This referred to the
following exchange on 31 January 2008 (at PBD 2516 to 2519):
Mr Liew: I actually wanted to ask and say, look, this letter was sent by
Mr Goh to these people, the handwriting on its right side was in fact - -
[The President]: Was by him?
Mr Liew: - - his signature.
[The President]: But he says he didn't see.
Mr Liew: He says he didn't - - he had no notice of this letter.
[The President]: Huh? Have a look whether that's your signature there.
Panel Member: Is that your signature?
A: Sorry, sir, I need to rectify, sir. That was - -
[The President]: What is that?
A: That was my signature, sir.
[The President]: Your signature?
A: Sorry, sir.
[The President]: But you didn't see?
A: I really didn't see because I just - -
[The President]: You see first then before you answer, you are creating a
lot of - -
A: Sorry, sorry.
[The President]: - - confusion. Look at the letter, there is no hurry, you
know. There is no haste, you know, we all are not going to - this is not
another en bloc sale, you know, you just go through the letter and say
whether it's sent - -
Mr Liew: Sir, that is our point.
[The President]: - - otherwise your evidence - -
Mr Liew: That is why we said that our instruction - -
[The President]: - - you said 'No, I have not seen this' but your initial
is there.
Mr Liew: - - was that he knew about it. It was given to him as the
chairman and that he actually sent it to the members, and there was this
issue that he was well aware of.
[The President]: No, but inadvertently he must have forgotten, even his
signature, he has forgotten, so what is there - -
A: Yes, sir.
Mr Liew: But I want to - - at least be fair, sir, to him, at least be fair
to my clients and to everybody that he said that he didn't know about this
letter.
[The President]: Yes.
Mr Liew: I have to point out that he actually sent this letter out to
people; that was his signature.
A: But that was 2000, sir, I have forgotten about it.
[The President]: Yes, he has forgotten about it already.
Mr Lee: Sir, I am thankful for that clarification because my questions
were all surrounding - - based on the fact that Mr Richard Ng -- Mr
Richard Goh had seen this letter.
Now, Mr Goh, now that we -- now you are reminded that you have seen this
letter before --
A: Yes.
Q: - - can you look at paragraph 2 with me of this letter and it addresses
an application or request to up the plot ratio for Rainbow Gardens and it
says:
Your -- 'Our position on issue of upping the plot ratio has already been
explained and they say that piecemeal increases will not be considered',
will not be considered.
Now that you have seen this again today, today this paragraph now that you
have seen this paragraph and you know URA's position is piecemeal
increases in plot ratio will not be considered, would you have applied to
the URA to increase a plot ratio in year 2007 before the revision of
masterplan?
A: I will not, sir.
179 The above exchange pertained to a letter which Goh had said he did not
see but it turned out that his signature was on it. It is true that the
President's response that Goh must have forgotten about it appeared to
suggest a way out for Goh and the President should not have said aloud
that Goh must have forgotten about it.
180 However, I would add that the letter was in respect of the possibility
of an increase in plot ratio and it was accepted that the SC did not
follow up on the plot ratio. I have elaborated on the issue about the plot
ratio under Issue No 4 and will not repeat what I have said.
181 I would also point out that the above exchange demonstrated the
President's frustration or impatience with a witness for the Majority
while Mr Liew was complaining about how witnesses for the Minority had
been treated.
182 As regards the allegation about the President's interruptions about
the examination of witnesses by Mr Liew, this allegation was covered by,
for example, sub-headings (v), (vi), (ix), (xix), (xxii), (xxvii).
183 Using sub-heading (v) and the first cross-reference thereunder as an
illustration, as there were many cross-references, the first referred to
the following exchange on 29 January 2008 (at PBD 2139 to 2140):
Mr Liew: 28th April. All right, so what I am trying to establish, sir, is
this. Mr Goh says that look, the three of them signed on 28th April, they
put this condition, signature not valid unless you get not less than 76.8.
But by the time they signed the sale and purchase agreement with the
developer, which is on 12th May, about two weeks later or about a week
later, they are saying that because they signed at that point in time,
they achieved that minimum. You know, therefore these three signatures
must be valid, all right. That is their point. And the simple point is
that because once they signed the CSA, they are bound by the CSA. That is
their point, you see. So I need to establish that because I am moving on
into the CSA itself, you see.
[The President]: Well, that is for submission what.
Mr Liew: No - -
[The President]: Because they say I am selling it with certain condition.
Mr Liew: Yes, I know.
[The President]: As long as they come to tender, you get this price, I
will sell.
Mr Liew: I understand, sir.
[The President]: But before that, you are saying that even before that,
they must have - - they must get the price minimum - -
Mr Liew: No, no, to establish the fact, you see, Mr Goh basically says
this, there is these three - - you see, if you take into account these
three, if their signatures are not valid, it may affect the 80 per cent,
they may not even achieve the 80 per cent. So I am trying to establish
that. You see, the 80 per cent signed with a condition, and the condition
is that you must have a minimum sale price, right.
[The President]: Yes.
184 The above exchange was in respect of Issue No 3. It will be recalled
that the Conditional SPs had signed the CSA with the condition that the
MSP was $76.8m whereas under the CSA, the MSP was $68.5m. It seemed to me
that the facts in respect of those signatures were not in dispute. Whether
the condition invalidated the earlier signatures of other SPs or the CSA
in its entirety was, rightly, a matter for submission. There was no need
to cross-examine Goh on it.
185 Having said that, I accepted that not all the President's
interruptions cited by Mr Liew were as clear cut. I also accepted that the
President should not have interrupted as much as he did.
186 As regards the allegation that the President had treated the witnesses
on the Minority's side in an unequal and inconsistent manner, this
allegation overlapped with the other allegations like the next allegation
and the allegation about disparaging remarks.
187 As regards the next allegation that the President had asked questions
that were directed at obtaining concessions from the Minority rather than
at clarifying points, this allegation was covered by, for example,
sub-headings (xxxiv) and (xxxviii).
188 Using sub-heading (xxxiv) as one illustration, this referred to, inter
alia, the following exchange on 5 February 2008 when Elizabeth Lim (one of
the Minority), was on the witness stand (at PBD 3150 to 3153):
[The President]: So you want Ang to be appointed as the lawyer instead of
Rajah & Tann, is it?
A: No, no, no. I did not want Ang. I just asked.
[The President]: Yes?
A: I did not want to appoint Ang. I mean, if - - no, no, no.
[The President]: Why? You also angry with Ang. I thought he is a - -
A: That was not my point . My point is surely it will be fairer to let the
SPs decided whether they wanted Ang's lower quotation.
[The President]: Well, Ang is a member, he is also the owner there, you
know. If you appoint Ang, a lot of people -- there will be a lot of
accusation saying that he is a - -
A: No, he said that he will only act - -
[The President]: -- conflict of interest, he is the owner.
A: No, he declared his interest and he said he will only act if more than
50 per cent agreed.
[The President]: Yes. So that is correct.
A: Yes. So my question was - -
[The President]: He did - - Ang did directly the - -
A: My question - -
[The President]: - - so has he managed to get 50 per cent?
A: No, my question was surely you should let the SPs - -
[The President]: Surely you should - - he should try to garner like 50 per
cent of the owners to - -
A: - - SPs decide, he was not given the time.
[The President]: Yes?
A: He was not given the time. By the time - -
[The President]: Who was - - have not been given the time?
A: By the time he came up with his suggestion on the - - he was going
around the estate on the 17th of March.
By that time, by - -
[The President]: He must do it fast, yes.
A: By that time 29th March already, you know, the CSA, the signatures were
obtained already, sir.
[The President]: Yes.
Mr Liew: Sir, I think it is not fair to say, that is the question you
should address to Ang, you see. You should address to my client.
[The President]: Right.
Mr Liew: My client is explaining what was the situation then.
[The President]: Yes. She said already, why do not get Ang, maybe she is
more confident with Ang than with Rajah & Tann.
A: No, that is not my point. That is not my point.
[The President]: Yes.
A: My point was, I think the SP should have a say to the - -
[The President]: You specially mentioned Ang, that is why we want to know.
A: No, no, because that was the only one available that was lower.
[The President]: I mean, know any lawyers you know in town?
A: No, that was the quotation that was received that was lower. I mention
him not because I wanted to appoint him.
[The President]: Lower - -
A: But because I wanted to - - I felt that it was fairer to let the SPs
decided.
[The President]: No, you are entitled to your views, all right.
189 As can be seen, the above exchange was in response to the Minority's
view that the SC should not have pushed for R&T to be appointed as
solicitors to act for the vendors. It seemed to me that the President was
wondering what the fuss was about in respect of that appointment. Although
I accepted that some of his remarks were uncalled for, I did not think he
was trying to descend into the arena. I would add that I too was surprised
that the Minority was raising the fact and the manner of R&T's appointment
as an indication of an absence of good faith in the circumstances. This
has been covered under Issue No 4 and I will not repeat what I said there.
190 I come now to the allegation that the President kept on harping on the
issue of wasting time by the Minority or Mr Liew. This allegation was
covered by, for example, sub-headings (i) and (xxxiii). There were many
cross-references under sub-heading (i).
191 Taking the first two cross-references under sub-heading (i), the
exchange was on 6 December 2007 (at PBD 1853 to 1858):
Mr Lee: It is - - I move on to another point, sir, which is the
respondents, the minority have also objected to say that the subsidiary
proprietors signed the CSA before the meeting to explain the CSA.
Sir, I think in the statute, the only relevant date is the start date of
the CSA, which is the 29th, in this case, it is the date when the first
signature is placed on the CSA, as your Honours are aware. And in this
case, this is the 29th March 2007. So we have in our application stated
this very clearly that the start date of the CSA is 29th March 2007. The
first signature was placed on that date. What the respondents are
complaining of is that there was a meeting on 31st March for the CSA to be
explained to the subsidiary proprietors. And how is it that some people
have chosen to sign it before it is explained to them?
Sir, I think this point, sir, is that some people do not require an
explanation, so they can sign before hand.
[The President]: Yes, they can. I see no reason why they cannot sign
before.
Mr Lee: Yes, sir, if they are solicitors, for example, they do not need to
be explained to.
[The President]: Yes.
Panel Member: Why are we listening to all these? I mean - -
Mr Lee: These are the objections by the respondents, sir.
Panel Member: You want to object, I mean are you really objecting to the
objection, I mean when this issue - -
[The President]: All you are wasting - -
Panel Member: At the end of the day, we will be hearing all these all over
again anyway.
[The President]: Yes.
Mr Lee: Yes, sir.
[The President]: Yes, I do not know why party is trying to - -
Panel Member: Mr Liew?
Mr Liew: My point, your Honour, is that this is an interlocutory
application.
[The President]: Yes.
Mr Liew: Many of the matters are subject to the obtaining of the evidence
and the cross-examination of the evidence. So at this stage when plaintiff
or the applicant take out this interlocutory application to strike out on
the ground that many of the further objections are, according to them,
irrelevant, really, it is up to the Board to decide after only the
evidence has been taken. At this stage, in terms of interlocutory
application, I do not think it is right for the applicants to try to shut
out the respondents in terms of saying that these further objections that
I have raised are irrelevant. It is ultimately subject to evidence that
has been taken and up to the Board - -
[The President]: But it was you who insisted you want to hear with the
preliminary objections.
Mr Liew: No, your Honour - -
[The President]: This should be heard in the open court when we hear
witnesses testify and we say whether it is correct or not. You are wasting
everyone's time.
Mr Liew: Sir, this is - -
[The President]: And you chose to do it, we hear.
Mr Liew: Sir, this is the plaintiff's application.
My - -
[The President]: This application is for against your further particulars.
Mr Liew: Correct, your Honour. But my objections, your Honour, the
interlocutory application is not in respect of all the further objection.
In respect of procedural requirements affecting three to four documents.
[The President]: Yes, procedure requirement - - even at the later stage,
when we hear the evidence, in submissions you still can raise this point -
-
Mr Liew: I understand, your Honour.
[The President]: - - but you want to raise them now, we can hear it.
Mr Liew: But sir, but my point is simply this, the applicant first take
out this objection and say the respondents have no right to put in further
objections and they are now in this interlocutory application saying these
further objections are irrelevant. The relevancy of it is still subject,
your Honour, to the evidence and the Board's decision. My point is simply
this - -
[The President]: No, why do parties not - - if parties can agree, then
your further objections reserve until the finding of the case, then we can
go on on his first objection about whether you people can file further - -
Mr Liew: I understand that, your Honour.
[The President]: So if parties can agree, then we can go on with the case,
rather than - -
Mr Lee: Yes.
Mr Liew: So we will call - -
[The President]: Rather than - -
Mr Liew: Sorry.
[The President]: - - wasting one whole day hearing the frivolous
objections by both parties.
Mr Lee: Yes.
Mr Liew: Your Honour - -
Mr Lee: Sir, I am happy to proceed on with the case, without even
proceeding with my application, sir.
[The President]: Yes.
Mr Lee: I do not have to - -
[The President]: If parties can agree, then we are going to proceed with
hearing the case.
Mr Liew: No, your Honour, my point is this, your Honour, that the
plaintiffs - - the applicants say that the further objection is
irrelevant, ought to be struck out because filed late. I can -
[The President]: That is why you want to reserve this for Board to decide.
Mr Liew: I understand that, your Honour.
[The President]: After hearing the case, we can tell you whether your
objections are frivolous or not.
192 Viewing the exchange in its entire context and not just the part where
the President mentioned to Mr Liew about the wasting of time, it will be
seen that the President, as well as a panel member, was rather annoyed
with having to deal with various preliminary objections. The Minority had
filed objections to the Application. One of the objections was that some
of the SPs had signed the SPA before the meeting of 31 March 2007 (and I
have dealt with this point under Issue No 4). In turn, the Majority had
apparently applied to strike out this objection. The President was of the
view that the Majority's application to strike out could and should have
been dealt with at the main hearing and during the exchange on the
striking out application, the President also mentioned that the Minority
too had raised preliminary objections about procedural defects which he
also thought could and should have been dealt with at the main hearing.
Hence, the reference to the wasting of time was really directed at both
sides.
193 At this stage, I would mention that the above passage also covers para
8(iii) of the PRS (cited above at[172]). I did not think it was fair to
describe the statement about, "wasting the whole day hearing the frivolous
objections by both parties" as simply an indication that the President was
not inclined to hear the preliminary objections of the Minority. As I
mentioned above, the President was thinking that they could all be dealt
with at the main hearing. He was not trying to shut out either side as the
PRS was suggesting. In any event, as earlier intimidated, there were
separate and earlier hearings for the Minority's preliminary objections
and the Majority's striking out application.
194 As regards the allegation that the President made several uncalled for
disparaging remarks, this allegation was covered by, for example,
sub-headings (xii), (xv), (xxi), (xxiv), (xxxi), (xxxvi), (ixi) and
(ixii).
195 Using sub-heading (xii) as an illustration, the reference was to a
remark made by the President on 4 February 2008 (at PBD 2660):
[The President]: But your clients all did not sign. They all - - your
client all did not take her word for right.
Mr Liew: Sir, the point of the matter is this - -
[The President]: Yes.
Mr Liew: - - is that - -
[The President]: Your client are all very intelligent man.
...
196 I accepted that the President should not have made what appeared to be
a sarcastic remark about the Minority being intelligent but it was on a
non-issue.
197 I come now to some of the examples given in para 8 of PRS about the
President's apparent bias (see[172] above).
198 As regards the allegation in paras 8(i) and 8(ii) of PRS that the
President was telling the Minority off that it was alright for SPs to sign
the CSA before the meeting of 31 March 2007, I accepted that the President
should have exercised restraint although he was right in that any SP may
sign the CSA if he so chooses without waiting for the meeting.
199 As regards the allegation in paras 8(vi) to 8(viii) that the President
was challenging Mr Liew's point that Form 1A was a form prescribed by the
STB and found in the relevant website, it seemed to me that the President
was not so much challenging the point but was drawing a distinction
between that and a requirement under the primary or subsidiary
legislation, as I elaborated under Issue No 2. The President was grappling
with the unusual situation that the website was "prescribing" a form not
found in the legislation.
200 As regards the allegations in paras 8(ix) to 8(xi) of PRS that the
President was expressing his views on various points, it seemed to me that
he was testing various positions taken by the Minority although he should
have done so in a less colourful manner.
201 On the other hand, there were also instances when the President made
remarks against Mr Lee or the SC. For example, on one occasion on 29
January 2008, the President observed that Mr Lee kept jumping up to object
(see PBD 2199). He also remarked that the Minority had scored a point
about the SC's letter of 29 March 2007 giving too short a notice for the
meeting on 31 March 2007 (see PBD 2200). He also observed disapprovingly
on 31 January 2008 that the SC had not maintained minutes of their
meetings. He asked whether they were illiterate (see PBD 2385).
202 I considered the notes of evidence in their entirety. I also bore in
mind that verbatim transcripts tend to give the impression that a tribunal
has interrupted much more than it actually has. I would add that another
member of the Board had also asked many questions and made various
comments although not as many as the President.
203 I did not agree with some of the interruptions of the President and I
was of the view that he should have been more careful and restrained in a
number of his remarks even though some of the points taken by the Minority
were obviously unsustainable such as those relating to the appointment of
R&T and ERA and the distracting objection over the return of the first
envelope to Poon. However, looking at the matter holistically and bearing
in mind the qualitative impact of his remarks and interruptions, I was of
the view that the President was not biased and had not predetermined the
Application. There was no denial of justice to the Minority and a
reasonably minded person who had been present throughout the hearings
would not have considered that they had not had a fair trial. His conduct
was not so egregious as to merit sending the dispute back to be heard by a
differently constituted STB.
204 In the circumstances, I concluded that the Minority had failed to
establish their case under Issue No 5.
Issue No 6 - The STB erred in law in granting the collective sale order
in:
(a) making wrong findings of facts in the GD;
(b) failing to give due weight to evidence that ought to have been
considered in making their findings of facts; and
(c) giving weight to evidence that ought to have been disregarded in the
face of evidence to the contrary, in making their findings of facts.
205 Most of the specific allegations under Issue No 6 were already covered
under the earlier issues.
206 In oral submissions before me, Mr Liew highlighted one specific
allegation under Issue No 6. Mr Liew submitted that Gan was only admitted
as a witness of fact, but yet he was allowed to give his opinion in
respect of Form 1A (see Issue No 2). However, it transpired that it was Mr
Liew himself who had asked Gan questions on Form 1A. While Mr Liew at
first accepted (on 8 August 2008) that it was he who had asked Gan such
questions, he subsequently said (on 18 September 2008) that it was the
President who had done so. As a result, I had to remind him that he had
earlier accepted before me that it was he who had asked Gan questions on
Form 1A.
207 I would also mention one other point raised in Mr Liew's initial
(written) submissions before me under Issue No 6 although he did not
highlight it verbally. This was the point that the RG Board should have
subpoenaed Poon as a witness on the question about Poon's relationship
with Premier. I mention this point in case Mr Liew should wish to
resurrect it in the light of the Court of Appeal's decision in Horizon
Towers([74] supra) about the role of an STB as regards witnesses.
208 Poon's name was mentioned in the course of the hearing before the RG
Board in various contexts, and, in particular, the aspects regarding the
first envelope which was returned to him and his relationship with Premier
(the latter is relevant under s 84A(9)(a)(iii) LTSA). I have already dealt
with the return of the first envelope under Issue No 4. As for Poon's
alleged relationship with Premier, there was nothing more for me to go on.
209 As regards the point that the RG Board should have subpoenaed Poon, I
would mention (and as Mr Liew accepted) that the RG Board did at various
times suggest that Poon be called as a witness. However, both Mr Lee and
Mr Liew declined to do so. There was a suggestion by Mr Liew that he was
unsuccessful in contacting Poon (see PBD 2259-2261). However, it seemed to
me that if he had really wanted to, he would have been able to locate
Poon's whereabouts and get a subpoena issued against him. Mr Liew could
also have obtained a subpoena in respect of Lyon Tan of Premier or any
other representative who could provide the requisite information. The
facts before me were different from those in Horizon Towers where the STB
declined for a technical reason to allow one side to call someone as a
witness.
210 As regards the inquisitorial role of an STB, as mentioned above, and
the Court of Appeal's point that an STB can and should call for a witness
on its own initiative, the RG Board was acting on the basis of an
adversarial process. Furthermore, as Mr Liew had been coy about calling
Poon as a witness, I did not think it was fair for him to even assert in
his initial submissions that the RG Board should have subpoenaed Poon as a
witness.
Issue No 7 - The Board erred in making conflicting costs orders in their
GD.
Issue No 8 - The Board erred in making an order that all SPs be bound by
the CSA as if they were parties thereto.
211 As regards Issues Nos 7 and 8, Mr Liew accepted that they did not
touch on the substantive appeal.
212 For Issue No 7, Mr Liew submitted that in [70] of the grounds of
decision, the Board had said that it made no order as to costs (because
the objections raised by the Minority were not frivolous or groundless).
Yet, under [71(4)], the Board had ordered, "That all costs and
disbursements (including the majority owners' solicitors' costs), fees and
disbursements of and in connection with the application be borne by all
the subsidiary proprietors (including the minority owners) in accordance
with the terms of the CSA dated 30th day of March 2007".
213 In a letter dated 30 April 2008, the Board sought to clarify the costs
it made. The letter stated:
2. By para 70 of the Board's decision, the Board decided not to make any
order in respect of costs as the objections raised by the Respondents were
not frivolous or groundless. That is, subject to paragraph 71 where the
Board ordered that all costs and disbursements (including the majority
owners' solicitors' costs), fees and disbursements of and in connection
with the application be borne by all the subsidiary proprietors, the Board
decided not to make any other order as to costs.
214 That letter was not well drafted. Nevertheless, it was clear to me
that there was no conflict in the GD or that letter. In [70] of the GD,
the RG Board was saying that the Minority did not have to pay the
Majority's costs of the Application. This meant that in so far as
additional work had to be done by the Majority's solicitors to address the
Minority's objections, the Minority did not have to pay the brunt of the
costs of such additional work. Nevertheless, the Minority had to pay their
share of the Majority's solicitors' costs which would cover both the
initial work in respect of the Application and the additional work to
address the Minority's objections. For illustration purposes only, if the
initial work cost the Majority, say, $5,000 and the additional work for
the objections before the RG Board cost, say, another $30,000, the total
would be $35,000 (excluding the appeal to the High Court). The RG Board's
decision in [70] and [71(4)] meant that the Minority had to pay their
share, say, 6% of the $35,000 instead of paying their 6% share of $5,000
and, say, 65% of the $30,000 on a standard basis.
215 There was clearly no conflict in the RG Board's order and Mr Liew, as
counsel for the Minority, should have known what [70] and [71(4)] meant
when considered together. It seemed to me that he was under the mistaken
impression that the RG Board's order in [71(4)] meant that the Minority
still had to pay for most of the initial and additional work for the
Application which was not the case.
216 If the Minority were still aggrieved by the correct meaning of the
costs order in [71(4)], that was a different matter. On that point, Mr
Liew submitted that the Minority had not agreed to the CSA and therefore
had not agreed to pay the costs of the Application whether in respect of
the initial work or the additional work.
217 It seemed to me that, here again, Mr Liew was conflating his
arguments. Although the Minority did not agree to the costs of R&T, it was
open to the RG Board to make them pay for their share of such costs. The
initial work in respect of the Application was done for the benefit of all
the SPs since it involved a collective sale of RG entirely. It was not
wrong for the Minority to bear their share of the cost of the initial
work, even though they were objecting to the collective sale, because,
eventually, they would be receiving their share of the sale proceeds,
whether they wanted the sale or not.
218 As for R&T's cost of the additional work, the RG Board could have
ordered the Majority to bear that entirely or the Minority to bear it on,
say, a standard basis or the Minority to bear their share thereof. The
Board decided on the third alternative which was less costly to the
Minority than the second alternative. Yet, the Minority were still
complaining that they had to pay their share because the RG Board had said
that their objections were not frivolous or groundless. In my view, what
the RG Board meant was that the objections were not entirely frivolous or
groundless because some were clearly unsustainable for the reasons I have
stated. In any event, someone had to pay for the costs of the additional
work by R&T. While the Minority stressed that the Board had said that
their objections were not frivolous or groundless, the fact remained that
they had failed in their objections and it was their objections which
resulted in additional work having to be done by R&T. I might have opted
for the second alternative. In all the circumstances, the Board was not
clearly wrong in the costs order and there was no reason for me to disturb
it.
219 I come now to the details of Issue No 8. Mr Liew submitted that the
Board had no jurisdiction to order the Minority to be bound by the CSA
since they had not signed it. What he meant was that the Board had no
power to do so. He submitted that under s 84B(1)(b) LTSA, the effect of an
order of the Board for the collective sale was that all the SPs would be
bound by the SPA, but not the CSA since there was no mention of being
bound by the CSA in s 84B(1)(b) or the rest of s 84B(1).
220 There seemed to me no practical purpose in raising Issue No 8 unless
the real purpose was to avoid paying even a share of R&T's conveyancing
fee and ERA's fee, both of which had been stipulated in the CSA.
221 Mr Liew also relied on parts of [7] and [43] of the judgment of Chan
CJ in Ng Swee Lang-CA ([19]supra) which states:
7 ... Once the Board has approved the collective sale application, the
Board's order binds all the minority owners and they, together with the
majority owners, are under an obligation to transfer their respective lots
and the common property to the purchaser in accordance with the terms of
the sale and purchase agreement (see s 84B(1)(b) of the Act). The sale
takes effect by virtue of the Board's order, and not by virtue of the sale
and purchase agreement. In short, the collective sale is not a contractual
sale, but a new form of statutory sale.
...
43 ... The Act does not require the appellants, as minority owners, to
sign the S&P Agreement as it would not be practical to make them do so.
They are not under any contractual obligation to sell their unit to the
Purchaser, but they are under a statutory obligation to do so. ...
222 I was of the view that those passages did not assist the Minority.
What Chan CJ was saying was that any minority owner would be bound by a
sales and purchase agreement, which the majority enter into with a
purchaser, not because the minority owner had voluntarily entered into
such a contract, but because the LTSA makes him bound by it once a
collective sale order is made. Chan CJ was not addressing the question
whether an STB has the power to make a minority owner also bound by a
collective sale agreement. If an STB has such a power, a minority owner
would be bound not because he had voluntarily entered into a collective
sale agreement but because the STB ordered it so.
223 Mr Lee submitted that under s 84A(11) LTSA, the RG Board was given the
necessary power. It states, "The Board may make all such other orders and
give such directions as may be necessary or expedient to give effect to [a
collective sale order]". He submitted that the order made by the RG Board
was one that was commonly made by an STB appointed under the LTSA. In the
present case, it was necessary or expedient to make the Minority bound by
the CSA so that R& T could represent all the SPs to act in the sale. It
was also only right that the Minority be bound to pay their share of all
disbursements and fees incurred in respect of the collective sale.
224 I was of the view that s 84A(11) did empower the RG Board to bind the
Minority to the CSA. Accordingly, they had failed in Issue No 8.
Summary
225 In the circumstances, I dismissed the Minority's appeal by way of the
present Application with consequential orders on costs.
226 As I have stressed, the price which Premier was eventually liable to
pay under the SPA was much higher than any other bid. The recent global
financial meltdown meant that that price was even more attractive. In the
course of the hearing before me, the parties did try to resolve their
differences and they appeared close to doing so but for an outstanding
dispute or two. It is such a pity that the saga continues.
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