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"I am a BLOGGER NOT an expert. This is a BLOG not a 'go-to' website for official information. I represent no one's view save my own. I have neither legal nor financial training, nor do I have anything to do with the real estate industry. My understanding of the Collective Sale Process is from a layman's position only. My calculations, computations and tables are homespun and may contain errors. Please note that nothing in this blog constitutes any legal or financial advice to anyone reading it. You should refer to your lawyer, CSC or financial adviser for expert advice before making any decision. This disclaimer is applicable to every post and comment on the blog. Read at your own risk."
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There is one thing worse than an Enbloc ----- and that is an Enbloc done badly. Since the majority have the necessary mandate to sell, then they owe it to all SPs to make a success of it. Minority SPs can only watch and wait, if they sell then lets pray it's at a price we can move on with, if they don't sell, then we are happy to stay for a few more years.

KOON SENG HOUSE (Court of Appeal)

Co-owner loses fight to stop collective sale
Straits Times - 03 Mar 2010


This is the lone minority owner in Keng Soon who thought he could fight his case without representation at the Court of Appeal.

The court, comprising Judges of Appeal Chao Hick Tin, Andrew Phang and V. K. Rajah, were unanimous in deciding that Mr Goh, as a co-owner, did not have the right – known in legal parlance as locus standi – to be heard in court, since he and his now ex-wife had to act as one in the en bloc sale."
"But Justice Chao remarked: ‘We are extremely doubtful that your case is strong. Most, if not all, of the points you raised are without merit.’ Justice Rajah piped in: ‘And we are being polite.’"

" While he was not ordered to pay legal costs, Mr Goh will have to pay $3,000 for the sales committee’s expenses for the appeal."



His case was never heard because both owners must be be objectors in order to be heard in court. Another clarification for the books. Why didn't the High Court rule like this?
I ask this as no mention was made of the Supplemental CSA being a fresh 12 month agreement - it didn't seem to form part of the grounds of appeal.  The COA didn't touch on this  either.  Did they ignore the huge elephant in the room? Does the HC ruling on this new issue stand? Unless, I hear otherwise, I think it does.

Like the CPF waiver of monies outstanding to a member's CPF account, this ruling remains open to Appeal by another minority owner in some future en bloc case. Either that or the Ministry of Law should trot out further amendments to the LTSA and ring fence the process with deadlines that stick! 12+12 is now 12 + (12)m +12, where (12)m is a Supplemental CSA times any number of multiples.
At least the judges were lenient when it came to costs and didn't saddle this owner with layers of costs. Thank goodness for small mercies.
 
LOCUS STANDI
I have no legal training but I do have questions about who is considered  minority, majority and about those that have co-owners in each camp.

Majority
Clearly, units where all co-owners have signed the CSA and have not rescinded their agreement during the 5 day cooling off period. A majority owner cannot make an appeal at the STB or High Court ... well, only for the brave-hearted

Minority
Clearly, units where all co-owners have not signed the CSA and retain their right to make an objection at the STB, High Court and Court of Appeal if they act is one

Split units
Co-Owners who are not in agreement; with one signing the CSA and the other not signing. The CSA is not valid and so is not counted towards the majority. They are considered minority but unless they act as one and co-sign the affidavit, the minority co-owner cannot make an objection to the sale at the STB*   So this unit is a minority unit but without minority rights. 

* Since this was the case at the Appellate Court for Koon Seng House - I am just assuming it holds true for other levels - STB and High Court. But I may be wrong. 


Written decision of Court of Appeal
The merits of the claim
28     Having found against Mr Goh on the issue of locus standi, there was no need for us to consider the merits of Mr Goh’s substantive claim. It suffices for us to indicate briefly our view on the same. Mr Goh insisted that he had a strong case for objecting to the sale on the bases of procedural irregularities and unfairness. Upon a closer analysis of Mr Goh’s claim however, we were extremely doubtful that he had a strong case. Indeed, most, if not all, of the points raised were without merit. We could not agree with his allegations that the sales committee constituted for the purposes of the collective sale had breached its fiduciary duties to all the owners by failing to make timely and proper disclosure and failing to act in good faith in respect of them. We also did not think that an equal distribution of the sale proceeds among all owners within the Development was unfair or inequitable in the present circumstances. Allegations that the Board had failed to act independently were misguided. Moreover, in respect of Mr Goh’s allegations of procedural irregularities, we were of the view that the Judge had more than adequately considered these allegations and dismissed them with sound and detailed reasons. As for the additional instances of alleged procedural irregularities which Mr Goh had raised before us, these were also without any substance. It seemed to us that he was nitpicking. Accordingly, even if Mr Goh had the standing to bring this appeal before us, upon viewing Mr Goh’s case in its totality, we would have upheld the Judge’s decision.
Conclusion
29     In the result, we dismissed the present appeal. As regards costs, we fixed it at $3,000 which Mr Goh should pay to the Respondents. We upheld the cost order made by the Judge below. Finally, as requested by the Respondents, we authorised the Registrar of the Supreme Court to execute, on behalf of Mr Goh, all documents necessary to effect the collective sale should Mr Goh refuse to execute the same.

2 comments:

  1. Ha, ha ... Semantics, semantics ...

    - Majority, Super Majority

    - Minority, Partial Minority


    Wanna bet? We'd get Partial Super Majority one of these days. Say, 80% by share-value and strata-title signed CSA but one of the units within this Super Majority is owned by two persons and only one signed.

    So how?

    ReplyDelete
  2. he CSA is not valid unless ALL co-owners sign and therefore cannot be counted toward the majority. If the majority margin is slim - then the minority owners (yes, owners, they have to do the donkey work) will go through all the units with a fine tooth comb to weed out those that are possibly in error and so bring the majority figure down. The minority lawyer can then do a property search on those units.

    But you are right - a future wacko ruling might give more power to the majority owner - or the owner WHOSE NAME APPEARS FIRST ON THE STRATA ROLL , since that is already provided for in the BMSM.

    In any AGM, if both owners vote on a resolution then it is the FIRST owner only whose vote is counted!!!! So if the first owner is majority, then he will over-rule his minority co-owner...

    I think the proper way should be that they cancel each other out.

    But, hey, why am I giving them ideas!

    ReplyDelete