Disclaimer






"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.

The Time Line



Enbloc Round 2
According to the LTSA and terms in the draft 2 CSA:

When does the CSA expire?
CSA but no 80%: - 12 months from date of first signature (Agreement Date) (13.1.2 (a))

CSA + 80% but no Sales and Purchase Agreement (SPA) : - maximum 24 months from date of first signature (Agreement Date). (13.1.2.(b))

CSA + 80% + SPA :- no expiry. The CSA will remain in force until completion of sale and vacation of unit. (13.1.1)


In the draft 2 CSA (TC Enbloc Rd 2) we are told that if there is a supplemental agreement to lower the RP, it is not a fresh agreement and will not add another 12 months to the sale process (8.1.3(d))

BUT according to the following High Court decision, a supplemental agreement  is a fresh agreement that adds 12 months to the process, so my question to the solicitor is this:

Question? Which takes precedence? The CSA or a High Court ruling?

Koon Seng House High Court Decision
7    Subsequently, however, when bids were invited for purchase of the property, there was only one offer for $18,800,000. Realising that the reserve price then was too high, the owners agreed (after discussion) to reduce the reserve price to $19,800,000. To effect this variation in the CSA, a supplemental agreement was signed. The first signature to the supplemental agreement was appended on 24 March 2007. By 7 May 2007, the owners of 27 out of 33 units (including the nine terrace houses) had signed the agreement. Other owners progressively added their signatures so that by 6 September 2007, the owners of 30 out of 33 units had validly signed the supplemental agreement. This included the owners of 21 out of 24 flats.

36    First, where an earlier CSA had failed to achieve its intended purpose, ie, to sell the land to a purchaser, the proprietors of the land could not be precluded from making a new agreement with a lower reserve price. Hence, the supplemental agreement constituted a fresh agreement. Therefore, time for the purpose of para 1A(a) of the Schedule should be reckoned from the date the first signature was appended to the supplemental agreement.

37    Second, s 84E(3)(b) provides that proprietors holding not less than 80% of the aggregate share value may apply to the Board for a collective sale order. At the earliest, the 12-month period within which application may be made to the Board starts when 80% majority has been reached or first crossed (as the case may be). The plaintiff was therefore wrong to say that time for this purpose started running from the date of the first signature. There are two distinct 12-month periods. As I said, application may be made to the Board as soon as 80% majority has been reached or first crossed. However, this does not mean that the 12-month period within which application must be made to the Board necessarily starts then (see para 1(a) of the Schedule). For example, it could start at a later date when a greater percentage majority is reached so long as the time elapsed from the first signature to the time when such desired majority is reached is also not greater than 12 months (see para 1A of the Schedule).
38    The first signature to the supplemental agreement was appended on 24 March 2007 and the last was on 6 September 2007 (well within the 12-month period within which a majority of not less than 80% had to be reached). The other 12-month period (ie, that within which application to the Board had to be made) commenced on 6 September 2007. Therefore, the application made on 16 April 2008 was well within time.

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