Horizon Towers Contacts Needed & Comments Raised

The initial post on the Horizon Towers' STB dismissal has generated over 160 (and counting) comments, in true MSN style of rapid fire and response. I do not believe in censorship nor do I want to stop people from commenting to one another, so I'll put some of my comments here rather than be drowned out by the continuing discussion (and often speculation) on the plight of Horizon Towers.

Firstly, if there are any Horizon Towers owners/residents reading the blog, a major newspaper reporter who specialises in collective sale reporting is looking for contacts to interview with regards to the situation in Horizon Towers. If you'd like to talk to the reporter, please let me know - enblocsingapore@hotmail.com . I'll hook you up. The reporter is bona fide, and anonymity can be maintained should you choose. It'll be good to get some information from the residents and owners, to at least calm some of the very rampant speculation. Just note that if you have been advised by your lawyer(s) not to speak to the press, then you should comply.

Now aside from the glaring question of who sues what where how when, two other issues have turned up in the comments - (a) is the CSA still valid for it to be resubmitted to STB (b) during the owners' meeting where they decide what to do next, should any voting be public or confidential.

Voting, Anonymity and Why Current Enbloc Favours Certain Parties Over Others

I'll address the latter (b) first. For a while now, I have been advocating the fact that the current system of enbloc procedures is not efficient and mindful of the needs and concerns of owners. What I'm referring to is the fact that any signature collection for the CSA can last for a year.

Think of it this way - if a powerful political party is given not a short period of time to campaign for votes (as is currently practiced), but a whole year to garner votes, and by garnering I mean actively in-your-face constant reminders to vote for them and why it's good to vote for them etc, do you think elections will be fair? No, because (1) a sustained campaign is only feasible to the party with the financial resources and clout to do so; any party that does not have that power will face serious problems trying to get their own votes, (2) there is a very real risk of wearing down - a voter might vote irrationally simply because they want to get it over with.

The period of time to collect a CSA is 1 year. That favours a sustained campaign by the agent and sale committee to push for a sale, and to wear out resistance if any. Unlike voting, CSA signature collection is not anonymous either. In other words, the agents and SC know who voted and who didn't. They are under no obligation to keep that confidential (see your CSA, are there any clauses which require that such information be kept confidential? Doubt so). Any owner who signs on the CSA can see who else has or hasn't signed. They can then persuade, coerce, even threaten their neighbours, resulting in an ugly community divided into two.

When the owners meet to decide the fate of their estate, one commenter said that any voting should be kept confidential. Absolutely. No raising of hands. Have proper ballot cards for all registered SPs to decide, and that result should be compiled by an independent party.

This should be the way with CSAs as well, to be honest. Hold 2 voting sessions in a 4 month period (not 1 year and given the bullish property market, even pro-sales owners should think a year too long), with voting done anonymously but verified and certified by an independent party. Failure to achieve 80% means accepting that it's not going to happen, and owners moving on with their lives.

CSA and SPA Validity

I want to preempt by saying I'm not a lawyer nor trained in Law. I read things carefully and logically. All discussion is based purely on rational and not legal reading, so CAVEAT EMPTOR (BUYER BEWARE - READ AND ACCEPT AT YOUR OWN RISK!). One commenter asks if Horizon Towers wishes to resubmit, can they 'reuse' the CSA?

Okay, there's TWO contracts involved in a collective sale. The Collective Sale Agreement (CSA) which binds the owners, sale committee, outlines the responsibilities of agents and lawyers (sometimes), method of distribution etc etc. The Sale and Purchase Agreement is a contract between the buyer (the developer in most cases) and the seller (the majority owners).

Each of these two contracts vary, sometimes subtantially, between estates. This depends on the law firm hired and the SC's decision to include/exclude certain clauses, indemnities, conditions etc.

Typically, the CSA will have a number of expiry or period of validity clauses. The Horizon Towers (HT) CSA should contain them as well, outlining when the CSA will lapse (eg when 80% is not achieved by a particular expiry date, when no SPA is achieved, when no application to STB is made etc). Assuming that the CSA has a clause to the effect that (for example) if STB approval is not issued within 12 mths from the execution of the CSA, it means that so long as HT has not reached that deadline, the CSA is still valid. Hence, everyone who signed on that CSA is still bound by it. They can extend the deadline (if permitted in the CSA), eg to apply to STB to obtain approval but the signatures stand.

The SPA should likewise contain clauses that outline its validity subject to an STB order. For example, if the STB dismisses the application within X number of months from the date of the SPA, then the agreement shall be deemed to be cancelled etc. It might even outline claim clauses eg "the purchaser shall have no claim whatsoever against the owners for compensation, costs, damages" etc. So in all likelihood, if the HT SPA contains such a clause, the STB dismissal would have cancelled it BUT not the CSA. If the CSA goes past the expiry date and no submission to the STB has been made, then the SC will need to recollect signatures again. I do believe that if HT SC decides to resubmit, since the SPA has been nullified, they'll need a (most likely) redrafted SPA to submit to STB as part of the documentation.

That's my (amateurish) reading of it. Do let me know if it's wrong, but like I said, it'll depend on the individual CSA and SPA. The best advice on this would be to seek a lawyer. And no, I don't have the HT documents. :P

It's a really rough time for HT owners, both majority and minority I'm sure. All the best to everyone there.

Tags: Horizon Towers, collective sale agreement, CSA, sale and purchase agreement, SPA, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore