Friday, 11 January 2008

STB - Judiciary or Volunteers?

This article on the Today paper (5 Jan 2008) was quite interesting and insightful in highlighting some of the problems of the STB in terms of its functions and members (article available here). Mr Yadav pointed out that the STB is made up of volunteers and this may create conflicts of interest. He asked "who better than a group of impartial persons to manage this delicate balance other than the judiciary". The perception of the STB in many minority owners' eyes is after all quite negative - out of hundreds of enblocs that have gone through STB, and given the numerous complaints about underhanded methods used by marketing agents and sales committees, only a handful of dismissals was ever made. It brings up the question - is STB there to be a check-and-balance mechanism in ensuring fairness and equity in enbloc sales, or is STB there to facilitate enbloc sales? If the former, why were the hundreds of thousands spent on legal fees by minority owners wasted away raising complaints, issues and concerns about how the sale was handled, only to have all their complaints, issues, concerns pushed aside to approve the sale?

The law points out that good faith must be secured in the sale, yet it narrowly defines the meaning of good faith through sale price, method of distribution and relationship of purchaser to owners. What about if the sale was not conducted in good faith, eg if the agent made misrepresentations to secure CSA signatures, or if the meetings were not conducted appropriately, or if the negotiations between purchaser and SC was not done in a fair manner? These have been raised at STB hearings by various minority owners, but legally they do not constitute good faith.

I'm reminded of a transcript of a general meeting at one enbloc site, where a (now ex-)member of the STB, who is also a lawyer representing the SC, made an appearance to the estate to assuage the worries about both Horizon Towers and the (then) impending legislation. In the meeting, he weaved between his role as the lawyer in charge of sale and his role as an STB member. When asked if there would be any conflict of interest, he brushed it off by saying that in any STB hearing involving the estate, he will not be a member of the STB tribunal. This of course does not say anything about whether he may or may not have shared insider information with other STB members, and because he is paid by the SC/marketing agent, he gave information about the runnings of STB and about the HT case (some information of which were not public knowledge). If this wasn't a failure of conflict of interest I do not know what is - that a STB member can use his (supposedly neutral) position to appeal to owners to sign the CSA, indirectly or otherwise.

I wrote about this potential conflict of interest more than a year ago here. At that time, I looked at the breakdown of panel members. Since the new legislation, STB has increased the number of members from 30 to 39. I include the new breakdown, with the old breakdown in square brackets.

Lawyers 8 [5]
Judges 2 [2]
Academics (Lecturers and Professors) 6 [5]
Engineers 4 [4]
Surveyors 4 [2]
Architects 4 [4]
Property Consultants 6 [8]
Consultants 3
Accountants 2

New entries are consultants (non-specific) and accountants. Out of the 8 law firms represented, 4 stated that they deal with enbloc sales. Again, like in the previous post, in these various categories, I'd consider judges, academics and accountants to be fairly neutral with no corporate conflicts of interest. I'm also discounting other extraneous factors eg a law professor who is a condo raider lol. In other words, I'm only looking at their affiliation (firms) and their career function (a law professor is more likely to be neutral in hearings than a property consultant from Savills for example).

Vested Interest Panelists in STB (or members who may have conflicts): 29
Neutral Panelists in STB: 10 (or 25%)

The 2007 list of members had 7 neutral vs 23 vested (or 23%). Under the 2008 list, it means that in a tribunal of say 4 members, there's a 1 in 4 chance of a member who at least can be said to be a neutral person.

I think Mr Yadav is correct - there's only two safeguards against unscrupulous enbloc sales attempts - the law and STB. STB needs to be more neutral in their membership selection, and the judiciary is one way forward. The law also needs to consider carefully that matters of good faith must encompass far more than just price, distribution and relationship. It must recognise the political nature of enbloc sales as well as the social consequences of enbloc sales in disrupting peoples' lives.


Anonymous said...

I agreed that technically faults lies on the Marketing Agent (MA) and the Sale Committee (SC) on the enbloc exercise as why are these agents from the Marketing company is allowed on the estate to keep harassing the Subsidiary Proprietors (SP)going door-to-door forcing them to sign to agree to Enbloc and even worst is why should the MA be given those names of SP whom had not signed and they went visiting every household to ask which make the SP in a difficult position to reject sometime due to the neighbourhood of the estate especially if you belong to the Minority. Collective Sales should be conduct Voluntarily between the Estate Sales Committee by tender methodnand there is nothing to do with the Marketing Agents after the presentation of Reserve Price and let the SP decide and not up to the SC or the MA to control the situation.

Anonymous said...

hi Dr M,

Glad that you're back with your refreshing analysis. I'd like to participate in your opinion survey, but kept hitting "unable to process request".

Thank you.

Dr Minority said...

Re unable to process request...

Do make sure you have cookies enabled. Also, I wrote about this before when other users (particularly those using IE7) had the same problems

The Pariah said...

Indeed, it's disturbing that we are getting into "MONEY JUSTICE".
See Part C of my Aug 2007 blog at

How many of us can afford the scale of legal fees forked out by the Horizon Towers Minority Dissenters in standing up for their rights to seek justice???

The Pariah said...

More questions:

1. How many collective sales orders were issued by STB where Minority Dissenters did NOT file objections? Could it be because the Minority Dissenters voted with their feet due to public perception of STB bias?

2. How many cases that were so-called "settled" during STB mediation without going through STB tribunal hearings? Could it be because the Minority Dissenters were strenuously encouraged by STB to engage the services of lawyers for tribunal hearings and they were offered a pittance of sesame seeds (not even peanuts!) by courtesy of STB's facilitation to erode the very spirit of the law on collective sales (ie, every owner should be entitled to the SAME basis of distribution of collective sales proceeds)?

3. How many STB rulings in favour of the Majority Consenters did not go through the appeal process of the judiciary at High/Appeal Court level? Could it be because of the intimidation of legal and court fees?

As I said in my blog:

Justice Delayed is Justice Denied.

Justice Hurried is Justice Buried.

Anonymous said...

STB roles: Current enbloc process questionable. Enbloc Application process should be streamlined.

1. STB administration should check for statutory compliance before accepting the application. Document such as TOP/CSC, signatures to meet minimum requisite, etc. Why waste everybody time & money if they can comply to the statutory requirements.

2. STB hearing should confined within the technical matter as per Act i.e sale price, method of distribution & financial loss.
STB should not hear on any other matters of law. They should refer it to HC for decision.

Another main point that need to be stressed: STB role is to ensure that all enbloc application should strictly comply to the LTSA requirements. The Act had been approved by parliment. Therefore, all intents and purposes of the goverment to facilate enbloc sale are already provided for in the approved Act. STB should NOT further facilitate enbloc sale giving similar reasons.

- Minority need Justice to prevail

Anonymous said...

All well said but are the relevant authority or STB panel members for that matter aware of how we feel? I know of lawyers who felt that noises made in blogs are just never ending complains.Fyi, when they schedule 9.30am session, the panel members are always late, long lunch time and it ends early. A case of money not worth it feeling.EO.

Anonymous said...

"All well said but are the relevant authority or STB panel members for that matter aware of how we feel? I know of lawyers who felt that noises made in blogs are just never ending complains."

Lawyers saying that.. really priceless. They are the ones that benefit most from the status quo since they get big money no matter the outcome of the sale.

V appalling the way STB treats the hearings. Someone should write to ST Forum..

Anonymous said...

I feel that en bloc will be dead from now on. You guys probably can feel it too. It good news for the anti enbloc vigilante corp, but it also means theres almost nothing to do already LOL

Anonymous said...

Sometimes our government believes in masterly inactivity to see how things develop with the passing of time. This hiatus in en bloc activity seems to be one such occasion.

This leaves room for developers to heckle and strong arm their way to completing en blocs that expired or are in a legal tangle.

Did they learn from this -

The Senior Minister himself has stated:

Supposing Catherine Lim was writing about me and not the prime minister . .. She would not dare, right? Because my posture, my response has been such that nobody doubts that if you take me on, I will put on knuckle-dusters and catch you in a cul de sac . . . Anybody who decides to take me on needs to put on knuckle dusters. If you think you can hurt me more than I can hurt you, try. There is no other way you can govern a Chinese society.

Would one call this setting a good example for Singapore businesses?

And as far as Chinese societies go, I wonder how far he would have got running a country the size and spread of China - and its Chinese - in his inimitable style?