How Many CSAs can a CSA CSA?

I received this email from Mr Francis Zhan, retired Chairman from Regent Gardens (RG), which has given me (implied) permission to "keep [my] readers informed" of the development at RG. Let me post his email first (with private information anonymised), and then I'll respond, drawing from the RG judgment by Justice Lee Seiu Kin (available here, or here on scribd).

Dear Dr. Minority,

I read with great interest your blog on en bloc activities in Singapore, and thought I may be able to contribute the latest information on the most controversial en bloc sale in Singapore from the horse's mouth.

I am the last Chairman of Regent Garden Condominium, and have been its Chairman for 16 consecutive years, treasurer and council for the earlier 4 years.

You are probably aware of the situation surrounding our en bloc sale so I will not waste time with history. I will deal with the crux of the issue which is the key issue the majority owners are appealing to the Court of Appeal against the High Court's ruling on 16 May 2008.

Justice Lee S K had ruled that a purchaser may enter into a side contract with payment to the 6 minority owners to secure their agreement to the en bloc sale as nothing in the Sales and Purchase Agreement forbade such an arrangement. And to make his ruling practical, he issued an order that the 6 minority owners be enjoined as parties to the original CSA! (written judgement was released a week ago).

In effect, therefore, there are TWO collective sale agreements -- the main CSA with S$34.0m. to be shared by all 31 owners, plus an additional or sub-CSA with S$X.0m. to be shared by the 6 minority owners. To add insult to the injury, one of the 6 minority owners filed a suit claiming for "financial loss" based on the S$34.0 sale price, ignoring the additional receipts from the share of the S$X.0m.

We cannot understand how the Honourable J. Lee could arrive at such a conclusion without examining the meaning of a Collective Sale, and his judgement therefore produces TWO COLLECTIVE SALE AGREEMENTS. We are not even questioning the manner in which the purchaser obtained the consent of the 6 minority owners (vis a vis the Prevention of Corruption Act), and merely asked for the logic of such an arrangement, if validated by the Courts.

If a property owner can stay as a minority owner and gets two, or even three (as in the above case) cheques as against the majority owner getting only one cheque, who on earth would want to, or dare to, sign the CSA as a majority owner?

Will appreciate if you can keep your readers informed of this latest development, and transmit the information to any other forum on en bloc sales, for the benefit of the community because I don't want to see another property owner taken for a ride.
If you need any documentation on the above sale, do not hesitate to contact me. I can also be reached on my mobile XXXXXXXX.


Francis Zhan,
Retired Chairman,
MCST No. XXXX
Regent Garden Condominium.

I note with interest that Mr Zhan wrote "we" in his email, which I take to imply he represents the majority owners of RG, as it would seem the problem is with the minority owners obtaining additional sums from the sale, through some alleged private agreement with Allgreen (the buyer of RG).

The judgment for RG is very complex and addresses a number of issues. I want to pick on one only which is Mr Zhan's comment that the Judge effectively allowing more than ONE CSA to be executed, in this case, TWO CSAs. I'll draw from the judgment where necessary.

Firstly, the CSA is a very specific document. I cannot emphasise this repeatedly to as many people as possible. It's a contract, with all that a contract implies. As such, any clause that is present or absent in it has implications to the sale. In almost all CSAs I've seen, it's very very comprehensive, especially with regards to the protections of the majority owners and the SC. It sometimes include, in one I've seen, woolly clauses such as what happens when the sale price offered during the tender is less than the reserve price. This merely reflects poor contractual writing, in my opinion, especially considering how air-tight some clauses can be to protect the SC etc. The point is that there is only, and only, ONE CSA in any enbloc sale, and ONE Sale and Purchase Agreement. Mr Zhan's argument of TWO CSAs is therefore a rhetorical, and not a legal, one.

What he's alleging is that there is one CSA and SPA, and for the minority owners, there are private contractual agreements with Allgreen. Not CSAs. This is most obvious when you realise that the CSA binds and encompasses all owners eventually (should sale be approved) but any private agrement binds only the minority owners.

Can the developer do that? Mr Zhan disagrees obviously, since it creates the situation that allows for "greedy" minority owners to hold out and ask for more through private agreements. It also causes "an unequal and disproportionate amount to be distributed to all subsidiary proprietors" (Clause 22). Surely that is unfair to the majority involved! It means that everyone should endeavour to be the minority, to get more!

Let's examine that closely.

1. If everyone waits it out, hoping for more money, then the sale will not go through. This means everyone will not get anything from it. In reality, this always happens. You have some minority owners who steadfastly refuse to sell, and others hoping to wait until the reserve price goes up, before signing. To collapse minority owners to being merely "greedy" is stereotyping and reflects simplistic thought. Enbloc sales are complex, and people will sign the CSA for various reasons, including but not limited to, greed.
2. It's an "industry practice". Clause 44 of the judgment points to Mr Tan Tiong Cheng of Knight Frank who admits that "the practice of offering additional payments to minority owners to procure their consent to the sale of the relevant property is widely adopted within the industry". This means that at the very least, marketing agents, enbloc lawyers, and serial enblockers are aware of this. Under the new enbloc laws, minority owners now have the possibility of additional compensation if justified. This would be unfair to majority owners, but it's the law. What an owner has to consider, is if s/he will obtain such compensation or not, and hedge their bets.
3. There's risk involved. Clause 26 shows how a third party notice against minority owners was made to determine, among other things, whether because of the private agreements, the minority owners are therefore liable to majority owners for damages. In other words, if a minority owner accepts the private agreement, s/he may be opening themselves up for potential lawsuits against them. So it's not instant cash in your hands.
4. Because it's "industry practice", what the SC SHOULD have been done is to provide explicit clauses in the CSA and SPA to prevent such payments to be made (Clause 44). In other words, as mentioned earlier, how comprehensive your CSA is, is crucial. The judge went at length to point out that such provisions are not included in the RG CSA/SPA and hence, Allgreen is within legal means to provide supplementary payments to some owners. It's legal.
5. The judge also asked the question of whether the additional payments to the minority owners constitute "detriment" to majority owners. Were they disadvantaged because they now have to sell below what others are getting, or below market value? He reasoned thus: "The fact that the majority owners now have to sell the property below its “market value” cannot suffice, since under ordinary contractual principles parties cannot be allowed to escape a properly formed contract simply because it turned out to be a bad bargain after they had ascertained what the development charge was. Nor can the fact that the majority owners end up receiving disproportionately less than the minority owners constitute “detriment”, since [the lawyers for the majority owners] would then be making the proposition that although the majority owners had, at the time of signature, been perfectly willing to sell their units at a particular price, the fact that the minority owners will receive a larger sum in order for the sale to proceed is somehow detrimental to the majority owners even though this will permit the sale to be carried out on exactly the same terms as the majority owners had contracted for in respect of their units." (Clause 48). In other words, when a person signs the CSA, at the expected value and terms, he should not want, or be found wanting, since it's a binding contract.

I return to Mr Zhan's key question: "If a property owner can stay as a minority owner and gets two, or even three (as in the above case) cheques as against the majority owner getting only one cheque, who on earth would want to, or dare to, sign the CSA as a majority owner?" The answer, as always is not simple. You sign the CSA knowing full well it's a contract and a binding one, with all the legal consequences that entails. If you are for the sale, sign it with independent legal advice on the implications of it. If you are not for the sale, review the CSA as it'll bind you later on, should the sale be approved by STB. In the final calculation of things, the CSA applies to everyone, be it majority or minority. But to refrain from signing in the hope of getting more from private agreements, is to hedge your bets - hoping that you'll get such an agreement from the developer (in many cases that does not happen), hoping that you will not get sued, hoping that the sale will go in accordance to the terms of BOTH the CSA/SPA and the private agreements.

I should also note that in the RG judgment, the judge has pointed out that there is no written agreement between Allgreen and the minority owners (Clauses 66 to 76). The arguments he made are on legal grounds, and point to the definition of what would count as a "further agreement". He found that there was no legal basis for such a "further agreement". I'm not a judge nor even a lawyer, and hence cannot assume to argue against his decision on this matter. That is a matter for the majority owners to make a case.

The morale of this RG tale? Mr Zhan's suggestion that it forwards the anti-enbloc front - that holding out for more money as a minority owner is a good thing - has to be tempered with the legal and financial risks involved. As in any legal case, having damn good lawyers make a difference in whether you can defend yourself or not. I therefore have to disagree that there are multiple CSAs involved in RG's case, have to disagree that minority owners are inherently 'greedy', and have to disagree with the simplistic view that minority owners stand to gain everything by holding out for private side-payments.


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Tags: regent gardens, high court, collective sale, collective sales, en bloc, en-bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore

Prime News on Hope Group

This is something we don't see often - when a group of self-volunteered home owners get together to create a website with information to help other owners who are being subjected to the enbloc blight. "Self-volunteer? Sure, like the sales committee!" I hear some cry, but there's a big difference - sales committee 'volunteers' have a big FINANCIAL gain out at the end of their effort, assuming the sale succeeds. Hope volunteers have no such gain except the satisfaction that they have helped to educate the public, and helped owners to protect their basic, fundamental, right to a home. And THAT, my friends, is what volunteerism should be about. Don't see much of that around nowadays, when others are put before self.

This was printed in the Straits Times the day after National Day. I'm reprinting the whole thing, and I have a wee comment at the end, in response to the last person interviewed in the piece.


Hope for owners fighting en bloc; A website with information on the laws and processes in collective sales is aimed at helping minority owners
Straits Times Prime News 11 August 2008
By Lim Wei Chean & Arlina Arshad

THE name of the website - www.hope4stayers.com - says it all. It is a forum for, and set up by, people who are worried about losing their homes in a collective sale.

Its opening words are a call to arms.

'We need to share our experiences to get us through this nightmare,' it reads.

'We hope that our daily lives can be free from the constant worries of losing our homes to those who see home as a mere financial tool for wealth.'

Cosmetics distributor Tan Keng Ann started the site when his neighbours wanted their condominium along Toh Tuck Road sold en bloc last year.

The 60-year-old said there had been a dearth of information online about collective sales.

'We want this to be an educational site, for people to learn more about en bloc sales.'

And so the Hope website was born. (It is an acronym for Home Owners' Protecting Entitlements.)

The site started in February with about five or six members from estates on the chopping block. Today, it has a core group of 25 flat owners scattered in 15 estates that are going through the sale process, some for the second time.

They include Bayshore Park, Green Lodge and Pine Grove, some of which made waves in the media by forming an anti-sales brigade.

The Hope group's objective is to equip stayers, also called minority owners, with information about the en bloc process so they can fight to keep their homes.

The website is expansive. It includes a compilation of the collective sales law, legal tips for minority owners and a list of confirmed, on-going and failed en bloc deals.

One member, who declined to be named, joined after some new faces at her condominium tried to get elected to the management committee.

She said: 'I didn't know what these people were up to.'

She learnt soon after when a collective sales order was tabled.

For those who opposed the sale, information about the en bloc law was key, she said. They were facing an uphill battle against a majority of owners who had professional consultants to guide them through the legal minefield.

One minority owner in Rainbow Gardens along Toh Tuck Road wishes he had known earlier how to navigate the en bloc landscape.

The resident, who declined to be named, protested against the sale even though it had the requisite 80 per cent support to go through.

His appeal to the Strata Title Board, a government authority that rules on en bloc sales, was turned down. He took the case to the High Court but, the sale went through before it was heard.

Disappointed, the man said he is considering writing about his ordeal for the Hope website.

He said: 'My advice to minority owners is pray hard you don't get the 80 per cent.'

Meanwhile, the Hope group is cobbling together a list of proposals for the Law Ministry to consider.

A ministry spokesman said it will 'continue to monitor the effect of the changes in practice, and review the feedback to see if further amendments to the en bloc rules are necessary'.

Not everyone is supportive of the Hope website, though.

Mr Issac Chin, an investor who sits on the sales committee of Pearl Bank Apartments at Outram Park, which is trying to go en bloc, does not see the need for such a group.

He said the law is clear: if 80 per cent of the owners want to sell, the sale will go through.



Mr Chin is absolutely correct - the law is indeed 'clear' on the matter of what criteria should a sale counts as valid. However, as many who have been through enblocs and suffered for it know, the law is also very UNCLEAR and SILENT about many things:

• The law is SILENT about the fact that home is a basic fundamental right, and it should not be the case that other owners can take that right away from you. It's like if 80% of your community vote that you must convert to a particular religion, you must comply, whether you like it or not. I'm sure noone will stand up for that, right?
• The law is UNCLEAR about how to handle harassment from aggressive people, be it majority or minority. They are able to act with impunity because they are fully aware that their actions will not count as any form of bad faith under the enbloc law. This shouldn't be the case at all.
  
• The law is UNCLEAR on what should count as good faith, especially considering that numerous arguments have been made in front of STB about many incidents that should constitute bad faith, but were thrown out simply because the law was too restrictive in its meaning of 'good faith'.
• The law is UNCLEAR about itself. We've seen legal titans battle it out in court, we've seen judges issue judgments that seem to sometimes contradict the meaning of the law, and other times advocate the enbloc law to a fanatical degree. If such legal minds that make up our legal profession can spend hundreds of thousands of dollars slugging it out in court, often at our expense, does it not say something about the law itself? Worse, where does that put us civilians who have little to no knowledge of legal matters?

As Mr Chin showed, he chose a particular interpretation of the enbloc law - that of a single point of 80%. Hope stayers will clearly highlight that there are numerous other parts of the law that is highly ambiguous, questionable and even so legally knotted that it really should at the very least be re-examined.

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Tags: hope4stayers, hope group, collective sale, property, enbloc sale, enbloc, en-bloc sale, en-bloc, en bloc, condo, collective sales, singapore

Let's Enbloc Organs!

Received this email which insists that the Health Minister Mr Khaw need not worry about procedures for organ trading; just use the enbloc law since it works so well! I've reproduced verbatim.

Email Subject: En-bloc Organs the Way to Go Man!

Mr Khaw Boon Wan don't need to look further than our en-bloc regulations to implement organ trading. After all, there are similarities - Your organ is not your own, your organ is not protected by the Constitution, your organ is more important for society, society want the best for your organ!

Step 1: Getting the stakeholders!
Suppose you want to sell your kidney. You have a total of 50 living relatives in the world. Gahmen issues you the same number of random citizens, so 50 citizens. You need to hire a marketing agent (anyone with experience on enbloc, sure can sell your organ wan!). Your agent has to convince 80% of your 100 stakeholders if you are 30 years and above (30 yrs is chosen as the threshold because of scientific evidence from University of TalkCock so dun pray pray). 90% of your 100 stakeholders if you are younger than 30 years old. If you wish to donate gahmen protected organs (like brain lah if you have Ph.D., reproductive organs if you have university degree) then the threshold is 50 years old (must make sure you use them first, for country!). All stakeholders will get a cut of the profit from selling your organ, and of cuz the more organ you sell, the better!

Step 2: Getting the majority vote!
Marketing agent has 1 year to obtain 80% or 90% vote from your stakeholder. They then have 1 year to public tender your organ and apply to Ministry of Health for approval of sale. From tremendous enbloc experience, agent can split stakeholder group into "sell sell" group - mostly random citizen who dun know who you are and dun care, "die die dun die" group - close relatives who worry you might not survive the organ operation.

Step 3: Public tender!
Now agent will put your organ up for public tender. Of course, if got under-the-table offer, can consider lah. Dun worry, you dun have to worry about the highest bidder, sometimes lower bidder but from reputable family who needs your organ for future of Singapore, can oso. You will always make the right judgment call.

Step 4: Application to MOH for approval
Now must send your application to MOH for approval. A Organs Donation Board will be set up consisting of lawyers, engineers, architects, business consultants. People who knows what's best for you! They will decide if sale is done in good faith by checking on (1) sale price, (2) organ renewal potential - whether your body part is going to someone better in society or not (3) relationship of buyer to seller - obviously the closer the buyer is to seller the better.. organ type compatability lah! Dun worry if your agent blackmail your relatives, threaten to take their organs instead, all this is legit since sale still done in good faith.

Step 5: Minority objection
No such thing. For show only. Organ is for betterment of Singapore. Objector can appeal to High Court but why waste money?

Step 6: Completion
Your organ is not your own anymore. You cannot do anything to damage it, like go on beer binge, buffet, char kway teow. Buyer reserves the right to call upon you to operate on your body, just to make sure what they bought is what they want. And clear anything in the way, like blood vessels. No worry, buyer's surgeons have the best of concerns for your organ. I mean, for you!

Step 7: If more than 1 organ
If you intend to sell more than 1 organ (kidney, liver, reproductive organ, toe, finger, eye, ear), then must set up sale committee who has the best interests of your organs in mind. SC must be people with the highest standing, are professionals with plenty of experience. You can find them in the Classifieds under Organ Raiders. They will do their best to sell your organs to the best (not have to be highest) bidder. They will get a cut of the profit for their services. They don't need to know you, they just want your organ!

See, Health Minister no need to worry! The en-bloc law is unfallable and faultless! The Organ Donation Board only need to rubber stamp and approve sale. After all, the recipients are bound to be very successful citizens of Singapore whose lifestyle ruined one or two organs, no worry, can just buy and replace cos got money! They are more important to society!

So let's en-bloc organs!

[Note from Dr M: Not sure if I should be worried about this email, or take it as tongue-in-cheek. God help us if it's actually taken seriously!]

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Tags: organ trading, enbloc organs, collective sale, property, enbloc sale, en-bloc sale, enbloc, en-bloc, en bloc, collective sales, singapore

"It is ugly. And it brings out the worst in Singaporeans"

An excellent article appeared in the Sunday Times today by frequent enbloc reporter Jessica Cheam. I'm going to reproduce the entire article in this post, simply because it hits lots of relevant points, and it is really a well-written piece. Feel free to comment as usual (and as usual, I do not censor comments except for spam.)

Just an interesting observation - Are Singaporeans (note - not expats who own properties) the main (or even only) culprits in the enbloc saga? From my own experience, it looks like the owner-resident expats are often the ones who would fight enblocs, and are often quite vocal about their stand against enbloc sales.

The Sunday Times (Singapore)
June 1, 2008 Sunday
En bloc sales bring out the worst in Singaporeans
Jessica Cheam

After a most spectacular year for the en bloc market last year, sales activity has finally frizzled out and for most parties involved, it is a welcome time-out. While property agents may lament the slowdown, one group of home-owners can heave a sigh of relief, as the threat of being forced to sell their homes retreats into oblivion.

Well, for most, anyway.

The recent debacle at the annual general meetings of two of the most iconic condominiums on the East Coast - Bayshore Park and Mandarin Gardens - proves that while the market has gone dead, en bloc woes have not, and will not, go away.

Some points of contention that arose at the meetings were the use of proxy votes to influence decisions, and conflicts of interest arising over the roles of management councils and sales committees.

In the course of my job, I have covered my fair share of en bloc deals, and as a non-partisan observer of proceedings, I have come to one conclusion about the 'uniquely Singapore' phenomenon that is the en bloc.

It is ugly. And it brings out the worst in Singaporeans.

Recent developments have also highlighted weaknesses in the law regarding collective sales and a private property owner's rights. This is despite the tightening of en bloc rules that kicked in last October, which ensure, among other things, that sales committees are properly elected, and collective sales agreements witnessed by lawyers.

This has no doubt cooled the en bloc fever which gripped the nation last year, with a total of 116 collective sales generating record investment sales of $13.64billion.

But some glaring flaws in the en bloc process remain. They include the distribution of sale proceeds, the role of the management council versus the sales committee, and the use of proxy votes at annual and extraordinary meetings.

Let me elaborate.

Firstly, owners should be compensated according to their flat attributes - height, cost of renovation, view.

I have found that pro-en bloc types usually own low-floor units, with average furnishings and view. Anti-en bloc types, by contrast, typically own beautifully renovated top-floor units with stunning views - it is no wonder that these owners want more compensation or refuse to sell, according to how much they have invested in their homes.

Current laws favour the average owner, who receives a pay-out equal to that of his top-floor neighbour, which is obviously unfair and has been the root of many conflicts and arguments.

The Strata Titles Board (STB) has also previously ruled that renovations, along with interest, are not a 'deductible expense', which means your renovations count for nothing in a collective sale.

To create a level playing field, provision should be made so that owners get fair value for their homes, perhaps by a government-appointed independent valuer.

Secondly, the management council and sales committee should be kept separate by law, since the role of the former is to maintain the upkeep of the estate, while the other's role is to sell it.

Current laws allow a sales committee member to be on the management council as well, but this has caused unhappiness at many estates - not just at Bayshore and Mandarin - where suspicion breeds among residents towards those who carry both positions.

On the issue of proxy votes, it is theoretically democratic. But it also allows decisions to be skewed one way, because residents who want certain things changed will attend meetings and get proxies from similar-minded neighbours to achieve the results they desire.

Meetings currently require only 30per cent of the total share value held by residents of an estate to attend, which enables decisions to be made without majority consent.

This should be looked at. One solution could be to raise the minimum requirement of residents present to 80per cent, or instead to do away with proxy votes altogether so that voting cannot be manipulated - perhaps via an online or e-mail voting system.

My advice in the meantime?

Don't buy into a strata-titled property if you do not want to be forced to sell your home. Current laws do not ensure you will be able to live in your condominium unit until your dying days - even though, in my opinion, you should be able to.

Most countries in the world allow this basic right, why can't we?

Perhaps the lawmakers could take some of these issues into consideration when compiling the next set of refinements.

Beyond the economic value of urban rejuvenation or boosting shareholder value for property developers, the en bloc phenomenon has ripped apart the moral fibres and harmony of our society.

Is this a cost our society is willing to pay?

On the one hand, I can sympathise with those who want to sell: they may be approaching retirement, or perhaps have plans to move away, and want to get the best price.

But there are people who have spent hundreds of thousands of dollars beautifying their homes to be their retirement nests, plus those who value the environment they live in beyond any amount of realisable value.

Do the former have the right to determine if the latter lose their homes? Owners still have a choice to sell their homes on the open market.

In terms of 'specuvestors' who swoop in to snap up units in the hope of making a quick collective sale buck, their motivation is even more inexcusable. It is okay to want to make money, but do it without hurting someone else.

It's not just Singaporeans who become embroiled in controversial sales, but also foreigners and permanent residents.

I just hope that my estate never has to go through this nightmare. It is sure to do permanent damage to relationships which have taken years to build up, but which take only a sale notice to destroy.

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Tags: jessica cheam, sunday times, collective sale, property, enbloc sale, enbloc, en-bloc sale, en-bloc, en bloc, condo, singapore, collective sales

The Dump After Completion (Image Heavy Warning)

(Note: This post contains numerous images and may take some time to load. Please be patient.)

What happens after completion, when the owners get their money and have vacated the premises?
What happens when you don't have a management council anymore?
What happens when nobody gives a damn what happens to an enbloc'd estate?

A reader sent these photos in, of an estate that has gone enbloc. He stayed till the Date of Vacant Possession when he had to hand over the estate to the developers. In the period between completion and possession, owners have very little regard for the estate, and have begun to dump their things anywhere convenient, when they were clearing out. Not only that, the reader said that there's only a skeleton cleaning crew who is struggling to clean up the corridors, as well as the vacated units, in addition to their daily chores.

At the time when the photos were taken, the estate's still about 1/4 occupied but it looked like a wasteland. Literally.

Above: Notice of 80% achieved.

Above: Carpark lights increasingly left unreplaced.

Above: Corridor lights also left unreplaced. Oddly, the block with the SC chairman is very well maintained.

Sofa and abandoned junk left in stairwells. Complete disregard of fire safety hazards.

Above: Abandoned fishtanks. Potential mosquito breeding ground.

Above: More abandoned fishtanks, this time in the main entrance which still has plenty of thoroughfare.

Above: Abandoned in corridor.

Above: Sideways sofa left in stairwell.

Above: Basement of stairwell has become a dumping ground. There was a significant increase in mosquitoes and flies in the weeks preceding Possession.

Above: Unpainted exterior. "Out" is appropriate here.

Above: Reader's own recently renovated apartment, which is due to be torn down. A complete contrast to the rundown exterior and common spaces.

Above: Reader said he will miss his home sorely. "It isn't right, when our wonderful home gets torn down barely 4 years after its renovation."

I have to agree with the reader here. These pictures put a stark face to the after effects of an enbloc sale, as well as the complete hypocrisy of tearing down what looks like a perfectly cosy home. Sorry, dear Reader, for your loss.

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One Committee to Rule Them All: Management Committees and Sales Committees

Back in Jan 2007, I blogged about the potential conflict of interest when a member of the Management Committee (MC) is simultaneously a member of the Sales Committee (SC) in an estate (you can read that here). I wrote (and I repeat): "The mandate of the MC is to maintain or update/upgrade the development whereas the mandate of the SC is to sell off the development in whatever condition it is in, as quickly as possible".

Over the last few days, two condominiums over at the East Coast have fully realised the consequences of this conflict of interest, when their MC contains pro-sale members, or SC members. You can read about the troubles brewing at Mandarin Gardens and Bayshore Park here , here and here.

These conflicts of interest are not illegal. In fact, the LT(S)A's Third Schedule only requires that a member of the SC discloses his/her indirect or direct interests in "any property developer, property consultant, marketing agent or legal firm, being an interest that could conflict with the proper performance of his functions as a member of the collective sale committee" (Third Schedule LT(S)A, Sect 2). So from the side of the SC, so long as the member is not involved with any of the stakeholders in the sale, it's alright. On the side of the MC, the BMSMA states that so long as the member of the MC does not have any "pecuniary interest, direct or indirect, in any contract, proposed contract or other matter which is before any meeting", it is alright as well. Nowhere in the law does it require that the member of the MC must declare and remove him or herself should s/he have any direct or indirect interest in a collective sale process. The consequences are felt at at least 2 estates now, and I'm sure countless others unreported in the media. The government needs to realise this is happening and do something.

How many of you undergoing enbloc sales have a member of the SC that is also in the MC? I've already stated in my Jan 2007 blog why this works so well in lubricating the sale process, so it's almost natural for the pro-sale group to have a member in both SC and MC. I have one in my own ex-estate - the Chairperson of the MC is the Chairperson of the SC. I can only hope that any estate involved in an enbloc sale, do their best to ensure that a member of the SC cannot be a member of the MC, and require that he/she withdraw him/herself from the MC once they are elected into the SC.

I've started a poll on this matter. Feel free to pitch in.

Previous poll results are (rank ordered):

Why are you a stayer?
My home is more than just about money: 18 (52%)
My right to a home should be sacrosanct: 17 (50%)
I love my neighbourhood: 16 (47%)
My home is a part of my identity: 9 (26%)
I'm not offered enough money: 7 (20%)
Pragmatic reasons (School, Church etc): 7 (20%)
I'm too old to move: 0 (0%)
Total voted: 34

It would appear that the top 3 reasons for people choosing to fight against an enbloc of their homes, is that they believe that their home extends beyond its value as a financial asset, that they should have the right to keep their homes, and because of the neighbourhood they live in. These are three really important reasons that unfortunately the government has chosen not to factor at all into their policy making process. A pity. Because these are the three most important reasons that establishes one's identity and affiliation to home and nation. Any wonder why some of the comments on my previous post suggests strongly that I should emigrate elsewhere, where there's less likelihood of my home undergoing enbloc?

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Tags: Mandarin Gardens, Bayshore Park, sales committee, sale committee, collective sale committee, management council, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore

Three Perspectives on Land Acquisition

Read three rather interesting articles from three different sources - Business Times, The New Paper (really), and a Blog.

First, A/P Mak Yuen Teen from NUS Business School wrote a letter to the BT Editor, in response to a BT article on Saturday (here) about a possible MinLaw review of the enbloc amendments. The letter really deserves to be read in its entirety (available here) but let me extract some really great points from A/P Mak:

However, I would like to urge the government to go further than that. I hope that we do not approach en bloc rules purely from the perspective of urban renewal or economic development. En bloc sales should also not be driven primarily by the commercial interests of property developers, consultants, agents and advisers, but rather by the interests of those who are personally affected by en bloc sales, be they majority or minority owners, and the wider interests of society.

As we move towards a more caring society and recognise people with more diverse talents than just academic and business success, we should also take into account the wider societal and environmental impact of en bloc sales.

Can we have the moral authority to play a leadership role on the world stage, which is increasingly concerned with wider societal and environmental issues, if we disregard them in our own backyard?

What are the wider societal and environmental costs of tearing down perfectly good buildings and dislocating communities compared to the economic benefits?

Let's hope the government has the foresight, and the courage, to take the higher road of considering, seriously taking into account, the "societal and environmental impact" of enbloc sales. These have been raised in Parliamentary Debates in 2007 and back in 1999, so it's a matter of whether the policy makers and law reviewers want to assume the "moral authority" or not.

The 2nd article is from the New Paper (available here), about a man who refused to sell his home, despite agents badgering him to. While it's about a landed property, his tenacity and refusal to sell his home should be an exemplar to all stayers, whether they live in condos, or landed homes. As he said, "I want to stay here until they have to move me out". How I wish that can be the case in condos!

Finally, a rather interesting enbloc blog "Enbloc Outlook 2008" appeared recently, very quickly populated over the last few days with enbloc news. From my quick reading of it, especially the blog post of 14 April (here), I'm assuming that the blogger is pro-enbloc, and lives in Tampines Court. He/she gave, what I must admit, a good argument for the sale of Tampines Court to be pushed through. Still, while I'd love to argue point by point, recent workload and events have limited me to posting his/her link here. Feel free to write on his/her blog.

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Tags: collective sales, en bloc, en-bloc, en-bloc sale, enbloc, collective sale, enbloc sale

A Downgrader's Nightmare

Received this email over the weekend from a reader. I can fully empathise with him, since I'm pretty much going through the same nightmare myself. For all those who have a home that they are thinking of enblocking, please read this cautionary tale.

Reader, I feel for you.

In a few more weeks, my family will be kicked out of our home.

Yes. KICKED OUT because of a successful en bloc which we did not agree to.

A home that was renovated not more than a few years ago, from top to bottom including brand new marbled floors, new fixtures, new furniture, everything from scratch. We thought, naively, that it was to be our home for the next few decades.

Barely after we moved in, a pro-tem SC proudly announced the en bloc. Our estate was not old at that time. It now looks run down because EVERY upkeep and updating of the estate was put on hold. This just before they started the en bloc attempt.

My family refused to be subjected to en bloc again. We thought fine, let’s get ourselves a new condo, so that we can have at least 10 years of peace before some IDIOT decides to champion an en bloc at our new home. Because of the property market boom, we had no choice but to buy a property, downgrading from a 1800 sqf perfectly renovated and absolutely spacious home on a quiet road, to a 1200 sqf home near a main road with all sorts of useless corners designed by architects who looked like they have never tried living in an apartment.

Then the nightmare started. Almost all our furniture could not fit the new place. They have to be replaced with smaller versions. We have a tight schedule within which to move home, install new fixtures in the new home, get furniture, get quotations for movers, cancel utilities, transfer utilities, change of addresses, all these amidst our hectic lives.

We will make no profit by the end of our move when we factor in what we’d spent for our old home, and what we need to spend for our new one.

We are frustrated, upset, that this is happening to us. People who say “just move elsewhere” do not realize that it isn’t that convenient, practical nor even realistic to do so. SACRIFICES always have to be made when we move homes, and EVEN BIGGER SACRIFICES when we move from a cherished home.

People who are thinking of signing the Collective Sale Agreement, of that profit and windfall – think carefully, especially after you’ve factored in all the other costs. If you’re not losing your home, then that’s not a problem. But if you have to move, how often are you prepared to do so, and what’s the cost to you, your family, your finances, when you do so?

Those residents who eagerly signed for the en bloc in our estate, and who have to move now, are regretting it. We say to them, TOO LITTLE TOO LATE. They could have kept their homes and not have the hassle and trauma of moving, but they were BLINDED by what they thought was going to be profits.

Are we angry? Yes! For losing our home which we love and built, literally from the bare cement. For policy makers who do not CARE about the consequences of en blocs to people’s lives. For individuals who do not care about people who have valid reasons to STAY in a place they love. For a society that continues to NAIVELY think that en blocs are great.

IT ISN'T. IT NEVER WILL BE. NOT FOR US.

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Tags: downgrader, downgrading, downgrade, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore, real estate

1996AD (Not exactly 10,000BC) - Origins of Enbloc Nightmare?

I've just had an interesting discussion about the recent Channel 5 TV series called "En-bloc". Putting aside the sensationalism of what is really a traumatic experience for many people, and the rather stereotyped portrayals of 'anti-enbloccers' in negative ways, it made me wonder how did our existing enbloc laws (allowing for majority consent) really start.

I dug around the ST archive as far back as I could.. Pre 1997 Amendments that changed the enbloc law to allow for an 80%/90% majority consent. Back then, property consultants involved in enbloc sales pointed out that the larger the estate, the lower the chance of a successful enbloc simply because it's plain harder to get that unanimous 100% consent.

I found, in May 1996, several ST Forum letters including a 1000+ worded letter (1000 words!) that sounded about the right time to get the government to rethink enbloc policy (about a year to the 1997 Parliamentary debate). The 1995-1996 period was also the time when SERS or Selective En Bloc Redevelopment Scheme was implemented, which saw HDB flat prices escalate phenomenally. I'd argue that the SERS got the public consciousness to link enbloc = profits.

But why limit the windfall only to HDB SERS? Why not private condos? It's true that at that time, enblocs are possible, just incredibly difficult due to the 100% consent.

So back in May 1996, Mr John Christopher de Souza and Mr Ronny Sim suggested in their ST Forum letters a revision of the enbloc law of 100% consent. Mr Sim, for example, calls it an 'exit strategy' for condo owners - a revision of consent to 75%. These were followed by an ST commentary by Tan Sai Siong, putting into public discourse the term "the tyranny of the minority". Arguing that buildings that are over 30 years old will fall apart because it's the end of their life cycle, Ms Tan again brought up the profitability of SERS for HDB estates, and suggested 75% or 90% as suitable thresholds.

You can read the full texts (which I won't reproduce due to length) here on scribd.

These were followed by 2 letters by Martin Goh and Laena Tambyah, very prescient of all the troubles we face now regarding enbloc sales. I'll reproduce them since they're short :) (You can read them in the scribd link as well.) I wonder if we ever meet the writers of these letters now, almost 12 years later, what would they say?

(As a note - 1996 was about the time when the government imposed a major curb on property speculation, especially for enbloc sales - the taxes on capital gains. Reports suggested that the taxes did not deter people from investing in enbloc potential estates, with a record number of enbloc sales in 1996 - despite unanimous consent required.)


The Straits Times (Singapore)
May 13, 1996
Forum; Pg. 28
En-bloc sales: Owners should not be forced to sell property

I REFER to Mr Ronny Sim's letter "En-bloc sales: Exit strategy needed" (ST, May 7). While I agree with him that there is a need for old estates to be upgraded via redevelopment, I find the idea of a Bill to deny the minority their right to object to a redevelopment proposal absurd.

Most en-bloc sales promise incredible profits. Under normal circumstances, any person would be enticed to offer his property for a collective sale. But there are some who may have reasons to object to such a sale. One example could be that of a property inherited from a loved one. It may have great sentimental value for which no amount of money can compensate. Imposing a "majority wins" rule defies all fundamental rights in property ownership. It may also give rise to abuse by unscrupulous individuals or groups for selfish gains.

I sympathise with Mr Sim's frustrations, but I cannot agree with his suggestion for legislation. I find it fascinating that a Member of Parliament supported his suggestion to force an individual to sell his property against his will, just because the majority thinks it is a better option.

MARTIN GOH

The Straits Times (Singapore)
June 8, 1996
Forum; Pg. 36
Spare a thought for the elderly who may not need fancy condos
THE COST OF THE SINGAPORE DREAM

THE letter "Don't pursue dreams at the expense of others" (ST June 3) is timely.

One aspect of materialism at the expense of others that is not mentioned is the singlemindedness with which some Singaporeans are pursuing the possibility of making a killing through en bloc sales of condominiums.

I have heard, on more than one occasion, comments such as "There's one old woman holding out" and "If only that old couple would be more reasonable".

The elderly folk who are holding out and appear to be unreasonable have probably spent all their CPF and other savings on purchasing these particular apartments.

In all likelihood, valuing their independence, they bought their homes for proximity to family and accessibility to shopping and transport. In their twilight years, they are expected to uproot themselves and move to unfamiliar surroundings.

There are no retirement villages or similar facilities in Singapore where the independent elderly can retire in comfort and dignity.

Where are they going to move to? Will banks consider them credible clients for loans to purchase new property?

The elderly may not want or need the new fancy condos. If the younger folk yearn for luxury amenities, perhaps they should take a lesson in thrift and patience from their elders, and in due course they will be able to afford (with a clear conscience) those tempting dream condos instead of hoping to make a fast buck at the expense and inconvenience of our senior citizens.

LEAENA TAMBYAH

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Tags: history of en bloc sales, history, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore, real estate, collective sale

Banning Enblocs on Newer Buildings

It is rare to see a reader-submitted letter on enblocs in the Sunday Times, so it's interesting to see Mr John Lee Junshi's letter in the Inbox where he advocated that newer buildings should be banned from enblocs. At least until their 20th birthday. You can read that entire letter reproduced here.

His words:-
"The proposed amendments could have done better by prohibiting the collective sale of buildings that are less than 20 years old, and making the collective sale of buildings progressively easier for buildings 20 years and older.

For example, by requiring 80 per cent share value approval for buildings that are at least 20 years old but less than 30 years old; 75 per cent approval for buildings at least 30 years old but less than 40 years old and so on.

This formula will ensure that there is a balance between environmental concerns and urban renewal."

I actually submitted something along the same lines to MinLaw during the public consultation - a staggered method of calculating consent level based on the age of the buildings, rather than the simple 10 year mark as is currently implemented, and which is kept for the new amendments. Guess my suggestion got fed to the shredder :)

But I added additional clauses to the model. You see, while the idea of a staggered consent level is one way to go, it does not take into consideration the possibility that older buildings may not necessarily be more blighted, or decrepit, or rundown. I'm always heartened when I see 30+ year old condos that are well kept, very well maintained, upgraded consistently over the years with new lifts, improved security, renovated common hallways/gardens etc. When an effort is made on the part of owners who wish to keep their estate in pristine condition regardless of age, they should not be penalised by the possibility of the wrecking ball. So I suggested that if an estate has undergone substantial renovation/upgrading, they could apply for a 'stay order' against enblocs. In other words, it would be as if time has reset itself.

This point is important - owners should be given the possibility to take ownership of their own estate in two ways - not just in collectively selling (current mode) but collectively deciding to upgrade/renovate their estate (not in current mode or Mr Lee's letter). Should the latter happen, they should be rewarded with at least 10 years of enjoying their newly done up estate. A building inspector can certify such a renovation as being one that is substantial to formalise the stay order.

If estates in global cities like New York, London, Paris can be kept in pristine condition despite them being over 50-100 years old, why not in Singapore?

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Tags: collective sale, collective sales, en bloc, condo, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore

Bayshore Park Goes on TV Monday 17 Sep 8.30pm

The new season of "Get Rea!" with Cheryl Fox begins with a documentary on the situation over at Bayshore Park. The opposition for enbloc sales, the Love Bayshore Park group (link here), has mobilised themselves even before the EOGM to elect the sales committee has begun. You can read the article on CNA here and reproduced here. The Get Real programme will be shown on Monday 17 September 07 8.30pm-9.00pm Singapore Time, CNA channel.

The blurb is below:-
"Episode 1: The en bloc fever's spreading in Singapore. For those chasing the property boom, it's the best time to cash in but it's a different story for those who want to stay. And the battle to sell or stay put, could get ugly. Your home could be your Singapore Dream or your Singapore Nightmare."

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Tags: Love Bayshore Park, Bayshore Park, Get Real, CNA, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore

Architects - The Invisible Victims of En-bloc Sales

Friday's Straits Times carried a lengthy article on Singapore's veteran architects whose babies were subjected to the wrecking ball recently, courtesy of enbloc sales. Architects like Victor Chew, Timothy Seow, and William Lim, designed some of the earliest post-independence buildings and condominiums. These landmarks - Beverly Mai, Futura etc - are the true icons of Singapore's modern architecture. Yet in gaining huge windfalls, they are losing, as William Lim said "collective memories". Willaim Lim - "The Red House Bakery in Katong, the National Theatre - these may not be fantastic examples of architecture but they said something to the people"; "But there is no respect for the memories of the invisible public."

Victor Chew's question is poignant - what does a building mean to people? Is it just an investment waiting for the enbloc profit? Is it memories and histories for people who lived there? Is it just a place to stay, in true pragmatic Singaporean style?

Dr Timothy Seow's suggestion is likewise significant - he pointed out that many of the condos he designed were "well-designed buildings which if given a chance to be upgraded, would still be able to take on a new look that is relevant to the times".

Will the government continue to let the market-driven model of urban redevelopment systematically demolish the collective memories and architectural heritage of Singapore's modern era? Or will the government step in and put into place, like what Dr Seow suggested, upgrade schemes for condos which are worth conserving?

It's not impossible, it's a question of will. And if the government's actions in the past were any indication, when there's a will there's a way, as they say.

This article couldn't be more timely. I grew up on the west side of Singapore, and used to imagine Westpeak Condo (currently being torn down) as a giant Transformer (with its noticeable 'head'). Now I will never be able to drive past it and remember my childhood memories.

You can read the article reproduced in condosingapore here.

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Tags: William Lim, Timothy Seow, Victor Chew, Singapore architects, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore, collective sale

Poll! Would you enbloc your home?

Just realised that blogger has a polling system. So the question is simple - Would you enbloc your home? For those of you who've never voted before (walkovers and all that)... Just check one button and click "Vote"! You can only choose one of the choices but with 9 possibilities, I'd have thought one of them should cover your answer :)

Go vote!!

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Tags: enbloc poll, en-bloc poll, en bloc poll, collective sale poll, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, collective sale, singapore

Something Completely Different

And now for something completely different :) :)

My texts can be dry and overly serious sometimes. So it's nice to see someone who is much more capable of expressing his thoughts about enbloc sales than I could ever be.

Sei-ji rakugaki (wonder what that means) is one of those rare political cartoonists (at least that's how I'd label him :) ). He drew one on enblocs :) He's done lots of cartoons for other issues too (here) :)


Love the cigar :)

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Tags: en-bloc cartoon, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, property, singapore

Is Singapore Your Oyster - Proximity and Amenities

Most agents, pro-sale owners and even Mr Mah Bow Tan, would point out that should the sale proceeds be insufficient to afford you a similar location home, you can always move further afield where properties might be cheaper.

A Voices letter in Today Online raises an important issue - what intangibles do you lose when you move "further afield"? The letter by Mr Francis Hong (reprinted in CondoSingapore here) is about 500 patients who petitioned to HDB to retain their family GP when they are forced to relocated for a SERS (Selective En Bloc Redevelopment Scheme) on their estate. Mr Fong points out that the need to be close to certain amenities is not one of luxury but "one of necessity".

What amenities do you lose when you are forced to move away from a community that you are familiar with? How do you calculate the loss of such intangibles, when factoring in what you'll get from the proceeds, and what you'll lose from your home?

Some examples:

For children: Parents often relocate to within a certain boundary around a school of their choice, so that there's a higher chance of their kids going to that school. They have to, without any choice, continue to stay in the same area for their childrens' future.
For parents: Any parent with more than 1 child knows that if they have to send their kids to school, they want (a) their kids to be in the same school/kindergarten ideally (b) a school/route that is convenient for them, enroute to work ideally. Moving home will disrupt this, often requiring that they wake up earlier just to get the kids to school on time.
For elderly: Psychologists have pointed out that as you get older, you want to have familiarity around you. Grandparents hate it when kids come into their homes and really mess things up. Likewise, when old people venture out, they need familiar routes, places, landmarks. Moving home is disruptive, and often traumatic.
For families: Loss of clinics that they have been with for decades, loss of friends and neighbours, people who'd keep an eye out for their homes when they're away on holiday.
For working adults: Unless you move to a home nearer to your place of work, chances are you'll have to device new routes to work. Further afield may well mean longer travelling time, more traffic to encounter, and waking up earlier/coming home later.

These are very real factors that will affect you if you move home, whether by choice or not. These are very real reasons to think about before you decide to enbloc your home or not. I know of people who have spent the past 6 months trying to find a new home for themselves, visiting flat after flat to no avail. Perhaps in 3-4 years' time, one might find a glut of new units flooding the market, but there's no guarantee that prices will not escalate beyond your reach (a very real possibility).

Do you cherish the conveniences and necessities that you have taken for granted, things people and places that will disappear at the stroke of an STB approval?

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Tags: collective sale, collective sales, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore

Post-Enbloc Sale aka Free-For-All

A forum letter in the ST today highlights the fact that while our enbloc legislation is very precise in the execution and protocols surround the SALE of the estate, it is extremely woolly about the CONSEQUENCES of the sale, ie what happens after the owners get their hands on the profits.

What happens? Well, after legal completion (the point when most owners get their sale proceeds), the land belongs to the developer. The managing council will be dissolved, there won't be a managing agent, your estate is in the control of the developer. Even though there are people staying there (including children and elderly), the developer (subject to the conditions stated in the SPA) often has the right to invade your estate and put up signboards, erect show flats (yes, in plural), conduct preconstruction testing and drilling. Your security will have a hard time keeping up with who comes in and when. In fact, as my post all the way back in Jan 2007 showed, expats have complained of developers not even maintaining the quality of the estate's service and maintenance (even though owners and tenants staying there after completion are still required to pay maintenance fees) and worse, creating all sorts of health and safety hazards on your land.

But who cares? Pro-sale owners have their money and are gone from the place. The only people left - tenants (some of whom are not even aware the estate's being demolished) and residents desperately looking for alternative homes, hoping for a bullish market to show any sign of slowing down.

What can you do? Nothing much, since any SPA is decided by the sale committee and the developer (with their lawyers), and if the developer wants to come in, will any SC say no? The only hope you have - do not sign the CSA until you get a rock solid written promise from the SC not to allow developers into your own, especially if you are planning to stay there. I'll update if I have more information on what legal recourse tenants and residents have against developers creating health, noise and safety hazards in your estate.

As a colleague wrote to me, "if civilians are required by law to wear safety gear when they enter a construction site, what happens when the construction site enters your home?"

Straits Times Printed Forum
Aug 13, 2007
En bloc sale: Work starts even before all move out
Chio Tan Seng

AMID all the stories on collective property sales readers of The Straits Times have come across, mine in Balmoral View has a twist.

The developer has moved in equipment to build a showflat even though seven units of this 22-unit condo are still occupied.

It means we cannot use the visitors' carpark and the recreation areas, apart from having to tolerate the dirty swimming pool, noise and dust. In the meantime, we are still billed for monthly maintenance.

Yes, our condo was an early bird in the 'en bloc wave', and prices paid to unit owners were low compared to the current level. We accepted the deal, and the last unit must be vacated by November.

But what right has the developer to rush in before everyone moves out?

Some to-ing and fro-ing with Building and Construction Authority officials revealed that, although the deal was completed in May, the developer had already applied for and got the necessary approvals from the Urban Redevelopment Authority (URA) to build a showflat in February last year.
Did the URA check with the Strata Titles Board on the legality of such a move, given that there are residents who do not need to move out until November?

By mid-June, heavy construction equipment was moved in and the construction of the showflat is now in earnest. The recreation area has been cordoned off.

Also, I see obvious safety concerns with children playing in the compound, especially with wooden scaffolding less than a couple of metres from the swimming pool.

I understand the developer's haste to catch the hot property market but this is at the expense of residents still living on the estate.

Can the authorities enlighten us on this unsatisfactory situation?

Tags: completion date, construction work, collective sale, collective sales, condo, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, singapore

Myth #9: Understanding the Law and Knowing Your Rights

Nominated MP Siew Kum Hong wrote an op-ed piece to Weekend on 11 August 2007, which highlights his very thoughtful views of enbloc sales in general, and the Horizon Towers situation in particular. I will not reproduce his entire piece, but you can find it on CondoSingapore's Forum here. Note - Mr Siew has his own blog and has posted additional comments on his piece here.

I do want to comment on some of his points, specifically his argument that "just like any other commercial transaction, there are very real commercial and legal risks in collective sales":-

"With so much at stake, inexperienced sellers could and should have engaged lawyers to advise them personally. It is the sellers' own responsibility to ensure they understand all their liabilities and comply with all legal obligations.They also could and should have negotiated for terms they are comfortable with."

"If a seller is uncomfortable with the collective sale agreement (CSA) which binds the sellers collectively, he or she could always not sign it. If the concern is over the SPA with the purchaser, then a seller can seek to impose greater controls and oversight over the actions of the sale committee before signing the CSA. It is difficult to sympathise with a seller who sees only the promised dollar signs and signs without fully understanding its implications."

What Mr Siew said above is the correct interpretation of the law, and of common sense, truth be told. Everyone should read carefully the terms and conditions of anything they sign (be it credit card application, signing up an account on a website, installing a software). But the reality is very different of course (how many read the Microsoft terms and agreements before clicking on the "I agree" checkbox?). But putting aside human laziness to read such text, there's another set of very real problems that works in favour of the sale committee, the marketing agent, lawyers and developers, ie the enbloc sale:-

1. Anyone with a non-law degree, much less a non-law PhD, will struggle with the CSA and the Sale and Purchase Agreement (SPA). In densely packed multiple subordinate and embedded clauses, these contracts can induce migraines simply by attempting to understand it. If people can barely understand it, how can owners who (a) can't understand English, (b) can't understand legal English, (c) do not have the resources to get a lawyer to read it, realise what rights they have or do not have? If the law requires that the advertisement and announcement of the sale be in 4 languages, why can't the law require that the CSA be in 4 languages as well as plain English?
2. Most people assume that the sale committee (SC) are selfless people, who represent their interests and rights, and hence will not question in detail the intricate clauses in the CSA/SPA, which is almost always drafted by the SC and lawyers without input from the owners. Most estates have no say whatsoever in the nomination, election, voting and ratification of the SC. How much harder, then, for input into the drafting of a legal document like the CSA or SPA?
3. The approach advocated by most agents, including the professional enbloc firms, is that a SC should not be consultative in the drafting of the CSA; they see this as only taking up more time and a waste of time. So they advocate that the CSA be prepared and at the first Owners' Meeting, have it ready for signing. "Take it or leave it" without any choice in revisions. At what point can an owner negotiate for terms? They simply can't and can only do so by not signing the CSA. But if 80% are ignorant enough to do so, then what good does your refusal do?
4. The best method to ensure a CSA or SPA is truly representative of all owners, including minority owners, and to impose greater control and oversight on the SC is to require that owners who have reservations on the sale/CSA to be a member of the SC as well - a form of check and balance or an alternative voice that gives critical feedback to the over-riding pro-sale mentality. However, every CSA I have seen thus far has a clause requiring that each SC member must sign the CSA within a time frame (typically 7 to 30 days). This immediately excludes any form of "control" or "oversight" when owners who have reservations about the sale cannot offer his/her services to the community, except perhaps as a minority voice posting on a blog.
5. The problem is input by owners into any drafting of the CSA, much less SPA (which is mainly handled by the SC and lawyer in conjunction with the developer), is near impossible. The law does not require it, nor does it form a legal objection in any way when STB hears of it.
   

Mr Siew has his heart in the right place, and has talked about the legal aspect of any contract that one must be cognizant of. Unfortunately, the reality on the ground which many enbloc estates are facing, is that people who wish to negotiate, feedback, discuss about the CSA or SPA, are not given the opportunity to do so. It is a myth that one can know and negotiate one's rights in an enbloc sale. Transparency, accountability, and due process, go against the nature of a quick sale, after all.

And even more unfortunately, only the law can change this.

Tags: Siew Kum Hong, collective sale, collective sales, en bloc, en-bloc, en-bloc sale, enbloc, enbloc sale, real estate, singapore