Saturday, 22 September 2007

The End of Enblocing Singapore?

Parliament has passed the amendment bill. According to the draft legislation (Attachment B):-
"To provide that the amendments to the Land Titles (Strata) Act will not apply to a development where the collective sale agreement has been signed by the required majority owners before the date when the amendments were passed by Parliament."

Likewise in the Consultation Paper (Attachment A):-
"26. The LT(S)A will be amended to give effect to the confirmed changes. The confirmed changes will apply to all projects except those that have already obtained the majority of 80% / 90% (based on share value) at the time the proposed amendments are passed by Parliament."

I take these both to mean that the new rules on enbloc processes just kicked in yesterday. Someone let me know if this isn't the case. You can also read Prof Jayakumar's Second Reading of the amendment bill here; there's information of some of the changes made to the amendment bill based on subsequent feedback (but not the criticisms by the various MPs).

So what now? Is the blog done? Unlikely. What I call the 'baby months' of a new law will comprise of various parties using everything they can to push the boundaries of how the new amendments will affect their estate's sale. Pro-sales will do their best to cut corners if possible, anti-sales will do their best to ensure corners are not cut, and adhered to. While the process will take longer, it will ultimately allow many points of access for those who wish to keep their homes (and conversely many points of attack for those who want to sell).

Here's the prediction for the near future:-
  1. Enblocs won't stop. Sales committees will have to be more sociable and actually do the ground work of meeting people, gathering support. Likewise, those against the sale will have to mobilise themselves and gather support. Questions about suitability of potential SC candidates will become frequent. The outcome will be largely positive because in many ways, if everyone turns up with their questions and grill the candidates, only those who are well-supported will emerge as more representative than pre-amendment time.
  2. Marketing agents will bump up their commission fees, citing more work that they have to do to get the process moving along. Typical rates of 0.3% will probably go up to 0.4-0.5% for baseline RP, and 1.5-2% for above RP. The more established agents will be monopolistic and very quickly, you'll see standardised rates across the bigger firms. Owners will be in a conundrum - hire a big firm and pay the premium; hire a smaller firm and suffer a potential Horizon Towers. While decisions will rest with the various owners/protem-SCs, what must be clearly outlined now are the duties and responsibilities for the agents, in accordance with the new amendments. Eg some agents are saying you don't need 4 EOGMs but can compress them into less. Will this mess up the application? Maybe not, but maybe it might too. The beginning stages of a new law is always a painful time when both parties (pro- and anti-) strive to find ways to counter one another. Better be safe than sorry though.
  3. Likewise for law firms and their fees. Again, the bigger ones will standardise quickly and the owners need to make clear what are the duties and responsibilities for the law firms. Through the law firm, the owners should also engage the SC directly to clearly outline their duties and responsibilities. Horizon Towers is an example of how things can still go wrong post-amendment since some aspects of the problems reside in the CSA and the responsibilities of the SC.
  4. For those who love their homes, what can you do? Document everything, take note of when announcements for EOGMs are made, when they are held, whether a notice of who are eligible to vote is placed up, who voted, how was the voting done etc. Everything counts now. Attempts will be made by pro-sales people to interpret the new law in their favour and it'll be up to anti-sales people to ensure this does not happen. It means you need to mobilise yourselves into a group if possible. Look at the Love Bayshore Park and Dairy Farm groups, both fairly successful in raising the profile of their intention to keep their homes. Get together, read up on the new law, read both the Land Titles (Strata) Act and the Building Maintenance and Strata Management Act. Push the envelope yourselves - can you submit a motion before an EOGM to require all potential SC candidates to present a CV of their relevant experiences? Can you submit motions that require voting of a particular resolution to be done? Can you query the CSA during the EOGM? Can you demand an account or justification why particular agents/law firms were selected? Can you vote on these matters (or put in a motion to vote)? Bear in mind an EOGM doesn't mean that the pro-sales people hold the reins; any SP can submit a motion according to the BMSMA as shown below.
  5. Use the forums eg condosingapore (but do create an account!) or create your own blogs, document for others to see what you have succeeded (or not succeeded) in doing. Many estates are now more emboldened by the knowledge that there are other estates that have like-minded owners who wish to do something about protecting their homes against mindless destruction. Information shared is always a good thing.
The baby months will be a time of testing and contesting the boundaries, as both pro- and anti-sales try to find their feet under the new regulations. The pro- have the advantage of big estate agencies and law firms to help them (since these firms will undoubtedly share their knowledge and intelligence about other estates among themselves and their clients). Anti-sales have only the internet, and their strong determination to fight back.

Good luck.

Building Maintenance and Strata Management Act First Schedule Requisition for motions to be included on agenda for general meeting
12. —(1) Any subsidiary proprietor may, by notice in writing, served on the secretary of the council of the management corporation or (as the case may be) subsidiary management corporation, require inclusion in the agenda of the next general meeting of the management corporation or (as the case may be) subsidiary management corporation of a motion set out in the first-mentioned notice and the secretary shall comply with the notice.
(2) The secretary of the council shall give effect to every requirement in every notice under sub-paragraph (1).
(3) Sub-paragraph (1) shall not require the inclusion of a motion on the agenda of a general meeting for which notices have already been given in accordance with this Schedule, but in that case, the secretary of the council shall include the motion in the agenda of the next general meeting after that.


Anonymous said...

Good insight to the amendment Dr. Minority.

1) My main contention is most SC members are working like a sort of gestapo group. In my condo , none of the SC members have revealed their contact email or at least telephone contact for owners to reach them or to discuss any doubt as to the attempted sale.

They claimed to have met over 9 times but no minutes of the meetings were circulated to owners.
If they were acting on behalf of owners in the negotiation of sale surely keeping all owners informed is paramount.

2) The amendment did not address the problem as to how many times should SCs be allowed to continue to sprout more potential deals when an attempted sale falls through.
There is nothing more irritating and stressful than knowing that we could be in the same battle constantly when a condo reaches its 10th year.

IF a potential sale fails to reach 80% or 90% consensus for whatever reason (and especially when it has to do with pricing) should the anti-enbloccers be allowed to stand their ground, get a sort of injunction order to bar the outgoing SC or any new ones from attempting yet another enbloc sale proposal for a reasonable period of time?

This would at least allow for normal life to resume , in particular those owners who have long term tenants in their units or ageing owners.

Anonymous said...

we understand!!!!!!!

Anonymous said...

enbloc one way or another is about homes and money. sharing puplic information are for 'MUSHROOMS KEPT IN THE DARK AND FED ON ......'

Anonymous said...

Thanks, Dr Minority, for all your effort, help and information. It has been greatly appreciated.

Anonymous said...

in point 2 you mention 4 eogm. is that the number required?

Anonymous said...

You are indeed a genius! Thank you for your wisdom and efforts.

Anonymous said...

We've reached something like 76% so with the new laws does that mean the SC's start from scratch? Can't say I sympathise with them as they have not made themselves available for any queries.

Dr Minority said...

>>We've reached something like 76% so with the new laws does that mean the SC's start from scratch? Can't say I sympathise with them as they have not made themselves available for any queries.<<

I'm awaiting confirmation that the new law has indeed commenced, but assuming it has, then if your estate has not reached 80%, they would be subject to the new law. Unless they have conducted themselves in accordance with the new Schedules in the LT(S)A, it is very likely they'll have to redo everything from scratch.

Anonymous said...

Based on the amendments passed down by Parliament on 20th Sep on the number of time for EOGM, the critical factor is who is authorised to arrange for such meeting and the number of attendees? As for TVC, the usual number of attendee from the estate is usually half of the population which the other half will not get to know about the outcome like Rebellrouser claim that their SC had over 9 times of meeting but any minutes or circular which will hurt the other rest of the community. Therefore, my suggestion is that in future for any enbloc, the EOGM will need to be documented by appointed Secretary of the meeting or the Management Agent to be present and it is their duty to answer to all SPs of the estate for any progress. If the MA fail to put the notice or cirular on the estate noticeboard then the SP will have the right not to folk out that quarterly maintenance for that particular quarter. In this way, I believe that all SPs can have a peace of mind to take of their family while MA/EM must be accountable for the activities such as maintain the structure of the building and other matters relating to the estate especailly for Enbloc Collective Sales when they are being paid Quarterly by SPs.