Almost a year of wrangling and millions of dollars in legal fees later, the controversial en bloc sale of Horizon Towers was eventually approved yesterday by the Strata Titles Board (STB).
Still, the board’s verdict by no means spells the end of the long-running saga - minority owners who oppose the sale could still appeal. That would put the sale on hold, and could mean another round of protracted legal disputes.
The STB’s much-awaited decision on Horizon Towers was delivered before a packed room in the board’s Maxwell Road headquarters. Tribunal chairman Philip Chan read out the prepared statement solemnly, before four teams of lawyers and some 70 owners, curious onlookers and the media.
Acknowledging that this collective sale ‘lasted longer than most other en bloc (sales)’ that have come before the STB, Mr Chan said that his tribunal eventually decided to grant the application for the collective sale of Horizon Towers, after considering the various merits of the case.
He said that the board had been ‘particularly guided’ by the recent decision reached in the Phoenix Court en bloc sale and the parliamentary debates on recent amendments to the legislation governing en bloc sales.
In the Phoenix Court case, Justice Andrew Ang threw out the sole minority owner’s objection to the collective sale of the freehold apartment block at St Thomas Walk. Justice Ang determined that it was important to look at the purposive nature of the law governing collective sales, which requires that 80 per cent of owners have to agree to the sale before it can go through. As the requisite majority was obtained in the Phoenix Court case, Justice Ang ruled that the transaction was not prejudicial to the minority - as the law had intended.
A similar stance was adopted by Senior Minister of State for Law, Associate Professor Ho Peng Kee, and Deputy Prime Minister and Law Minister S Jayakumar in the recent parliamentary debates on amendments to the Land Titles (Strata) Bill.
Prof Ho had said requiring 100 per cent consent among owners for an en bloc sale was untenable, as it would cause delays in any sale, acrimony and incur costs. He said that amendments to the law would provide adequate safeguards to protect minority interests and that the existing 80 per cent or 90 per cent majority required - depending on the age of the development - was satisfactory. DPM Jayakumar agreed that amendments to the Bill would provide more safeguards and transparency for all owners.
Tribunal chairman Mr Chan also said yesterday that the minority owners who opposed the sale had failed to prove their case that the transaction had been carried out in bad faith. The minorities had alleged, among other things, that the sales committee and its sales agent had not worked hard enough to get the best price possible for the development.
The tribunal will issue detailed grounds for its decision at a later date. It ruled yesterday that no order would be made for costs, meaning that the minority would not have to bear any portion of the costs of the proceedings.
The gallery’s reaction to the tribunal’s decision was muted - surprising for a case that has caused much emotional upheaval for its owners. Owners received the verdict quietly and shuffled out of the room.
The minority owners, who feel they will lose their homes with this sale, were accepting of the verdict. ‘The decision was not unexpected. We have done and will do what is principally correct,’ said Jasmine Tan, who declined to comment at this point on whether she would appeal against the STB’s decision.
And, expectedly, the majority owners - the over-80 per cent who agreed to the collective sale - were relieved with the STB’s decision. They face the threat of being sued for up to $1 billion by the buyers, Hotel Properties (HPL) and its partners, if the deal falls through.
Said a group of some 80 majority owners: ‘We are happy with the decision and very pleased that the en bloc is going through. We look forward to the buyers confirming that they will proceed with the deal and withdrawing the legal suits they have started against some owners.’
HPL and its partners, for their part, have expressed their happiness with STB’s decision - but have held back on any decision on the lawsuit, pending the actual completion of the sale.
‘We are pleased that the STB has allowed the collective sale and rejected the objectors’ case, including their allegations of bad faith,’ said HPL executive director Christopher Lim.
The buyers’ lawyer, Senior Counsel K Shanmugam of Allen & Gledhill, added: ‘Our client entered into the transaction in good faith and paid what was then a record price for the property. The application should therefore have proceeded smoothly, but the market changed. As a result, the case went through a number of critical junctures. We are, however, happy that the end result is that the tribunal has ruled that the sale should now go ahead.’
Source : Business Times - 8 Dec 2007