Lecture 4 Searches - Investigation Of Title

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Students are requested to print out copies of Forms B & D used by the Housing Developers for sale of residential properties and bring them for the Conveyancing (4) & (5) Lecture. Students can get it from the Housing Developers Rules through LawNet.)

Objectives Describe what a title search is Extract relevant information from a title search Explain why a title search is important Explain the significance of a solicitor’s undertaking for title deeds Explain how legal requisitions relate to title When: - Action happens at beginning when contract being negotiated – instructions – series of corresp bet vendor’s sol and purchaser’s sol – agreement on terms of sale Searches – some at beginning and some along the way after contract concluded - You should make a title search when you are instructed to act BUT … you must

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• Get client’s consent first, especially if deal is not closed yet. – tell client why search needs to be done • Because if deal not closed deal may be aborted and client may turn around and bite you. • Explain the importance of search and let client instruct you to make the search.

Why? Money – if deal not closed yet and one aprty decides to walk away fr deal, clients wnt to pay as little as possible, will not pay for the search. So must get consent first/ Avoids resentment at having to pay abortive costs and search fees if deal falls through.

Purpose of title searches - • Confirms client is buying from proper owner/correct person  Name of Owner or Registered Proprietor - • Confirms particulars of property such as tenure & area – ensure that restrictive covenants don’t affect client’s plans to develop land etc  description of property: • name and duration • area • grant or lease no. • type of property o (e.g. freehold, leasehold) and LAND area (whether final or provisional; In the case of common law land check if there is a modern survey) o For strata unit shows floor area o Note that for landed property built up area is reflected as a warranty on contract and not on the title deed. Age of Building Permitted use of Property - whether it is zone residential or commercial or otherwise  Is property in qn restricted residential property?  If so, is V non-Sg citizen/foreign company/foreign society? If so was approval/clearance given? - If Sg company/Sg society, was clearance letter obtained from Controller? - • Alerts client as to encumbrances  (e.g. mortgage, CPF charges, MC charges, charging orders lodged by way of caveats (if any), writs of execution, orders of court appointing receivers with power of sale) An exploration into the implications of these encumbrances is necessary to ensure that good title can be given to the purchaser.  In most cases, the encumbrances will be discharged on completion. In the case of mortgagee sales, subsequent encumbrances are defeated on sale by mortgagee (Section 73 LTA)

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• Alerts solicitor as to possible problems with title or need to get approvals from authorities  find practical solution to problem, usually don’t use long complicated legal solutions.

Transfers made in exercise of power of sale 73. —(1) The Registrar shall register in the manner prescribed by section 37 any transfer in the approved form by a mortgagee or chargee made in exercise of a power of sale, without being concerned to inquire whether default has occurred, or whether notice has been given, or whether the power was otherwise properly or regularly exercised. (2) Upon registration of such a transfer, the interest of the mortgagor or chargor as described therein shall pass to and vest in the transferee freed and discharged from all liability on account of — (a) that mortgage or charge; (b) any mortgage or charge registered subsequent thereto; (c) any lease registered subsequent to the mortgage or charge mentioned in paragraph (a) and which is not binding on the transferor; and (d) any interest which is registered or notified subsequent to the mortgage or charge mentioned in paragraph (a) (including any interest claimed under a caveat) and which is not binding on the transferor. Restrictive covenants Especially relevant if P intends to buy property for particular purpose e.g. to develop highrise block of flats and restrictive covenant specifies that only detached house may be built on land. If such restrictive covenants are present and are against P’s wishes, must try to discharge them. If rights of easement over land exist, developer may have to plan development in such manner so as to preserve rights of occupiers of dominant tenement(s). Would-be P should check to ensure that Planning Department would allow such a development on the land other examples that that the conveyancer has to take note of - if the property is the subject of a trust, require 2 trustees to give a valid receipt for the proceeds of sale – Section 18 Trustees Act However for an exception see Wee Poh Neo’s case (1936) MLJ 266.

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Facts: The powers under which an executor sells for the purpose of paying debts & c, do not constitute "an immediate binding trust for sale" within the meaning of the Trustees Ordinance. If a sale is effected to produce funds to pay funeral or testamentary expenses or the debts of the deceased, then a single executor may give a valid receipt. If the proceeds of sale are to be employed as capital moneys impressed with the objects of the trust then they must be paid to no less than two trustees and no receipt given by only one trustee will be a good discharge to a purchaser. If a single executor purports in selling to be acting as such and to be selling for the purpose of paying the testator`s debts or his funeral expenses, the purchaser is not put further on enquiry and is safe if he has no notice that the vendor`s representations are untrue, at any rate during a period of six years after the testator`s death. Re Tambi bin Osman, [1929] SSLR 186 considered and followed. Held: This is a vendor and purchaser`s summons taken out under the provisions of s 4 of the Conveyancing and Law of Property Ordinance. The declarations asked for in the summons are "that the requisition and objection in respect of the ability of the said Wee Poh Neo to give a valid receipt for the proceeds of sale of the land and premises comprised in the abovementioned contract of sale have been sufficiently answered by the applicant the vendor" and "that a good title to the said land and premises has been shown in accordance with the particulars and conditions of sale contained in the abovementioned contract." An executor has always been regarded by the Courts of Equity as holding the property of the deceased in a fiduciary capacity and as being in effect a trustee. The primary duty of the executor is to realise so much of the assets of the deceased as will pay the debts and funeral and testamentary expenses of that deceased. Thereafter he holds the property in trust for the beneficiaries under the will. ….Now the first observation I have to make on these provisions, read together, is that the expressions "sole trustee" and "sole personal representative" should not in my view ordinarily be used as meaning or including one trustee surviving out of several or one executor who alone, out of two or more nominated by the testator, has proved the will. "Sole trustee" and "sole personal representative" should ordinarily be taken to indicate only a

person in respect of whom the settlor or testator has expressed the wish that he shall alone carry out the trust imposed upon the property in question. I think, however, that the use of the word "sole" in the Ordinance must, in order to give effect to the intention of the legislature, be construed as including a surviving trustee who has power to act or one of several executors who alone has proved. What then is the effect of the section? I think it is that no single trustee (including in that term an executor who alone has proved) can receive monies which arise under a trust for sale and which then constitute capital monies for the purposes of the trust. If the sale is effected in order to produce funds with which to pay funeral or testamentary expenses or the debts of the deceased then a single executor may give a valid receipt. If the proceeds of the sale are themselves to be employed as capital money impressed with the objects of the trust then those monies must not be paid to less than two trustees and no receipt given by only one trustee will be a good discharge to the purchaser. …. Although at first sight it might appear that the ordinary duties of executors are included in the trust itself I think the true view is that the word "trustees" is merely descriptive and includes "executors," that the executors are to carry out first their duties as executors, and that it is only afterwards that the residue of the testator`s property is to be applied for the purposes of the trust. In any case the sale of any part of the testator`s property in order to pay funeral and testamentary expenses and debts would not produce "capital money" under the trust and could be properly considered as the exercise of the duties of executors rather than of trustees under the trust. What then is the position of the purchaser? He calls for a probate copy of the will to ascertain its provisions in respect of the property to be sold. He ascertains that probate has been registered in respect of the property in the Registry of Deeds but this tells him very little. The purchaser is not put further on enquiry. The Ordinance exonerates the purchaser from seeing to the application of the purchase money, and as Warrington LJ said in Re Kemnal and Still`s Contract , [1923] 1 Ch at p 310:- "It is well settled that no purchaser is liable to have his title called in question unless he has actual notice of the impropriety of the transaction." [268] If, therefore, a single executor purports, in selling to be acting as such and to be selling for the purpose of paying the testator`s debts or his funeral and testamentary expenses, the purchaser is safe if he has no notice that the vendor`s representations are untrue. The result may be largely to vitiate the object the legislature. An executor remains an executor indefinitely, even though he be also nominated under the will to be a trustee of trusts created by that will. A dishonest person who is both executor and trustee under the will, by falsely alleging to an innocent purchaser that he is selling qua executor, may therefore be enabled, at any rate during a period of six years after the testator`s death, to sell all the trust property and to pocket the proceeds unimpeded by any necessity of abetment by a second trustee. That, however, is the law as I understand it. In the present case I was informed that the purchaser was satisfied that the sale was in fact being made in order to provide for the payment of funeral and testamentary expenses and debts. I therefore make the declarations and the order as to costs prayed for by the vendor.

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it is not sufficient to look at the RODA register and check that the names were correct; you should have to look into the documents themselves Sometimes, the option may include a clause pertaining to title a title search may be essential for you to decide what clauses you want to incorporate in the option For uncompleted units, is project licensed/unlicensed? - Your attention is drawn to Philip Hoalim’s Case (1977) 1 MLJ 88 (PC) Piece of land granted by state to A subject to term that land would be surrendered should require land for public purpose Land sold from A to B 18 years later B sold it to C some 90 years later from time government land grant given Conveyance from A to B would constitute good root of title since no intervening dealing with land - Issue: Whether C had to investigate into original land grant since AB conveyance had endorsed government land grant? Held:

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Not bound by covenant in original land grant though he had constructive notice because AB conveyance had identified land completely and perfectly ‘in a manner upon which no survey plan could improve’

Facts: This was an appeal from the decision of the Court of Appeal of Singapore ( [1975] 1 MLJ 231). The respondent in this case owned an island off the coast of Singapore. The Collector of Land Revenue gave notice of compulsory acquisition of the island for public purposes. The original Crown or state grant of the island to one Angus in 1860 contained a provision enabling the State , if it should be required for public purposes, to reacquire the island, paying therefor the latest purchase price plus any money that had been expended on the land by the owner. The Collector of Land Revenue did not proceed under that provision but he set in motion the ordinary processes of compulsory acquisition for public purposes. But in ascertaining what a notional purchaser in the market would pay for the island it was relevant to consider whether the 1860 reacquisition provision was still enforceable at the date of the publication of the notice of compulsory acquisition. The Appeals Board constituted under the Land Acquisition Act stated a case for consideration by the Court of Appeal setting out a number of questions of law upon which guidance was sought. On appeal to the Privy Council, three questions remained outstanding for the determination by the Privy Council: (1) whether the Registration of Deeds Ordinance 1886, which required registration of conveyances of land in default of which the document was (in broad terms) not to be recognized by law, applied to all original state grants of land as distinct from subsequent assurances by subjects; (2) whether the Court of Appeal was right in holding that the provision for reacquisition in the 1860 grant amounted not only to a covenant by Angus but also to a condition of the grant; (3) whether, if the provision for reacquisition was of the nature of a covenant only conferring upon the State an equitable interest in the land, the respondent had constructive notice thereof when he bought the land in 1951. Holdings: Held, allowing the appeal and cross-appeal: (1).The Registration of Deeds Ordinance 1886 did not apply to a grant by the Crown (State ) of land in Singapore. Non-registration will therefore not avail the respondent, who could only succeed in avoiding a depressant effect on the market value of the land of the provision in the 1860 grant if (a) he was correct in saying that the provision operated by way of covenant and not also by way of condition and (b) he purchased the land in 1951 without notice actual or constructive of the provision. (2).The language of the 1860 grant was not such as to impose a condition. The provision therefore was a covenant creating an equitable interest in the land and not also a condition. (3).The respondent did not have constructive notice of the provision in the original Crown grant.

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Possible application of Administration of Muslim Law Act o If you see a Muslim name, it is not simple because if the property is the subject of a charitable trust, then all sales after that are VOID. Your attention is drawn to the following cases: o Abdul Rahman b Mohd Yunoos & Anor v MUIS [1995] 2 SLR 705. o The testator Hussain made his last will in India on 3 October 1918 and he died there on 13 October 1918. Probate was granted on 5 May 1919 to one of the two executors of the will and issued by the Supreme Court of the Straits Settlements of Singapore on 23 July 1919. Double probate was granted to the other executor on 2 February 1920 and issued on 12 April 1920. Clause 15 of Hussain’s will stated that rents from his three properties were bequeathed for certain religious and charitable purposes, namely, for the upkeep of a mosque in India. When the appellants were appointed trustees of Hussain’s estate on 17 September 1993, two of the properties ceased to be part of the estate and only the undivided half share in No 34 Arab Street (‘the property’) remained. The half share of the rent of the property was insufficient to carry out Hussain’s wishes. The appellants applied to sell the half-share in the property to construct a new mosque and to fulfil Hussain’s wishes. This was approved by the Commissioner of Charities. The respondent, MUIS opposed the sale of the half-share in the property arguing that the trusts created by cl 15 were Muslim charitable trusts or wakafs and being for the promotion of the Muslim religion or for the benefit of Muslims, the property automatically vested in MUIS under ss 58(2) and 59 of the Administration of Muslim Law Act (Cap 3) (‘the Act’). The trial judge held that the income from the half share of the property constituted a wakaf and as such, the property and income derived therefrom automatically vested in MUIS. The appellants appealed. o Held, dismissing the appeal: o (1) Hussain’s will was to be construed in accordance with Muslim law and not the common law, by virtue of s 63 of the Act. This section was not limited to instruments or declarations executed or made after the commencement of the Act.

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(2) Applying s 63 to cl 15 of Hussain’s will, it was clear that the rents from the half share of the property constituted wakafs. As the property and the income derived therefrom was in Singapore, it did not matter where the wakafs were to be performed as it was the utilization of the income which came under the jurisdiction of the Act. o (3) On the interpretation of ss 58 and 59 of the Act, Hussain’s half share in the property vested automatically in MUIS. As such, the appellants had no legal title or right to deal with the half share in the property other than to carry out the wakafs as directed under cl 15 of the will. o (4) The trial judge was right to hold that s 4 of the Settled Estates Act (Cap 293) and s 59 of the Trustees Act (Cap 337) were inapplicable in this case. LS Investment Pte Ltd v MUIS [1998] 3 SLR 754. o Facts: By her will of 21 November 1911 the testatrix, Sharifah Shaikah bte Syed Omar bin Ali Aljunied (Sharifah) directed that the balance one third of her estate be applied to purchase a house or shop and apply the income to hold celebrations for her father and her own memorials, supply ten vessels of zamzam water, furnish a mat for Koran reciters and engage someone to perform haj and al-omrah pilgrimage on her behalf. The will further directed that $300 of the net income of her trust property in Singapore be added to the net income of the property purchased for the balance of the one third mentioned in the will if the latter income was insufficient to carry out her directions. The balance was to be applied for charity and benevolence in general. o Sharifah died on 11 September 1912 and her executors bought two lots of leasehold land on trust for the purposes specified in the will. One of these two properties became the single real asset of the trust as the other was compulsorily acquired by the government. On 4 June 1992 the defendants MUIS, a body corporate constituted by the Administration of Muslim Law Act (Cap 3) (AMLA) to administer all Muslim charitable trusts, wrote to Syed Hamid Junid (Hamid) and his brother, who were the trustees of the property. MUIS wanted a copy of the will to ascertain if the property was a wakaf property (ie one which belonged to a Muslim charitable trust). o On 9 July 1993 the trustees executed an agreement with the plaintiffs LSI to sell them the property free from encumbrances with vacant possession for $800,000. The application to sanction the sale was heard on 11 October 1993 and the trustees obtained an order in terms of the application. The sale and purchase of the property was completed on 29 November 1993 when the trustees executed an indenture of assignment to the plaintiffs assigning them the property free and discharged of all trusts and provisions of the will of the testatrix. The indenture was registered on 1 December 1993. o MUIS came to know of the sale of the property, and lodged a caveat on 2 December 1993 claiming that they were lawful owners of the property under s 59 AMLA. Section 59 AMLA provided for the vesting in MUIS of all properties forming part of a Muslim charitable trust. The plaintiffs learnt of the caveat in February 1995 and filed this action to expunge MUIS’s caveat, and to injunct MUIS from lodging any further caveats and for damages. MUIS argued that they were lawful owners and that LSI had no title to the property as they purchased it from trustees who had no valid title. MUIS counterclaimed for an order that the property vested in them and that all entries in the Register of Deeds and other record books relating to the indenture of assignment and any other intruments purporting to assign LSI’s purported interest in the property be expunged. o The three main issues before the court were: (a) whether prior to the assignment between LSI and the trustees, legal title vested in the trustees or MUIS; (b) whether the sale to LSI sanctioned by the order of court meant that MUIS’ claim had been transferred to the proceeds of the sale of the property and the apartment the trustees had bought with it, and could no longer be maintained against the property; and (c) whether LSI could rely on the doctrine of bona fide purchaser for value without notice. o The High Court dismissed LSI’s application and allowed MUIS’s counterclaim and held that the court was satisfied that Sharifah’s will created a wakaf and that the doctrine of bona fide purchaser for value did not apply in this case as the doctrine only aided those who did not have notice of the competing interest. LSI appealed, arguing that no valid wakaf was constituted and that in any case, the doctrine of estoppel applied. o Held, allowing the appeal in part: o (1) The property constituted a valid wakaf under s 58(2) of AMLA. The purposes for which Sharifah had directed the income of the property to be utilised were either charitable or religious, although private. Thus, the wakaf created by was good in law. For a wakaf to be valid, there had o

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to be a tying down of the capital or corpus itself. In this case, as there was no termination of the dedication of the income, the logical and necessary inference had to be that Sharifah intended to consecrate and dedicate the capital in perpetuity as well even though there was no express statement that the property was dedicated to constitute the wakaf. (2) A wakaf was not valid if it depended on a contingency which may or may not occur. On the facts, there were no true contingencies as upon Sharifah’s death, what assets were hers and what debts were hers were objective matters which could have been ascertained. They did not depend on events which had yet to happen. (3) The property dedicated belonged to Sharifah, and the wakaf was created in respect of the balance of the one-third of her estate and the property was acquired by the trustees with that sum pursuant to her explicit wishes in her will. (4) The authority given to the trustee of a wakaf under s 58(4) of AMLA to manage the wakaf was expressly subject to the provisions of AMLA. Under s 58(2), the Majlis was to administer all wakafs and there was a clear distinction between ‘administer’ and ‘manage’ in AMLA. The net effect of ss 59, 62(2), 62(4) and 63(2) of AMLA was that legal title to wakaf properties vested in MUIS. Therefore, it was not within the province of the trustees, as managers, to apply to court to approve the sale under s 59 of the Trustees Act as they did not hold the legal title to the property. They were no longer trustees in the English law sense. Therefore, while the trustees in this case had obtained a court order under s 59 of the Trustees Act sanctioning the sale, it did not confer title upon the party where that party did not possess title to the property in the first place. (5) For the doctrine of estoppel to arise, it was essential to show the element of acquiescence on the part of the party against whom the estoppel was claimed. One could not acquiesce to something not known. MUIS clearly did not know of the proposed sale by the trustees to LSI and of the application to obtain the sanction of the court for the sale. The evidence showed that MUIS had been pursuing the trustees for a copy of Sharifah’s will without success. There was no dealing whatsoever between LSI and MUIS. LSI’s claim based on proprietary estoppel, estoppel by representation and estoppel per rem judicatum failed. (6) Section 66 of AMLA did not help the appellant in this case as it clearly did not rely on any list gazetted under this section before the transaction. Hence, the omission of this wakaf in any list published by MUIS was wholly irrelevant. (7) After MUIS knew of the sale of the property to LSI, it did not inform LSI about its interest in the property. LSI, in ignorance of MUIS’s claim proceeded to redevelop the property. As MUIS stood idly by and let LSI carry on with the works, an estoppel arose in favour of LSI. Thus, the estoppel here gave rise to an equity in favour of LSI in so far as the redevelopment works were concerned. This would be satisfied if LSI was reimbursed in full for all expenditures actually incurred by them on account of the redevelopment works. The order of the court below. (8) With regard to LSI’s submission that there should be an order for retrial as the case should have proceeded as if begun by writ as questions of fact were involved and there should be cross-examination of witnesses, the court held that there was no cause for a retrial under s 39 of the Supreme Court of Judicature Act (Cap 322) as it was clear at all times that the parties were prepared to let the matter be decided on the basis of the affidavit evidence.

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Is property acquired by way of gift? (Possibility of triggering Section 8 Estate Duty Act and Sections 98 and 99 Bankruptcy Act)

Section 8 Estate Duty Act Property not deemed to pass 8. —(1) Property passing on the death of the deceased shall not be deemed to include property held by the deceased as trustee for another person, under a disposition not made by the deceased or under a disposition made by the deceased more than 5 years before his death where possession and enjoyment of the property was bona fide assumed by the beneficiary immediately upon the creation of the trust and thenceforward retained to the entire exclusion of the deceased or of any benefit to him by contract or otherwise. (2) In the case of a disposition made for public or charitable purposes, the words “5 years” in subsection (1) shall be read as “12 months”. (3) In the case of settled property, where the interest of any person under the settlement fails or determines by reason of his death before it becomes an interest in possession, and subsequent limitations under the settlement continue to subsist, the property shall not be deemed to pass on his death.

(4) Where by a disposition of any property an interest is conferred on any person other than the disponer for the life of that person or determinable on his death, and that person enters into possession of the interest and thenceforward retains possession thereof to the entire exclusion of the disponer or of any benefit to him by contract or otherwise, and the only benefit which the disponer retains in the property is subject to such life or determinable interest, and no other interest is created by that disposition, then, on the death of that person the property shall not be deemed to pass by reason only of its reverter to the disponer in his lifetime. (5) Where, by a disposition of any property, the interest mentioned in subsection (4) is conferred on 2 or more persons, either severally or jointly, or in succession, that subsection shall apply in like manner as where the interest is conferred on one person. (6) Subsections (4) and (5) shall not apply where such person or persons taking such life or determinable interest had at any time prior to the disposition been himself or themselves competent to dispose of such property. Sections 98 and 99 Bankruptcy Act Transactions at an undervalue 98. —(1) Subject to this section and sections 100 and 102, where an individual is adjudged bankrupt and he has at the relevant time (as defined in section 100) entered into a transaction with any person at an undervalue, the Official Assignee may apply to the court for an order under this section. (2) The court shall, on such an application, make such order as it thinks fit for restoring the position to what it would have been if that individual had not entered into that transaction. (3) For the purposes of this section and sections 100 and 102, an individual enters into a transaction with a person at an undervalue if — (a) he makes a gift to that person or he otherwise enters into a transaction with that person on terms that provide for him to receive no consideration; (b) he enters into a transaction with that person in consideration of marriage; or (c) he enters into a transaction with that person for a consideration the value of which, in money or money’s worth, is significantly less than the value, in money or money’s worth, of the consideration provided by the individual. Unfair preferences 99. —(1) Subject to this section and sections 100 and 102, where an individual is adjudged bankrupt and he has, at the relevant time (as defined in section 100), given an unfair preference to any person, the Official Assignee may apply to the court for an order under this section. (2) The court shall, on such an application, make such order as it thinks fit for restoring the position to what it would have been if that individual had not given that unfair preference. (3) For the purposes of this section and sections 100 and 102, an individual gives an unfair preference to a person if — (a) that person is one of the individual’s creditors or a surety or guarantor for any of his debts or other liabilities; and (b) the individual does anything or suffers anything to be done which (in either case) has the effect of putting that person into a position which, in the event of the individual’s bankruptcy, will be better than the position he would have been in if that thing had not been done. (4) The court shall not make an order under this section in respect of an unfair preference given to any person unless the individual who gave the preference was influenced in deciding to give it by a desire to produce in relation to that person the effect mentioned in subsection (3) (b). (5) An individual who has given an unfair preference to a person who, at the time the unfair preference was given, was an associate of his (otherwise than by reason only of being his employee) shall be presumed, unless the contrary is shown, to have been influenced in deciding to give it by such a desire as is mentioned in subsection (4). (6) The fact that something has been done in pursuance of the order of a court does not, without more, prevent the doing or suffering of that thing from constituting the giving of an unfair preference. What is a title search? - • Obviously a search on the title to property – ownership etc - • Where and how to make it? o • SLA – online or at Land Registry – STARS search – Singapore title automated registration system o go into sla website – see what searches are and how to make them. - • Search is by Lot & MK/TS nos or address of property - • Common law title – Index of Lands - • Torrens/LTA – Certificate of Title, SSCT or Substituted Cert of title – most land in sg converted to torrens system. Very few pieces of unregistered land.

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Period of limitation for title to be deduced CLPA s. 3(3) & 3(4) Lessee or assign not to call for title to freehold. 3. —(3) Recitals, statements and descriptions of facts, matters and parties contained in deeds, instruments, Acts or statutory declarations 12 years old at the date of the contract shall, unless and except so far as they are proved to be inaccurate, be taken to be sufficient evidence of the truth of those facts, matters and descriptions. 27/93. Period of limitation for title to be deduced. (4) A purchaser of land shall not be entitled to require a title to be deduced for a period of more than 15 years or for a period extending further back than a grant or lease by the Crown or the State, whichever period is the shorter.

Process of Making a Title Search 1. P’s solicitors will get title deeds from V so that he can commence his own investigations on the title. But before he can get them from the V, he has to give a Solicitor’s Undertaking The title deeds are sent on the usual undertaking “to return the same to us on demand without any claim or lien thereon whatsoever” Practice Directions & Rulings 1989 p. 99-100 (Items 4 and 5) o This very serious undertaking is usually affixed by way of a rubber stamp on the schedule of deeds accompanying the title deeds.  Never put this only in a schedule – danger if title deeds lost  Also put on cover letter as well as Schedule How serious is breach? o Very serious – Rule 51 of the Legal Profession (Professional Conduct) Rules states that an advocate and solicitor shall honour the terms of a professional undertaking given to another advocate and solicitor, a court of law, tribunal, client or any other person. (see page 145 to 148 of the Professional Responsibility manual on “undertakings”). o Therefore possible grounds for professional misconduct.

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Solicitor’s Undertaking - • After contract is concluded, title deeds are sent to Purchaser’s solicitor to enable investigation of title o undertaking is serious matter – amounts to professional misconduct if breach it o satisfy return on dd by imposing on bank’s sol the same undertaking – dd them ot return to you whch you can then return to vendor’s solicitors. Make sure that you impose the same undertaking when you sent docs to someone else! - • What does this mean? - • How serious is breach? o Discip action by law society o Cover letter – enclosing title deeds; pls acknowledge receipt by signing on schedule. Where is the undertaking? Stimes other side may take letter but doesn’t return the schedule – so is he bound by undertaking? You never took it back. Impt that other side acknowledges on something which has the words of undertking on it! o Be careful 2. P will then begin title search online or at the Singapore Land Authority STARS: Singapore Titles Automated Registration System (the computerized registration and public search system of Singapore Land Registry) • Search is by Lot and Mukim/ Town Subdivision numbers or address of property • Searches of land register are definitive and if land registry makes errors state may pay damages • Note that Mukim and Town Subdivisions are mutually exclusive. If the property has a Mukim number it cannot have a Town Subdivision number and vice versa. • Mukims are older parts of town. Lot number is the exact plot of land you are talking about. Identifier in property is lot number and mukim number (cos they are fixed whereas addresses can change)

Town subdivisions – closer part of town

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Common law title - Index of Lands copies of Index of Lands shows transactions registered against property – often handwritten – only shows transactions registered against the property Is it enough to look at the Index? – no. if checking title, resp goes beyond face of index of land Must investigate back at least 15yrs see CLPA for this reqt to check for good root of title. Either get orig fr vendors or go and buy from the registry. (s.3(4) CLPA) o “A purchaser of land shall not be entitled to require a title to be deduced for a period of more than 15 years or for a period extending further back than a grant or lease by the Crown or the State, whichever period is the shorter.” o Freehold land via deed of transfer, leasehold land via assignment o Good title may not be perfect title but must be marketable title o V’s solicitors under not general duty of disclosure but usually bound to answer Requisitions if questions relate specifically to title and property unless contract provides otherwise  If question do not relate to title, then the V’s solicitors should be helpful and informative wherever possible

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V no duty to disclose any defects.. only bound to disclose any latent defect in title which are not apparent upon inspection; as for patent defects, the burden if cast on P’s solicitors to conduct his own investigations [Huang Chin Hwee v Heng Kay Pay] Duty only extends to defects in title, not quality • If non-disclosure relates to quality, there is no general duty to disclose and knowledge is generally not material in the absence of misrep/ warranty/ other circumstances • However, if the disclosure relates to title, the duty of V’s solicitor to disclose is irrespective of knowledge [Huang Chin Hwee v Heng Kay Pay]

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Read bundle of title deeds o Eg if 6 transactions, must have 6 title deeds! If any lost, was there proper stat declaration done by person with authority. And to ensure that property not charged to anyone.  Document which records disposal of interest in land (legal and equitable) for period of 15 years from date of current transaction for consideration can establish good root of title  Meaning of Good Root of Title – instrument of disposition which deals with/ proves the ownership of the whole legal and equitable estate in the ppty sold, contains description by which ppty can be identified and shows nothing to cast doubt on the title of the disposing party (Williams on Vendor and Purchaser) • in practical terms, it is a document that disposes both legal and equitable interest of the property for value & must be a good description of the property, then this document can be a good root of title • and then search for 15 years backwards from this document which provides a good root of title • e.g. “Deed of appointment of new trustee”… does not qualify for the GRT o Look out for some conveyance or even a re-conveyance would do [reconveyance would be something like when the buyer pays back everything to the bank, and reconveys both legal and equitable interest] Read doc to establish chain of title & whether deeds are complete – impt to get every single doc perfect every time transact. Make sure that A had power to cnvey and properly conveyed in that nothing was left out. If small interest was left out or not accurately described, then title might be defective. If allow transaction to go through, solicitor may be found negligent. o Not always conveyance fr a to b – seller may be a legal rep; prev owner died (testator/deceased) => need ot call for will to make sure that property conveyed according to terms of will. Did he have power to sell, or was it an assent? Must ensure that names are exactly correct

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Investigation of title does not only require you to make sure that 15 years ago, there was a conveyance etc… have to ensure that there was no break in the chain of conveyance There can never be any break, the parties must be the same  E.g. when you have A, B selling to C, then E selling to F… then there is a break in the chain  Example given by lecturer: cannot have a situation when you transfer the land back to C (deceased)… at common law, can only transfer to the estate of C… not C

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Recitals more than 12 yrs = facts This is 1 whole area of law  Recitals, statements and descriptions of facts, matters and parties contained in deeds, instruments, Acts or statutory declarations 12 years old at the date of the contract shall, unless and except so far as they are proved to be inaccurate, be taken to be sufficient evidence of the truth of those facts, matters and descriptions (s3(3) CLPA)  Where personal representative selling more than 6 years after death of owner, court order needed (s35(2) CLPA) (cannot transfer title to deceased, only to his estate) Where trustees selling under Trustees Act, would generally require the giving of valid receipt for proceeds of sale by 2 trustees (s18 Trustees Act)  For Muslims, under Administration of Muslims Act (AMLA), must be charitable trusts  Fact that authority can issue condemnation notice is not sufficient to constitute defect in title • mere fact that a state of affairs exists which might bring into operation provisions of law imposing burden/liability is insufficient to constitute a defect in title • before there is any question of defect of title, the intention on part of the authorities to invoke the provisions of law must have manifested [Huang Chin Hwee v Heng Kay Pay]  More detail on this area of law can be found in the book, “Emmet on Title”. Limitation period for liability? o 3 yrs for injury cases o 6 yrs for contractual liab o no limitation period for solicitor’s liab for defective title o Note that there is no limitation period for liability if you are negligent in your conveyancing work. o Under the RODA, registration does not validate an invalid conveyance or document [as per s14]

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 Torrens/ LTA – Certificate of Title (“CT”), Subsidiary Strata Certificate of Title (“SSCT”) (for flats) or SCT Torrens title – LTA Indefeasible Title: • An indefeasible Certificate of Title is “the mirror” of the title • A solicitor need not investigate the earlier common law title if the title is unqualified Qualified Title: a) A solicitor is required to investigate the common law title as the title is subject to the earlier common law title b) He should also make a search of the Torrens Title from the date of issue of the Certificate of Title c) A Qualified Title can become an indefeasible title by the lapsing or cancellation of the caution as to title - Indefeasible title – S46 LTA – but only if unqualified ie no caution on title deed - If qualified, must investigate common law title. Even if caution has lapsed. How long? (5 yrs) Look at caution endorsed on title deed At present, most titles are unqualified. Encourages complacency but still need to check! Risky. Always chance that partr property has problem. Investigation of title confined to examining CT, SSCT or SCT. What can a CT tell us? Let’s take a look at a sample – see tutorial sheet for sample – o note that for landed property area is only site area, must get surveyor to show full area. If flat, it will show floor area. o Insert in tutorial sample the manner of holding – joint tenants. Impt because in tutorial 2 will need to draft letters.

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o Restrictive covenants – if there under encumbrances, must notify client about it o Check bankruptcy act – void or voidable See, in corresp with the above: o Land tenure & title no. o Area – site for land & floor for flat o Manner of holding o Name of Registered Proprietor o IC no, citizenship & address o Instrument : Transfer – What does this tell us?  If silent, transfer for value.  Transfer by gift or assent – no consideration  Transfer for value, not gift or assent etc o • Memorial o • Caution – nil or “subject to any interest that may have affected the land as at the date of the last cancelled conveyance” (there are other versions of this clause)

Section 25 LTA Cautions and lapsing of cautions 25. —(1) Upon the creation of a qualified folio, the Registrar shall enter thereon a caution warning persons dealing with the registered proprietor therein named that the land comprised therein is held subject to any interest which affected it at the date of the creation of that folio, and so long as the caution remains on that folio that land shall be so held. (2) A caution recorded on any qualified folio (whether created under this Act or the repealed Land Titles Act (Cap. 157, 1985 Ed.)) shall lapse in one of the following ways: (a) if, after the creation of the qualified folio, a purchaser for valuable consideration and without fraud becomes registered as proprietor of an estate or interest in the land comprised in the folio, the caution shall lapse as regards the estate or interest on the expiration of 5 years after the date of the last deed which was cancelled by the Registrar on the creation of the folio; or (b) if, immediately before the expiration of 10 years after the creation of the qualified folio, the caution affecting the folio has not lapsed as regards all estates and interests in the land comprised in the folio or has not been cancelled, the caution shall lapse — (i) on the expiration of that period; or (ii) on the expiration of 24 months after 20th August 2001*, whichever is the later. *Date of commencement of section 8 of the Land Titles (Amendment) Act 2001 (Act 25 of 2001). (3) A mortgagee or chargee shall not be regarded as a purchaser for the purposes of subsection (2). (4) When a caution lapses under subsection (2), the lapsed caution shall constitute a defunct entry and the Registrar shall, of his own motion or after the lodgment of an application in the approved form made by the proprietor of the land, cause an entry to be made in respect of the lapsing of the caution. (5) Upon the lapsing of a caution under subsection (2), the folio shall cease to be qualified and the land comprised therein shall thenceforth be held subject only to such interests as are registered or notified on the folio and to such interests as are otherwise excepted by section 46. (6) Any person deprived of land by the operation of this section shall not by reason of that deprivation have any claim against the assurance fund.

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• Notice, Order of Court • Encumbrance – caveats (especially when in the process of selling), restrictive covenants, charges, mortgages  If got, call and buy a copy.

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Can make search of Torrens title from date of issue of CT, SSCT or SCT. Indefeasible title o Section 46 Land Titles Act o But only if unqualified If no caution as to title, unqualified title, no need for 15 years investigation of common law title. o because the basis of the Torrens system is that the register is a mirror Under the RODA, registration does not validate an invalid conveyance or document [as per s14]

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However, under the Torrens System/ LTA, registration does validate an invalid document [per s46LTA] If qualified with a caution, must investigate common law title. How long? 15 years. Must investigate CL title as title subject to earlier CL title Look at caution endorsed on title deed. “Subject to any interest which may have affected the land at the date of issue of the Certificate of the Title restrictions as follows …” Note that under s26(1) LTA: - When Registrar has entered caution on qualified folio pursuant to s25, proprietor of land comprised in that folio may apply to Registrar in approved form for cancellation of caution if he is able to deduce title for continuous period of not less than 12 years from date of his application and is able to satisfy Registrar that there are no outstanding interests which are not notified on that folio you have to see whether the caution has lapsed, if it has then can forget it, cos Qualified title can become indefeasible title by removal of caution (s46LTA) o “purchaser” is very restricted, excludes chargee or mortgagee or fractional purchaser o If purchase entire estate, caution deemed to lapse after 5 years (NA to fractional purchases)

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s25(2) LTA: In favour of any P of an entire estate/interest in any land registered, a caution entered lapses on expiration of 5 years from date of last conveyance which was cancelled by Registrar upon creation of qualified folio    • • At present most titles are unqualified. Must confirm that there is no break in link of title, parties must be same Check for encumbrances e.g. mortgages, caveats lodged, CPF charges, Management corporation charges, charging orders lodged by way of caveats, writs of execution, orders of court appointing Receivers with power of sale Most encumbrances will be discharged on completion For mortgage sales, subsequent encumbrances are defeated on sale by mortgagee s73(2) LTA: Upon registration of transfers made in exercise of power of sale, mortgagor’s/chargor’s interest shall pass and vest in transferee freed and discharged from all liability on account of(a) that mortgage/charge; (b) any subsequently registered mortgage/charge thereto; (c) any lease registered subsequent to mortgage/charge and which is not binding on transferor; and (d) any interest registered/notified subsequent to mortgage/charge (including interest claimed under a caveat) which is not binding on transferor

-->> What can an LBS search tell us?

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• LBS = Lot Base System • Sometimes shows up notice of acquisition of land • Shows how lots are derived from parent lots, traces amalgamation and subdivision – useful for developments – to check that developer is the owner of that whole plot of land o covenants affecting land – must check every single part o Tells us past history of the land e.g. shows how lots are derived from parent lots, traces amalgamation and subdivision, useful for developments. • Some banks ask for this • Can be costly, so how? – balancing. Fees cover both your legal fees and search fees! o Tell clients about it and ask them for permission Land registers is manual in HDB – STARS elodgement system is for e-caveats (does not require of Certificate of title). In contrast, for private property, you can perform an online search if you wish. Public search – impt – DIPS – admissible in court for purposes of evidence act Reporting to client after your title search Tell your client the following:

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1. the name of the registered proprietor 2. explain how the property was conveyed to the registered proprietor o if property transmitted upon death of previous owner explain to client that you need to perform more searches on the transmission of death. 3. let client know what is the size of the surveyed area, just in case the area was misrepresented to them. 4. tell client whether got any encumbrance, mtge or charge. 5. tell client if got any restrictive covenants (especially if he’s buying for a certain purpose(e.g. to build semidetached houses) 6. If there is a caution, inform client of it and give advise as to whether caution valid, or will it lapse upon completion so that he can hold absolute title.

4. Terms in title – conditions of contract
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It is not unusual that the terms in the contract provide that the title be “properly deduced”, “free from encumbrances” or “in order” a. Properly deduced – What does this mean? i. Oakden v Pike 34 LJ Ch. 622 - The purchaser is entitled to have every document forming a chain in his title abstracted in chief; the abstract of a mere recital of document is not sufficient; otherwise the vendor might simply abstract the conveyance to himself, setting out the recitals: Dart on Vendors and Purchasers, 6th ed. p. 341. ii. Note also CLPA Section 3(4) Period of limitation for title to be deduced. (4) A purchaser of land shall not be entitled to require a title to be deduced for a period of more than 15 years or for a period extending further back than a grant or lease by the Crown or the State, whichever period is the shorter. b. Free from encumbrances – In Jones v Barnett [1899] 1 Ch 611, the definition of an encumbrance as a “claim, lien or liability attached to property” was accepted. Is it necessary to state that the purchase be free from encumbrance in the light of CLPA s 7(1)? i. Section 7(1) CLPA c. Title in Order: A provision containing these words does not mean that the title must be in “perfect order”. It is sufficient that the title is “substantially in order” – Smith v Morrison [1974] 1 AER 957.

Covenant for title to be implied. 7. —(1) In a conveyance there shall, in the several cases in this section mentioned, be deemed to be included, and there shall in those several cases, by virtue of this Act, be implied, a covenant to the effect in this section stated, by the person or each person who conveys, as far as regards the subject-matter or share of subject-matter expressed to be conveyed by him, with the person, if one, to whom the conveyance is made, or with the persons jointly, if more than one, to whom the conveyance is made as joint tenants, or with each of the persons, if more than one, to whom the conveyance is made as tenants in common — On conveyance for value. Right to convey. Quiet enjoyment. Freedom from incumbrance. Further assurance. (a) in a conveyance for valuable consideration, other than a mortgage, the following covenant by every person who conveys and is not expressed to convey in a fiduciary capacity: that, notwithstanding anything by the person who so conveys, or anyone through whom he derives title, otherwise than by purchase for value, made, done, executed or omitted, or knowingly suffered, the person who so conveys, has, with the concurrence of every other person (if any) conveying by his direction, full power to convey the subject-matter expressed to be conveyed, subject as, if so expressed, and in the manner in which, it is expressed to be conveyed, and that, notwithstanding anything as aforesaid, that subject-matter shall remain to and be quietly entered upon, received and held, occupied, enjoyed and taken, by the person to whom the conveyance is expressed to be made, and any person deriving title under him, and the benefit thereof shall be received and taken accordingly, without any lawful interruption or disturbance by the person who so conveys or any person conveying by his direction, or rightfully claiming or to claim by, through, under or in trust for the person who so conveys, or any person conveying by his direction, or by, through or under anyone not being a person claiming in respect of an estate or interest subject to which the conveyance is expressly made, through whom the person who so conveys derives title, otherwise than by purchase for value; and that, freed and discharged from, or otherwise by the person who so conveys sufficiently indemnified against, all such estates, incumbrances, claims and demands other than those subject to which the conveyance is expressly made, as either before or after the date of the conveyance have been or shall be made, occasioned or suffered by that person or by any person conveying by his direction, or by any person rightfully claiming by, through, under or in trust for the person who so conveys, or by, through or under any person conveying by his direction, or by, through or under

anyone through whom the person who so conveys derives title, otherwise than by purchase for value; and further, that the person who so conveys, and any person conveying by his direction, and every other person having or rightfully claiming any estate or interest in the subject-matter of conveyance, other than an estate or interest subject to which the conveyance is expressly made, by, through, under or in trust for the person who so conveys, or by, through or under any person conveying by his direction, or by, through or under anyone through whom the person who so conveys derives title, otherwise than by purchase for value, will, from time to time and at all times after the date of the conveyance, on the request and at the cost of any person to whom the conveyance is expressed to be made, or of any person deriving title under him, execute and do all such lawful assurances and things for further or more perfectly assuring the subject-matter of the conveyance to the person to whom the conveyance is made, and to those deriving title under him, subject as, if so expressed, and in the manner in which the conveyance is expressed to be made, as by him or them or any of them shall be reasonably required: (in which covenant a purchase for value shall not be deemed to include a conveyance in consideration of marriage); On conveyance of leasehold for value. Validity of lease. (b) in a conveyance of leasehold property for valuable consideration, other than a mortgage, the following further covenant by every person who conveys and is not expressed to convey in a fiduciary capacity: that, notwithstanding anything by the person who so conveys, or anyone through whom he derives title otherwise than by purchase for value, made, done, executed or omitted, or knowingly suffered, the lease or grant creating the term or estate for which the land is conveyed is, at the time of conveyance, a good, valid and effectual lease or grant of the property conveyed, and is in full force, unforfeited, unsurrendered and in no way has become void or voidable, and that, notwithstanding anything as aforesaid, all the rents reserved by, and all the covenants, conditions and agreements contained in, the lease or grant, and on the part of the lessee or grantee and the persons deriving title under him to be paid, observed and performed, have been paid, observed and performed up to the time of conveyance: (in which covenant a purchase for value shall not be deemed to include a conveyance in consideration of marriage); Legal requisitions & title

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Distinct from Requisitions on Title which are between Ls and for the purpose of seeking clarification about title. Requisitions on Title will be dealt with in the notes on Lecture 8 send legal requisitions and interpretation plans to the relevant government departments to ascertain whether the property is in any way affected by any scheme or is subject to any encumbrance INTEREQ (Integrated Legal Requisition System) o All legal requisitions must be sent electronically through Intereq (available through the Lawnet Service Bureau), which facilitates the sending of legal requisitions and the receipt of replies from government agencies. The relevant departments will not answer any requisition sent manually. Replies can be expected in 4-6 weeks. An example of an LR clause: “If any reply to a legal requisition and/or interpretation plans are found to be unsatisfactory or if the property is affected or may be affected by the MRT system or any roadline or any road or drainage proposal or government acquisition or scheme or intended government acquisition or scheme then this agreement may be rescinded at the buyer’s option…” (Lim Kim Lian v. Swee Eng Heng [1988]1 MLJ 277)

What is a ‘legal requisition?  Application to competent authorities for certain information to be supplied  Even if not made pursuant to standard form of requisition, still a requisition and any reply from competent authorities, whether contained in said plan/by separate correspondence, is reply to requisition  Objective test, determine if P given what he had substantially bargained for  Test: “Will a reasonably determined consider this difference to be inconsequential?”  If no, reply unsatisfactory, can rescind If yeas, no choice by but to complete purchase Sent after contract concluded o Title/ bankruptcy searches conducted against vendor – to check tt they have capacity o Subject to satisfactory replies to legal requisitions - See definition of LRs in Chu Yik Man v Rajagopal [1987] 2 MLJ 557 – o Requisition was merely application to competent authorities for certain information to be supplied

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For convenience, form of requisition has been standardised by each of relevant authorities, but request for road interpretation plan whether/not made pursuant to standard form of requisition is as much a requisition as that in prescribed Form and any reply from competent authorities, whether contained in said plan/by separate correspondence, is reply to requisition1 A similar definition was also given in Peh Kwee Yong v Sinar Company (Pte) Ltd in the Court of Appeal, [1987] 2 MLJ, page 535 “But the term, “requisition” is not a term of art and has no special or defined meaning even amongst conveyancing lawyers. In our view, there is no reason whey it should be given its ordinary and natural meaning, and in that sense, requisition is synonymous with enquiry or request for information.” o “requisition is synonymous with enquiry or request for information” • LRs are questions sent to NINE government departments (please photostat page 54 to 58 of the Manual for info as to what exactly are you asking for from each government department , and incorporate them with this set of notes) Look at pages 50 to 54 of your manual & state how the following affect the title/owner of a property S6(1) Sewage & Drainage Act S58 Environmental Public Health Act S37 Building Control Act Road Interpretation Plans esp impt for landed property; stimes raod buffer. Private vs public interest – sol to check that buyers able to enjoy their property! See cases where judges have held how much property taken up for road line is or is not satisfactory reply

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THE AUTHORITIES CONCERNED eight legal requisitions (A) Public Utilities Board, Water Reclamation (Network) Department, Ministry of the Environment Sewerage Department provides information: - S. 6(1) Sewerage and Drainage Act (Cap. 294)  owner of property to construct or alter the sewerage system SDA requiring the owner of any sewerage system to make a sufficient drain-line emptying into any public sewer and to disconnect and demolish any sewerage system rendered useless or unnecessary Cause all sewage therefrom to be discharged into such sewerage system as directed Premises not provided with adequate sewerage system 6. —(1) If it appears to the Director that any premises are not provided with an adequate sewerage system, the Board may, by notice in writing, require the owner or occupier of the premises to construct such sewerage system, or to make such alteration to the existing sewerage system as he considers necessary. [8/2001] (2) The Board may, at any time by notice in writing, require the owner or occupier of any premises served by any sewerage system to make a sufficient drain-line emptying into any public sewer and to disconnect and demolish at his own expense any sewerage system rendered useless or unnecessary thereby. [8/2001] (3) The Board may, by notice in writing, require the owner or occupier of any premises to cause all sewage from that premises to be discharged into such sewerage system as it may direct. Maintenance fees: r. 3(1) Sewerage and Drainage (Sewage Treatment Plants) Regulations Maintenance of private sewage treatment plants under section 8 of Act 3. —(1) A monthly fee according to the scale set out in the Schedule shall be payable to the Director for the maintenance of a private sewage treatment plant under section 8 of the Act.

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However, in Chang Seow Song v Fong Tat Motor Co. [1997] 3 SLR 539, the Court of Appeal overruled the decision in Chu’s case which had held inter alia that “any reply from the competent authorities is a reply to a requisition”. The Court of Appeal held that a response to a request for a copy of the road interpretation plan by the LTA stating “the road interpretation plan for the site was not available” was NOT a “reply” to the purchaser’s requisition or application for the road interpretation plan. A response which refused or did not answer the question which was put by the requisition could not constitute a “reply”.

(B) National Environment Agency, Central Building Planning Unit, Ministry of the Environment National Environment Agency, Central Building Planning Unit, the Ministry of the Environment, show whether the land is affected by a drainage reserve

(C) National Environment Agency, Environmental Health Department, Ministry of the Environment Ministry of the Environment Environmental Public Health Act (Cap. 95) S. 43 EPHA empowers Director-General of Public Health to “take such steps as he may consider necessary to remove or abate all nuisances of a public nature” Public nuisances to be abated 43. The Director-General may take such steps as he may consider necessary to remove or abate all nuisances of a public nature and may, if he considers that the circumstances so warrant, proceed at law against any person committing any such nuisance.

(D) The Comptroller of Property Tax, Inland Revenue Authority requisitions sent to the Comptroller of Property Tax for a search of the current Valuation List relating to the affected property Property Tax Act (Cap. 254) Recover arrears of property tax (E) Land Transport Authority Survey and Lands Department (Relating to Street Works) Land Transport Authority for information on streetworks Any outstanding charges under Street Works Act (Cap. 320A) Whether road giving access to property is a “public street”

(F) Commissioner of Building Control, Building and Construction Authority Building Control Act (Cap. 29) Replies to requisitions relate to the physical state of the property itself Questions asked relate to: • Whether an order has been made for the cessation, demolition or alternation of building works or building. Such expenses and interest, until recovered, constitute a first charge on the property


Whether Certificate of Statutory Completion (“CSC”) or a Temporary Occupation Permit (“TOP”) has been issued. Contravention of this is an offence Whether there are any expenses owed to the Government

(G) The Chief Planner, Urban Redevelopment Authority replies from Chief Planner give information on: • any planning approvals • approved use for the property

zoning of the property, Residential Property Act (Cap. 274)  only Singapore citizens and approved persons may purchase residential property not falling within the exemptions referred to in the Act in Singapore

(H) Land Transport Authority, Survey & Lands Department, (Relating to Rapid Transit System) (“LTA”) requisitions are sent to the LTA to check whether the property will be affected by MRT lines any Notices under Rapid Transit Systems Act (Cap. 263A) any notification in the Government Gazette

5. ROAD INTERPRETATION PLANS Land Transport Authority – Road and Drainage Interpretation PlansRoad Interpretation Plans adopted lines and safeguarded lines RIPs are read together with replies to requisitions from the LTA (relating to streetworks)

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6. LOT BASE SEARCH Lot Base Search also conducted to determine whether property is affected by acquisitionIt is integral now to apply for these plans as otherwise you won’t know if the property in question is affected by any approved road, backlane or drainage proposal. The plans provide the latest and most accurate information about road/ drainage lines and/or proposals affecting a property.

(I) For strata units, the 10th is sent to the Management Corporation to ask if any outstanding maintenance fees/ capital levies charged that client may have to pay. -> under Section 54(1)(c) of the Land Titles (Strata) Act. Ideal to have certificate in before completion but usually it takes a while s54(1)(c) LT (Strata) Act: MC shall, upon application made to it in writing in respect of a lot the subject of the subdivided building concerned by subsidiary proprietor/mortgagee/prospective P or mortgagee of that lot/person authorised in writing by such a subsidiary proprietor or mortgagee and on payment of prescribed fee, certify, as at date of certificate, in respect of the lot in respect of which application is made(i) amount of any regular periodic contributions determined by MC under s48(1)(m), (n) and periods in respect of which those contributions are payable (ii) whether there is any amount unpaid of any contribution determined under s48(1)(m), (n) and if so, amount thereof and date on which any such contribution was levied……… o Maintenance fees – mthly upkeep o Capital levies – refurbish lift, swimmning pool etc – tell client about this! Format a change of format in the Building and Construction Authority (BCA) Requisitions previously, the following questions were asked in the requisition form of BCA’s predecessor, Development and Building Control Division (DBCD): 1. is the property affected by any approved road proposal? 2. Is the property affected by any approved backlane proposal? 3. Is the property affected by any approved drainage proposal? These questions have been omitted from the new forms In the light of the change, it is imperative to apply for the Road and Drainage Interpretation Plans in a purchase/mortgage of property transaction as these applications for Interpretation Plans are now the only sources which will provide the latest and most accurate information about road and drainage lines and/or proposals affecting a property • What do LRs have to do with title? The replies to the requisitions are important because they may reveal whether the property is affected by charges, fees, assessments or any notices sent to the owner or occupier of the property for the owner or occupier to do certain acts. Non-payment of any charges, fees, or assessments and non-compliance with notices may give the authority a right to impose a charge on the property, or it may itself constitute an offence for which there is a penalty. The property may also be affected by changes, alterations or road widening schemes. A prospective purchaser is entitled as of right to be fully informed so that his interest can be safeguarded. - LRs show up noncompliance with law & regulations. o Effect of non-compliance is often a charge on the property with power to sell property o MC has power to lodge charge against flat and sell flat for arrears in maintenance fees – S43 Building Maintenance & Strata Management Act (came into force 2 yrs ago, used to be under land titles strata act) Other examples o Unpaid property tax. Comptroller does not care who is the proper party responsible for payment. He goes after current owner o • In a previous case, a condo encroached on State Land. Authorities went after current owners, not developers  Encroachment on state land – Condo Escada encroaches on state land – authorities go after current owners and not developers  Problem when you negotiate to purchase a landed property

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and you see a request for approval to render alterations or additions (e.g. to change a single storey house to a 3 storey house)… and any failure to seek approval, the law does not go after the person who rendered the change; rather, it goes after the OWNER should ask the buyer client whether the house looks different from those of the neighbours o as long as there is a potential state of affairs, it does not render the property defective o should go to the building authority to come to make an order for requisition because if the buyer goes through with it, then he will be liable for any fines etc

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Qn: What is a ‘reply to a legal requisition? cf: Reply stating that ‘plan unavailable’ is not a reply Response from authority requisitioned which refused to/did not answer qn put by requisition could not be a ‘reply’

Chang Seow Song v Fong Tat Motor Co Pte Ltd (1997) 3 SLR 539 (CA) - overruled decision in Chu’s case which had held inter-alia that “any reply from the competent authorities is a reply to a requisition” - In Chang’s case the Court of Appeal held that LTA’s letter stating that “road interpretation plan for the above site is not available” was not a reply to legal requisitions or application for road interpretation plan V granted option to X to purchase property subject to existing tenancies and subject to grant of written permission Optioned assigned to P who duly exercised it Terms of option incorporated Sg Law Society’s Conditions of Sale Option also stated that any reply not received by P’s solicitors by completion date shall be deemed satisfactory P’s solicitors sent out usual requisitions to relevant authorities but did not then apply to LTA for copy of road interpretation plan Only around 2 months later did they apply for road line affecting property to be plotted on general interpretation plan, which was submitted together with application On same day, LTA returned general interpretation plan to P’s solicitors with road line unplotted with remarks ‘The road interpretation plan for the above site is not available’ P’s solicitors immediately informed V’s solicitors of this and later purported to rescind option as no satisfactory reply had been obtained from LTA V’s solicitors replied stating that reply from LTA was not and could not be deemed unsatisfactory and therefore P not entitled to rescind contract

Held: When P exercised option, P did so with full knowledge of written permission and in particular the location and site plan attached to it, which showed provisions for road reserves Also, P knew that he was purchasing net area of land available for re-development subject to written permission which constituted purchase and sale agreement of property - Whether, notwithstanding written permission, LTA would still have revised road line was another qn altogether - Qn was whether it would be amply evident to ‘any reasonably determined purchaser’ that if LTA did revise road lines from that shown in the location and site plan it would have been such a revision, if it affected the property adversely, that could have been considered de minimis/marginal and would not have been a valid reason to rescind contract LTA letter was not ‘reply’ to P’s requisition/application for road interpretation plan - Response from authority requisitioned which refused to/did not answer qn put by requisition could not be a ‘reply’ (overturning CHu Yik Man which stated that any reply fr competent auth is a reply to the acquisition) LTA’s letter of 23 July 1996 stating that the road interpretation plan was not available was not a ‘reply’ to FTM’s requisition or application for the road interpretation plan. Purpose of requisition was to get an answer which P’s solicitors would have considering in advising P whether answer was/was not satisfactory Even if it was an answer to requisition, it could not be considered by a ‘reasonably determined purchaser’ that ‘not available’ could be considered ‘unsatisfactory’

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Since letter was not a ‘reply’ and since no reply was received by P’s solicitors from which it could have been ascertained whether property was affected by road line and if so whether to a greater extent than that shown in the location and site plan by completion date, reply was deemed satisfactory Hence P not entitled to rescind sale and purchase agreement Since the letter was not ‘a reply’ within the meaning of cl 10 of the option and since no reply was received by FTM’s solicitors from which it could have been ascertained whether the property was affected by a road line and if so whether to a greater extent than shown in the location and site plan by the completion date, para (d) of cl 10 of the option operated and the reply was deemed satisfactory. Accordingly, FTM’s solicitors’ letter of 24 July 1996 purporting to rescind the sale and purchase agreement was of no effect and did not rescind the agreement. The agreement was brought to an end by the operation of condition 29 of the Singapore Law Society’s Conditions of Sale 1994 following the vendor’s service of notice to complete which the purchaser failed to comply with.

Effectively overrules Chu Yik Man v S. Rajagopal which had held that ‘any reply from competent authorities is a reply to a requisition’  So if do not answer, NOT a reply to a requisition QN: WHAT IS A ‘SATISFACTORY’ LEGAL REQUISITION?  Issue fraught with uncertainty- What is satisfactory to V may not be so to P

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Where criteria are not spelt out clearly, test is: “Would a reasonably determined purchaser get substantially what he had bargained for?” - Chu Yik Man Therefore to avoid issues in this area VERY IMPORTANT to have clear drafting so as to categorically and specifically identify the instances that would render a reply “unsatisfactory” – Chu (Chan Sek Keong) – perceptn of purchaser as to what satisfy reply to requisition is likelyt o be diff fr that of vendor; if conveyancer still use what is std but imprecise nad unsatisf formla for all agreements for sale nad ourcahse pf property and make no effort to define clearly tuypes of public works proposals and permissible lmits of such proposals, then courts will have to consier relevnt factors and apply obuj std as to what is reaoinable in circusmntnace of each case  If a purchaser of a property is concerned in respect of how much the frontage of the property or the area of the property will be affected by road proposals or drainage proposals, then it would be prudent for him to stipulate clearly the limit of his tolerance in the agreement for sale and purchase.  If the developer purchasing a piece of land for redevelopment realizes the implication the nett area (i.e. the area less than that which will be taken for reoad proposals and drainage proposals), will have on the plot ratio of the number of units that he can construct on the land, then he should stipulate the limit of his tolerance in precise terms on the agreement. Indeed it would be prudent, for the developer to have also bargained for a specific clause in relation to planning permission if this is allowed by the V.

sIn respect of letters of offers in relation to housing loans and even construction loans, perhaps more care could be taken to word such letters of offer to define what would be the allowable limit in relation to road proposals and drainage proposals rather than make such offer conditional upon the imprecise term of “satisfactory replies to requisitions” and searches. The purpose of course, is to ensure that the property to be mtged as well as its value is substantially what was envisaged as security at the time the offer was made.

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Qn: Is it sufficient to state that purchase can be annulled so long as replies are ‘unsatisfactory’ to P/his solicitors’?  Use of right was not to be arbitrary/without reason and court would not allow P to call off whole contract in face of any of answers to requisitions to which P took what was merely a capricious/fanciful objection

Test would be that of a reasonably determined P and that whether a particular answer was satisfactory to such a P was a qn of fact

(Narrow strip of property 2.55% being affected by proposal for road widening SATISFACTORY) Peh Kwee Yong v Sinar (Co) Pte Ltd (1984) 2 MLJ 260, (1987) 2 MLJ 533 Facts:

The respondents were the owners of the property at No 9, First Avenue, Singapore. On 25 November 1982 the respondents, in consideration of $20,000 paid by the appellant by a document in writing called option, offered to sell to the appellant the property at $1,860,000 and on the terms and conditions as provided therein. One of the terms of the sale was cl 6 which states, inter alia, that `The property is sold subject to your solicitors receiving satisfactory answers to all requisitions sent to or to be sent by them to the various government departments and in the event of any of the answers to such requisitions being found unsatisfactory to you or your solicitors you may annul the sale in which event the 10% deposit paid by you shall forthwith be refunded to you ...` On 30 November 1982 the appellant`s solicitors submitted to various government department legal requisitions. While awaiting the receipt of the answers to these requisitions, the appellant, on 4 December 1982 accepted the respondent`s offer, and in accordance with the terms thereof paid to the respondents` solicitors a sum of $166,000 being the 10% of the purchase price less the initial payment of $20,000, to be held by the solicitors as stakeholder pending completion of the sale. A valid and binding agreement was thus made between the parties. After the conclusion of the agreement, the appellant`s solicitors received the answers to the legal requisitions, all of which appeared to be quite innocuous. On 16 December 1982 the appellants further received the road interpretation plan relating to the property from the Road Division of the Public Works Department (hereinafter referred to as `PWD`) which showed a narrow strip of the property abutting First Avenue being affected by a proposal for road widening. The appellant`s solicitors wrote a letter dated 16 December 1982 to the respondents` solicitors informing the latter that the property was affected by road widening and also alleging that there was a misrepresentation made to the appellant that the land area of the property was over 14,000 sq ft, whereas the actual land area was only 12,900 sq ft. The letter intimated that the appellant reserved his rights to rescind the contract and to demand for a refund of the 10% of the purchase price, and enquired whether the respondents would agree to a reduction of a purchase price. No reduction of the purchase price was agreed to. The appellant did not proceed with completion of the purchase under the agreement. Immediately after the time for completion as provided in the agreement had elapsed, the respondents` solicitors gave the appellant 21 days` notice to complete failing which the contract would be treated by the respondents as at the end and the deposit would be forfeited and retained for the benefit of the respondents. The appellant applied to the High Court, inter alia, to rescind and annul the sale and purchase of the property on the ground that the answer to the requisition from the PWD was unsatisfactory in that the property was affected by a proposal for road widening. The court dismissed the application and held that a true and natural construction of cl 6 must place it on an objective and reasonable basis and that only those answers to the requisitions which were unsatisfactory to a reasonably determined purchaser could entitle such a purchaser to annul the sale and purchase agreement. On the facts, the judge held that the area affected by the proposed road widening was so inconsequential that no reasonably determined purchaser would regard it as unsatisfactory. (See [1984-1985] SLR 398.) P agreed to purchase property zoned for residential use Relevant road interpretation plan showed that property was affected by road widening and when implemented, would reduce area by about 329 sq feet Property was sold subject to P’s solicitors receiving satisfactory answers to all requisitions sent to various government departments and in event of any of answers to such requisitions being found unsatisfactory to P’s solicitors, P may annul sale P’s solicitors alleged that according to Interpretation Plan, land was affected by road-widening which would reduce the area P asked for price reduction Later , P gave V notice in writing purporting to annul sale and purchase agreement on ground that reply to requisition was unsatisfactory V refused to accept notice of annulment and instead, served on P a 21-day notice in writing to complete purchase Held:

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Only those answers to requisitions which were unsatisfactory to a reasonably determined P could entitle such a P to call off agreement - Whether particular answer was unsatisfactory to a reasonably determined purchase within meaning of clause was, in each case, a qn of fact – notwithstanding subj form of clause, obj test of wat is satisfactory msut be applied - Area to be affected by road-widening of 2.55% of total area was so inconsequential that no reasonably determined P could regard it as giving him right to annul sale and purchase agreement Held by CA: Affirmed result in HC Generally, amongst conveyancing lawyers in Sg, requisitions connote standard forms of questionnaires prescribed by government departments in which members of the public are required to submit in their application for information relating to properties Term ‘requisition’ was not a term of art and had not special/defined meaning even amongst conveyancing lawyers, merely synonymous with enquiry/request for information The appellant`s application dated 3 December 1983 to the PWD for a road interpretation plan was in a standard form prescribed by the PWD and was an enquiry or request for information relating to the property. It was in the ordinary sense a `requisition` and was a requisition for the purpose of cl 6. The road interpretation plan issued by the PWD in response to the appellant`s application constituted an answer to the requisition. Parties had used words ‘being found unsatisfactory to you/your solicitors’ and these words were clear and had to be read in their ordinary sense; due weight and effect to be given to express words used by parties Parties had intended that unsatisfactoriness of any answers to requisitions would be a matter lying wholly within subjective judgement of P/his solicitors, but there were constraints on this exercise of such a drastic right by P which would be subject to court’s control Where the contract gave a right to the purchaser to annul a purchase in certain circumstances, namely, if any of the answers to the requisitions were found to be unsatisfactory to the purchaser or his solicitor, the exercise of that right under a clause, such as cl 6, was equally subject to the control of the court. Use of that right was not to be arbitrary/without reason and court would not allow P to call off whole contract in face of any of answers to requisitions to which P took what was merely a capricious/fanciful objection Test would be that of a reasonably determined P and that whether a particular answer was satisfactory to such a P was a qn of fact Slight widening of road might well be beneficial to such development and was not necessarily an adverse/minus factor Purported rescission by P was prompted by his dissatisfaction over property area rather than by any real unsatisfactoriness of answer contained in road interpretation plan On facts, 329 sq feet (forming 2.55% of total area) was so inconsequential that no reasonably determined P could regard as giving him right to annul sale and purchase P would still be getting what he substantially agreed to purchase • Road lines in Sg are of 5 categories, from Category 1 denoting expressway to Category 5 denoting minor roads * Qn: Does reply from Roads Section stating categorisation of road affecting property affect whether reply is ‘satisfactory’?  No, same test of a reasonably determined P is still to be applied Lim Kim Lian v Swee Eng Heng (1988) 1 MLJ 227 – eg of clause enabling purchaser to rescind contract once land affected by any roadline - (Almost 14% of whole are of property affected by roadline UNSATISFACTORY) Sale and purchase was subject to ‘your solicitors receiving satisfactory replies to their legal requisitions and applications for interpretation plans to various government departments and MRT Corp and if any of such replies and/or interpretation plans are found to be unsatisfactory/if above property is affected or may be affected by MRT system/any roadline/any road or drainage proposal/government acquisition or scheme then this agreement may be rescinded at your option’ Requisitions showed that property was affected by a roadline to almost 14% of the whole area P in exercise of right under option, rescinded agreement to purchase and asked for 10% deposit refund Held: By no stretch of imagination could 14% be considered inconsequential - P would not have obtained what he wanted if 14% of total land area would sometime in the future be taken away from him for road-widening purposes

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Reply unsatisfactory and P could rescind Difference in categorisation of road ought not to affect test to be applied in determining whether reply from authorities was satisfactory Court should further give effect to parties’ intentions as expressed in option and not rewrite it Parties had taken pains to stipulate and expressly provide for the eventuality that occurred Qn: If road reserves affecting property, sufficient for P’s solicitor to merely send copy of road interpretation plan together with explanatory notes to P and inform him that property is affected by road proposal? No

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Chu Yik Man v Rajagopal (1987) 2 MLJ 557 - (Land required for road widening just below 10% UNSATISFACTORY) Facts: The plaintiff entered into an agreement for sale to purchase from the second defendant a two-storey bungalow. The property was sold `subject to the satisfactory replies to the requisitions to the Local Authorities and the Provisional Mass Rapid Transit Authority being received by the purchaser...` Later the plaintiff`s solicitors received a duly answered legal requisition from the Development and Building Control Division to the effect that the property was not affected by (a) any approved road proposal or (b) any approved backlane proposal or (c) any approved drainage proposal or (d) any Government Gazette Notification. However, eight days later, the said solicitors received from the Roads Planning & Design Branch, Roads Division, Public Works Department, a road interpretation on which was noted that part of the property was `Land required for Road Widening` and that road was a Category 4 Road, ie a major road of a required minimum width. It was not disputed that the area that might be affected by road widening was just below 10% of the area of the land. The affected land did not affect any part of the building which was sited far from the road and nearer to the rear boundary. The plaintiff sought a declaration that the agreement for sale to be declared null and void and an order for the return of 10% deposit. He submitted that a loss of 10% of the land rendered the reply to the requisition unsatisfactory. Property sold ‘subject to satisfactory replies to requisitions to Local Authorities and Provisional MRT Authority being received by P’ Pf’s solicitors received duly answered legal requisition from Development and Building Control Division (DBCD) to effect that property unaffected Later, solicitors received from Roads Planning & Design Branch, Roads Division, Public Works Department, a road interpretation on which was noted that part of property was ‘land required for Road Widening’ and that road was a Category 4 Road i.e. major road of required minimum width Not disputed that area that might be affected by road widening was just below 10% of area of land and affected land did not affect any part of building which was sited far from road and nearer to rear boundary Dft submitted that reply could not be regarded as unsatisfactory because answer in relevant requisition stated that there was no approved road proposal affecting the property and that road interpretation plan and notation thereon are not requisitions/replies to requisitions Pf sought declaration that agreement for sale be declared null and void and order for return of 10% deposit on basis that loss of 10% of land rendered reply to requisition unsatisfactory Held:

A requisition was merely an application to the competent authorities for certain information to be supplied. A request for a road interpretation plan whether or not made pursuant to the standard form of requisition was as much a requisition as Form DC9(DO)-5 and any reply from the competent authorities, whether contained in the said plan or by separate correspondence, is a reply to the requisition Formula ‘satisfactory reply to requisitions’ is intended to give P substantially what he has bargained for, taking into account his purpose in purchasing property and such other circumstances which would have a direct/indirect effect on fulfilments of that purpose

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The road widening would result in a diminution in the area of the property (and therefore its overall value) without any compensating increase in value in some other way as a result of the road widening. Diminution in land area cannot be sole determining factor in most cases, must consider factors that affect a property in terms of its size, use, purpose of purchase and therefore its value Court will have to consider all relevant factors and applying an objective standard as to what is reasonable in circumstances of each case – wld reasonably determined purchaser consider this diff in the land area inconsequential? If no then reply unsatisf and contract can be rescinded If not purchaser has to complete the purchase : - obj test employed A difference of $30,000 to $50,000 in value was not negligible by any standards and a potential loss of about1000 sq ft from about 10,000 sq ft was also not negligible, particularly in Singapore. Pf would not get what he had bargained for if sale were forced on him and hence reply to requisition was accordingly not satisfactory as contemplated by agreement for sale Agreement null and void, deposit to be returned to Pf Since difficult to ascertain what will constit satisfy reply , SK Chan exhorted all conveyancers to take trouble to revise drafting of the condition as to satisfy replies to make its meaning clearer or intent more specific

Yeo Yoke Mui v Ng Liang Poh Held: - Scope of Rspdt’s duty was to examine and consider terms of option and advise Aplt on any unusual terms contained in it and to make searches and investigation on property and advise Aplt of any material fact/matter adversely affecting property Rspdt ought to have gone further and advised her on meaning of ‘Categories 4 and 5 roads’ and how they affected property Not imputing too high a standard to a conveyancing lawyer if we say that he must have some knowledge of road interpretation plans and meaning of various terms appearing thereon since applications for road interpretation plans are frequently made by conveyancing lawyers, as a matter of good practice, and one can justifiably assume that they obviously understand purpose of such plans and what such plans say or mean. - In circumstances of case, it was not sufficient for Rspdt merely to send Aplt road interpretation plan and explanatory notes and leave her to read these notes herself

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Qn: How significant is it to expressly state, in contract, that property is purchased for redevelopment? Important, because if not stated, would not be assumed that property purchased for redevelopment (Road widening proposal applicable if and when lot comes for development SATISFACTORY since P did not state that buying property for redevelopment)

Tatlien v Tan & Lie (1982) 1 MLJ 9 - Facts: - Option had clause 5 providing for annulment of sale in event of any of answers to requisitions being unsatisfactory - Authorities in answer to a requisition stated that ‘road widening line is inserted by Roads Branch in accordance with current standard and will be applicable if and when lot comes for development’ Properties were zoned for local shopping and were purchased on condition of such zoning Replies to requisition stated that properties were unaffected by any approved road/backlane/drainage proposal but that they were affected by rear service road P then applied for and obtained road interpretation plan which showed that properties could be affected by road widening - Subsequently, Development Control Division letter explained effect of road interpretation plan, that site was unaffected by road widening line, but however, that it was affected by a rear service road as property abut this rear service road, applicable if and when lot comes up for redevelopment Road widening line would apply only if redevelopment of property was to take place, but as matter of law, this fact was irrelevant to P because he had not purchased property for redevelopment The second defendants by an undated option expiring on 30 June 1980 offered to sell Nos 2/2A and 6/6A Moonstone Lane for $620,000. The plaintiffs exercised the option. Clause 5 of the option provided for the annulment of the sale `in the event of any of the answers to such requisitions being unsatisfactory`.

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On 6 May 1980, a reply was received from the authorities in answer to a requisition of the land concerned. The answer stated that `the road widening line is inserted by the Roads Branch in accordance with the current standard and will be applicable if and when the lot comes for development`. The sole question before the court was whether the contents of the said letter amounted to an `unsatisfactory answer` to a requisition within the meaning of cl 5 of the action. Held: - Could be no implied term that contract was conditional upon property being capable of redevelopment/that if it could be redeveloped, there would be no scheme affecting its redevelopment - Fact that if and when property was subsequently redeveloped some portion of it would be compulsorily acquired for road widening purposes thus diminishing value of property was immaterial - P bought properties for their existing use and not for redevelopment, so could not complain about road widening scheme which would/might come into existence upon redevelopment taking place Subsequent to Tatlien’s case, the LTA has since stated in the Road Line Plan Explanatory notes that “the portions of land which are required as road reserve are coloured on the road line plan. These portions of land are to be set aside when development/ redevelopment takes place on the subject lots or when road construction/ improvement is carried out by the Land Transport Authority, whichever is earlier”. Statement wld have made diff prior to the case

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In Teo Hong Choo v Chin Kiang Industries Pte Ltd [1983] 2 MLJ 309 the learned judge distinguished Tatlien’s case on the ground that in the instant case, the property was affected by the road widening line and as such the answer to the requisition was unsatisfactory. The plaintiff exercised an option to purchase No 1214 Upper Serangoon Road for $59,000. A sum of $20,000 was paid to the defendants for granting the option and $39,000 being the balance of the 10% of the purchase price to the vendors` solicitors as stakeholders. The sale was subject to the Singapore Law Society`s Conditions of Sale 1981 subject to `special conditions herein contained`. Clause 5 of the option provided that `in the event of any of the answers to such requisitions being unsatisfactory, the purchaser may annul the sale in which event the deposit paid shall be refunded to the purchaser without any recourse`. - On 8 January 1983 a legal requisition was sent to the Development Building and Control Division by the plaintiff`s solicitors. On 4 February 1983 the answers to the said legal requisition were received. On 23 March 1983, a letter written to the plaintiff`s solicitors by the Public Works Department stated, `that the road widening lines indicated on the interpretation plan is applicable when the site comes up for redevelopment or when the widening of Upper Serangoon takes effect.` In these circumstances the plaintiff claimed that the answers to legal requisition 5(a) and (b) read with the letter of 23 March 1983 were unsatisfactory within the meaning of cl 5 of the option thus enabling her to annul the sale and have refunded to her the deposit of $59,000 paid to the defendants under the contract. - Held , allowing the purchaser`s claim: (1).Clause 3 of the option to purchase had the effect of overriding cl 15 of the Singapore Law Society`s Conditions of Sale 1981 and making cl 5 of the option to purchase a necessary condition of the contract. (2).As the answers to the legal requisition 5(a) and (b) were unsatisfactory from the point of view of the purchaser, the purchaser could, at her option, annul the sale and have her 10% deposit refunded to her. (Property possibly affected by road widening and re-zoning for redevelopment SATISFACTORY) Tay Theng Khoon v Lee Kim Tah (Pte) Ltd (1992) 1 SLR 609 (CA) Clause in agreement allowed P to withdraw only of property was adversely affected by any ‘drainage or proposal of government’ P received from DBCD reply showing that part of property was zoned public open space and therefore not available for development for residential purposes as intended by P P purported to withdraw from purchase on ground that reply was unsatisfactory due to ‘government proposal adversely affecting property’ Held: On true construction of sale of land, right to withdraw depended on satisfactoriness of reply Clearly, reply unsatisfactory in that it adversely affected property, but issue was whether it was a ‘proposal’ of government Zoning of piece of property is NOT a ‘proposal’ and would be artificial to construe it otherwise

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Fact that property falls within particular master plan zoning per se does not require the doing of anything to make it conform to the plan, hence DBCD reply not within ordinary meaning of word ‘proposal’ ‘Proposal’ envisages a scheme/plan by which something is to be done Would be ‘proposal’ if it was by government authorities and other public bodies to undertake positive functions of constructing, improving and developing public infrastructure e.g. roads, drainage, sewerage No such term could be implied/that if property would be developed, there would be no scheme affecting their redevelopment

Lie Kee Pong v Chin Chow Yoon (1998) 3 SLR 92 - (Common drain forming 4.3% of land SATISFACTORY) Common drain formed 4.3% of land Held: - Strip of land affected was only 4.3% of whole land and was at rear Neither house/any part of garden was affected - Court found that P had seen garden and was satisfied with it and redevelopment of property was not contemplated After considering all circumstances, reply to legal requisition satisfactory Judge stated that not possible or approp in lw to darw lnie o general application Seet Peng Yam v Mohamed Mohidin Habibullah (1988) 2 MLJ 347 - (Substantial area of property affected and road widening line cutting across part of front porch of house UNSATISFACTORY) Option clause stated that purchase subject to P’s solicitors receiving ‘satisfactory replies to legal requisitions from various government departments and if replies unsatisfactory, V should refund 10% deposit to P’ P’s solicitors received reply from DBCD that road line affected property and that substantial area of property was affected and road widening line cut across part of front porch of house P claimed reply unsatisfactory and tried to get back refund for deposit Held: - P wanted to purchase property which had a fair amount of land attached Government’s reply unsatisfactory and P entitled to refund Kua Beng Koon v Kwok Wai Tien (1993) 3 SLR 101 - (Road proposal adversely affected property in that if implemented, part of building had to be demolished UNSATISFACTORY) Clause in agreement stated that P could rescind if any of replies were unsatisfactory in that property was affected by any road/drainage proposal - BUT clause further provided that if reply stated that property would be affected by any road/drainage proposal arising from a redevelopment of property shall not be deemed unsatisfactory Also, if common property was affected/marked with a category 5 road line/buffer of 2.3m, not deemed unsatisfactory P’s solicitors informed V’s solicitors that they were rescinding agreement because road interpretation plan was unsatisfactory because there was a ‘road proposal which adversely affected property’ Road proposal was to widen service road running beside property and if implemented, part of building in which property located, including part of apartment would have to be demolished Held: On plain reading of the words, so long as property was adversely affected by 1 of factors enumerated, P entitled to rescind agreement Although no information as to exact amount of land that had been safeguarded in this case, amount was fairly substantial If implemented, part of apartment would have to be demolished, property adversely affected Wong Meng Yuen Eddie v Soh Chee Kong (1990) 3 MLJ 352 - (23.4% of property being affected by road widening proposal UNSATISFACTORY) Sale was subject to Law Society’s Conditions of Sale Clause in agreement stated that sale was subject to P’s solicitors receiving satisfactory replies to their requisitions to government departments Further provided that any such replies indicating that property would be affected by road proposal arising from redevelopment of property would not be deemed unsatisfactory (‘clause’) Road proposal said to adversely affect property would only be implemented on development/redevelopment of property or a road construction/improvement being carried out whichever was earlier Area affected was 23.4%

Held: Since it was V who sought to rely on ‘clause’, burden of proof on term to discharge, which they had failed to do (failed to prove that purpose of property purchase by P was for redevelopment) - Objective test to be applied as to whether property was adversely affected by road proposal Fact that no current programme does not make proposal any less a proposal Existing state of affairs is that there is a proposal and whenever implemented would affect property by depriving it of 23.4% of its land area and also a portion of building Existence of such road proposals were within contemplation of parties and they sought to specifically provide for it by including ‘clause’ in contract, so court’s duty was to interpret it and to give effect to parties’ intentions Ang Kok Kuan v Ang Boh Seng (1993) 3 SLR 669 (CA) - (16% of land affected by road line UNSATISFACTORY) Road interpretation plan showed that property was affected by road line, amounting to 16% of total area affected by road line, 13% affecting building structure, 3% vacant land But at that point in time, there was no intention of PWD to carry out any road widening, but only for ‘safekeeping purposes’, applicable when subject lots came up for redevelopment/when required for road widening, whichever was earlier V’s solicitors served 21-day notice to complete on P Held: While existence of road line per se does not make reply unsatisfactory, it was neither possible/desirable to lay down any hard and fast rule as to where dividing line should be Relevant considerations include percentage of land affected, whether building itself would be affected by road line and whether there was any particular feature/understanding relating to property Objective test viewed from perspective of ‘reasonably determined’ person Fact that no immediate proposal to widen road makes no difference in deciding whether reply unsatisfactory But on fact, reply unsatisfactory as not only was percentage of total area significant, but more than ¾s of it affected building itself Lee Hooi Lian v Kuay Guan Kai (1990) 2 MLJ 345 - Can still invoke terms of option even if no contract signed yet if V is clearly unable to sell what he had contracted to convey V granted option to P, paid option fee Option was to be exercised by P signing option and delivery of same together with a cheque representing 10% of purchase price less option sum Option clause stated that sale and purchase subject to P’s solicitors receiving satisfactory replies to legal requisitions, if not agreement could be rescinded at P’s option Property was affected by road line P asked for refund V argued that until option had been exercised, contract to purchase had not come into being and P could not rely on any of clauses set out in option, which would only form terms of the contract when option exercised Held: - Failure to exercise option was no ground to refuse refund of option money if V was clearly unable to convey what he had contracted to sell, which is the case here No reason why P could not accept repudiation and recover option sum Taking a strictly technical approach would ignore essential nature of an option contract TYPICAL CASE GOES LIKE THIS: Sale usually subject to Law Society’s Conditions of sale - Sale also usually subject to typical clause in option stating P’s right to annul sale and get back deposit if replies unsatisfactory (usually some road widening proposal etc) - Replies return but whether they are ‘satisfactory’ becomes disputed issue P will rely on option clause to annul sale V will rely on Condition 29 giving P notice to complete V will then rely on Condition 15 (property sold subject to government improvement schemes) P will rely on Condition 33 (special conditions prevail) and then that particular clause in option allows withdrawal

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Lawyers have to know roughly what to look for, and that means a basic understanding of the technical jargon associated with the requisition results:

Yeo Yoke Mui v Ng Liang Poh Held: - Duty to examine and consider terms of option and advise client on any unusual terms contained in it and to make searches and investigation on property and advise of any material fact/matter adversely affecting property - Ought to have gone further and advised her on meaning of ‘Categories 4 and 5 roads’ and how they affected property - With help of explanatory notes pertaining to road interpretation plan, he must have realised and understood, at least roughly if not precisely, meaning of Categories 4 and 5 roads and how they affect property Not imputing too high a standard to a conveyancing lawyer if we say that he must have some knowledge of road interpretation plans and meaning of various terms appearing thereon since applications for road interpretation plans are frequently made by conveyancing lawyers, as a matter of good practice, and one can justifiably assume that they obviously understand purpose of such plans and what such plans say or mean. Unsatisfactory replies to legal requisitions, subdivision permission for the condominium refused for noncompliance with planning conditions: Tate & Anor v Sihan Sadikin 1991 MMD [Dec] 1522 Whether unsatisfactory replies gives rise to anticipatory breach: Lo Geok Kwee v Suriyakumari d/o Kandasamy Gopal (B.T. 18.12.91) Unsatisfactory replies to legal requisitions, road interpretation plan showed that property would be affected by road widening – approximately 10%: Yeo Wee Tee & Anor v Peter Cheong Seng Peow (O.S. 1234/86) 1992

Recommendations the solution is to provide in property transactions, clauses in the Agreement for Sale and Purchase which categorically and specifically identify the instances that would render a reply “unsatisfactory” eg.: • frontage of the property, it will be prudent for him to stipulate clearly the limit of his tolerance in the agreement for sale and purchase • when purchasing a piece of land for redevelopment, realizes the implication the nett area will have on the plot ratio of the number of units that he can construct on the land, then he should stipulate the limit of his tolerance in precise terms in the agreement, also to include a specific clause in relation to planning permission if this is allowed by the Vendor • letters of offers in relation to housing loans and construction loans, care taken to define what would be the allowable limit in relation to road proposals and drainage proposals rather than make such offers conditional upon the imprecise term of “satisfactory replies to requisitions” an searches What does the lawyer do after he is satisfied with the title and with the replies to the legal requisitions? 1. Report on the title to the client (see above). Once the contract has been signed, the solicitor of the P has to do three things a. lodge a caveat at the Singapore Land Authority b. Send requisitions on title to the vendor’s solicitor’s. These are a series of searches directed at the vendor on the title to the property. The P must send his requisitions within 14 days of the contract – see condition 4 of the Law Soc’s Conditions of Sale 1999. c. Draft the Conveyance or Transfer in favour of his client for the approval of the Vendor’s solicitor The vendor’s solicitor will answer the Requisitions on title and approve the draft Conveyance/ Transfer. The Vendor’s solicitor will also prepare the completion account setting out the balance payable by the purchaser on completion. The P’s solicitor will then write to his own client to put him in funds to complete the ourchase. The P’s solicitor will have to prepare his own account setting out the amount payable on completion including all stamp fees and disbursements and solicitor’s costs. Scaled fees in conveyancing matters have been revoked. The engrossment of the Conveyance/ Transfer is then sent to the Vendor for execution. When the vendor has executed the conveyance/ transfer, then arrangements can be made to complete.

2. 3.

4.

Search on Vendor (covered mainly in lecture 3, included here as a reminder that apart from performing searches on title and legal requisitions, you should also search the parties as well) Transmission of property upon death (Tutorial 2 question 1 problem) - If the Vendor acquired the property upon the death of the previous owner, you should check to see if the estate duty has been paid. Because under Section 29 of the Estate Duty Act, if Estate Duty is not paid, IRAS will have 1st charge over the property. As lawyer, what you should do is to extract the transmission upon death document using the document number provided in the certificate of title from the Singapore Land Authority From there you can find out who has died, so you can check whether estate duty has been paid. You can then subsequently write to the commissioner of estate duty to ask if estate duty has been paid. Alternatively, you can also apply for a search on the court file in respect of an application for a grant of the deceased. Don’t rely on copy provided by the seller, as it may not be reliable. Residential property in the case of restricted property, to check the citizenship of the V at the time of acquisition of the property; if the V is a non-Singaporean citizen or a foreign company or society, whether approval was given by the Minister pursuant to s25 RPA? (see lecture 3 notes) o name of owner or registered proprietor o capacity to sell o citizenship of the Vendor o was property acquired by way of gift? o Required to obtain a license? In the case of a Singapore Company or association, whether the Controller’s certificate/ clearance latter pursuant to s10 RPA has been obtained? (see elcture 3 notes) Bankruptcy and insolvency search where natural person, to make a search at the HCs to see if any bankruptcy petitions or proceedings have been issued against the vendor where company: to a winding up and judicial management searches at the HC to check is winding up proceedings have been commenced against the V or whether applications are pending for appointment of JM o to obtain a copy of the company’s M/A and A/A to see if they have the right hold and sell property, and if so, whether there is a valid director’s resolution permitting such a sale ==> if searches reveal pending bankruptcy or liquidation proceedings, the purchaser will be advised not to proceed with the transaction as a bankrupt or a corporation in liquidation is incapable of transferring title to a purchaser [unfair preference; transaction at undervalue etc] to a WSS search, and a Cause Book Index Search s77(1) BA: Any disposition of property made by him shall be void except to extent that it has been made with consent of/been subsequently ratified by, the court s98: Transactions at an undervalue can be avoided at option of OA s99: Transactions involving any unfair preferences can be avoided at option of OA If bankrupt gives unfair preference and becomes bankrupt because of that, transaction can be set aside - But only on proof that bankrupt influenced to give that 3rd party a better position than if nothing had been done) s102 BA – OA may apply to court to restore within the period of 6 months, ending with the date when the person was made bankrupt, for undue preference, however, court can only do this when the it is satisfied that the transaction was influenced by the desire to prefer • Cause book search

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Suits search Check for caveats, court orders, writs of execution To prevent any rescission of contract e.g. pending suit and S uses 9% deposit to pay off Hence need stakeholder’s clause to prevent disposal of deposit in such manner If searches satisfactory, advise that might not need stakeholders clause but ask client similarly if he wants it

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Search on Purchaser HDB property concerns by lawyer representing the Purchaser • Need to be more cautious because might need HDB’s written consent for client to buy private property (when client is lessee), as per HDB’s policy Applicable when unit directly purchased from HDB/from open market under CPF Housing Grant Scheme Else client could end up losing his option money/even losing his HDB flat  If stay in Executive Condominium, cannot buy commercial property of more than $250,000 unless approval obtained (Executive Condominium Act)  If stay in HDB flat, cannot buy commercial property of more than $350,000 unless approval obtained

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