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Grounds publishedDecided 25 Sep 2009
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High Court

Mohamed Amin bin Mohamed Taib and Others v Lim Choon Thye and Others

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[2009] SGHC 216Case no. OS 17/2008, SUM 3938/200933 paragraphs

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  1. Woo Bih Li J:

  2. Background

  3. [1] In order to understand the background to Summons 3938 of 2009 (“the Present Summons”) filed in Originating Summons No 17 of 2008 (“OS 17/2008”), it is necessary to set out the background to OS 17/2008 first. That background is set out in paras 1 to 9 of the Grounds of Decision (“GD”) of Judith Prakash J dated 3 March 2009 for the main action (reported at [2009] 3 SLR 193) which I set out below for easy reference.

  4. [6] The taxation of BC 137/2009 was adjourned to 11 August 2009 pending the hearing of the Present Summons.

  5. [8] On 11 August 2008, BC 137/2009 was taxed. Later on the same day, I heard the Present Summons. The other defendants, that is, the first, second, fourth to sixth defendants, and the ninth and tenth defendants in OS 17/2008 took a neutral stand on the Present Summons. After hearing arguments, I adjourned the hearing to 18 August 2009 for the plaintiffs to file an affidavit as to whether they knew that the SPA had not been stamped.

  6. [9] On 13 August 2009, the plaintiffs’ affidavit was filed and served. It stated that they were not aware of the lack of stamping of the SPA (and the Supplemental Agreement) prior to 22 December 2008. That was when their solicitors M/s Legal 21 LLC informed them about a letter from the Board stating that the agreements had not been stamped.

  7. The reasons

  8. [11] In the first place, prayer 1 of the Present Summons was unnecessary as the Board had already dismissed the application before it on the basis that the SPA, and presumably the Supplemental Agreement as well (collectively “the Relevant Agreements”) were inadmissible in evidence as they were not stamped.

  9. [13] I will deal with prayers 2 to 3(b) of the Present Summons together as they deal with the 30 October 2008 Order and OS 17/2008.

  10. [14] The thrust of the arguments of Mr Vijay Kumar Rai, who was counsel for the Remaining Minority, as well as being the eighth defendant himself, was that because the Relevant Agreements were not stamped, there was no basis in the first place for the application to be made to the Board. He also argued that for the same reason, ie, the want of stamping, the court had no jurisdiction to make the 30 October 2008 Order. He relied heavily on s 52(1) of the Stamp Duties Act (Cap 312, 2006 Rev Ed). However, the next provision is also relevant. Sections 52(1) and (2) state:

  11. [15] I was of the view that Mr Rai had misapplied s 52(1). It does not render an unstamped document which ought to be stamped void ab initio. It merely stipulates that such a document is not admissible in evidence until the appropriate stamp duty is paid. This is reinforced in s 52(2) which provides for the admissibility of such a document on payment of the stamp duty and any penalty. That rule is a rule of evidence and does not affect the validity of such an unstamped document. As is obvious, the situation could have been rectified at any time upon payment of the appropriate stamp duty and penalty. Furthermore, even if a document were to be invalid in the sense that, for example, it was forged, that does not defeat the jurisdiction of the court to hear and decide on matters based on that document.

  12. [16] It was clear to me that the court had jurisdiction to make the 30 October 2008 Order.

  13. [17] I should also point out that it was because of the 30 October 2008 Order that the Board continued with the hearing of the application and dismissed it (again) for want of stamping. If the 30 October 2008 Order was to be set aside for want of jurisdiction, then the Board’s initial decision of 11 December 2007 would remain. However, if the court did not have jurisdiction to hear OS 17/2008 because of the stamping issue, then it is likely that the Board would also not have jurisdiction to make the decision of 11 December 2007.

  14. [18] Mr Rai, also argued that the 30 October 2008 Order was a fraud upon the Remaining Minority (and the other defendants) because the plaintiffs did not disclose the fact that the Relevant Agreements were not stamped.

  15. [19] Assuming that the plaintiffs were aware of the non-stamping, it is an arguable point whether they were obliged to disclose the non-stamping if no one had asked them about it. In any event, they executed an affidavit to say that they were not aware about the non-stamping as elaborated above. They only knew about the non-stamping after the 30 October 2008 Order had been made. While Mr Rai did not accept their explanation, he himself had no basis for suggesting otherwise beyond his suspicion, frustration and desperation. He was in no position to assert as a fact that they were aware before 30 October 2008.

  16. [20] Mr Low, counsel for the plaintiffs in OS 17/2008, also pointed out that the obligation to pay the stamp duty was on the purchaser and not the vendors. It appeared to me that the purchaser had played the vendors out.

  17. [21] Mr Rai further alleged that the plaintiffs ought to have checked with the purchaser whether the Relevant Agreements had been stamped but Mr Low rightly pointed out that the Remaining Minority (and the other defendants) did not do so themselves. They did not demand to have sight of the original of the Relevant Agreements although they too were represented by solicitors and it was in their interest to do so in the context of the ongoing litigation.

  18. [22] I would also point out that neither the stamping of the Relevant Agreements nor the admissibility thereof was in issue before Prakash J whether in respect of OS 17/2008 or Summons 396/2008.

  19. [23] It was clear to me that there was no fraud on the part of the plaintiffs and, as I have said, the suggestion of the same was without basis.

  20. [24] There was also no injustice arising from the 30 October 2008 Order or from the order made in Summons 396/2008.

  21. [26] Mr Rai’s arguments for this prayer 3(c) were no different from his arguments for prayers 2 to 3(b) and I reached the same conclusion for prayer 3(c) as for the other prayers.

  22. [28] I would add that I was informed by Mr Low that there is apparently now a practice direction that an applicant for approval of a collective sale is to adduce evidence that the relevant sale and purchase agreement is stamped in support of the application.

  23. Schedule of Chronology of Events

  24. [20] July 2007

  25. Application filed to seek the Board’s approval for the collective sale of Regent Court.

  26. [11] December 2007

  27. The Board dismisses the application in view of the ninth and tenth defendants’ objection on the ground of financial loss.

  28. [07] January 2008

  29. OS 17/2008 is filed to contest the Board’s decision.

  30. [28] January 2008

  31. Summons 396/2008 is filed by the Remaining Minority to strike out OS 17/2008.

  32. [09] October 2008

  33. Summons 396/2008 and OS 17/2008 are heard. Prakash J dismisses Summons 396/2008 and orders the Remaining Minority to pay costs to the plaintiffs. OS 17/2008 is part-heard and adjourned to a date to be fixed.

  34. [30] October 2008

  35. Order of Prakash J in OS 17/2008. She sets aside the decision of the Board (of 11 December 2007) and remits the plaintiffs’ application for approval of the collective sale to the Board for hearing. The issue of costs of OS 17/2008 is adjourned to a later date to be fixed.

  36. [18] March 2009

  37. The Board recommences the hearing of the application pursuant to the 30 October 2008 Order but by then, they have received the 4 December 2008 letter from IRAS.

  38. [24] March 2009

  39. The Board dismisses the application because the SPA (and the Supplemental Agreement) are not stamped. The Board orders each side to bear its own costs.

  40. [08] July 2009

  41. The plaintiffs file BC 137/2009 in respect of the costs granted to them in Summons 396/2008. The hearing for taxation is fixed on 28 July 2009.

  42. [27] July 2009

  43. The Remaining Minority file the Present Summons. The taxation is adjourned to 11 August 2009 pending the hearing of the Present Summons.

  44. [03] August 2009

  45. Counsel for each side appear before Prakash J on the issue of costs for OS 17/2008 and for hearing of the Present Summons. Prakash J declines to hear the latter which is adjourned. She also orders that the Present Summons is not to affect the taxation of BC 137/2009. The issue of costs for OS 17/2008 is adjourned pending the outcome of the Present Summons.

  46. [11] August 2009

  47. BC 137/2009 is taxed. Later in the same day, the Present Summons 3938/2009 is heard by Woo J. It is adjourned to 18 August 2009 for the plaintiffs to file an affidavit as to whether they knew that the SPA was not stamped.

  48. [13] August 2009

  49. The plaintiffs’ affidavit is filed and served.

  50. [18] August 2009

  51. Continued hearing of Present Summons. It is dismissed with costs.