Singapore legislation
Section 58
Section 58
Property not to be used as security or attached, etc., and no trust in respect thereof to be created without approval of Board
(1)
Subject to subsections (4) and (5), any contract or agreement to directly or indirectly use protected property (or the proceeds of sale of protected property) as security or collateral for any debt, obligation or claim is void.
(2)
Any act (including the deposit of title deeds), deed, instrument or document that purports to protect rights under or give effect to any contract or agreement that is void under subsection (1) is of no effect and does not result in or create any interest in land and is not capable of being registered under the provisions of the Registration of Deeds Act 1988 or the Land Titles Act 1993.
(3)
Where any deed, instrument or document mentioned in subsection (2) is registered under the provisions of the Registration of Deeds Act 1988 or the Land Titles Act 1993 —
the Board may, by an instrument lodged with the Registrar of Deeds or the Registrar of Titles (as the case may be) declare the deed, instrument or document to be void; and
the Registrar of Deeds or the Registrar of Titles must register the instrument lodged by the Board under paragraph (a) without being concerned to inquire into its regularity or validity, and upon registration of the instrument must cancel the registration of the deed, instrument or document declared by the Board to be void.
(4)
Subsection (1) does not apply if the security or collateral is to be created or granted in favour of —
the Board;
an approved financial institution; or
any person or person belonging to a class of persons prescribed by the Minister as a person to whom, or a class of persons to which, subsection (1) will not apply.
(5)
Subsection (1) does not apply to any contract, agreement or arrangement under which an approved financial institution uses any of its interest in any security over any protected property as security or collateral for the grant of any facility by the MAS to the approved financial institution.
(6)
No protected property is to vest in the Official Assignee on the bankruptcy of the owner thereof.
(7)
No protected property is to be attached in execution of an order of any court unless the order of the court is obtained by —
a mortgagee in exercise of the mortgagee’s rights under a mortgage created with the prior written consent of the Board over that property; or
a chargee in exercise of the chargee’s rights under a charge under any written law over that property.
(8)
Subsections (6) and (7) do not apply if the sole owner of any protected property is not a citizen of Singapore or, where there is more than one owner, all the owners are not citizens of Singapore.
(9)
No trust in respect of any protected property may be created by the owner thereof without the prior written approval of the Board.
(10)
Every trust which purports to be created in respect of any protected property without the prior written approval of the Board is void.
(11)
No person is entitled to any protected property (or any interest in such property) under any resulting trust or constructive trust whensoever created or arising.
(12)
In this section —
Definition
“approved financial institution” means —
any bank licensed under the Banking Act 1970;
any finance company licensed under the Finance Companies Act 1967;
any direct insurer licensed under the Insurance Act 1966; and
any merchant bank licensed under the Banking Act 1970;
Definition
“facility” means an arrangement between the MAS and an approved financial institution under which the MAS provides funding to the approved financial institution, and includes a credit facility and a repurchase transaction;
Definition
“MAS” means the Monetary Authority of Singapore established under section 3 of the Monetary Authority of Singapore Act 1970;
Definition
“proceeds of sale”, in relation to any property, means the proceeds from any transaction involving the sale, transfer, conveyance, assignment, mortgage, charge or the disposal in any manner of the property or an estate or interest in the property;
Definition
“protected property” means any flat, house or other building that has been sold by the Board under the provisions of this Part;
Definition
“Registrar of Deeds” means the Registrar of Deeds appointed under the Registration of Deeds Act 1988 and includes any Deputy Registrar of Deeds;
Definition
“Registrar of Titles” means the Registrar of Titles appointed under the Land Titles Act 1993 and includes any Deputy Registrar of Titles and Assistant Registrar of Titles.[51