What do you own in buying a 99LH condo unit?

[Secretariat]

(The following applies to all strata developments including HDB, and to a certain extent Townhouse)

Condominium, as a type of housing development, is not a modern idea. Its history can be traced to the Roman era and the first condo development in London can be traced to Leicester Square in 1850s.

Condo does not represent a type of housing architecture, but a type of legal ownership of the development called Strata. Its invention was primarily for a freeholder (of the FH land and the building constructed on the land) to solve a problem; how not to pay for the maintenance of the building or houses he was leasing to tenants.

Again, this idea originated at least more than 100 years ago by some savvy businessmen.

But lets go back to the ownership question first, before talking more on maintenance.

What do you own when buying a condo unit? There are essentially two parts; ownership of the unit, and ownership of the common property.

Ownership of the Unit.

There are two definitions:

- If you ask an american attorney, and being american, you are likely to get a sweeping answer like "you own the box of air within the unit",

- If you ask an english lawyer, you are likely to get an answer like "you own all the internal walls and the fixtures that come with it, and half of those walls you share with your neighbors and the common property"

There is not much difference between the two definitions, practically, because if you intend to tear down an internal wall for example, the prior consent of the condo MC is needed.

Same as in the situation of HDB.

Ownership of Common Property

The structure of the condo building, the land, the swimming pool, the carpark etc are collectively called common property, which is legally owned by all the units in the condo, in proportion to the share values, in tenants-in-common.

Notice the wording "units" above.

In other words, the ownership is attached to the unit. Which means that when the unit is sold by an owner, the owner has no rights to dispose his share in the common property asset.

This is not really significant, unless the sinking fund is huge for some funny reason, and the owner wants a share of it. He will be denied.

Then who owns the legal title of the common property?

......to be continued in next post

[Secretariat]

The condo MC owns the legal titles of the property; the land & the building structure. The "C" of MC refers to a corporation, so it has all the ingredients and duties of it; audited annual accounts, mandatory AGM, EGM where calls for etc. The appointments to the MC have all the fiduciary duties, and the chairman can be criminally charged if, for example, misappropriating the sinking fund.

So, basically, each unit becomes a shareholder of this corporation. Therefore, for the issue of land title, the unit has no direct stake in the land itself, but a stake in a corporation that owns the land.

And this is not even necessary true if you are buying a condo in, for example, London. Do not be surprised to find that the common property of a condo development there, the common property's legal title is still vested in the freeholder or developer, but you will still need to contribute to the condo maintenance & sinking fund. The freeholders are still well represented and protecting their rights in the House of Lords.

This is my understanding for the subject, so please point any errors for the benefit of the forum.

[phantom_opera]

You must be a Legal Secretariat

[richwang]

Is there a separate physical legal title for the common property?
I have not seen such document.

Thanks,
Richard

[buttercarp]

"In other words, the ownership is attached to the unit. Which means that when the unit is sold by an owner, the owner has no rights to dispose his share in the common property asset."


From this statement, I gather that after the owner has sold his unit, he still has a share in the common property?

Most of the time, when a development is old, there may be lacking of funds.
Does it mean that the MC can demand that the previous owner contribute to this fund even though he has sold his unit ?

[richwang]

No. Once you have sold your unit, you will not be liable for what happens afterwards.
However, if you buy a resale unit, you will be liable for the debt the previous owner owe.

http://statutes.agc.gov.sg/aol/searc...rec=0#pr38-he-.


Contributions by subsidiary proprietors


40 (4) A person who has ceased to be a subsidiary proprietor of the lot shall only be liable to pay the contribution levied under this section or section 41 and which was unpaid at the time he ceased to be a subsidiary proprietor, plus the interest accruing on the unpaid contribution until such time as it is paid.

40 (3) If, at the time a person becomes a subsidiary proprietor of a lot, another person is liable in respect of the lot to pay a contribution levied under this section or section 41, the subsidiary proprietor shall, subject to section 47(3), be jointly and severally liable with the other person for the payment of the contribution and interest on the contribution.

Thanks,
Richard

[richwang]

"In other words, the ownership is attached to the unit. Which means that when the unit is sold by an owner, the owner has no rights to dispose his share in the common property asset."

My reading of this statement is that there is NO separate Title Deed for Common areas. If you look at your Title Deed again, it lists the Project, the total shares and your shares.

So the common area ownership is distributed to each unit.
Once you sell your unit, you don't own anything in the common area anymore (in line with common sense).

Thanks,
Richard

[Secretariat]

No. Once you have sold your unit, you will not be liable for what happens afterwards.
However, if you buy a resale unit, you will be liable for the debt the previous owner owe.

http://statutes.agc.gov.sg/aol/searc...rec=0#pr38-he-.


Contributions by subsidiary proprietors


40 (4) A person who has ceased to be a subsidiary proprietor of the lot shall only be liable to pay the contribution levied under this section or section 41 and which was unpaid at the time he ceased to be a subsidiary proprietor, plus the interest accruing on the unpaid contribution until such time as it is paid.

40 (3) If, at the time a person becomes a subsidiary proprietor of a lot, another person is liable in respect of the lot to pay a contribution levied under this section or section 41, the subsidiary proprietor shall, subject to section 47(3), be jointly and severally liable with the other person for the payment of the contribution and interest on the contribution.

Thanks,
Richard

This is nice.

Can you interprete the power of the Commissioner under Part III clause 6?

[CondoInterested]

Err... I am confused... Are we talking about FH here or LH?

[buttercarp]

Err... I am confused... Are we talking about FH here or LH?

The title says we are discussing about 99LH.
Any difference?

[richwang]

OOPS. So we are only talking about LH.
For HDB, it is very clear. You don't have any title even after fully paid up.
I only get a duplicate copy of Title which clearly says I am paying $1 rental every year. So I am just a long term tenant.

I don't own 99LH PC. Could someone who has fully paid up 99LH PC comment?

Thanks,
Richard

[richwang]

Can you interprete the power of the Commissioner under Part III clause 6?

It basically says the authority can request you to paint your condo every 5 or 6 years,etc.
This is a very good law, that's why Singapore condos are so beautiful. In other countries, authority may not have such power, so condos can be very run down after years.

Thanks,
Richard
==================

Commissioner may require building owner, etc., to carry out repairs, etc.

6.—(1) Where, in the opinion of the Commissioner — (a)
any building or any common property or limited common property (whether or not an exterior feature) has not been kept or maintained in a state of good and serviceable repair or in a proper and clean condition; or

(b)
any exterior feature of a building has not been kept or maintained in such manner as to be securely fixed to the building and as will prevent any collapse of such exterior feature or its support,

[Secretariat]

My reading of this statement is that there is NO separate Title Deed for Common areas. If you look at your Title Deed again, it lists the Project, the total shares and your shares.

So the common area ownership is distributed to each unit.
Once you sell your unit, you don't own anything in the common area anymore (in line with common sense).

Thanks,
Richard

Quite practically, there is not a physical title deed, because the units are in different stages of being paid off. And then during the duration of the 99-years leasehold, units are also changing hands.

So, how to enable the MC to function, how to enable a bank to lodge of caveat?

Read further in the Strata Title Act, on the role of the President and the Minister.

[buttercarp]

OOPS. So we are only talking about LH.
For HDB, it is very clear. You don't have any title even after fully paid up.
I only get a duplicate copy of Title which clearly says I am paying $1 rental every year. So I am just a long term tenant.

I don't own 99LH PC. Could someone who has fully paid up 99LH PC comment?

Thanks,
Richard

For PC, when you fully paid up, you go to the lawyer's office and pay the lawyer, then they give you the original title deed.

[Secretariat]

It basically says the authority can request you to paint your condo every 5 or 6 years,etc.
This is a very good law, that's why Singapore condos are so beautiful. In other countries, authority may not have such power, so condos can be very run down after years.

Thanks,
Richard
==================

Commissioner may require building owner, etc., to carry out repairs, etc.

6.—(1) Where, in the opinion of the Commissioner — (a)
any building or any common property or limited common property (whether or not an exterior feature) has not been kept or maintained in a state of good and serviceable repair or in a proper and clean condition; or

(b)
any exterior feature of a building has not been kept or maintained in such manner as to be securely fixed to the building and as will prevent any collapse of such exterior feature or its support,

Yes.

So, for a private property, how come the Commissioner (a public servant) has that power?

Does the Commissioner has the same power to force a non-strata building owner to paint etc?

[Secretariat]

OOPS. So we are only talking about LH.
For HDB, it is very clear. You don't have any title even after fully paid up.
I only get a duplicate copy of Title which clearly says I am paying $1 rental every year. So I am just a long term tenant.

I don't own 99LH PC. Could someone who has fully paid up 99LH PC comment?

Thanks,
Richard

For HDB, the Town Council is the equivalent of MC for condo.