July 20, 2007

Minority owners go to court to revoke en bloc sale

$287m sale not made in good faith, say seven owners

By Elena Chong, Court Correspondent

FIGHTING THE ORDER: Seven minority owners of Futura condominium are appealing against the STB order. -- ST PHOTO: ALPHONSUS CHERN

MINORITY owners of the Futura condominium, which was sold en bloc last year for $287.3 million, have gone to court, claiming that the sale was not made in good faith.

The seven dissenting owners of the freehold condominium in Leonie Hill Road are appealing against an order by the Strata Titles Board (STB) on May 23 approving the collective sale.

Among other things, the STB has ordered all owners, including those who have not signed the collective sale agreement, to be bound by and comply with the terms and conditions of the sale.

An application by the seven, represented by Mr Henry Heng Gwee Nam from Tan Peng Chin LLC, to dismiss the order and suspend the sale pending the final determination of the appeal is to be heard before Justice Woo Bih Li today.

The development, comprising 69 units and three penthouses, was completed in 1976.

Occupying an 87,034 sq ft site, it has a plot ratio of 2.8 and a maximum gross floor area of 243,695 sq ft.

The condominium was put up for collective sale at $295 million in a tender last year.

A subsidiary of City Developments, City Sunshine Holdings, clinched the deal at $287.3 million last October.

Each flat owner will get about $3.7 million while penthouse owners will get $9.4 million each.

Court documents filed by the applicants say the STB failed to consider that the $287.3 million was not secured in good faith.

Within three hours on Oct 23 last year, the amount was reduced from the initial price of $291 million.

The minority shareholders allege that no land survey was done, and no minutes were kept of the sales committee meeting. Nor was a meeting of owners called before the reduced price was accepted.

The appellants say the STB failed to take into account or give significant weight to the allegation that the sales committee failed to discharge its obligations.

Thus, they argue, the sales committee's decision to accept the $287.3 million was unauthorised.

Based on the affidavits, it appears that the grounds of decision by the STB have not yet been published.

Mr Matthew Saw from Lee & Lee is appearing for the majority owners.

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