8th 4-weekly Notice

As of 16 April 2011, 46 units signed the CSA, making up 30.5% of total share values.

Tags: bgv, botanic gardens, botanic gardens view, en bloc, condo, en-bloc, enbloc, csa, collective sale agreement, signing

7th 4-weekly Notice

As of 19 March 2011, 46 units signed the CSA, making up 30.5% of total share values.

Tags: bgv, botanic gardens, botanic gardens view, condo, en bloc, en-bloc, enbloc, csa, collective sale agreement, signing

6th 4-weekly Notice

As of 19 February 2011, 44 units signed the CSA, making up 30.1% of total share values.

Tags: bgv, botanic gardens view, en bloc, en-bloc, enbloc, csa, collective sale agreement, signing

5th 4-weekly Notice

As of 22 January 2011, 44 units signed the CSA, making up 30.1% of total share values.

Tags: bgv, botanic gardens, botanic gardens view, botanic gardens view, en-bloc, enbloc, cas, collective sale agreement, signing

4th 4-weekly Notice

As of 25 December 2010, 42 units signed the CSA, making up 28.8% of total share values.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, csa, collective sale agreement, signing

3rd 4-weekly Notice

As of 27 November 2010, 42 units signed the CSA, making up 28.8% of total share values.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en-bloc, enbloc, csa, collective sale agreement, signing

2nd 4-weekly Notice

As of 30 October 2010, 40 units signed the CSA, making up 27.4% of total share value.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, csa, collective sale agreement, signing

1st 4-weekly Notice

The CSC is required by law to put up a 4-weekly notice to update residents on the enbloc.

36 units signed as of 2 October 2010 making up 24.7% of total share values.

Tags: botanic garden, bgv, botanic gardens view, en bloc, en-bloc, csa, collective sale agreement, signing

Outcome of 4 September EOGM

The method of apportionment in the BGV CSA was approved.
Total number of votes casted : 86 share values
Number of votes casted For: 51 share values
Number of votes casted Against: 35 share values

The terms and conditions of the CSA was approved.
Total number of votes casted : 82 share values
Number of votes casted For: 44 share values
Number of votes casted Against: 35 share values

The first signing started on 4 September after the EOGM.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, csa, collective sale agreement, apportionment method, eogm

Action Needed

Dear fellow owners,

The Sale Committee has now called for another EOGM, and is seeking proxies for its position. It would appear that they are determined to begin the collective sale process, starting off with an increase of the recommended Reserve Price (RP) to $xxx million (figures removed for confidentiality reason). This is despite some of the serious misgivings that we, and other owners, have raised in the last EOGM and through written feedback, all of which have not been addressed.

Before deciding whether to sign the Collective Sale Agreement (CSA), we urge you to consider the following issues:

1. All owners need to be aware of the contingency clause 4.1.4 which allows the Sale Committee to go for a lower sale price. In other words, it does not matter if the RP is $xxx million, or $xxx million (figures removed for confidentiality reason), or even $888 million. So long as the CSA gives the Sale Committee the power to accept a lower sale price, there is absolutely no guarantee to any owner that the amount stated in Schedule 2 (Method of Apportionment) is exactly what you will get.

2. While the contingency clause 4.1.4 might reflect ‘common practice’, it contradicts the very bullish and positive signals and rhetoric of the Sale Committee and ultimately expresses a lack of confidence in achieving the recommended RP of $xxx million. A more ‘realistic’ sale price might be offered to the Sale Committee, one that is far below $xxx million, and clause 4.1.4 gives the Sale Committee the power to accept such lower sale price. We have advocated the removal of Clause 4.1.4 from the CSA but this has been ignored.

3. We also questioned, during the last EOGM and via written feedback, the exact and detailed process by which clause 4.1.4 would be executed. What happens if a lower sale price is offered? How will owners be contacted? Who will be contacted? How will the signing of the supplemental agreement be conducted and for how long? What happens if 80% is not reached? Shouldn’t an EOGM be required? The actual process remains vague and ambiguous, which contrasts with the very precise legal nature of the rest of the CSA.

4. We understand that the proposed 60:40 method of allocation of sale proceeds is not acceptable to many owners, who want it to be on the basis of 50% strata area and 50% share value. This would be a fairer basis, as all owners have been paying the same amount towards maintenance and sinking funds all along, regardless of the size of their apartments. Again, this has been requested at the previous EOGM and in written feedback, but the Sale Committee has not acceded to owners' feedback.

5. Another major issue is the exclusion of liability and indemnity clauses in favour of the Sale Committee. These effectively provide that even if the Sale Committee makes mistakes or is negligent, it is excused from liability to the Sellers. If you sign the CSA, you will not be protected at all from any mistakes or negligence of the Sale Committee, and you will have to bear any losses or damages due to such mistakes or negligence yourself. For example, in the Horizon Towers case, when the owners who signed the collective sale agreement were sued for damages by the buyer, they had no recourse against the sale committee. We had previously asked for these provisions to be removed, for owners' protection.

These are very serious problems we have found with the CSA and with the collective sale process. We have repeatedly raised them to no avail. Whether you are for or against the sale is irrelevant when you consider the consequences of these 5 points in the event that a lower sale price is the best offer on the table, or when close legal scrutiny is made of the entire sale. If you agree with us - that the CSA is insufficient, that the conditions are not right, that you worry you might not get what is declared in the method of apportionment, that the method of apportionment of proceeds is not fair, or that there is insufficient legal protection for owners – and you are unable to attend the EOGM, then we request you respectfully to consider giving us your proxies for the EOGM. If you are unsure whether you will be able to attend the EOGM, you may wish to send us the proxy form first. In the event that you are able to attend the EOGM, your proxy will automatically be void by law, and you will be able to exercise your vote personally.

A proxy form is attached for your use. Please pass the completed and signed form to Mr Tan Lai Huat (at Blk 1 #xx-xx) or Ms Wong Hwei Ming (at Blk 9 #xx-xx) or to the Management Office at your convenience, but by no later than Wed, 1 Sep 2010 (as the forms have to be deposited at the Management Office by 2 Sep 2010).

Finally, we would respectfully urge that you take some time now to consider the effect of the CSA on your position and take any professional advice you deem appropriate, rather than wait and see what happens.

This is very important because although you may choose not to sign the CSA now, if the CSA is passed in its current form at the EOGM, and if it later becomes binding on all owners by reason of an order of the Strata Title Board, it will be too late to change any terms at that time. You will then become subject to all the terms of the CSA as it stands, including the sale price, the method of apportionment of sale proceeds, and the indemnity and exclusion of liability in favour of the Sale Committee. Please act now.

Thank you for taking the time to read and consider the points we have raised.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en-bloc, enbloc, singapore, csa, Collective Sale Agreement, EOGM, Reserve Price, collective sales committee, sales committee, CSC, apportionment, indemnity, liability, STB

Things to Consider

Dear fellow-owners,

1 In respect of the EOGM that Mr Lee of the Sale Committee is convening, we note that under the new amendments to the Land Titles (Strata) Act both (a) the terms and conditions of the Collective Sale Agreement and (b) the method of apportionment must first be approved by the EOGM before matters can move further. Since owners of both two and three bedroom apartments are represented among the contributors to this blog, we are, in the interests of fairness and transparency, not taking a position on apportionment. But we would urge you all to examine the apportionment methods that the Sale Committee proposes, and decide for yourselves whether you think they are fair to you, given the scale of your investment in your apartment in Botanic Gardens View.

2 As for the Collective Sale Agreement, we note that Mr Lee's call for an EOGM tried to imply that changes to the Collective Sale Agreement are being made to take account of the new regulations. This is of course debatable. As you will recall, the Sale Committee made changes to the Collective Sale Agreement quite a while ago, after the Horizon Towers judgement made it clear what happens to Sale Committees that act in bad faith. These changes were all to its own benefit and to the detriment of the signatories' legal rights. We are highly doubtful that they will have had the good faith to remove these changes. We therefore urge owners in Botanic Gardens View to consider (and if you support an en-bloc sale to reconsider) carefully, with appropriate legal advice, before agreeing to an en-bloc sale. Among other things, you may wish to ask your legal advisors to:
(a) advise you on the implications of the Sale Committee's power to sell below the reserve price,
(b) the requirement that the signatories indemnify the Sale Committee for their actions, and
(c) how and whether signatories can obtain appropriate protection from the Sale Committee for any losses you may suffer in relation to the en bloc sale.
The benefits of such a sale are illusory, except to the professional speculators, but the damage to our interests and living standards will be real, permanent and irretrievable. The easiest way to protect yourself is to simply refuse to either approve or sign the Collective Sale Agreement.

3 We think it helpful, for the benefit of any newcomers among us, to remind ourselves of the many reasons why this estate has specific reasons not to succumb to the Sale Committee's determination to sell:

The most important reason first. Where do we go?

Botanic Gardens View:
- is freehold
- is in District 10
- is next to the Botanic Gardens
- is next to a major hospital
- is five minutes from Orchard Road and
- has apartments that are very spacious and well-laid-out by current standards

No matter how high a price we get for our homes (and remember that under the most recent version of the Collective Sale Agreement, the Reserve Price may not be the price we sell at as there is provision made for a lower Sale Price), there is no way in the near or distant future that we will be able to afford replacement apartments with all these qualities. None of us will be able to afford to live in the city centre once we are driven from Botanic Gardens View. Most of us who live here do not own more than one property, unlike some members of the Sale Committee.

We have been told ad nauseum over the last few years that for the money we get we can buy brand new apartments with fancy facilities. It was seldom mentioned that at Singapore prices these would all have to be far away in outlying districts. We ask, and keep asking: why should we sacrifice everything that we have now for less? Small flats at higher prices, far from the centre, with far higher conservancy charges,with unnecessary facilities that most of us will not need or use but will still have to pay for? And it is clear that given the housing market in Singapore, most of us will not even have any nest-egg left over, once we have been forced to spend the proceeds of Botanic Gardens View on inferior, substitute accommodation.

4 As the above list reveals, Botanic Gardens View is a unique site. Its long-term value will not go down. Why should a developer reap the benefits of this? We know who will own our estate if we sell, and it will not be ordinary Singaporeans such as ourselves. We consider our homes here to be long-term investments, and we see no reason to throw them away simply so that quick profits can be made at our expense.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, condo, en bloc, en-bloc, enbloc, singapore, CSC, sales committee, CSA, Collective Sales Agreement, apportionment, EOGM

Problems of (In)Validity and (Un)Reliability with the CSC Survey Form

Dear Fellow Owners and Residents of BGV,

We are pleased that the BGV Collective Sale Committee has made one change in its proposed new draft Sale Agreement, to the apportionment method. As can be seen from the various blog posts highlighting the efforts that owners have taken to examine the CSA in depth, including various legal aspects of the contract, the CSC has nevertheless chosen to ignore most of their concerns with the proposed CSA. We wish to reiterate that the points listed here are not trivial matters but have legal and binding consequences for all owners.

Therefore, we wish to point out the following:

1. There is still no guarantee that the BGV Enbloc Sale will sell at $xxx,000,000 (figure removed due to its sensitive nature). This is because of the clause in the CSA that allows the CSC to accept a lower sale price.


2. There is ambiguity in the process of informing owners of a lower sale price and getting their approval, opening up the possibility of loopholes, abuse and a lack of transparency in how matters will be properly conducted.


3. We now have three different apportionment methods offered to owners – (1) the CBRE’s 1/3 share values:1/3 strata area: 1/3 valuation; (2) Credo’s 70:30 method; (3) Credo’s revised 60:40 method. The latest revision seems to be an arbitrary one that does not seem to conform with the Singapore Institute of Surveyors and Valuers’ recommendations. No rationale is provided for the change in apportionment method, either.


4. The revised CSA does not address the issue of adequate legal protections for the subsidiary proprietors and the MCST from liability and damage caused by actions of the CSC, as well as from non-performance by an intended purchaser. The recent law suit against the Horizon Towers CSC will serve as a reminder of the need for legal protection for all owners to be addressed.


5. Lengthy discussions at the last EOGM and extended written feedback from owners have resulted in minor changes in the CSA and apportionment methods without addressing the serious concerns owners have. This raises the question of to what extent does the CSC take feedback from owners seriously.

We note that the CSC wishes to ascertain our views in respect of the continuation with or termination of the BGV Enbloc Sale. We have no objection in principle. However, we note certain problems with their Survey Form, which if uncorrected will render this exercise pointless. The most obvious problem is that there is no provision for the signatory to confirm their identity. There is therefore no way to determine whether a returned Survey Form is genuine or not. There is nothing to stop any party from, for instance, photocopying fifty forms and filling out names and addresses, on the side that pleases them, either for or against. Accordingly, the result of such a survey, whether for or against, could not properly form the basis of any decision. An attempt to use such forms to support the continuation of the BGV ENbloc Sale and the Sale Committee's existence, for instance, would certainly be open to legal challenge.

We therefore strongly suggest that:
(a) the survey form be modified to include provision for the signature of all subsidiary proprietors of the unit;
(b) all survey forms that do not have the name(s), apartment number or signature(s) should be discounted; and
(c) the survey forms should be counted by the entire MC.

We understand that many people are concerned about the possibility of harassment if they reveal their views. The events in, for instance, Laguna Park, where pro-sale elements committed acts of criminal vandalism and then tried (unsuccessfully) to blame them on anti-sale apartment owners, show that this is not an unfounded fear. However, if strict security is maintained, and the Survey Forms are not revealed to anyone but the MC and the CSC, any act of harassment should be easily traceable and appropriate action can be taken.

We therefore urge the BGV Collective Sale Committee to take account of the above and (i) revise the new proposed draft CSA to address the feedback highlighted above and (ii) revise the Survey Form so that it is actually valid, useful and usable.

Tags: apportionment, Collective Sale Agreement, collective sales committee, csa, CSC, En-bloc Sale, enbloc, EOGM, harrassment, Management Council, sales committee, survey

CSC Letter cum Survey

On 3 February, those of us staying at BGV received a letter from the BGV CSC. For those living off-site or overseas, they would have received the letter anytime from 4 to 9 February.

The letter from CSC is reproduced below.



The main points in the CSC letter are that:
1. The CSC has agreed to a marginal compromise with regards to the apportionment method in the CSA.
2. The CSC seeks to determine if BGV owners wish to continue or to call off the BGV enbloc sale via a survey.

While we applaud the CSC for wanting to hear from us owners with regards to our thoughts about the enbloc sale of BGV via the survey form, we have serious concerns with the validity and reliability of the survey form. We shall address our concerns in the next post.

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, real estate, singapore, csc, collective sale committee, sale committee, apportionment, letter, survey, csa, collective sale agreement

Problems with a Lower Reserve Price

Here's another letter sent to the CSC with regards to the draft revised CSA. Names have been anonymised at the request of the authors.

31 Dec 2009

To the Collective Sale Committee and Credo Real Estate:

Dear Sirs/Madams,

I am writing on behalf of owner of Blk 1 of Botanic Gardens View, who has appointed me as representative on the matter of the collective sale of Botanic Gardens View (BGV).

During the Extra-ordinary General Meeting (EGM) dated 23 August 2008, I and others, have raised a number of critical issues that are seen to be highly problematic both in the collective sale process, and in the Collective Sale Agreement (CSA). Since then, an amended CSA had been sent out to all owners dated 18 October 2009. In the letter from the Mr John Lee, Chairman of the Collective Sale Committee (CSC), it was stated that:

"After deliberations and taking into account the various proposals raised by a few owners at the EGM, the Collective Sale Committee (CSC) agreed with the amendments as proposed by Mr. Norman Ho. A set of the amended pages of the CSA is enclosed for your reference."

I note that the amended CSA included several changes made to Clause 4.1.4 (on the matter of the lower reserve price), with minor changes elsewhere. While this appears to indicate that the CSC may have taken into consideration the “various proposals”, upon closer reading of the amended Clause 4.1.4, I am very disappointed that majority of the issues raised on the 23 August 2008 EGM were not addressed. In fact, my reading of Clause 4.1.4 is that the revision serves to tighten a possible loophole to prevent Sellers who withdraws from the CSA because of the lower sale price from seeking legal action against the CSC and other Sellers.

I wish to reiterate the issues that I raised during the 23 August 2008 EGM, and which is still relevant now, on the following points of the apportionment method and the CSA:

Proposed Apportionment Method

1. I am unclear on how some of the figures were obtained in the powerpoint slides printout provided by Credo. For example, on the slide titled “Apportionment Method – A Comparison” which compares between the 70/30 method (Credo) and the 1/3+1/3+1/3 method offered by CBRE, the values for the latter method are dissimilar to my own calculations. Using CBRE’s apportionment method (which is stated at 1/3 Valuation, 1/3 Strata Area, 1/3 Share Value), these should be:

[Table inserted here has been removed due to its sensitive content.]

Firstly, the values on the powerpoint slides for the 1/3 CBRE method shows deceptively similar values to the 70/30 Credo method. Owners might think that there is not much of a difference between the two methods when for owners of 117sqm units, the difference is substantial at over -$114,405 if we compared CBRE values against Credo values (see pdf file with calculations). I would like to know how Credo derived their 1/3 method apportionment of proceeds, which is quite different from those calculated using CBRE’s apportionment values.
Secondly, using the argument of narrowing the variation between upper and lower bands of premium over valuation is incorrect. In the example of 1/2SA+1/2SV used in the letter dated 12 Sep 2008, a 1% premium increase for a 117sqm unit size amounts to $29,756, whereas a 1% premium increase for a 163sqm unit size is $46,097. In other words, a 2% increase in the smallest unit is almost equivalent to a 1% increase for the largest unit. So, saying that the smallest unit gains 135% premium compared to the largest unit’s 103% premium is deceptive when looking purely at the percentage increases, as it might look to the reader that the smallest units gain proportionately more relative to the biggest units, when that simply isn’t accurate.
The better approach is to look at the apportioned amounts offered by Credo (70/30) and by CBRE (1/3 method) and consider the differences between the two methods. When viewed this way, the 38 units that are 150sqm and above have a positive difference, whereas over 108 units have a negative difference ranging from from -$82,231 to -$114,405. In other words, 108 units will stand to lose the equivalent cost of buying a car if they go with the Credo method. This is untenable and unfair. Given that the argument of using variation is questionable, I would like to see further justification of why the 70/30 method is a ‘fairer’ option for all owners. I would like to see evidence that other estates of similar configuration as BGV have adopted the 70/30 method, or failing that, why this estate is more suited to the 70/30 method over all other methods, without using the variation argument.

Lower Reserve Price Amendments

2. What are the detailed procedures on the dissemination of information on the lower reserve price and the process of the “signing of a supplemental agreement”?
a. This is not clearly defined and stated in the CSA, and needs to be done in as explicit a manner. I fail to see why such procedures are not explicitly described in a legal document such as the CSA when procedural matters are clearly explicated in the Land Titles (Strata) Act’s First to Third Schedules. For example, the LTSA requires that a general meeting be held “to provide information on the number of offers received for the collective sale and the respective amounts” (Third Schedule, 7.1.f, LTSA). By law, therefore, the CSC is required to hold at least one EGM to inform all owners of offers received, and subsequently, if they wish to accept a lower sale price. It is unclear, however, how and when will owners be notified of the opportunity to sign any supplemental agreement. Neither does it provide any information on how long will this process of signing the agreement take.
b. The revised Clause 4.1.4.a where “if the proposed sale price is lower than the Reserve Price, the Seller’s Approval shall be required (by way of signing of a supplemental agreement) before accepting such lower sale price” must be taken to read that not less than 80% share values in the Management Corporation and with not less than 80% of the total strata title area of all Units (excluding area of any accessory lot), ie the “Seller’s Approval”, must sign the supplemental agreement. Is this the case – that should a lower sale price be proposed, the CSC must obtain the signatures of owners that would constitute the Seller’s Approval in the supplemental agreement, before such a sale price can be accepted?
c. If (b) above is correct, then it should be included within the CSA, that the signing of the supplemental agreement must begin at the same EGM to inform owners of the offers received. A deadline must also be stipulated on how long could this collection of signatures for the supplemental agreement take. Otherwise, this supplemental signature collection can in theory last a year from the first signature on it. A reasonable length of time to collect the required Seller’s Approval signatures for a lower sale price, should be not more than 1 month, given that all owners would be aware and the CSC is able to keep everyone informed. This will set owners at ease that there is a reasonable and tangible outcome to this round of collective sale at a lower sale price, whether it is successful or not. Likewise, developers will also be assured that their offer will be taken seriously and not be dragged out for a lengthy period of time while the CSC collects the required signatures. A short and practical deadline will ensure that any change in market circumstances will not affect the proposed lower sale price. Any lengthier period of time will only complicate matters and any argument not to include a deadline needs to be justified to all owners.

3. Does the supplemental agreement required for a lower sale price supercede the signatures on the original CSA, as signed by Sellers? How does this have bearing on the Notice of Rescission fully entitled to Sellers by law which states that all Sellers are only allowed to rescind once from the CSA (also in Clause 6.1.37). So, if a Seller rescind once in the original CSA, signs back on the CSA, finds out the sale price is lower than the RP, can he rescind again? It should be clearly specified in the CSA that in such a situation, the Seller is entitled to his right of rescission.

4. Why is there Clause 4.1.4.b that effectively prevents any owner who previously agreed to the sale (at the expected RP) but decides against accepting a lower sale price, from taking action against any of the Sellers who signed on the supplemental agreement? By law, if a subsidiary proprietor (SP) has not agreed in writing to the sale, he or she may file an objection with the STB. Is a SP who has decided against a lower sale price still entitled to file an objection with the STB? It should certainly be the case, at the very least. I fail to see why such SPs are not entitled to any action against any Sellers who have agreed to the lower sale price, and I would like to know the rationale for this.

5. Again, I fail to see why the clause for lower sale price (4.1.4) is included in the amended CSA by Credo/Rodyk when it was clearly absent in the CBRE CSA. As Mr John Lee’s letter dated 18 October has clearly cited “positive outlook” where the “high-end market (which is where we are) will likewise improve”, and given the recent push again for the collective sale, the CSC must be seen to be confident enough in achieving the reserve price that there should be no need for clauses for a lower sale price. This clause reflects a certain lack of confidence in achieving what is maximally possible for the estate, and an ambivalence in the collective sale. Given its highly problematic nature and the lack of procedural explicitness, I would strongly argue for the complete removal of Clause 4.1.4 from the CSA. This was also the view of others who spoke up at the EGM.

Seller’s Approval

6. Clause 11.2 allows for sellers to “appoint a representative to attend and vote at a Sellers’ meeting and in respect of His Unit, that representative shall attend and vote at the Sellers’ meetings for and on behalf of that Seller”. I note that the second mention of meeting is in the plural. I hope this is a typographical error and would like to point out that the appointment of a representative is valid for only one meeting and not for any subsequent meetings thereafter. This is to prevent any representative from continuing to exercise their voting power beyond the meeting that they are explicitly entitled to do so.

I thank the CSC for allowing me the opportunity to provide further written feedback, although I must admit that most of these are already voiced to the CSC during the 23 August 2008 EGM. I had assumed, given that the EGM was completely audio recorded and minuted, that issues raised then would be addressed in any future revisions to the CSA or apportionment method. I am disappointed that this was not the case. I can only hope that this formal written feedback will make the CSC consider, very seriously, what has been said both at the EGM and now in this letter. Repeating these objections again will only serve to reflect poorly on the CSC’s claims that they seek to be a reasonable and fair group of owners to represent the estate.

Yours sincerely,
Owner
Blk 1 Taman Serasi
Botanic Gardens View

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, real estate, singapore, csa, collective sale agreement, csc, collective sale committee, feedback, apportionment, RP, Reserve Price

Questions and MORE Questions

Here is a letter by another BGV owner for the CSC with regards to the apportionment method and the CSA. Likewise, this BGV owner is waiting to see if written feedback about the revised draft CSA will be taken into consideration by the CSC...

"Date: 2009/12/31
Subject: MCST 215 (Botanic Gardens View) - Revised Draft Collective Sale Agreement

Dear Sirs,

I refer to your letter dated 18 Oct 2009 and the revised draft Collective Sale Agreement ("CSA") enclosed therewith. In your letter, you asked for written feedback on the revised draft CSA.

I am writing to place on record the following points:

1. Feedback had already been given on the previous draft of the CSA at the Extraordinary General Meeting ("EGM") held on 23 Aug 2008, which lasted for several hours. The feedback given included vigorous opposition to, among other things, the formula for allocation of sale proceeds amongst the subsidiary proprietors, the clause empowering the Collective Sale Committee ("CSC") to enter into a sale below the Reserve Price, the clauses entitling the CSC to amend the CSA and the sale & purchase agreement without obtaining the prior approval of the subsidiary proprietors, and the existence of various clauses indemnifying the CSC and exempting the CSC members from all liability whatsoever. Also, I had requested for the inclusion of provisions to indemnify the subsidiary proprietors and the MCST against damage and liability caused by the actions of the CSC, as well as the provision of a performance bond to ensure performance by the purchaser.

2. Further, it should be noted that at the EGM, the correctness of the figures presented by Credo in support of the proposed formula for allocation of sales proceeds was questioned by subsidiary proprietors. Credo insisted that the figures were correct. However, Credo subsequently issued a letter stating that there were "typographical" mistakes in the figures presented at the EGM, without specifying what those mistakes were and without clearly informing subsidiary proprietors of the effect of the mistakes, which may make a material difference in the perception of subsidiary proprietors (especially those who had attended the EGM and saw the presentation by Credo) as to the decisions which they should make.

3. The feedback given at the EGM has not been taken into account in the revised draft CSA in any substantive or meaningful manner.

4. In particular, from the revised draft of the CSA, the CSC is intent on using the same formula for allocation of sale proceeds as set out in the previous draft of the CSA, notwithstanding that it has not provided satisfactory explanations as to why there was a change from the formula used in the previous en bloc sale attempt (which involved the same chairman and secretary as the current CSC). The formula for allocation of sale proceeds set out in the revised draft CSA is substantially and materially disadvantageous to the subsidiary proprietors of Block 1, and those of them who attended the EGM were totally against adopting this formula. It is grossly unfair to them as they each have one share in the MCST and have, all along, been paying the same maintenance and sinking fund amounts as the subsidiary proprietors in the other blocks.

5. Further, from the revised draft CSA, it also appears that the CSC is preparing in advance for a sale below the Reserve Price. The provisions in relation to such a sale below the Reserve Price do not adequately provide for the protection of subsidiary proprietors who may have signed the CSA on the basis of a sale at or above the Reserve Price. The revised draft CSA does not satisfactorily meet the many concerns raised by subsidiary proprietors at the EGM on this clause, on which the consensus was that it should be removed entirely, in the interests of the subsidiary proprietors as a whole. If such a clause is included in the CSA and potential purchasers are aware of its existence, no doubt they will utilise this to their advantage to reduce the purchase price.

6. Also, I would reiterate my position that the subsidiary proprietors and the MCST must be adequately protected under the CSA from liability and damage caused by actions of the CSC, as well as from non-performance by an intended purchaser. These protections must therefore be incorporated in the CSA, and the clauses indemnifying the CSC and exempting the CSC from liability for their actions must be removed. This is in the interest of all subsidiary proprietors and the MCST, and is absolutely necessary in view of the problems previously faced by subsidiary proprietors in other en bloc sales in Singapore. It is no excuse to say that this has never been done before, as the CSC is duty-bound to protect the interests of all the subsidiary proprietors, rather than adopt a CSA which is more favourable to purchasers in the hope of an easy sale, which may lead to problems for subsidiary proprietors subsequently.

7. It remains to be seen if any written feedback on the revised draft CSA will be taken into consideration by the CSC, after it has ignored the feedback already given at the EGM on the previous draft CSA. However, the CSC members should bear in mind the duties and obligations (including fiduciary duties and obligations) they each owe to all subsidiary proprietors, in the light of the Court of Appeal decision in the Horizon Towers case.

8. The CSA should be therefore be amended to take in the feedback mentioned above, and in due course be considered and decided upon by the subsidiary proprietors in a properly-convened general meeting. 9. Finally, I would also place on record that although the notice of the EGM specifically stated that the items on the agenda for the EGM were to "consider and decide on" the "apportionment of the sales proceeds" and "the terms and conditions of the draft Collective Sale Agreement (inclusive but not limited to the Reserve Price...)", the agenda was changed at the last minute at the commencement of the EGM, when the chairman of the CSA announced that the meeting would only be limited to a presentation and discussion of the draft CSA, and that the EGM would not in fact "decide on" the apportionment of the sales proceeds or the terms and conditions of the draft CSA.

Yours faithfully,
L.H. Tan"

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, condo, en bloc, en-bloc, enbloc, real estate, singapore, csa, apportionment, collective sales agreement, csc, collective sales committee, sales committee, feedback, reserve price, eogm, egm

Questions, Questions, Questions

Despite having asked the CSC several questions at the last feedback deadline of 30 October, the CSC has only responded to one of my questions by extending the deadline of written feedback with regards to the proposed apportionment method and the CSA from 30 October 2009 to 31 December 2009.

I have decided to email the CSC again with my previous questions as well as new questions with regards to the apportionment method and the CSA. Perhaps the CSC will have more time this time round to respond to all my questions.

For the sake of fairness and transparency, I have reproduced my email to the CSC for all to see.

"RE: Feedback on BGV Enbloc‏
From: BGV Stayer (enbloc_bgv@hotmail.com)
Sent: 31 December 2009 20: 39PM
To:
Cc: enbloc_bgv@hotmail.com

Dear Botanic Gardens View CSC,

I am writing in to place on record the various points as stated below:

1. During the EOGM held on 23 August 2008, the apportionment method of 50/50, removal of the lower reserve price clause, etc., were among the suggestions that surfaced. Although the CSC said they would consider the suggestions given by the owners, most, if not, all of them were not taken up. It would seem that written feedback is the only feedback that the CSC would seriously consider. This was not explicitly stated to owners either at the EOGM or via your previous letters. IT ALSO BECKONS THE QUESTION OF WHAT IS THE POINT OF HOLDING EOGMS IF THE VERBAL FEEDBACK GIVEN THEN ARE NOT SERIOUSLY TAKEN?

2. There seems to be a vote of no confidence in the market situation with the inclusion of the lower reserve price clause in the CSA. If the CSC has no confidence in the market, shouldn’t it be better to wait till the next upturn, rather than to sell BGV at whatever price we can? The lower reserve price clause should be removed to safeguard all owners against the quick sale of BGV. It seems like a case of “die die must sell”. We are NOT in dire strait that we need the money from the enbloc sale.

3. In the revised CSA, there are NO details on HOW the CSC will report the lower reserve price to all the owners.
a) Will ALL owners be informed? Or only the 80% who have signed the CSA will be informed? Or only the owners who are PRO-SALE sellers will be informed as they are likely to sign the supplemental agreement TO ACCEPT THE LOWER SALE PRICE?
b) How will all the owners be notified of the lower reserve price? Through an EOGM? Or through a selective process where only owners who are pro-sale sellers will be informed?

4. In the revised CSA, it seems to be a case where only those who AGREE to the lower reserve price have to sign the supplemental agreement.
a) As indicated in 3b, how can we be assured that the CSC has made every effort to contact each and every owner? What sort of assurance is the CSC giving to us, knowing that in the past, some owners had wilfully been omitted by the CSC from notification about the enbloc news?
b) In the case of owners who have signed the CSA but don't agree to the lower RP, what assurance do we have from the CSC and Credo that these owners would not be badgered and harrassed continuously into signing the supplementary agreement? Can we have assurance in black and white from the CSC and the lawyers that once these owners have indicated they want to withdraw from the CSA, they will be left alone thereafter?

5. There is no timeline stipulated for the informing of owners of the lower RP and no timeline stipulated for the collection of the supplemental agreement. The lawyers and the CSC have refused to set a timeframe in black and white citing it should be the developer’s/ buyer’s call. Therein lies the danger of allowing the CSC to NEGOTIATE with a potential buyer. If the timeline is going to be long drawn-out , e.g. if the CSC made arrangement with the buyer to sell BGV at the lower RP in exchange for 12 months to gather the signatures for the supplemental agreement, there is nothing we could do if the market picks up during the 12 months. That is not looking after the interest of the owners other than making a sure sale at a lower than agreed RP. A time frame of say, 2 months should be fixed by us, the owners so that we can be assured that the CSC is truly looking after our interests, that is, if after 2 months FROM THE FIRST SIGNATURE ON THE SUPPLEMENTAL AGREEMENT THERE WERE INSUFFICIENT SIGNATURES, the enbloc sale will STOP rather than compromise to a lower reserve price.

6. I have earlier feedback during the 30 October deadline that the CSC and Credo should explain in greater detail why you felt that the 70/30 method is far superior to the other 5 apportionment methods detailed in the Credo presentation (included with the 12 September letter). It remains to be seen if the CSC and Credo would clarify this point or choose to ignore a legitimate query.

7. Also in my earlier feedback, I have asked both the CSC and Credo to clarify on what criteria will you be considering individual owners’ feedbacks? Currently, it would appear that the CSC and Credo is firmly committed to the 70/30 method since it has remained the same despite the EOGM discussions. Likewise, the changes to the CSA appear superficial and is tightened only to protect the CSC further from unhappy owners should a lower RP prevail, rather than in response to the numerous concerns over the lower reserve price matter. In other words, how will you revert to all owners on the feedback received (ie the exact nature of said feedback), your responses to them, why you made the decisions you chose to make, including why you felt that any feedback is unacceptable. Again it remains to be seen if the CSC and Credo will answer a legitimate query or choose to ignore it at their own convenience.

Yours sincerely,
Wong Hwei Ming
Blk 9, #09-17"

Tags: bgv, botanic garden, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, singapore, csa, collective sales agreement, feedback, csc, collective sales committee, sales committee, apportionment

To Sell or Not To Sell - Asking the Right, and Hard, Questions

Dear fellow-owners,

As you will be aware, the Sales Committee has resurfaced with a new draft contract. To sum up our opinion of it, if you have read it carefully, you will see that signing it will deprive you of all rights against them in the event of malfeasance or negligence on their part, and will also bind you to accept whatever price they decide, no matter how low it is i.e. the reserve price might as well no longer exist for any effect that it will have. Today, however, we wanted to remind ourselves, and any newcomers to Botanic Gardens View why we continue to think that selling this estate en-bloc is a bad idea for all those owners who are not short-term speculators merely out to make a profit at the expense of our long-term interests.

1 This is an absolutely unique site, We are next to the Botanic Gardens, next to a major hospital, five minutes from Orchard Road. None of us, however much we get in an en-bloc (and given the new draft collective sales contract, the Sale Committee obviously thinks that it won't be very much, which raises again the question of why they are so desperate to sell our property in the first place) is ever going to get a replacement with all these facilities. Do we think that any developer is going to give us a decent flat in any redevelopment? The experience of the unfortunate former inhabitants of Gilman Heights should tell you that this is a fantasy. We need to face the truth that wherever we go after this, it won't be in the centre of town, it won't have the best garden in Singapore on its doorstep and it won't have the size and good layout of our homes. Given the current bubbliness of the property market, a replacement of equal quality and convenience will probably cost more than the Sale Committee's price for Botanic Gardens View. This is the fundamental reason for us, and we think that it will be an important consideration for many others. If your answer (as ours is) to "Where will you go after being kicked out of Botanic Gardens View?" is "I don't know", it is something to take very seriously.

2 This is an absolutely unique site and there is no way that it is going to lose its value. Why should we let a developer get the benefit of its long-term capital value by selling now? This is a long-term investment. Those of us who are not professional short-term speculators do not need to be impressed by get-rich-quick fantasies. When the next genuine property upturn occurs, this will be the only major site left undeveloped on this side of Orchard Road.

3 We are honest, and admit that the uniqueness of this site also has drawbacks. There is no evidence whatsoever that the URA will lift the height restrictions on development on this site (because it is next to the Botanic Gardens). There is even a possibility that the restriction will be returned to its actual original authorised limit of four stories. This will limit the immediate value of the site to a developer in the present market, though in the long run, as the population rises, this will become less important. This is a further reason why we should think long-term and not be bullied or seduced into sudden decisions against our own interests.

4 We recognise that this development is old. However, we point out that there is no reason why it cannot continue to give good service if it is properly maintained, on a proper schedule. We are watching the MC carefully to ensure that it complies with its legal obligations to maintain the estate, so that the estate is not deliberately allowed to run down in order to force us out, as has happened with other developments.

So we hope that the above will be useful for everyone reading this blog and everyone interested in continuing to get the benefits of living in BGV. We wish everyone a Happy New Year, and hope that we will enjoy many more of them in BGV. As always, we reiterate our long-standing suggestion that anyone thinking of signing the draft collective sale agreement should get independent legal advice on how it affects their legal rights and obligations. We are of the view that its effect is entirely negative. But of course, there is absolutely no need to sign it, for the reasons given above.

Tags: enbloc, botanic gardens, botanic garden, botanic gardens view, condo, en bloc, en-bloc, csa, collective sale agreement, sales committee, collective sales committee

Restarting Enbloc - By NOT Being Fair to Owners?

I recently received the CSC Enbloc letter (see below) and the revised CSA that is an attempt to restart the enbloc process at BGV after more than a year long hiatus.

While I cannot stop the CSC from doing so, I want to point out several points that seems to have been ignored from the period of the last EOGM in August 2008 until now which pertains to the fair treatment of all owners, including those staying overseas or off-site and the continued lack of transparent process in the enbloc attempt of BGV.

Upon receiving the enbloc letter, I am, in particular, appalled that an extremely short deadline is imposed on all owners to request for written feedback on the most important document of all - the CSA and the apportionment method. Does this mean, if by this short deadline, no response is provided (which is likely), then the CSC will ASSUME that everyone is happy?

Surely that can't be how a group that is charged with taking care of the collective sale of the estate attempts to get a sense of the sentiments on the ground?

For the sake of fairness and transparency, I have reproduced my email to the CSC for all to see.

"From: enbloc_bgv@hotmail.com
Sent: 26 October 2009 02: 01AM
To:
Cc: enbloc_bgv@hotmail.com

Dear Botanic Garden View CSC,

Your Enbloc letter dated 18 October Sunday and the revised draft CSA were received by hand on 20 October 2009 Tuesday. It can only be assumed that owners who stay off-site or overseas will receive their documents anyday from 21 to 29 October.

There are several points which I wish to raise with the CSC and Credo:

1. The deadline of 30 October 2009 for written feedback is too soon. It is also unclear what is the nature of the feedback that you are requesting to comply by the 30 October 2009 – only the apportionment method, or with regards to the revised draft CSA as well. Given that the revised draft CSA was delivered in this letter, I can only assume that the deadline of 30 October 2009 applies for written feedback for both apportionment method and the CSA.

2. You have therefore effectively given owners only TEN days (and for many, less) to provide their written feedback on important matters such as the CSA of which the apportionment method is a part of. This does not give enough time for owners who reside overseas and also owners who are currently overseas to mull over, consider and respond. Neither does it give time for owners to get in touch with legal counsel with regards to the revised terms of the CSA. Also, it need not be pointed out that it has been more than a year since any formal correspondence was made on this matter, and many owners may have forgotten the exact discussions on pertinent issues by now.

3. At the very least, since the CSC has taken over a year to revise the CSA, the CSC should allow all owners at least 2 months, until the end of December 2009, to consider and respond to these revisions of the CSA (including apportionment method). Anything less will reflect negatively on the way the CSC seems to be giving owners insufficient time to examine the revisions. I can only assume that after this ‘deadline’ whichever date it may be, there will be no further discussion on the matter of the CSA so it is imperative that time be given for all owners to read through the legal document carefully, and under advisement by legal counsel.

4. At the 23 August 2008 EOGM, there were complaints by owners on the apportionment method and yet these issues did not change the apportionment method in the revised draft CSA in any way. It would appear that these complaints were ignored, despite the assurance at the EOGM that all feedback will be reviewed and taken into consideration, written OR verbal.

5. In order for owners to make an informed decision about the apportionment method, I find that the justification provided by Credo in the letter dated 12 September to be insufficient as it does not provide detailed accounts of all 6 different methods described. It is not the responsibility of owners, many of whom are not familiar with proper calculations for apportionment methods, to calculate alternatives as requested by the letter dated 18 October. Instead, it is incumbent upon the CSC and Credo to show to all owners what each owner will be getting from the en-b! loc sale, for each of the 6 methods, and then and only then, can each owner make a decision on which alternatives are more suitable for them.

6. Therefore, I would suggest reprinting the slides from the Credo presentation (included with the 12 September letter) which detailed the apportionment calculations for the 6 methods, and explain in greater detail why you felt that the 70/30 method is far superior to the other 5 methods.

7. Also, on what criteria will you be considering individual owners’ feedbacks? Currently, it would appear that the CSC and Credo is firmly committed to the 70/30 method since it has remained the same despite the EOGM discussions. Likewise, the changes to the CSA appear superficial rather than in response to the numerous concerns over the lower reserve price matter (although I will consult a lawyer on this point). In other words, how will you revert to all owners on the feedback received (ie the exact nature of said feedback), your responses to them, why you made the decisions you chose to make, including why you felt that any feedback is unacceptable.

8. Finally, to be clear and fair to all owners, I believe the CSC should make it explicit that you are requesting for written feedback on the revised CSA in your 18 October letter (it is implied, but not explicitly stated). Otherwise, there needs to be an EOGM to discuss the revised draft CSA, to be fair to all owners. At the very least, as mentioned, the deadline for feedback needs to be pushed by at least 2 months, and the protocols, processes and decisions whereby the CSC will consider such feedback should be made transparent to all owners.

Response from the CSC and Credo to the above points raised would be appreciated. Thank you.

Wong Hwei Ming
Blk 9, #09-17"

Tags: botanic garden, bgv, botanic gardens, botanic gardens view, en bloc, en-bloc, enbloc, real estate, singapore, collective sale agreement, csa, collective sales committee, sales committee, csc, letter to owners, apportionment

Letters, Truths, ACTION!

After Mr Tan L. H.'s letter (dated 15 August), Mr John Lee sent out via email his rebuttal of the points mentioned in Mr Tan's letter on 20 August. For the benefit of all, we have put up Mr Lee's email on scribd. Below is Mr Tan's letter in response to Mr Lee's email of 20 August. Mr Tan's letter has been sent to all owners and residents of BGV on 21 August.

"21 August 2008
Dear fellow subsidiary proprietor,

In response to my letter dated 15 Aug 2008, John Lee has sent an e-mail dated 20 Aug 2008 to various parties. In his e-mail, he makes certain statements which are clearly incorrect and misleading, and which I feel I need to set the record straight on. My comments are set out in italics below John Lee's statements:

1. He says that my "letter contain (sic) misleading information which needs to be corrected. He is writing like he is protecting the interest of the owners, but he is in fact trying to create doubts in your mind about the integrity and rectitude of the Collective Sale Committee."
My comments: My letter makes it very clear that it states my own concerns and suggestions in relation to the formula for allocation of sale proceeds and the terms of the Collective Sale Agreement. As I emphasised several times in my letter, each owner should consider his own circumstances and take independent advice. I certainly did not claim to be protecting the interests of the owners. And I certainly did not say anything at all about the "integrity and rectitude" of the Collective Sale Committee anywhere in my letter, which touches solely on the issues involved.

2. John Lee says that "*The formula for apportionment of the sale proceed has been changed.* This is true. The Sale Committee found the previous method of apportionment (of 1/3 area, 1/3 share value and 1/3 valuation) to be cumbersome and complex. It raises more questions than answers. The valuation component can be challenged - e.g. why this valuer and not that valuer or why not 2 valuers instead of 1 valuer or will valuation done at the beginning of the en bloc still be applicable at the end of the en bloc (a period of 12 - 24 months)? The Sale Committee decided to use a straight ratio of area vs share value to avoid controversy and overcome complications. The ratio of 70% area and 30% share value was chosen because 1) it is the closest to the previous method under current valuation 2) as advised by the Consultant, it will pass the equity test of the Strata Title Board 3) it is used by other condos with the same configurations, i.e. 1 share value for differing sizes of the units and 4) this formula has been upheld by the High Courts in the case of Holland Hill Mansion."
My comments: is it true that the ratio of 70/30% is "the closest to the previous method under current valuation", and what exactly does that mean? The critical question is why was this new ratio chosen, when the previous sale committee - which John Lee chaired - applied the previous formula which is now lightly dismissed as "cumbersome and complex"? Which formula is in the best interests of subsidiary proprietors? And why 70/30% instead of 50/50%? John Lee should explain what has changed since the previous attempted en bloc sale to justify such a change.

Further, is John Lee saying that the Consultant has guaranteed that the 70/30% formula will be approved by the Strata Titles Board? If so, this should be obtained in writing from the Consultant, and incorporated in the terms of the agreement with the Consultant.

He should also let us know which successful en bloc sales "with the same configurations" applied the 70/30% formula.

And speaking of being misleading, in fact, in the Holland Hill Mansion en bloc sale that he mentions, the statra area/share value formula was indeed upheld by the Strata Titles Board, the High Court and the Court of Appeal - but the ratio applied was 50/50%, and not 70/30%!

3. John Lee said: "He says: "*There is no protection in the CSA for you as a subsidiary proprietor*.... and the case of Horizon Towers is again mentioned. It is true that the owners of Horizon Towers who signed the CSA were sued by the Purchaser to honour the Sale and Purchase Agreement. If you recall, the consenting owners at Horizon Towers changed their minds about selling their property after they have entered into a contract with the Purchaser, when they realised that a neighbouring property was sold for twice what they got for their property. Of course, the purchaser has the right to enforce their contractual rights under the terms of the Sale and Purchase Agreement. Will this be repeated in BGV? Not likely if consenting owners do not change their mind after entering into a contract."
My comments: Another misleading statement on John Lee's part. The majority owners in Horizon Towers were not sued because they "changed their minds". They failed to comply with certain legal requirements in their submission to the Strata Title Board, and the buyer sued on the basis that the sellers had failed to perform their contractual duty to make a proper application. Whether or not this was based on a change of the majority sellers' minds is an inference from the facts.

So the real question to be asked is, if the CSC makes a faulty application or some other mistake in the sale process, leading to the owners being sued, what recourse would the owners have against the CSC? As the CSA is currently drafted, none. Not only that, the CSA provides that the owners indemnify the CSC - in 2 clauses, no less (clause 6.1.38 and clause 10.3)! Why should the CSC not be held liable for their actions, when they are acting as agents and fiduciaries in relation to valuable properties? Why should the owners indemnify the CSC?

As an aside, it is unclear why there should be 2 indemnity clauses. And it should be noted that though the indemnity in clause 6.1.38 is at least limited to acts of the CSC "in connection with" the CSA, the Collective Sale and applications to the Strata Title Board, there is no such limitation in clause 10.3. So theoretically under clause 10.3 the owners indemnify the CSC against "all actions, costs, expenses, damages and claims" whether or not related to the CSA or the Collective Sale. How can this be acceptable to owners?

4. John Lee says: "*There is no provision for a performance bond from a bank to guarantee that the buyer will complete the sale and make full payment of the sale proceeds*. If Mr Tan is correct, then he should show us a Sale & Purchase Agreement with such a preposterous provision. No Developer will accede to this demand. It has not been done before and it will never be done ever. Our protection is in the 5 - 10% deposit placed with our solicitor, which will accrue to the owners in case of a default, and the advice of our Consultants on the bona fide status of the purchaser.
My comments: I have said in my letter that we are likely to be told it is not market practice. But that is no reason why we should not have a performance bond if the purchaser is really keen to buy our estate. Market practice has to start somewhere, doesn't it? And should we not learn from the lessons of other estates whose purchasers pulled out of their enbloc sales, to begin a market practice that protects us? The deposit is insufficient protection, as the potential damages for an owner who has contracted to buy another property may be much larger than his share of the deposit. I believe this is what happened in the aborted en bloc sales earlier this year.

In any event, if the purchaser is bona fide and does not intend to default, then it should have no problem giving the bond. But my point is that no one can say for certain that a seemingly strong company will not collapse - look at Bear Stearns and Enron, just to name 2 of the largest, most successful corporations that have collapsed without warning. The CSC should in fact be the party insisting on this in order to protect all owners' interests, and not say that "it has not been done before and will never be done ever". Is this indicative of how the CSC will be negotiating to protect owners' interests?

5. *He says: "The power of the CSC to enter into a sale below the reserve price, and other important terms of the sale, should be subject to approval of the subsidiary proprietors. *It is misleading and mischievous to suggest that the CSC can enter into a sale below the reserve price without the approval of the subsidiary proprietors. Clause 4 - Sale Terms Reserve Price: $630,000,000/ Higher if increased with the Sale Committee's approval and Sellers are deemed to agree to such increase. If the proposed sale price is less than the Reserve Price, the Sellers' Approval is required before accepting such lower sale price. Sellers' Approval is defined in Clause 11 of the CSA as "the approval of sellers constituting at least 80% of share value and at least 80% of the strata title area of all units". Similarly the terms and conditions of the CSA cannot be changed willy nilly without the approval of the owners.
My comments: if John Lee had read the letter carefully, he would have seen that I was referring to changes in the terms of the sale and purchase agreement to be entered into with the buyer, not the CSA. Under the CSA, the committee is empowered to change the terms of the sale and purchase agreement. And what is wrong with saying that if the CSC wants to enter into a sale below the reserve price, it should get the owners' approval? In fact, this should be done before any such sale is entered into, with clear explanations why the CSC recommends such action, and why the reserve price cannot be achieved.

Further, it is unclear how and when each owner's decision whether to agree to the sale below the reserve price is to be ascertained, and what time period an owner is given to make such a decision. In all, the mechanism for a sale below the reserve price is unclear, and owners would do well to ensure that it is clearly specified if they agree at all to such a provision. It could be said to look like advance preparation for a sale below the reserve price. Is there something owners should know about now?

In fact, having taken a closer look at the CSA, clause 5.6 does purport to give the CSC the power to change both the CSA and the sale and purchase contract willy-nilly, subject only to what is stated in the CSA and the law requiring Sellers' Approval!

6. John Lee says: “He is also trying to collect as many proxies as possible to influence the outcome of the EGM in his favour. Do not be misled and confused by him.”
My comments: In fact, it is John Lee and his CSC members who have been collecting proxies all along, making it appear like there is a majority in favour of the en bloc sale, when actually it is a minority. It just looks like a majority because this group of en bloc sale supporters attends and votes at the EOGMs, usually through proxies held by John Lee and his CSC members. So the end result is that resolutions passed at the EOGMs appear to be overwhelmingly supported, while in reality, the majority have not attended or voted.

Thus, I would urge all owners to attend the EOGM this Saturday, and all future EOGMs, so you can hear for yourself and make up your own mind about how the various issues raised above, and other issues that other owners raise at the meeting itself, will affect your own circumstances. Otherwise you leave your fate in the hands of a vocal, persistent minority who act with their own interests at heart.

Yours sincerely,
Tan Lai Huat
Blk x Taman Serasi #xx-xx
Singapore xxxxxx "


Below is a letter sent to our BGV email by an owner and the owner asked for the letter to be put on the BGV blog. We have reproduced it here for the benefit of all.

"21/08/2008
Dear Vanessa and Hwei Ming,

I’ve held back on making comments, but the latest email from John Lee about Tan Lai Huat has really infuriated me. Just as John Lee has answered point by point, I want to bring to the attention of readers and owners these points he made:

1. “His letter contain misleading information which needs to be corrected”.

In fact, I believe the information he provided is not misleading, but enlightening. The points raised by John Lee in his rebuttal is incorrect, and I’m sure they will be brought up at the EOGM, which I encourage as many of you to attend. For example, he suggested comparing ‘two documents’. I suggest you compare the CBRE CSA and the Credo CSA to see the ‘great disparity’. When compared in terms of sale proceeds, owners from Blk 1 stand to loose over $100k under the new CSA! I guess it is purely coincidental that none of the CSC members own units in Blk 1 so will not face this loss.

2. “He is writing like he is protecting the interest of the owners, but he is in fact trying to create doubts in your mind about the integrity and rectitude of the Collective Sale Committee”.

This couldn’t be more obvious than the misinformation from the CSC’s own blog. For example, they stated clearly on their blog in response to the question: Can the reserve price be lowered after owners sign the CSA? Their answer was: “No. The reserve price is the minimum that owners agree to sell at. If the reserve price is not achieved, a sale does not take place”. I urge you to read clause 4.1.4 carefully to see if “a sale does not take place”. Such a clause about a lower sale price is not present in the CBRE CSA, but this just points out that the CSC is clearly preparing for a lower offer and is preparing to accept such a lower offer. Why else have this clause?

Some more “true facts” from their blog. In their “Timeline of Events”, they stated that in Jan 2008, “Owners present vote overwhelmingly in favour of formation of Collective Sale Committee”. Sounds like the entire estate is “overwhelmingly” for the sale, right? But actually, only 61 units out of 146 total attended and could vote. A total of ONLY 37% of the ENTIRE estate voted for the new CSC. That, my dear neighbours, is the “true fact”. A MINORITY GROUP has decided to push THEIR OWN AGENDA with no regard for the MAJORITY who are not keen on the sale.

And the most insulting, which many of you who received John Lee’s correspondence will remember, is now put up under “Alternative Places to Stay”. He has omitted certain sentences that were in his original letter, which I’ll now include, IN BOLD:

… It will not make much sense for us to sell our precious home and then splurge on a super luxurious home at 8Napier, Grange Residences, St Regis, etc. It will be plain stupid!

…Here are some estates where you can find homes with market value from $1-1.8 million: Normanton, Ridgewood, Pandan Valley, Pine Grove, Central Green, and many more in the east, west and central. Or, how about Punggol 21, the idyllic new town with shopping, nature, stream and MRT?

Some of the above estates are attempting to go en block, but they are not likely to succeed because they are huge estates, they have development charge issues, and most of them will not make it in time before the new Amendments become law.

Why did he omit these sentences? Because he called owners “stupid” just because we have a right to decide what kind of home we’d want to buy, luxurious or not. And how many of us were insulted that he would even suggest Punggol 21? I certainly do not see him moving out of his super luxurious home to this “idyllic new town”! And to add insult to injury, he suggests that we downgrade, downsize and move out of a perfect, central and beautiful location at BGV!!

3. “He is also trying to collect as many proxies as possible to influence the outcome of the EGM in his favour. Do not be misled and confused by him.”

Isn’t this the pot calling the kettle black? Isn’t he just as aggressively collecting proxies to influence the outcome of a general meeting? Didn’t he already achieve that, to great effect and to possible detriment of our estate, during our AGM when he steamrolled his pro-sale team into the management committee, courtesy of proxies?

I’m sorry but I’m quite disgusted by John Lee’s high and mighty attitude. Given his attitude, his bullish behaviour, his misinformation, I’m now greatly concerned that it is only one step away from our estate becoming like that of Laguna Park – with people living in fear of enbloc vandals who will not hesitate to bully the rest into signing the CSA.

At the end of the day, the only *TRUE FACT* is this – now is NOT the right time to sell. And unless we get rid of the CSC, our estate will be sold for less than what it’s truly worth.

A very disgusted owner
Name withheld for fear of vandalism. Not everyone parks near the guard house daily."

Dear Owner,
We thank you for your letter. We can understand your reason for withholding your name for fear of vandalism but we hope you can contact us as soon as you see this blog post. Thank you.

Tags: Botanic Gardens View, Taman Serasi, collective sale, collective sales, en bloc, en-bloc, enbloc, collective sale agreement, apportionment, proxy, EOGM, Letters to Owners, sale agent, sales committee

Time for ACTION!

Dear fellow owners and residents,

On 16 August, we received a letter by Mr Tan L. H., a resident staying here at BGV, in our mail boxes. He has sent his letter to all owners and residents, including those not staying at BGV. With his permission, we have reproduced his letter here in full for the benefit of all.


"15 August 2008

Dear fellow subsidiary proprietor,

I am a retired lawyer who has been living in this estate since 1991, and I was a Management Council member for a few years in the 1990s. I am writing to you in relation to the proposed EOGM on 23 Aug 2008, convened by the en bloc sale committee ("CSC") to approve the formula for apportionment of sale proceeds and the collective sale agreement ("CSA").

It is important to protect your own interest that you read this and take immediate action or obtain independent legal advice, as it would be too late to do so if the EOGM approves the proposed formula and CSA. This is regardless of whether you currently intend to sign the CSA or not.

Even if you do not wish to sign the CSA now, or are waiting to see whether you wish to sign it later, the terms of the CSA will be fixed upon approval at the EOGM and may become binding on you even if you do not sign, in the event that the Strata Title Board makes a binding order. These terms include the sale price, the reserve price, the formula for apportionment of sale proceeds to you (i.e. how much money you would get if the en bloc sale is successfully concluded) and other important terms such as when you have to vacate your apartment, and whether you get a share of the remaining management and sinking funds. Therefore if you do not act now, you may still become bound by the terms of the CSA which cannot be changed subsequently.

If you currently intend to sign the CSA, the above applies even more strongly, as you will become bound by the terms of the CSA as soon as you sign (unless you withdraw within the cooling-off period provided by the law).

I personally have several objections to the CSA, which may or may not apply in your case, as I understand that each of us has our own individual circumstances to consider. However, I would urge you to consider the following points, and take independent legal advice to protect your own position.

The objections and suggestions I have are as follows:

1. The formula for apportionment of sale proceeds has been changed from the one previously proposed by the previous collective sale committee. It is now skewed in favour of the units with the largest floor area, instead of that being in a one-third proportion as previously. The fact that all subsidiary proprietors have all along been paying in equal shares for maintenance fees and sinking funds is conveniently ignored. No reason has been given for this change, which benefits the owners of units in Block 9 the most. You should insist that the formula be in the same proportion as that previously used, or at least in a 50:50 proportion.

2. There are no protections in the CSA for you as a subsidiary proprietor if the CSC's actions cause you damage or loss. If you recall the Horizon Towers case, the owners who signed that collective sale agreement were sued for damages of about $5 million each, but had no recourse against their sale committee. That case was only resolved after a year-long court process involving large sums of legal costs and much stress and anxiety. This point is extremely important considering that you will be granting the CSC the authority and wide powers to act on your behalf in the sale. Even worse for you, the current CSA provides that the CSC is exempted from liability for their actions! You should require that indemnities from the CSC, collectively and individually, be inserted in the CSA to protect yourself, and that the CSC's exemptions from liability to be removed from the CSA.

3. There is no provision for a performance bond from a bank, to guarantee that the buyer will complete the sale and make full payment of the sale proceeds. This is important as developers normally incorporate a two-dollar company (without any financial resources of its own) to develop projects. Without such a performance bond, the developer could easily walk away from its obligations and liabilities to you as a seller. However, if you have contracted to purchase a replacement unit pending the completion of the en bloc sale , you will be stuck with contractual and financial liabilities in respect of that purchase. This has happened in a few en bloc sales earlier this year. You will probably be told that it is not market practice to provide such a bond. However, if a developer really wants to acquire our prime property, it should pay us the right price - our price - and comply with our requirements for our own protection. After all, our estate is in a totally unique and extremely valuable location - there is no equivalent to it in Singapore. You should insist that the CSA contains a requirement that a performance bond from an acceptable bank must be provided by the developer under the sale and purchase agreement.

4. The power of the CSC to enter into a sale below the reserve price, and other important terms of sale, should be subject to approval of the subsidiary proprietors. Under the current CSA, the CSC can decide, for example, to change the sale price, or change the time for vacant possession without such approval. Changes in the sale price are obviously very important as they affect the amount you may get in a sale. As for vacant possession, this would have important implications for families who need to make arrangements for school-going children, or who need to find alternative accommodation (obviously, this does not affect subsidiary proprietors who do not actually live in the estate). Changes in other terms would obviously have different effects, depending on the terms and the changes made. Are you comfortable enough with the CSC that you trust them to take such decisions on your behalf and in your best interests? It is always possible that other owners would rather make a quick sale at any price which makes them sufficient money to cover their own investment, which may differ from yours. You should require that the CSC obtains the approval of the subsidiary proprietors for any changes in the terms of the sale and purchase agreement from those specified in the CSA.

Aside from the above, you should study the CSA carefully and take independent legal advice if you need to. It will be too late to do this after the CSA is approved by the EOGM.

If you are unable to attend the EOGM but wish the above points to be raised on your behalf, I would be willing to act as your proxy for the EOGM. If so, please drop the duly completed and signed proxy form (or if your unit is owned by a company, the letter of authority) in my letterbox (at Block 1, Taman Serasi, #xx-xx) by Wednesday, 20 Aug. The proxy form and letter of authority are enclosed with the Notice of EOGM sent to you earlier by the MCST. If you change your mind and choose to attend the EOGM after the proxy form has been lodged, your attendance at the EOGM will, under the law, automatically cancel my appointment as your proxy.

Without sufficient votes, whether by proxy or by your attending the EOGM, it is highly likely that that the matters above will not be resolved in your favour.

Please take action before it is too late to protect your own interests. If everyone thinks that someone else will do the necessary, then the CSC will get their own way easily. This has happened in the last few general meetings when they obtained proxy votes to pass resolutions as they wished. Please think very carefully before you give your proxy vote to the CSC members, or leave the en bloc sale process entirely in their hands - will they act in your best interest, or in their own interest, bearing in mind that each owner has his own individual circumstances to consider?

Thank you for taking the time to read this. Please feel free to contact me (xxxxxxxx) if you wish to discuss the above. If I am not available, please leave a message and your contact number, and I will contact you as soon as I can. You can also e-mail me at: bgvresident@gmail.com

Yours faithfully,

Tan Lai Huat
Blk 1, Taman Serasi, #xx-xx
Singapore xxxxxx"


As this is a public forum, we have removed Mr Tan's phone number and address. For those of you staying at BGV, you can refer to Mr Tan's letter for his contact details. For those of you owners not staying at BGV (you would probably receive your letter by Monday or Tuesday), you can email him at bgvresident@gmail.com or email us at enbloc_bgv@hotmail.com and we will put you in touch with Mr Tan.


We will like to re-emphasize Mr Tan's last point:
PLEASE TAKE ACTION BEFORE IT IS TOO LATE. Whether you are for or against the enbloc, you have to take action to protect your own interest. Especially for those of you who wish to continue calling BGV your home, APATHY is NO LONGER an option.

Tags: Botanic Gardens View, Taman Serasi, collective sale, collective sales, en bloc, en-bloc, enbloc, EOGM, collective sale agreement, sale committee, proxy