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

Email Received: Which hat is he wearing? And a Reasoned Response to Market Forces vs Enbloc Potential

We received this anonymous email, that we're posting here verbatim below, and someone submitted a comment which is a reasoned response to Mr John Lee's latest email with the BGM/BGV price comparison (under comments):

I’m confused when I received Mr Lee's recent letter about the AGM.

Firstly, he wrote that Mr Tan Lai Huat’s resolution was not approved by the council. Isn’t Mr Tan Tew still the chairperson of the management council? Since when did Mr Lee become the spokesperson for the entire council when he is only a member?

Secondly, he said that the resolution is an en-bloc matter and nothing to do with estate management and urged owners who support the en-bloc to pass him their proxies. He signed off his letter as Chairman, Collective Sales Committee (CSC) and the letter was sent using BGV En-bloc letterhead.

I’m confused:
Mr Lee firstly objected to the resolution because it is an en-bloc matter which should not be tabled at the forthcoming AGM and he seemed to be speaking on behalf of the council. But he then objected to the resolution because he asserts it is Mr Tan's "cunning way of killing off the current enbloc attempt."

So in what capacity is Mr Lee objecting in - as an ordinary Council member who is working on behalf of all owners to manage BGV or as Chairman of the CSC who is working to sell off the estate?

The answer seems quite clear. And what is the view of the MC Chairperson on this matter, or has Mr Lee taken over this other committee too?

Thoughts on the AGM

We apologise for the lack of updates since the AGM due to a technical glitch on our blog. But in the meantime, we received an email from a concerned resident who attended the AGM and wished for us to put the email on the blog. This concerned resident has raised pertinent issues.

"At the AGM on 7 June, John Lee and 2 other members of his collective sale committee (CSC) were elected as Management Council (MC) members, together with 2 others nominated by John Lee, presumably supporters of the en bloc sale.

This was a result of John Lee and the CSC gathering a large number of proxy votes. Thus, the new MC for the estate comprises of John Lee and 4 of his CSC members and supporters, i.e. 5 out of the total of 7 positions on the MC!

It should be noted that of those 5 nominated by John Lee and a Mr Soon (who was in the previous Pro-tem sales Committee), only John Lee and one other MC member, Ms Leesa Lovelace, actually attended the AGM - the others were all absent. And it appears that Ms Lovelace left the AGM before the elections were conducted. We only have John Lee's word that they had consented to their nomination for election to the MC.

If they did not even bother to attend the AGM (or in the case of Ms Lovelace, stay for the entire AGM), how much interest will they have in running and maintaining the estate in the best interests of the residents and subsidiary proprietors? How much attention will they pay to the needs of the estate?

Although an objection was raised by an owner at the AGM that there was a clear conflict of interest in having CSC members also sitting as members of the MC, this was brushed aside and John Lee and his CSC members and supporters were voted into the MC with the help of their proxy votes.

But, if I were one of John Lee's CSC members elected into the MC, I would be very hesitant indeed to take his word that there is no conflict of interest, just because he says so.

In fact, I would be rather concerned as to my own position. To an objective observer (as a court of law will be) it is very clear that the interests and duties of the CSC members are very different from, and clearly conflict with, those of the Management Council. If I were in their position, I would certainly seek independent legal advice on this point, before I get myself too deep into a hole.

And what hole would I be getting into? The CSC members would do well to bear in mind that they will have onerous contractual, common law and fiduciary duties to the subsidiary proprietors who sign the collective sale agreement as well as those who may become bound by it. At the same time, if they take up their positions as MC members, they will be subject to onerous statutory and common law duties owed to all the subsidiary proprietors who make up the MCST.

Each of them may therefore find themselves liable for damages to the subsidiary proprietors who sign the collective sale agreement, or to the subsidiary proprietors who comprise the MCST, or even to both sets of subsidiary proprietors, in respect of their actions and decisions while sitting on both the MC and the CSC.

They can be assured that their actions and decisions as MC and CSC members will be scrutinised very carefully, and that they will individually and collectively be held accountable for any breaches of their duties.

I hope each of them has the resources to meet such liabilities in the event that they arise, as these may well be substantial. In any event, they should consider their individual positions very carefully.

Thus, if I were one of them, I would not be too quick to celebrate my election into the MC. Now every decision made at CSC meetings as well as MC meetings will be fraught with peril, as the possibility of breaching one or the other of their conflicting duties and liabilities will always be present. John Lee may well have made the position of these CSC members untenable and certainly unenviable.

They can also be assured that there are subsidiary proprietors who are prepared to take them to the very last stage of legal proceedings in the event of any breaches or if any damages are suffered by subsidiary proprietors due to their actions or decisions while sitting as members of the MC or the CSC.

They should therefore not be too happy about having secured 5 out of the 7 positions on the MC, and think that with such an overwhelming majority, they can make decisions without due regard to their individual and collective duties and liabilities. Subsidiary proprietors will be watching their actions very, very carefully.

Finally, to those who gave their proxy votes to John Lee or other CSC members, I think you have done yourself, and the other subsidiary proprietors, a real dis-service.

You might think that having loaded the MC with CSC members and en bloc sale supporters will be advantageous to you. However, as mentioned above, that will not necessarily be the case, as it may do more harm than good.

And if you think about it carefully, what happens to your property value if the en bloc sale does not succeed in the end or is successfully challenged, and in the meantime, the MC has run down the estate deliberately or by inaction or negligence? Don't forget that John Lee has failed in his en bloc sale attempt made at the height of the property frenzy last year, and that the property market has soured considerably since then.

Even if you don't live here and have rented out the place or are keeping it for investment, your long-term rentals and investment value will be adversely affected. How will you recover your losses then, and who will you look to, to make good your losses?"

There is certainly a lot of food for thought raised by concerned resident.

Coming EOGM and BGV AGM

Dear fellow owners and residents,

We have a couple of things to mention today. First, there is a letter from Mr John Lee of the Sale Committee (a) calling for another EOGM and (b) asking for proxy votes for the AGM, which, as you know, will be held this Saturday, 7 June 08. Curiously, despite this letter being dated the 22nd of May, neither of the two main contributors to this blog has received sight or sound of it (just to make it clear, we are not actually surprised at this). Just in case this discrimination is directed at other owners besides ourselves, we are happy to republish the letter on this blog as a public service. Second, there is the AGM.

Concerning the EOGM, we fully expect that the course of events will be the same as for the previous two EOGMs. That is, the Sale Committee and its minority supporters will be the principal attendees and everyone else will stay away, having better things to do than argue about the division of spoils from the sale of other peoples' homes. Some of us will be there, of course, so that you will have a reasonably objective account of events. However, the division of proceeds is something that should interest at least some of us owners. I refer to those of us would be willing to sell for the right price (ie not during this current extremely bad market). It is usual in en-bloc sales for the owners of larger or better-situated flats to suffer, since their share of the proceeds of sale rarely reflects a fair apportionment taking into account the superior value of, for instance, larger flats on higher floors. Since as our addresses make clear we are both in this position, we will make no comment but simply leave it to you all, dear fellow owners and residents, to reflect upon your own interests in this matter and decide for yourselves whether the protection of those interests merits your attendance at this EOGM. Since neither of us is in the slightest degree interested in selling our homes, how their price is to be divided up is a matter of indifference to us.

Concerning the AGM will be held this Saturday, 7 June 08. We thought that we would take this opportunity to urge everyone to attend. The AGM deals with the real, bread and butter issues of the management of our estate, not merely with the attempt to sell it out from under us. These are things that will affect all us in our daily lives: who will comprise the Management Council for the coming year? What has happened to the ongoing five-year maintenance programme? Will this estate continue to be maintained in good condition? We are all aware of what can happen when the Management Council of an estate is hijacked by people whose only interest is to sell.

We are pleased that Mr Lee's letter also expresses his intentions to maintain this estate in good order. However, this does not remove the inherent conflict of interest involved in being both a member of the Sale Committee ( which serves the interests of those who wish to sell our estate) and of the Management Council (which exists to maintain the estate in good condition for all of us, including the majority who do not wish to sell). We know that calling on the Sale Committee to do the right thing and end its members' involvement in the Management Council is a hopeless endeavour. We, the owners, are the only ones who can compel them to do so. How?

Quite simply, by voting against any candidate for the Management Council who is simultaneously a member of the Sale Committee. Mr Lee makes no secret (except to us, of course) about his desire to collect proxy votes, ostensibly to support his blameless and worthy endeavours to maintain this estate in good condition. We find this frankly unbelievable. The inhabitants of this estate are sensible people. No reasonable proposal for the management and maintenance of this estate has ever been refused by the AGM. Apart from the attempt by the Sale Committee and its cohorts to sell our homes against our wills, there is no major dispute or disagreement among the owners concerning the maintenance and management of this estate (really, does anyone here actually support the parking of heavy vehicles in the car-park? Is there a secret pro-heavy-vehicle faction among the owners, who must be fought tooth and nail?). We fully believe that there is no purpose behind this collection of proxy votes except the attempt to remove all remaining members of the Managment Council who do not support the Sale Committee, and effectively turn the Management Council into the mere tool and mouthpiece of the Sale Committee. Obviously, this result will be to the detriment of both the estate and the majority of its owners. After all, if the Management Council ever consists of a majority of pro-en-bloc sale people, what is to prevent the Council from making decisions AFTER the AGM which may directly or indirectly cause the estate to deteriorate in their attempt to encourage people to sell? The owners are not blind to see that a letter from the BGV En Bloc Office encouraging people to improve the estate goes against their push for a fast sale. Why proxy Mr John Lee when it is equally valid to proxy some other member of the Management Council, eg the Chairperson? How many of us have heard certain people saying that the estate is getting worse, and it's best to collectively sell now before it's too late?

We need only be reminded of the massive problems that can happen to the management of an estate when that is hijacked by pro-sales owners - Look at Mandarin Gardens and Bayshore Park to see what can happen when too many proxy votes end up in the hands of Sales Committee members:http://www.sghousing.com/2008/05/05/en-bloc-uproar-at-bayshore-park-mandarin-gardens/http://www.sghousing.com/2008/05/05/en-bloc-system-needs-relook-as-bayshore-shows/

In summary therefore, we hope that as many of us as possible will:

(a) Attend the AGM
(b) Scrutinise with the utmost care both the past year's maintenance activities and the plans for future maintenance
(c) Vote AGAINST any candidate for the Managment Council who will not dissociate themselves completely from the Sale Committee.

and of course, continue to Just Say No to whatever piece of paper the Sale Committee waves under our noses.

We will be doing all of these things and we hope that you will too.

Vanessa Chan
c/o Ms Sim Bock Eng, Wong Partnership, One George Street
Blk 9, #10-09, Botanic Gardens View

Wong Hwei Ming
things.unfair@gmail.com
Blk 9, #09-17, Botanic Gardens View

or BGV blog email: enbloc_bgv@hotmail.com

Tags: Botanic Gardens View, Taman Serasi, collective sale, collective sales, en bloc, en-bloc, enbloc, EOGM, AGM, voting, conflict of interest, Management Coucil