Case Summaries

Attorney-General v Aljunied-Hougang Punggol East Town Council

27 November 2015

Media Summary

Civil Appeal No 114 of 2015, Summons No 258 of 2015, Summons No 268 of 2015 and Summons No 269 of 2015

Attorney-General v Aljunied-Hougang Punggol East Town Council [2015] SGCA 60

1     In a judgment that was released this morning, the Court of Appeal allowed the application by the Housing and Development Board (‘HDB”) to be joined as a party to these proceedings and then partially allowed an appeal by the HDB and granted reliefs that are directed at compelling the Aljunied-Hougang-Punggol East Town Council (“AHPETC”) to put right various accounting and governance lapses identified in the report of the Auditor-General.

2     This case originated in the High Court with MND seeking relief to remedy the accounting and governance lapses in the running of AHPETC. The High Court dismissed MND’s application, and MND appealed.

3     The appeal was heard on 3 August 2015, together with an application by the HDB to be joined as a party to the proceedings. Two other applications were also heard at the same time. The Court of Appeal, comprising Sundaresh Menon CJ, Chao Hick Tin JA and Andrew Phang Boon Leong JA, reserved judgment after the hearing.

4     In the judgment, the Court allowed HDB to be joined as a party to the proceedings. The Court considered that the question or issue between HDB and AHPETC was linked to the reliefs sought by MND in these proceedings. In particular, the Court noted that the claims brought by HDB and MND arose out of the same set of facts and the reliefs sought were substantially the same. Although HDB only applied to be joined as a party at the appeal stage, the Court found that AHPETC would suffer no conceivable prejudice that could not be compensated by a suitable costs order. Hence, the Court was satisfied that it was just and convenient for HDB to be joined as a party.

5     The Court addressed the main issue of whether HDB and/or MND are entitled under the Town Council Act (“the Act”) to the reliefs sought in two parts:

a. whether, either HDB or MND had standing under the Act to seek relief from the court in the circumstances of this case; and

b. if so, what are the remedies that the court may grant.

6     On standing, the Court undertook a textual and contextual analysis of the words of the relevant provision in the Act and found that only HDB had the required standing in the present case to seek relief. In particular, it analysed similarly worded provisions in a number of foreign jurisdictions. Having done so, the Court observed a significant distinction in the wording of the provision in the Act that indicated that the legislative drafters had intended HDB to have standing to seek relief in all cases where a Town Council failed to perform its duties under the Act. On the other hand, the Court considered that MND, like all other persons, had to demonstrate that the statutory duty in question that was breached was imposed on the Town Council for its benefit before it could apply to the court for reliefs. The Court considered that MND had failed to do so, and hence it held that MND did not have standing to seek reliefs.

7     On the remedies to be granted, the Court said that while it could make orders that were effective to compel the Town Council to perform the duty in question that had been breached, it could not supplant the Town Council altogether and take the performance of duties upon itself, through court-appointed agents.

8     In the premises, the Court made the following orders:

(a) AHPETC shall make all outstanding sinking fund transfer(s) within a period of three months from the date of this order or such other time as the Court of Appeal may permit upon application being made to it. Within that time, AHPETC must decide whether to accept the grants-in-aid that had been offered by the Minister subject to conditions or to take such other measures as it may determine, such as to raise the conservancy and service charges and/or to liquidate its investments (if any) in order to put itself in a position to make the required transfer(s).

(b) AHPETC must take steps to comply with s 35(c) of the Act;

(c) To this end, AHPETC is required to:

(i) appoint accountant(s) to assist in identifying the outstanding non-compliances with s 35(c) of the Act and advise on the steps that must be taken to remedy those outstanding non-compliances;

(ii) require the accountant(s) to produce monthly progress reports until the accountant(s) is or are reasonably satisfied that AHPETC is fully compliant with s 35(c) of the Act;

(iii) ensure that the monthly progress reports, which are to be submitted to the HDB, which in turn may make these publicly available on the first day of every month (starting on 1 January 2016), provide sufficient details of the outstanding non-compliances with s 35(c) of the Act, and the steps that AHPETC is taking to remedy those outstanding non-compliances.

(d) Without prejudice to the generality of (c) above, the terms of reference of the accountant(s) who is/are appointed should extend to establishing whether any past payments made by AHPETC were improper and ought therefore to be recovered.

(e) To ensure transparency and efficacy in the execution of these duties, the identity and, if necessary, the terms of reference of the accountant(s) to be so appointed shall be subject to the consent of the HDB, which consent shall not be unreasonably withheld and in respect of which there shall be liberty to apply.

This summary is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court.