Case Summaries

Chan Sze Ying v Management Corporation Strata Title Plan No 2948

 

SUPREME COURT OF SINGAPORE

24 December 2020

Case summary                                                

Chan Sze Ying v Management Corporation Strata Title Plan No 2948         [2020] SGCA 123

Civil Appeal No 82 of 2020 and Summons No 112 of 2020

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Decision of the Court of Appeal comprising Judith Prakash JA, Tay Yong Kwang JA and Belinda Ang J (delivered by Tay Yong Kwang JA):

Outcome: CoA dismisses the appeal, holding that the intervener, as the MCST management council chairperson, lawfully adjourned an AGM without a motion to adjourn.

Pertinent and significant points of the judgment:

  • The chairperson of a meeting has a common law power to adjourn a meeting even if it is possible to vote on a motion to adjourn if the reality is that the proceedings cannot reasonably be expected to continue (at [50]).

Background

1 The appellant, Mdm Chan Sze Ying (“the Appellant”), is a subsidiary proprietor of The Caribbean at Keppel Bay (“the condominium”). The respondent is the condominium’s Management Corporation Strata Title Plan No 2948 (“the Respondent”). The intervener, Ms Lee Chuen T’ng (“the Intervener”), is another subsidiary proprietor of the condominium and was also the chairperson of the outgoing 12th Management Council.

2 The Respondent held its 13th annual general meeting (“AGM”) on 3 August 2019 at rented premises in the Keppel Club at which the elections for the incoming management council, the 13th Management Council, were held. The Intervener chaired the 13th AGM and was assisted by one Mr Chan Kok Hong (“Mr Chan”) from Savills Property Management Pte Ltd (“Savills”), the managing agent.

3 The AGM was scheduled to begin at 2pm and to end at 7pm. It was called to order at 2.30pm. Numerous lengthy discussions followed and the elections for the 13th Management Council only began late in the day. Mr Chan and the Intervener made various announcements that the AGM would be adjourned after the election results were announced. After the introduction of candidates and the voting, the counting of the votes was completed at around 8.45pm.

4 The Appellant and nine other candidates were elected to the 13th Management Council. The Intervener tied for the last seat with another candidate, Dr New Eak Chan @ Neo Eak Chan (“Dr Neo”). After the results were announced, the Intervener adjourned the AGM to 19 October 2019 without putting forward a motion to adjourn.

5 In between the AGM on 3 August 2019 and the continuation of the AGM on 19 October 2019, the 12th Management Council continued to meet and perform various tasks. This included approving a staff bonus to Savills at a meeting on 12 October 2019. At the 19 October 2019 meeting, Dr Neo withdrew his candidacy and the Intervener was declared elected as a member of the 13th Management Council.

The decision of the High Court

6 In HC/OS 1203/2019, the Appellant applied for declarations that: (a) the AGM of the Respondent held on 3 August 2019 was adjourned illegally and/or improperly as no motion to adjourn was passed and the AGM accordingly concluded on that date; and (b) the ten individuals elected on 3 August 2019 were the members of the 13th Management Council and that it took office on 3 August 2019.

7 The High Court judge (“the Judge”) dismissed the application on the basis that there was a residual common law power to adjourn the AGM which the Intervener could exercise. Further, para 3A(1) of the First Schedule to the Building Maintenance and Strata Management Act (Cap 30C, 2008 Rev Ed) (“the Act”) did not preclude the existence of that power. As the AGM was adjourned lawfully, the incoming management council only took office at the conclusion of the AGM at the end of the 19 October meeting, pursuant to s 54(1)(e) of the Act.

The Court of Appeal's decision

Whether the Intervener could exercise the common law power to adjourn the AGM

8 The Court of Appeal (“the Court”) observed that a management corporation was a creature of statute and that there were express rules governing its functions, including the holding of an AGM, under the Act. The general rule was that, in the absence of an authorising rule or statute, the chairperson had no power to adjourn a meeting without the consent of the majority of the attendees. However, as the parties accepted, the chairperson had a residual common law power to adjourn a meeting under certain circumstances (at [37], [39] and [40]).

9 The residual common law power to adjourn could be invoked where the reality was that the proceedings could not reasonably be expected to continue, even if it was possible to vote on a motion to adjourn. That was an objective inquiry, bearing in mind the prevailing circumstances. It gave sufficient discretion to chairpersons to regulate proceedings properly. However, this was not a licence for chairpersons to ignore the views of attendees and decisions of chairpersons had to stand up to objective scrutiny (at [50] and [53] to [55]).

10 On the facts, the evidence indicated that someone from Keppel Club had given the impression to Savills’ staff that the booked venue could be used until 9pm only and this was duly conveyed to the AGM. The evidence also supported the finding that time was needed for the attendees to vacate the premises (at [60] and [62]).

11 The Court considered the facts taking the Appellant’s case at its highest and assumed that the venue could have been used past 9pm and that no request for an extension beyond 9pm was made. Despite that, the Intervener would still have been able to exercise the residual common law power to adjourn the AGM as the AGM could not have been reasonably expected to continue to completion. First, the AGM had gone on for more than six hours without a break and had exceeded the time of conclusion of 7pm by almost two hours. Second, there were still 19 items left on the agenda, in addition to the run-off election to resolve the tie between the Intervener and Dr Neo, and these would have taken significant time to resolve given the contentious atmosphere at the AGM. Third, some attendees had already left or were in the process of leaving. Fourth, even if there was some miscommunication as to the use of the venue past 9pm, this did not affect the Intervener’s exercise of her power to adjourn which was done in reliance on what Mr Chan told the AGM (at [63] to [68]).

Whether the Intervener exercised the power lawfully

12 It was common ground that the residual common law power had to be exercised in good faith and reasonably (at [69]).

13 The Court found that the Intervener had not exercised the power in bad faith. The Appellant’s main complaint was that the Intervener was trying to hold onto power when she realised she might lose to Dr Neo if the run-off election took place on 3 August 2019 and the adjournment also enabled the 12th Management Council to grant a staff bonus to Savills (at [73]).

14 The Court disagreed with the Appellant’s characterisation of the facts (at [86]):

  1. First, taking the Appellant’s case at its highest, there was no evidence that the Intervener knew that no extension of time past 9pm was sought or that she was dishonest during the AGM. There was no evidence that her interests and Savills’ or Mr Chan’s were so aligned that they would seek to secure a benefit for each other (at [75]).
  2. Second, the Intervener could not have had a hand in the events that led to the time constraints that necessitated an adjournment (at [76]).
  3. Third, the evidence showed that an adjournment was in contemplation even before the need for the run-off election arose (at [77]).
  4. Fourth, the fact that the Intervener initially wanted to complete the elections on 3 August 2019 but later supported an adjournment was explained adequately by the change in circumstances as the meeting continued (at [78]).
  5. Fifth, the suggestion that the Intervener was afraid of losing to Dr Neo in the run-off election was speculative (at [79]).
  6. Sixth, even if the Intervener was afraid of losing to Dr Neo, there was nothing to suggest that the AGM was adjourned in order to allow her to cut a deal with him. In any event, Dr Neo might have withdrawn his candidacy on 3 August 2019 even if it was decided that the run-off election to break the tie would be held that night (at [80]).
  7. Finally, there was no evidence to suggest that the adjournment was intended to allow the 12th Management Council to award a staff bonus to Savills (at [82]). There were five other council members at that meeting besides the Intervener and Dr Neo and the decision on the staff bonus was unanimous.

15 The Court considered that even if the run-off election had taken place on 3 August 2019, the AGM would still have needed to be adjourned because there were many outstanding items on the agenda. Accordingly, the 12th Management Council would still have remained in office. The Court approved of the Judge’s interpretation of s 54(1)(e) of the Act that the incumbent management council vacates office only at the end of the AGM and the incoming management council takes office only at that point. The Court rejected the Appellant’s various suggestions that the Intervener ought to have let the run-off election take place and then end the AGM so that the 13th Management Council could take over or that the AGM should have been concluded on 3 August 2019 even without completing the run-off election (at [83] to [85]).

16 The factors that showed that the Intervener was not acting in bad faith would also lead to the conclusion that she was not motivated by irrelevant considerations or ulterior motives, and hence, that she was not acting unreasonably (at [87]).

17 The Court dismissed the appeal accordingly. Given the above conclusions, it was not necessary to address the other arguments on locus standi and the requirements for declaratory relief or to consider the effect of an invalid adjournment (at [90] and [101]).

The application for leave to adduce fresh evidence

18 The Appellant sought leave to adduce further evidence on appeal to prove that the AGM venue did not have to be vacated by 9pm and that no extension of time had been sought from the Keppel Club . The Court observed that the further evidence was inadmissible as it was hearsay. In any case, the first condition of non-availability was not met as the Appellant had ample opportunity to gather the evidence before the High Court hearing. The second condition of relevance was also not satisfied as the Court had analysed this case even on the basis that the Appellant’s factual submissions (which the further evidence sought to buttress) were correct and nevertheless found that the residual common law power to adjourn could be exercised and that it was exercised lawfully in the circumstances. The third condition of credibility was also not satisfied, at least in respect of one piece of evidence which involved a retraction of an earlier statement by the maker of the statement without any explanation. Counsel for the Appellant decided to withdraw the application at the hearing when most of these concerns were highlighted to him and the Court granted leave to withdraw the application accordingly (at [95] to [100]).

 

This summary is provided to assist in the understanding of the Court’s grounds of decision. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s grounds of decision.

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