Owners who object to a sale without valid reasons should compensate others
Letter from Martin Woo
There has been a spate of letters from minority owners voicing their complaints on the existing en bloc laws. They purport that these laws are “totally inadequate and lopsided”, as noted by Tan Kim Liang (”Rights of all owners must be protected during sale”, April 30).
In any en bloc sale, there will always be some owners who, at whatever price, will not want to sell and choose to remain where they are.
However, there are also owners who are out to hold the majority owners to “ransom” in order to get more compensation.
This has happened in many cases prior to 1999 where the law required 100 per cent consent from owners. In fact, I was told that now, even with the existing laws, there are still minority owners trying to get more compensation from the majority owners by objecting without valid reasons.
Imagine if the law had not been changed, there would not be any en bloc sales today. Singapore might in no time become a concrete slum. It is precisely because of this that the en bloc legislation was amended in 1999 to allow an en bloc sale based on 90 per cent consent for developments less than 10 years and 80 per cent for those 10 years or older.
One must look at both sides of the coin and not be one-sided in this issue. The government’s current review of the laws is the correct way of ensuring even-handedness.
I would like to make two suggestions.
First, developments marked out for en bloc sale should not be less than 15 years old, unless there are extenuating reasons such as structural safety, et cetera.
Second, minority owners who object without valid reasons should be made to pay a financial penalty to compensate the rest of the owners for interests and opportunity costs that resulted from the delay. These objectors now get away virtually scot-free.
Source: Today, 09 May 2007