LAND TITLES (STRATA) (AMENDMENT) BILL

4.05 pm

Order for Third Reading read.

The Second Minister for Law (Prof. S. Jayakumar): Sir, I beg to move, "That the Bill be now read a Third time."

Sir, the Second Reading of the Bill took place on 29th July 1986. It was then referred to a Select Committee.

The Select Committee received 25 written representations and heard oral evidence from 10 representors. They made valuable suggestions, many of which have now been accepted and incorporated in the Bill.

The Report of the Select Committee was presented to this House on 25th June 1987. The Bill, as set out in Appendix I of the Report, incorporates various amendments made by the Select Committee. The explanations for all the amendments are contained in Appendix V of the Report.

The rationale for the Bill itself was well covered by the Minister for Law during the Second Reading. I shall therefore not repeat them nor the explanations which are set out in detail. I propose only to draw the attention of hon. Members to some of the more important changes which have been recommended by the Select Committee.

Share value

The amended section 7 in clause 4 of the Bill prohibits a developer from selling any unit in a subdivided building unless a schedule of strata units with share value shown in respect of each unit has been filed with and accepted by the Commissioner of Buildings. The Commissioner is required to give his decision within six weeks of the filing of the schedule of strata units or of any subsequent amended schedule. A developer cannot change the share value assigned to a unit that has been sold unless he obtains the purchaser's consent. However, the purchaser's consent is not required for minor adjustments to the share value after the unit has been surveyed on completion.

The new section 10A in clause 6 makes it clear that the share value of a strata lot shown on a strata title plan registered with the Registrar of Titles cannot be varied except by the Registrar of Titles for correction of technical errors or by the Court where it is satisfied that the share value was assigned fraudulently to the lot.

Duties of developers

A new section 31 at page 15 of the Bill requires a developer of a subdivided building to open an account with a bank in the name of the management corporation upon the establishment of the management corporation and to pay into that account for the benefit of members of the management corporation any surplus funds in the trust fund which was earlier set up by the developer for the main- tenance of the building pursuant to section 9 of the Buildings and Common Property (Maintenance and Management) Act. The developer is also required to keep proper accounting records for audit purposes for the period when he is in control of the management corporation prior to the election of council members at the first annual general meeting of the management corporation.

Annual general meetings

The developer is also required to convene the first meeting of the management corporation within one month of the expiry of the 'initial period' or within six weeks of a request in writing made by the subsidiary proprietors of not less than one-tenth of the total number of strata lots, whichever is the earlier. The Select Committee has introduced this more flexible definition of 'initial period' and the period is now 24 months from the date of establishment of the management corporation or such other period as may be substituted by regulations made under the Act.

Subdivision of strata lot affecting common property

A subsidiary proprietor of a lot must obtain the prior approval of the management corporation if he divides the lot in such a manner as will result in the creation of additional or new common property. In other words, this provision seeks to protect the interest of existing subsidiary proprietors of other lots and to ensure that they will not have to bear the burden of maintaining any additional common property thrown up by the redevelopment of a lot.

Recovery of maintenance contributions

Under the new section 40 a prior mortgagee of a unit has to take into account any contribution due and owing to the management corporation. The mortgagee's power of overreaching the outstanding contributions is curtailed when he exercises the power of sale to recover monies secured by the mortgage which are due from the subsidiary proprietor of a lot.

Next, Sir, I want to touch on certain provisions dealing with Council members, managing agents and penalties. Council members

Section 63 in page 57 of the Bill requires council members to disclose their interest in any contract or proposed contract with the management corporation. The reason for this new provision is to seek to curb abuses by council members.

Managing agents

The new section 65 requires a managing agent who is directly or indirectly related to a proprietor of a lot to declare the nature of his relationship prior to his appointment.

Penalty

Section 64 makes it an offence for a member of the council or a managing agent of a management corporation to use his or their position to gain directly or indirectly an advantage for himself or other persons or to cause detriment to the management corporation. In other words, Sir, these provisions are to prevent abuse, malpractice and corruption.

Insurance

The provisions on insurances to be effected by management corporations and subsidiary proprietors of lots in a subdivided building have been revised by the Select Committee to take care of the comments of insurers, developers, subsidiary proprietors and mortgagees.

Strata Titles Board

I would like to draw the attention of hon. Members to the new Part VI in the Bill which deals with the establishment of strata titles boards. Several representors made requests to the Select Committee urging the establishment of such boards, and to follow the example of New South Wales, Australia, where there is legislation providing for the establishment of strata titles boards to adjudicate disputes between subsidiary proprietors and management corporations and between one subsidiary proprietor and another. As at 9th July 1987, based on the records at the Registry of Titles, there are more than 1,200 management corporations in Singapore in charge of more than 54,000 strata units. If such disputes were not to be adjudicated by the strata titles boards, they will have to be resolved in the courts. Proceedings in the courts are complex, protracted and costly. Furthermore, we should not overload our courts with such disputes.

In closing, Sir, let me say that the changes in the Bill, as reported, are quite technical. The Select Committee was grateful for assistance given by members of the Law Society as well as other representors. I believe that the changes in the Bill, as reported, significantly improves the Bill.

Sir, I beg to move.

Question proposed.

Mr Ng Kah Ting (Punggol): Mr Deputy Speaker, Sir, I am happy to note that various suggestions which were made during the Select Committee's hearings have been incorporated in the Bill. Therefore, I would like to commend the Select Committee for their thoroughness in going through the Bill and the Second Minister for Law's report to this House on the changes that have been incorporated in this Bill. Changes have also been introduced to make provisions in the Bill more clear. These include a new definition of subsidiary proprietor, amendment to section 6 to define charge and so on.

Sir, I note also that the Ministry has studied Land Title Strata legislations in other countries and has incorporated in this Report useful features found in such legislations. For example, as indicated by the Second Minister for Law, the new section 66 which is based on a similar provision found in the New South Wales legislation.

I also welcome the introduction of the new Part VI to provide for the establishment of one or more strata titles boards to adjudicate disputes between subsidiary proprietors and between management corporations and subsidiary proprietors. These boards will help ensure that such disputes will be more expeditiously dealt with. It will, of course, save both time and money for those involved in disputes arising from the use or occupation of lots in subdivided buildings.

Sir, in my view, the introduction of these changes will help ensure that subdivided buildings will be more effectively managed. But perhaps when the Bill is passed, the provisions should be reviewed from time to time to ensure that the management of the subdivided buildings is effective. Therefore, the Land Titles (Strata) (Amendment) Bill is a complex legislation. It is important therefore for the Ministry of Law to embark on a public education programme to help the public to get a better understanding of the provisions in the Bill. This is necessary because almost 90% of our population live and work in highrise buildings. They would indeed like to know how this Bill will affect them. I hope, Sir, that the Hon. Minister will look into this and consider ways to help the public to get a clearer understanding of the provisions in the Bill and the impact the Bill will have on them and their properties in highrise buildings. For example, with the assistance of the media, some of the key provisions could be presented in simpler layman's language with interesting examples thrown in to help the general public to better understand them.

Mr Deputy Speaker, Sir, on behalf of the GPC on National Development and Housing, I support the Bill.

Prof. Jayakumar: Mr Deputy Speaker, Sir, I thank the Member for Punggol, who is also the Chairman of the GPC on National Development, for his favourable comment. He has made a specific suggestion of conveying the key provisions of the Bill to members of the public in a form which is easily understood and shorn of all the technical legalisms. I think this is a good idea and my Ministry, together with the Ministry of National Development which has also an interest in the implementation of this Bill, will liaise to see how best it can be done.

Question put, and agreed to.

Bill accordingly read a Third time and passed.