The High Court has given the green light to the $610 million collective sale of Goodluck Garden, but also criticised managing agent Knight Frank, the condo’s collective sale committee and its lawyers for the way they handled the transaction.
Owners of the 210-unit freehold residential development in Toh Tuck Road in Upper Bukit Timah went to court after several minority owners raised objections to the sale.
Justice Woo Bih Li noted in court yesterday that the valuation by Colliers International at $542 million was not flawed, but a belated $637 million valuation by Asian Assets Allianz that dissenters submitted was.
He also disagreed with the dissenters’ arguments that there was an actual or potential conflict of interest because two members of the sale committee had relatives owning property in Goodluck Garden.
Justice Woo said there was no suggestion that the apportionment of sale proceeds was unfair as a result of this issue.
Those points, as well as other factors, led him to find no bad faith in the collective sale process.
But he also said the committee should have extended the tender by at least a week to inform potential bidders that it had been told by the authorities that there would be no development charge (DC) on the property. It could also have consulted the subsidiary proprietors about the next steps to take.
Justice Woo said: “Whether or not the reserve price would have been raised and whether or not potential bidders would have taken into account the reserve price, the point is that the subsidiary proprietors had been given, although inadvertently, an inaccurate impression about the DC and this should have been corrected immediately.”
Marketing agent Knight Frank had given home owners several estimates for a development charge, the highest being $63.19 million, but launched the tender before it received formal word from the Urban Redevelopment Authority about the actual charges.
Justice Woo also said that the apportionment of sale proceeds and the terms and conditions of the collective sale agreement should have been approved at a general meeting of the management corporation, and through “overt means” like voting.
Lawyers from Rajah & Tann had advised the sale committee that it was enough for those owners who had agreed with those terms to sign the collective sale agreement after the meeting.
The objectors were represented by TSMP Law Corporation’s Mr Adrian Tan.
Chinese developer Qingjian Group, which bought the estate, declined comment.
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