Property Legal Brief: Property Claims Without Written Memorandum

Previously, we have covered cases on division of assets involving HDB flats and private properties, and some of the lessons which can be gleaned from them. As part of PropNex’s continuous efforts to empower consumers in asset progression and preservation, we will, in this article, discuss two cases involving claims of interest in properties based on oral representation and undertaking.

CASE 1 :
In the first case, a grandmother sued her grandson to stake a claim on her late son’s HDB flat. Mdm Rasa sought, among other things, a declaration that she was entitled to the HDB flat or the sale proceeds thereof.
According to the Mdm Rasa, after the deceased’s (i.e. her late son’s) divorce, she was invited to stay in the HDB flat together with two other individuals. The deceased represented to her that he would leave the house to her/sales proceeds to her should he pre-decease her (the “Representation”). In reliance of the Representation, she spent money to renovate and improve the HDB flat, looked after the deceased while he was alive, handled household chores, and paid for household expenses.
She claimed that as a result, it would be unconscionable for her to be deprived of a stake in the deceased’s HDB flat. She was relying on the common law doctrine of proprietary estoppel for her claim. She lost.
Her grandson argued, among other things, that he was the sole beneficiary by operation of the Intestate Succession Act. He won.

CASE 2 :
In the second case, two brothers were embroiled in a legal battle where the senior sued the junior for 10% of the sales proceeds of the junior’s property. Sometime in 1976, their late father divided his three properties among his three sons via a ballot, but for some (conflicting) reasons, the property balloted by junior was agreed to be shared on a 90/10 basis with senior.

Sometime in early 2000, senior transferred his 10% share to junior via a Sales and Purchase Agreement dated 10 May 2000 (“SPA”) in exchange for the payment of $320,000. A statutory declaration was also declared to record the disposal of the 10% to junior (“SD”), making junior the 100% owner. A transfer document with acknowledgment of receipt of $320,000 was also signed by senior.
Senior claimed that he signed the SPA, SD and transfer document in reliance on an oral undertaking by junior that if senior transfers to him his 10% share, junior will pay senior “the monetary value” of 10% of junior’s property once it was sold. Senior claimed further that he never received the sum of $320,000, and that the SPA, SD and transfer document was a sham arrangement to enable junior to refinance his bank loan and/or obtain a bigger loan.
After hearing testimonies of family members who were called upon to testify in the dispute, audio conversations of a recorded meeting, and legal arguments on case laws and Acts of Parliament, senior’s claim was dismissed for he had failed to establish the existence of the sham arrangement. It was further held that the oral undertaking, even if proven, would be unenforceable under the Civil Law Act for want of writing.

Take-aways from the two cases
What is the learning point for the first case, if indeed the deceased intended the Representation? Should the Representation be in writing and signed by the deceased? Should it be reflected in the form of a Will? Should Mdm Rasa be made a joint-tenant with the deceased, or with the deceased and his son?
For the second case, if the understanding between the brothers were put on record and in writing i.e. senior transfers his 10% share to junior in exchange for junior’s agreement to share 10% of the sales proceeds for the property with senior, a prolonged and expensive legal battle would have been avoided.
The key lesson for both cases is such arrangements must be recorded in writing. This reflects the written memorandum requirement of Section 6 of the Civil Law Act which provides that “no action shall be brought against any person upon any contract for the sale or other disposition of immovable property, or any interest in such property; unless the promise or agreement upon which such action is brought, or some memorandum or note thereof, is in writing and signed by the party to be charged therewith or some other person lawfully authorised by him.”
But what does the phrase “in writing and signed”? Does this include email correspondence between sellers and buyers demonstrating a contract to sell a property, but no sales document was signed? Does “signed” mean wet-ink? We will seek to cover these questions on the upcoming article.

About the writer
Heng Eam serves as Assistant Director of Legal and Compliance at PropNex Limited. Having joined the company since March 2021, he provides legal counsel and training for agents and employees. A lawyer by training, he was called to the Malaysian Bar in 2005. From 2007, he practiced law in Singapore for several years before being called to the Singapore Bar in 2014. He then served as legal counsel for another major real estate agency, from 2015 up till 2021. Besides his specialisation in litigation, he also provides legal counsel for corporate regulatory issues such as the Personal Data Protection Act (PDPA), as well as advises clients on employment, property and landlord and tenant disputes.