Dispensation of Legal Requisitions ('LRs') for Properties under Construction ('PUC')

This article contains the results of a study, conducted by the Conveyancing Practice Committee of the Law Society of Singapore, to ascertain the need and suitability of sending LRs for PUC. Also included in this article are the procedures taken which led to the Committee's findings and their recommendations.

Introduction

In conjunction with the Singapore Land Authority ('SLA'), the Conveyancing Practice Committee of the Law Society of Singapore conducted a study to determine the propriety and necessity of sending legal requisitions ('LRs') for properties under construction where:

  1. the Temporary Occupation Permit ('TOP') had not been issued; and
  2. the developer is a licensed developer under the Housing Developers (Control and Licensing) Act (Cap 130).

Where appropriate, the Law Society would encourage the dispensation of LRs with the informed consent of the relevant parties, such as the developers and banks.

Working Paper

The Committee first prepared a working paper which was submitted to the SLA. The SLA, as a central co-ordinating body with the various government departments and statutory authorities, organised a meeting. The various parties attending the meeting were representatives from the following:

  1. SLA;
  2. Conveyancing Practice Committee;
  3. Real Estate Developers Association of Singapore;
  4. Association of Banks of Singapore;
  5. Association of Finance Houses;
  6. Law Net Secretariat of the Singapore Academy of Law;
  7. Inland Revenue Authority of Singapore ('IRAS');
  8. Land Transport Authority ('LTA');
  9. Building and Control Authority; and
  10. Ministry of Environment ('MOE').

As a result of two meetings held and the feedback given by the various parties, the Conveyancing Practice Committee drew up a paper which appended the results and compilations of the feedback.

Results and Recommendations

The results of the study have been submitted to the Council of the Law Society together with recommendations as to the efficacy of the practice of sending out the LRs for the PUC. The same results are appended in this article. The Conveyancing Practice Committee has scrupulously set down their comments on the significance of the usual replies or responses. In some cases, eg from the Sewerage Department of the MOE, the reply suggested that there was no necessity to send out those requisitions. In essence, it was a sheer waste of money. The compilation of the results are set forth hereunder as follows:

Requisition to the Building and Control Authority

Questions Posed

(a) Latest information

 


(b) Section 13 of Building Control Act (Cap 29) ('BCA').

(c) Sections 23 and 24 of the BCA.

 Significance

To obtain

 



Relates to demolition of a building.

 

Relates to buildings which are deemed  dangerous and where emergency measures are required.

 Implications/Comments

The particulars should on the approved particulars of be the same as the development. the approval information given by plan and dates the developer. of approval. The particulars are usually given by the developer's solicitors in the documents accompanying the sale and purchase agreements.


A building erected or to  be erected under an  approved plan is not affected. Section 13 relates primarily to buildings which are already completed.


Similarly, the sections  relate only to buildings already constructed. Thus ss 23 and 24 should not apply to PUC where  TOP has not been issued.

 

 Requisition to the Environmental Health Department, MOE

Questions Posed

(a) Section 45(2)(d) and (6) and (7).

 Significance

Whether the  property is a source of  nuisance or an order has been issued to prohibit the property from being used as a dwelling house.

 Implications/Comments

This section has no effect as the property is still under construction.

 Requisition to the Survey and Lands Department (Rapid Transit Systems), LTA

 
Questions Posed

(a) Sections 3, 5 and 6 of the Rapid Transit Systems Act (Cap 263A) ('RTSA')

 Significance

When  development plans are approved, the  MRT plans under the RTSA would have been taken into account. Usually the LTA would have provided, in their plans, buffers or safeguarding corridors.

 Implications/Comments

Once the  development plans are approved, the PUC are not affected or, at worst, not likely to be affected. 

Requisition to the Sewerage Department, MOE

Questions Posed

(a) Section 7 of the Sewerage and Drainage Act 1999.

 

(b) Regulation 3 of the Sewerage and Drainage (Sewerage Treatment  Plants) Regulation 1999. 

 Significance

This section relates only to enforcement actions for private sewerage plants in completed premises.


This regulation affects only properties with private sewerage treatment plants.

 

 Implications/Comments

This requisition is therefore not  applicable  for PUC. 

 


PUC will only have  sewer lines connected to the main sewers. No private treatment plants are allowed. Thus the requisition is totally unnecessary for PUC.

 

Requisition to the Survey and Lands Department (Street Works), LTA
Questions Posed

(a) Street Works 

 Significance


Will the PUC be affected by any improvement or development or adjustment of streets adjacent to the development? If so, are there any charges to be imposed? 

 Implications/Comments


The relevant Authority confirmed that street work proposals or future  plans have been taken into account when development plans are approved. However, the Authority did not wish to rule out a possibility (although it was admitted to be highly remote) of any change that may be made by the department after such plans are approved. The implication here is that though the PUC should not be affected at all, the Authority cannot be held responsible should it change its direction to make adjustments to the streets adjacent to the property development.

Requisition to the Urban Redevelopment Authority

Questions Posed

(a) What are the approved particulars of the Building Plans? 

(b) When were the development plans approved? 

(c) The Zoning. 

 

 Significance

To confirm only the brief  particulars of the development. 

To confirm the date.

 

To confirm the zoning. 

 

 Implications/Comments

This information should  have been provided by the developer along with the title deeds.


This information should have been provided by the developer along with the title deeds.


If the information and particulars provided by the developer on the PUC can be taken as correct and updated, there need not be a case for legal requisitions for PUC.

Requisition to the Central Building Unit, Pollution Control Department, MOE

Questions Posed

(a) Is the development affected by drainage reserves? 

 Significance

Once the development plans are approved, it can be assumed that  the drainage reserves have been taken into consideration.

 Implications/Comments

PUC are not likely or will not be affected. Therefore legal requisitions need not be made. 


Requisition to the Development and Building Control Department, LTA

Questions Posed

(a) The questions concern the road lines that may possibly affect the PUC. Essentially the same questions are posed here as in the requisition to the Survey and Lands Department (Street Works), LTA (above). 

 

 Significance

The road lines have usually been taken into account. 
If road lines are seen on the replies given,  the purchaser's  solicitors usually seek, from the developer's solicitors, confirmation that the road lines have been taken into account when the PUC are being constructed.

 Implications/Comments

Same effect and implication as seen in the requisition to the Survey and Lands
Department (Street Works), LTA (above).

Requisition to the Inland Revenue Authority of Singapore

Questions Posed

(a) To confirm whether the developer is owing the IRAS property tax and, if so, how much. 

 Significance

More often than not,  the developer would be paying by GIRO, spread throughout the year. Sometimes, the developer may be granted exemption.

 Implications/Comments

If the Developer confirms that the property tax is payable by monthly GIRO, a legal requisition is not necessary.


Discussions

Discussions are continuing between the Conveyancing Practice Committee, SLA, banks, Central Provident Fund Board and REDAS as to how the various parties can come together and agree on the dispensation of requisitions which will invariably see lots of savings for purchasers and borrowers.

Nonetheless, the results of the study speak for themselves. Readers of this article are encouraged to be critical and to exercise proper judgment in giving advice to clients on the necessity for such LRs.

It may be that not all requisitions may be dispensed with. But if this article does stimulate the mind and prompts it to respond, the Conveyancing Practice Committee and SLA would have achieved their purpose. A parting thought: 'Examine past mundane practices, you may find that some would have been obsolete'.

Derrick Wong
Straits Law Practice