1. ) LEE WEE KANG 2. ) CHAN CHEE HONG 3. ) LIM SIOK HUI 4. ) BOO HOOI PING 5. ) PERSATUAN PENDUDUK TAMAN CANARY v 1. ) KHOO SOON LEE REALTY SDN BHD 2. ) SKY JEWEL SDN BHD

Case Significance

Illustrates the requirements for a representative action under Order 15 rule 12 of the Rules of Court 2012 and the binding effect of a deed of mutual covenant on homeowners in a gated-and-guarded scheme, holding that homeowners bound by such deeds cannot resist the collection of maintenance charges.

This High Court decision concerns a dispute over the management of a gated-and-guarded residential scheme and the entitlement of the developer and its appointed manager to collect maintenance charges, decided together with related suits. The plaintiffs, individual homeowners and an officer of the residents' association, challenged the continued collection of maintenance charges and the management of the scheme by the developer and the company later appointed to manage it, and sought declarations, including that the defendants were not entitled to collect maintenance charges, and an account of alleged surplus funds. The defendants relied on the deeds of mutual covenant executed by the homeowners on the purchase of their properties, and counterclaimed for outstanding charges and for damages for inducing breaches of those deeds, while in companion suits the manager sued individual homeowners for arrears. The plaintiffs had initially pleaded that the deeds of mutual covenant were void ab initio for illegality, but withdrew that contention during submissions. The court held that the plaintiffs' purported representative action, brought on behalf of all homeowners in a phase of the scheme, was not maintainable because the requirements for a representative action under Order 15 rule 12 of the Rules of Court 2012 were not satisfied. On the substance, applying the burden of proof under section 101 of the Evidence Act 1950, it dismissed the plaintiffs' claim, the homeowners being bound by the deeds of mutual covenant. It found that the defendants had failed to prove their counterclaim for conspiracy to injure, and that, the representative action being unmaintainable, the defendants' claim for maintenance charges within that action was likewise not maintainable, leaving them to pursue separate claims; in the companion suits, however, the manager proved its claims against the individual homeowners. The court made orders as to costs reflecting these mixed outcomes. The judgment is a useful illustration of the requirements for a representative action and of the binding effect of a deed of mutual covenant on homeowners in a managed scheme.