1 Can a person who is ineligible to acquire a particular Housing and Development Board (“HDB”) flat claim an interest in it, or in the proceeds of its sale, by way of a purchase money resulting trust?

2 Two sisters, Swee Geok and Swee Hwa (the applicants), brought this action to claim for themselves the whole of the beneficial interest in an HDB flat (“the Flat”), or its sale proceeds. The Flat is in the sole name of their mother (the respondent, Mdm Gee).

3 Swee Geok and Swee Hwa say that because they had paid for the Flat, the beneficial interest in the Flat (or its sale proceeds) is theirs. If they are right, Mdm Gee has no beneficial interest in the Flat (or its sale proceeds) although she is its registered owner – she would merely be staying in it with their permission.

4 At earlier points in time, first Swee Geok and then Swee Hwa were registered co-owners of the Flat with Mdm Gee, but they ceased to be registered co-owners when they each acquired another HDB flat, and Mdm Gee is now the sole registered owner of the Flat.

5 Swee Geok and Swee Hwa could not continue to be registered owners of the Flat when they each acquired another HDB flat: one cannot own two or more HDB flats at the same time (see [26] below). But they contend that they can still claim the whole of the beneficial interest in the Flat (or its sale proceeds). They say the law allows this, notwithstanding that they still own their respective HDB flats.

6 In or around 1980, Mdm Gee and Swee Geok jointly applied to purchase the Flat. Mdm Gee and Swee Geok became the first registered co-owners of the Flat, and Swee Geok made payments towards it from her Central Provident Fund (“CPF”) account. ¹

7 In or around 1987, Swee Geok got married, moved out of the Flat, and became the owner of another HDB flat. What Swee Geok had paid towards the Flat was refunded to her CPF account. Swee Hwa replaced Swee Geok as a registered co-owner of the Flat, together with Mdm Gee. ²

8 From 1987, Swee Hwa made payments towards the Flat from her CPF account. In or around 1993, Swee Hwa got married, moved out of the Flat, and became the owner of another HDB flat. What Swee Hwa had paid towards the Flat was refunded to her CPF account. Mdm Gee’s husband, Mr Ong, replaced Swee Hwa as a registered co-owner of the Flat, together with Mdm Gee. ³

9 Swee Geok then resumed paying towards the Flat – this time, in cash – from 1993 until the Flat was fully paid up in early 2016. ⁴

10 During the period in which Swee Geok was making cash payments towards the Flat, Mr Ong passed away in 2009, leaving Mdm Gee as the sole registered owner of the Flat. ⁵

11 Mdm Gee has five children: Swee Geok and Swee Hwa, two other daughters, and a son – Joo Hak.

12 The Flat was initially occupied by Mr Ong, Mdm Gee, Swee Geok, Swee Hwa, and Joo Hak. With Swee Geok and Swee Hwa moving out, and Mr Ong’s passing, Mdm Gee and Joo Hak (and Joo Hak’s family) were the remaining occupants of the Flat.

13 This litigation was prompted by a will Mdm Gee made in 2013, purporting to bequeath the Flat to Joo Hak. ⁶ As Swee Geok and Swee Hwa put it, this was done “notwithstanding” that they were the ones who had made the payments towards the Flat. ⁷

14 In Mdm Gee’s will, she explained that she was bequeathing the Flat to Joo Hak because he and his children needed a home. She said she was grateful to her wonderful daughters who had given her monies and been understanding. She expressed her wish that her children would be generous and kind to each other, and that they would not quarrel over her will or her property. ⁸

15 Mdm Gee evidently regarded the Flat as hers. Swee Geok and Swee Hwa, however, did not agree with that.

16 In September 2020, Swee Geok and Swee Hwa lodged a caveat over the Flat. ⁹ The caveat stated that they were claiming “an ESTATE OR INTEREST in the land as Beneficiaries” based on the following grounds of claim: ¹⁰

17 In February 2021, Swee Geok and Swee Hwa filed this originating summons (“OS”) against Mdm Gee. By this time, Mdm Gee had been admitted to a community hospital, and substituted service of the court papers was effected on her care coordinator at the hospital.

18 ​In the OS, Swee Geok and Swee Hwa claimed a declaratory judgment that they “have a 58% and 42% beneficial interest respectively in [the Flat]”. When I first heard the matter, I queried the proportions claimed by them: had the refunds to their CPF accounts been accounted for? The hearing was adjourned for counsel to take instructions on this.

19 Swee Geok and Swee Hwa then filed a supplementary affidavit, acknowledging that they had been refunded all the payments they had made from their CPF accounts. ¹¹ That left the payments made in cash by Swee Geok from 1993 to 2016: when the Flat was in the names of her parents (from 1993 to 2009), and then in Mdm Gee’s sole name (from 2009 to 2016) (see [9] above).

20 Swee Geok and Swee Hwa also filed an application to amend the OS, to change the claim for relief to: “a declaratory judgment … that [Swee Geok] has a beneficial interest in the whole of the proceeds from the sale of [the Flat].” [emphasis added]

21 Recognising that she had been refunded all that she had paid towards the Flat, Swee Hwa abandoned any claim to the Flat, or its sale proceeds. That left Swee Geok as the sole claimant. Under the proposed amended OS, Swee Geok would only be claiming the beneficial interest in the sale proceeds of the Flat, rather than in the Flat itself. That claim was based on the cash payments which she made from 1993 to 2016.

22 Swee Geok added that she would not seek to realise her beneficial interest in the sale proceeds of the Flat until after Mdm Gee’s lifetime or until the time the Flat is sold (whichever came first). ¹² In other words, Mdm Gee could continue staying in the Flat, but if the Flat were sold in Mdm Gee’s lifetime then Swee Geok should get all the sale proceeds.

23 The provisions of the Housing and Development Act (Cap 129, 2004 Rev Ed) (“the HDA”) stand in the way of the applicants’ claims, in particular, ss 51(8), (9) and (10):

24 The Flat is “protected property” as defined in s 51(11) of the HDA: “any flat, house or other building that has been sold by the [HDB] under the provisions of this Part.”

25 In Lim Kieuh Huat v Lim Teck Leng and another and another appeal [2021] SGCA 28 (“Lim Kieuh Huat”), the Court of Appeal, citing Tan Chui Lian v Neo Liew Eng [2007] 1 SLR(R) 265 (“Tan Chui Lian”) and Koh Cheong Heng v Ho Yee Fong [2011] 3 SLR 125, stated (at [14]): “[t]he authorities are clear that s 51(10) of the HDA prevents a person who is ineligible to acquire an HDB flat from obtaining or becoming entitled to an interest in such a flat by way of a resulting or constructive trust.” The court went on to say that the question of “eligibility” must be “whether the particular person could purchase the particular flat, and what conditions must be met before that purchase would be approved” (at [14]).

26 Here, Swee Geok and Swee Hwa ceased being registered owners of the Flat, so that they could acquire other flats. That was required of them by s 47(1)(a) of the HDA:

27 As Swee Geok and Swee Hwa own other HDB flats, they are ineligible to acquire the Flat, and under s 51(10) of the HDA they cannot obtain or become entitled to any interest in it by way of a resulting or constructive trust. Indeed, in their written submissions, they expressly accept that they “are not eligible within the meaning of section 47 [and s 51(10)] of the HDA as they are the owners of [other] HDB flats”. ¹³ The payments relied upon to assert a resulting trust were those made by Swee Geok when she and Swee Hwa were ineligible persons.

28 By virtue of 51(10) of the HDA, Swee Geok and Swee Hwa are not entitled to the Flat or any interest in it. Sections 51(8) and (9) of the HDA would also defeat such a claim (see [35]–[52] below).

29 It follows that the applicants’ claim in the OS to the beneficial interest in the Flat must fail. Perhaps that is why they decided to abandon that claim, and to amend the OS such that Swee Geok would claim an interest in the sale proceeds instead.

30 The applicants (and finally Swee Geok) rely on a presumed resulting trust arising from the payments made by them. In their affidavits, they did not expressly say what their intention was when they made those payments, but it was submitted that their payments were not meant as a gift of the Flat to Mdm Gee, but rather to ensure that she had a property where she could reside at. ¹⁴

31 The applicants further contended that “even if an ineligible person is not entitled to own a HDB flat by way of resulting trust, she is still entitled to the sale proceeds therefrom”. ¹⁵

32 They rely on the High Court decision in Low Heng Leon Andy v Low Kian Beng Lawrence (administrator of the estate of Tan Ah Kng, deceased) [2013] 3 SLR 710 (“Andy Low”) for the proposition that under s 51(10) of the HDA “the effect of conferring an entitlement or interest in protected property by way of resulting or constructive trust is disallowed, although any resulting or constructive trust that confers such an interest is not rendered void” (Andy Low at [21]).

33 Andy Low did not, however, concern a resulting trust claim (which is the claim in the present case): the claim in Andy Low was one in proprietary estoppel. Moreover, the court was dealing with an application to strike out that claim on the basis that it was precluded by s 51(10) of the HDA as the plaintiff was an ineligible person. The court concluded that s 51(10) of the HDA did not extinguish the proprietary estoppel claim from the outset; and that as long as a proprietary estoppel claim does not give rise to an interest in the land (specifically, an interest in an HDB flat in favour of an ineligible person), it should not be affected by s 51(10) (Andy Low at [30(e)] and [30(f)]).

34 It was not necessary for the court in Andy Low to consider ss 51(8)–(9) of the HDA, and the court did not do so.

35 In Cheong Yoke Kuen and others v Cheong Kwok Kiong [1999] 1 SLR(R) 1126 (“Cheong Yoke Kuen”), the Court of Appeal considered the predecessors to ss 51(8)–(9) of the HDA, namely, ss 51(4)–(5) of the Housing and Development Act (Cap 129, 1997 Rev Ed) (“1997 HDA”):

36 The respondent in Cheong Yoke Kuen claimed on the basis of a resulting trust. The HDB flat in question was registered in the joint names of the respondent and his mother. The respondent was subsequently allocated a new HDB flat. As he could not own more than one flat at any one time (by virtue of s 47(1)(a) of the 1997 HDA), he ostensibly transferred his interest in the first flat to his mother, who became its sole owner. After his mother’s death, however, the respondent asserted that he still had a beneficial interest in the first flat by way of a resulting trust as he had paid for the flat.

37 The Court of Appeal held that the alleged trust was prohibited by s 51(4) and was void under s 51(5) of the 1997 HDA. In arriving at its conclusion, the Court of Appeal noted that there was earlier a blanket prohibition against the creation of any trust over HDB flats, but this was relaxed to allow such trusts to be created with the prior written approval of HDB (at [18]). The court went on to examine the underlying purpose of the prohibition and the policy of the 1997 HDA (Cheong Yoke Kuen at [19]):

38 In Cheong Yoke Kuen, the respondent’s claim was on the basis of a resulting trust, but the Court of Appeal reasoned that the respondent had “created” the alleged trust in his favour as he had intended to remain the beneficial owner of the first flat when transferring his interest in that flat to his mother (at [20]). The alleged trust was thus subject to ss 51(4)–(5) of the 1997 HDA.

39 The respondent in Cheong Yoke Kuen ([35] above) purportedly created the alleged trust when he transferred his interest in a flat that he had paid for to his mother, such that it appeared that his mother was the sole owner and he no longer had an interest in it, while he intended to be the beneficial owner of the flat. Here, the payments Swee Geok relies upon were made when the Flat was in her parents’ names, and then in the sole name of Mdm Gee – again, making it appear that the registered owner(s) owned the Flat and that Swee Geok had no interest in it (indeed, she had ceased to be a registered owner of the Flat some years earlier, and owned another flat), while Swee Geok intended to be the beneficial owner of the Flat. Swee Geok had purported to create a trust just as the respondent in Cheong Yoke Kuen had.

40 In Lim Kieuh Huat ([25] above), the parents claimed to have funded the purchase of an HDB flat that was registered in their son’s sole name (“the Kim Tian Flat”). They asserted a purchase money resulting trust in respect of the Kim Tian Flat. Their claim failed. The Court of Appeal held that this would be a nominee arrangement – in substance, for the son to hold the Kim Tian Flat as a bare trustee on behalf of his parents. The Court of Appeal stated (at [11]):

41 Likewise, by making payments towards the Flat while she was no longer the registered owner (but intending to be its beneficial owner), Swee Geok regarded her parents, and then Mdm Gee, as mere nominees holding the Flat as a bare trustee for her, in the same way that the parents in Lim Kieuh Huat regarded their son.

42 The fact that the alleged trust was purportedly created some time after the initial purchase of the Flat does not avoid the operation of ss 51(8)–(9) of the HDA – in Cheong Yoke Kuen ([35] above) the alleged trust was created some time after the initial purchase: when the respondent transferred his interest to his mother.

43 Both the respondent in Cheong Yoke Kuen, and Swee Geok, were the owners of other HDB flats. If the respondent in Cheong Yoke Kuen could not retain a beneficial interest in the first flat while owning another, neither could Swee Geok acquire a beneficial interest in the Flat while owning another. This is consonant with the policy of avoiding “abuse by persons who would and could easily purchase HDB properties through nominees” (Cheong Yoke Kuen at [19]), and the restrictions on dual ownership of HDB flats pursuant to s 47(1)(a) of the HDA (Cheong Yoke Kuen at [22]–[23]).

44 In Cheong Yoke Kuen, the Court of Appeal concluded (at [27]):

45 The respondent in Cheong Yoke Kuen thus failed to get an interest in the flat, or an interest in its proceeds of sale, although he had paid for the flat.

46 Applying Cheong Yoke Kuen, the High Court in Chong Sze Pak v Chong Ser Yoong [2011] 3 SLR 80 (“Chong Sze Pak”) likewise rejected a resulting trust claim to sale proceeds of an HDB flat (“the McNair Road property”). There, the trust purportedly created by a trust deed was held to be null and void under ss 51(4)–(5) of the 1997 HDA (see [42] and [58]). The court went on to say at [59]: “The Plaintiff’s attempt to claim the sale proceeds (of the McNair Road property) under a resulting trust, must also fail, see [Cheong Yoke Kuen ([35] above)] at [13]–[19].”

47 I would also mention Ong Chai Koon and others v Ong Chai Soon [2021] SGHC 76 (“Ong Chai Koon”), where the High Court found that a constructive trust justified an order for the sale of an HDB shophouse, with the sale proceeds being distributed to the beneficiaries of that trust (one of whom was the registered owner, the others his siblings). The court found that the parties always shared a common intention that they would treat the shophouse as their collective “retirement fund”, and that the shophouse would be sold at some point in time, so that its sale proceeds can be shared by them equally (at [189]). Thus, the court found a common intention constructive trust over the shophouse and its sale proceeds.

48 The court in Ong Chai Koon distinguished Cheong Yoke Kuen ([35] above) and Chong Sze Pak ([46] above) on the basis that those cases did not concern s 51(10) of the HDA but instead the predecessors of the current ss 51(8)–(9) (see [160]–[162]). The defendant had relied on ss 51(8)–(9) to argue that “an express trust” created over the HDB shophouse would fail (at [140]), but what the court found was a constructive trust rather than an express trust.

49 The defendant relied on s 51(10) of the HDA to defeat a constructive trust; but following Andy Low ([32] above) the court held that s 51(10) of the HDA did not render the constructive trust void – it would only prevent a person from becoming entitled to HDB property (or any interest in it) by virtue of that trust (see Ong Chai Koon at [160]). Thus, the court held that s 51(10) of the HDA did not preclude the court from ordering the sale of the shophouse and the distribution of its proceeds (see Ong Chai Koon at [108], [189] and [192]-[193]).

50 Unlike Ong Chai Koon, there is no constructive trust in the present case. Swee Geok and Swee Hwa did not assert a constructive trust, and there is clearly no common intention between them (on the one hand) and Mdm Gee (on the other hand) that the Flat belongs to the applicants, or to Swee Geok alone.

51 I find that ss 51(8)–(9) of the HDA defeat the applicants’ claim to the beneficial interest in the Flat, as well as Swee Geok’s claim to the beneficial interest in its sale proceeds. The decisions in Cheong Yoke Kuen ([35] above), Chong Sze Pak ([46] above), and Lim Kieuh Huat ([25] above) support the application of ss 51(8)–(9) of the HDA to the present case.

52 I thus do not need to decide whether, by itself, s 51(10) of the HDA might also have stood in the way of Swee Geok’s claim to sale proceeds. I would simply observe that when s 51(10) of the HDA was introduced (as 51(6) of the HDA in force in 2005), it was described by the Minister for National Development as an additional prohibition on top of the prohibition already contained in the predecessors to the current ss 51(8)–(9) (see Tan Chui Lian ([25] above) at [9]). Section 51(10) of the HDA is a prohibition: it does not save any purported trust that is null and void on an application of ss 51(8)–(9).

53 For the above reasons, Swee Geok and Swee Hwa have no beneficial interest in the Flat or its sale proceeds. I thus dismiss both the application to amend the OS, and the OS itself. Swee Geok and Swee Hwa shall withdraw the caveat that they lodged in respect of the Flat. They shall also provide copies of this judgment to Mdm Gee (through her care coordinator), and to their siblings.

54 Mdm Gee did not participate in these proceedings. I am informed that she is in a community hospital, but I do not have any objective evidence of her condition.

55 Although Mdm Gee was absent, what Swee Geok and Swee Hwa put before me was sufficient for me to dismiss their claims. If I had found their claims to have some merit, I would have directed that the court papers be served on their siblings so that they could consider if someone should be appointed to represent Mdm Gee’s interests.

56 Given the circumstances, I was disappointed that Swee Geok and Swee Hwa had sought an order for costs against their mother. All Mdm Gee did was to regard the Flat that was in her name, as hers – such that she could bequeath it to her son. Even if Swee Geok and Swee Hwa had succeeded in claiming the whole beneficial interest in the Flat (or its sale proceeds), I would not have ordered costs against Mdm Gee.

57 On a more positive note, Mdm Gee had in her will expressed her gratitude to Swee Geok and Swee Hwa, ¹⁶ and indeed they should be commended for the payments which they had made towards the Flat, providing their parents and their brother with a home. But they have their own HDB flats now, and they cannot also claim the Flat – Mdm Gee’s flat – or its sale proceeds, for themselves.