Mr. Lim (not his real name) invested in several plots of land in Alberta, Canada, sold by a Canadian company. They were bought at different times, following briefings conducted by the Singapore office of the promoter. He received titles to some of the plots and was waiting for the title for the remaining plots, when the Canadian company filed for insolvency.
Mr. Lim was shocked to learn that the Canadian company had taken a mortgage loan on his plots of land without his permission. After a lengthy legal process, the Canadian court had ruled that the mortgage was valid and the mortgage holder had higher priority on the land.
The land title showed that they had an undivided interest in the land. Presumably, the title of the land still resided with the Canadian company, which was able to take a mortgage loan on the land, to the detriment of the owners who had bought the "plots" of land. Mr. Lim and the other Singapore investors did not lodge a caveat to register their interest in the land.
When buying any property, whether in Singapore or overseas, it is important for the buyer to engage a lawyer who will take care of the legal formalities, including lodging a caveat to record your interest. Mr. Lim had trusted the promoter to handle the formalities, but that trust was misplaced, as the promoter had acted fraudulently.
As the registered owner of the land, Mr. Lim received notices from the Alberta Provisional Government to pay the property tax on the land. He is in a dilemma as he does not know if it is a crime for him not to pay the tax, and he does not know the real value of his land.
Purchasers should be aware of this risk, when they buy an overseas property.
Mr. Lim was shocked to learn that the Canadian company had taken a mortgage loan on his plots of land without his permission. After a lengthy legal process, the Canadian court had ruled that the mortgage was valid and the mortgage holder had higher priority on the land.
The land title showed that they had an undivided interest in the land. Presumably, the title of the land still resided with the Canadian company, which was able to take a mortgage loan on the land, to the detriment of the owners who had bought the "plots" of land. Mr. Lim and the other Singapore investors did not lodge a caveat to register their interest in the land.
When buying any property, whether in Singapore or overseas, it is important for the buyer to engage a lawyer who will take care of the legal formalities, including lodging a caveat to record your interest. Mr. Lim had trusted the promoter to handle the formalities, but that trust was misplaced, as the promoter had acted fraudulently.
As the registered owner of the land, Mr. Lim received notices from the Alberta Provisional Government to pay the property tax on the land. He is in a dilemma as he does not know if it is a crime for him not to pay the tax, and he does not know the real value of his land.
Purchasers should be aware of this risk, when they buy an overseas property.
When Singapore Govt was promoting Batam as Industrial Park for foreign Companies to operate in, Batam properties were selling like hot cakes.
ReplyDeleteMany Singaporeans bought houses in a project called the Waterfront. Little did they know the developer did not even pay the Indonesian Govt to lease the land for development.
The properties were built, the owners took possession, then the Developer folded up during the Asian financial Crisis, one weekend the owners found the properties flattened to the ground, the Indonesians sold the lease to another developer.
Like magic, one weekend the houses were standing there, the next they disappeared.
A lesson here for Singaporeans investing in properties in the Iskandar region, Johore. Our Govt is also actively involved in development there, open eyes big big, and choose the Developers carefully.
Choosing reputable developer is one of the factors for consideration but NOT a foolproof method. An efficient and effective(clean, impartial and independent) judiciary system of a country is of all importance when the disputes taking place between the parties involved.
ReplyDeleteIn 1995, many(about 200) Singaporeans bought free-hold Condo units in one of the popular projects which was developed by 'Berjaya Group'(controlled by Tan Sri Vincent Tan) in KL. In 2009, they/the purchasers lost a civic suit in KL High-Court on issue of their clubhouse(consists of swimming pool, gym, sauna and library etc.). The developer claimed that the purchasers are not entitled to the ownership of the clubhouse situated within the compound of their condo although all facts pointed otherwise.
The policy can change and 'chop and change' style is well-known in many of the developing nations. Lee Kuan Yew once put it candidly: "They welcome you and after that, they make you as the hostages when you enter." The risk is always high when investing in other countries.