Conveyancing & Law of Property Act
This act, commonly quoted as CLPA, regulates the conveyancing of real and personal property in Singapore. There are 75 sections in this act. It is important to understand the meaning of “conveyancing” and “property” in this act.
- Conveyancing. This is the legal art of creating, transferring and extinguishing property interest [Source: Sim Mong Soo (LLB, LLM), “Law & Practice – Property Transaction”, 1992].
- Property. This includes real and personal property; and any estate in any property, real or personal, and any debt, thing in action, right or interest in the nature of property, whether in possession or not. Personal property would include life insurance policy which is famously quoted in Section 73 of this act [Source: CLPA Statutes].
Section 20: Power for mortgagor to inspect title deeds
The mortgagor (i.e. the property owner) has the right to inspect and make copies of the extracts from the documents of title relating to the mortgaged property, including the mortgage deed, from the mortgagee (i.e. the bank). However, the cost incur in such action is bore by the mortgagor.
Section 24: Power incident to estate or interest of mortgagee
A mortgagee has 3 powers.
- A power to sell the mortgaged property by public auction or by private contract, when the mortgage money has become due.
- A power to insure and keep insured against loss or damage by fire on the property. The premiums paid for such insurance shall be a charge on the mortgaged property, in addition to the mortgage money, and with the same priority, and with interest at the same rate, as the mortgage money.
- A power to appoint a receiver of the income of the mortgaged property.
Section 25: Regulation of exercise of power of sale
A mortgagee shall not exercise the power of sale unless
- Notice of mortgage money has been served on the mortgagor and default has been made in payment of the mortgage money for 3 months after the service.
- Some interest under the mortgage is in arrears and unpaid for one month after becoming due.
- There has been a breach of some provision contained in the mortgage deed by the mortgagor.
Section 35: Land to devolve on death as chattels real
Section 35(2) of this act states that no sale or mortgage of land belonging to the estate of a deceased person shall be made by the legal personal representative of the estate after the expiration of six years from his death unless with the sanction of the court, or the sale or mortgage is expressly contained or implied in the terms of the will of the deceased.
Section 41: Management of land and receipt and application of income during minority
If the beneficiary of the property is a minor, an appointed trustee or a guardian of the minor may enter into and continue in possession of the property.
The trustees may, in their discretion, apply any income which, they consider proper, according to the minor’s age, for his maintenance, education, or pay out money to the minor’s parent or guardian for the same reason (i.e. for the maintenance and education of the minor).
The trustees may invest the residue of the income of the property in investment on securities appropriately.
Section 62: Restriction on executory limitations
Where there is a person entitled to land for an estate in fee or for a term of years, the executory limitation shall be void as soon as any living issue attains the age of 21 years old.
A fee simple subject to an executory limitation is an estate that ends when a specific condition is met and then transfers to a third party.
Section 66: Severance of tenancy in common and joint tenancy
This section states that a joint tenant may sever a joint tenancy of an estate or interest in land by a deed of declaration and by serving a copy of the deed of declaration personally or by registered post on the other joint tenants.
Section 73: Moneys payable under policy of assurance not to form part of the estate of the insured
This is the famous Section 73 law that regulates a life policy taken out for the benefit of spouse or/and children. Such a policy will constitute a statutory trust for the beneficiary, and the creditors cannot claim upon it.
If it is proved that the policy was effected with the intent to defraud the creditors of the insured, the creditors shall be entitled to receive out of the moneys payable under the policy a sum equal to the premiums so paid.
But since the introduction of Section 49L of the Insurance Act in 2009, all statutory trust policies will be structured through that act. Section 73 of CLPA will continue to govern all statutory trust life policy structured BEFORE the introduction of Section 49L of the Insurance Act.
Section 73(A): Co-owner liable to account
A joint tenant or tenant in common shall be liable to account to his co-owner for receiving more than his share or proportion of any rents or profits arising from the property.
Section 73(B): Voluntary conveyances to defraud creditors voidable
Every conveyance of property made with the intent to defraud creditors shall be voidable. However this law also states it does not extend to any disposed of property in good faith to any person not having the notice of the intent to defraud creditors.