A stakeholder holds the exercise fee pending completion, to protect the buyer
A worked RES examination question on resale option stakeholder, from our Paper 2 bank — with the rule it turns on, and why each of the four options is right or wrong.
The question
On the resale of a completed apartment, the buyer exercises the Option to Purchase and pays the 4% exercise fee. The OTP contains a stakeholder clause naming the Singapore Academy of Law, but the parties strike it out during negotiations. The buyer's agent asks how striking out the clause affects who holds the 4% exercise fee. Which statement is correct?
The answer, and why
Answer: D
The rule. A stakeholder holds the exercise fee pending completion, to protect the buyer. If the parties strike out the stakeholder clause, the fee is released directly to the seller — which increases the buyer's risk.
Why D is correct. With the clause struck out, the seller receives the 4% directly.
The other options.
- A the fee is not automatically shifted to the buyer's own solicitor.
- C striking the clause does not refund the fee to the buyer.
- B the clause was struck out, so the SAL no longer holds it.
Exam note. Strike out the stakeholder clause and the seller takes the money directly — a buyer-risk point.
More on Resale option stakeholder
Want a full paper instead of one question?
The free half-paper is 20 questions with a Section B case study, explained to this same depth. The paid sets are ten full 80-question papers across Paper 1 and Paper 2, every figure checked against the current IRAS, CEA, HDB, URA and SLA position.
Looking for past-year papers? CEA doesn't publish them — here's what it does publish.
Independent study material. Not affiliated with or endorsed by the Council for Estate Agencies. No pass guarantee — for study use only.