Case Details
- Title: ALS Memasa and another v UBS AG
- Citation: [2012] SGHC 30
- Court: High Court of the Republic of Singapore
- Date of Decision: 09 February 2012
- Case Number: Suit No 935 of 2010 (Registrar’s Appeal Nos 233 and 234 of 2011)
- Coram: Woo Bih Li J
- Plaintiffs/Applicants: ALS Memasa and another
- Defendant/Respondent: UBS AG
- Procedural Posture: High Court appeal against (i) dismissal of plaintiffs’ application to amend the Statement of Claim and (ii) striking out of the Statement of Claim and dismissal of the action
- Tribunal/Court Level: High Court
- Judgment Length: 16 pages, 7,867 words
- Counsel for Plaintiffs/Appellants: N Sreenivasan and Sujatha Selvakumar (Straits Law Practice LLC)
- Counsel for Defendant/Respondent: Hri Kumar Nair, SC, Benedict Teo and Charmaine Chiu (Drew & Napier LLC)
- Legal Area(s): Banking litigation; civil procedure (striking out; abuse of process); pre-action discovery; pleadings and amendments
- Statutes Referenced: Not specified in the provided extract
- Cases Cited: Chee Siok Chin v Minister for Home Affairs [2006] 1 SLR(R) 582; [2011] SGCA 55; [2012] SGHC 30 (as reflected in the metadata)
Summary
ALS Memasa and another v UBS AG concerned a dispute between customers and a bank arising from losses incurred in three UBS accounts. The plaintiffs alleged, in substance, that they did not authorise the relevant transactions and that they were misled into believing their UBS accounts were akin to fixed deposit or safe deposit arrangements. They sought an account of all transactions and damages to be assessed, and they also pursued pre-action discovery from UBS to obtain internal documents that would, they said, enable them to understand how the losses occurred and to formulate their claims.
The High Court upheld the procedural outcome below. The court dismissed the plaintiffs’ appeals and affirmed the Assistant Registrar’s decision to strike out the Statement of Claim and dismiss the action, as well as the dismissal of the plaintiffs’ application to amend. The court’s focus was on abuse of process, particularly the allegation that the plaintiffs had advanced a false case in order to obtain discovery and to tailor their pleaded case to the evidence they hoped to obtain.
In doing so, the court applied the structured approach to “abuse of process” articulated in Chee Siok Chin v Minister for Home Affairs. The court found that the plaintiffs’ core allegations were undermined by undisputed documentary and evidential material (including confirmations and telephone recordings) that pointed to authorisation and knowledge inconsistent with the plaintiffs’ pleaded narrative. The decision illustrates how striking out may be justified where pleadings are manifestly inconsistent with the evidential record and where the litigation process is used for an improper purpose.
What Were the Facts of This Case?
The plaintiffs were customers of UBS AG (“UBS”). The first plaintiff, ALS Memasa (“AM”), was about 65 years old, and the second plaintiff, Tjo Bun Khai (“Tjo”), was about 95 years old. The plaintiffs stated that neither could speak, read, or write English. Tjo was described as a wealthy retired Indonesian businessman who ran his own manufacturing business, while AM managed a company in the family business. These personal and linguistic circumstances formed part of the plaintiffs’ narrative about how they interacted with banking personnel and how they allegedly misunderstood the nature of the investments.
Before moving to UBS, the plaintiffs had long-standing banking relationships with OCBC for over 40 years. In late 2004 or early 2005, their OCBC accounts came under the care of a relationship officer, Gary Yeo (“Gary”). After about six months, Gary informed them he would be moving to UBS. In or around late 2006, the plaintiffs agreed to move approximately US$8 million in account value to UBS. Three UBS accounts were opened: two joint accounts and one sole account of Tjo.
Over time, UBS executed various transactions for the plaintiffs across these accounts, and losses were incurred on some of them. The plaintiffs’ claim, as pleaded, appeared to relate to all transactions executed for the accounts. Critically, the plaintiffs alleged that they did not provide direct instructions for the management of the accounts or for the trades executed. They also alleged that they were led to believe that their UBS accounts were fixed deposit accounts, similar to what they had with OCBC, and that they did not understand how they lost money or that the deposits were “high risk investments”.
Procedurally, the dispute began with a pre-action discovery application. On 26 November 2009, the plaintiffs filed Originating Summons No 1358 of 2009 (“OS 1358/09”) seeking broad categories of documents from UBS, including confirmation slips, instruction notes, attendance notes, telephone memos, recommendations and advice, analyses, and internal documents evidencing transactions. The court dismissed OS 1358/09 on 8 March 2010, and the plaintiffs did not appeal that dismissal. Approximately nine months later, on 17 December 2010, the plaintiffs filed Suit 935/10, and UBS subsequently applied to strike out the Statement of Claim and dismiss the action.
What Were the Key Legal Issues?
The principal legal issues were procedural and focused on the court’s power to strike out pleadings and dismiss an action, and on whether the plaintiffs’ proposed amendments should be allowed. UBS’s strike-out application relied on multiple grounds, including that the Statement of Claim disclosed no reasonable cause of action, was scandalous, frivolous and vexatious, might prejudice or delay a fair trial, and/or constituted an abuse of the process of the court.
For the purposes of the High Court’s reasoning in the extract provided, the court concentrated on abuse of process. The question was whether the plaintiffs’ litigation conduct—particularly their pre-action discovery application and the way their pleaded case was framed—amounted to an improper use of the court’s process. UBS argued that the plaintiffs had advanced a false case, using the discovery process to construct a narrative tailored to the evidence they hoped to obtain.
A related issue was whether the plaintiffs’ amendments could cure any defects in the pleadings. The Assistant Registrar had indicated willingness to allow limited amendment relating to pre-contractual misrepresentation, but ultimately dismissed the plaintiffs’ broader amendment application. The High Court had to consider whether the plaintiffs’ pleaded case, even with further amendments sought during the appeals, could proceed or whether it remained fundamentally flawed due to abuse of process and inconsistency with the evidential record.
How Did the Court Analyse the Issues?
The High Court began by setting out the doctrinal framework for abuse of process. Citing Chee Siok Chin v Minister for Home Affairs, the court reiterated that abuse of process can be systematically classified into four categories: (a) proceedings involving deception on the court, fictitious or sham proceedings; (b) proceedings where the process is not fairly or honestly used but employed for an ulterior or improper purpose; (c) proceedings that are manifestly groundless or without foundation and serve no useful purpose; and (d) multiple or successive proceedings causing improper vexation or oppression. This classification matters because it guides courts in deciding whether to terminate proceedings at an early stage rather than allowing them to proceed to trial.
UBS’s submission, as summarised by the High Court, was that the plaintiffs abused the process by putting forward a false case. The court treated the plaintiffs’ pre-action discovery application as a key contextual indicator. UBS argued that the plaintiffs’ discovery application was not genuinely aimed at identifying the basis of a claim they already knew, but rather was intended to obtain internal UBS documents so that the plaintiffs could tailor their case to the evidence. The court therefore examined whether the plaintiffs’ pleaded narrative—particularly the allegations that they did not authorise transactions and were misled about the nature of the accounts—was consistent with what the plaintiffs already knew or with what undisputed evidence later showed.
The court then focused on the “crux” of the Statement of Claim. The plaintiffs pleaded that, to the best of their recollection, they had not given direct instructions to UBS on management of the accounts and had not sought instructions. They further pleaded that they suffered loss due to negligence, breach of duty, lack of skill or diligence, and alternatively dishonesty. They stated that they were unable to provide particulars until discovery. In the alternative, they averred reliance on representations by UBS servants or agents (Gary Yeo and/or Donna Yeo) that the accounts were akin to safe deposit accounts and thus capital safe, and that such representations were false and made fraudulently or negligently, causing loss.
In assessing abuse of process, the court considered the plaintiffs’ affidavits in OS 1358/09 and the evidential material UBS produced in response. The High Court noted that the plaintiffs’ initial position was that they believed their UBS accounts were fixed deposit accounts and that they did not understand how they lost money. However, UBS’s response adduced evidence that, in the court’s view, demolished the primary position. The court highlighted that the plaintiffs’ narrative was inconsistent with evidence such as external securities transfers authorised by the plaintiffs and transactions evidenced by confirmations and telephone recordings.
Specifically, UBS argued that not all investments held in the UBS accounts were transacted by UBS; some were transferred from other banks, including OCBC. UBS referred to investments such as Mandiri bonds, Bank Rakyak bonds, RBS Notes, and Amgen Shares. This undermined the plaintiffs’ attempt to characterise all losses as arising from UBS-managed unauthorised transactions. The court also addressed investments made through UBS, including Constant Maturity Swap (“CMS”) notes. UBS submitted that the plaintiffs instructed UBS to acquire CMS notes, and that the plaintiffs signed purchase confirmations to purchase particular notes and authorised debiting their accounts accordingly. UBS further relied on transcripts of recorded telephone conversations in which AM allegedly instructed UBS to purchase specific notes.
Although the extract truncates the later portions of the judgment, the High Court’s reasoning—based on the portion provided—shows a consistent theme: the plaintiffs’ pleaded case was not merely weak or unproven; it was inconsistent with documentary and recorded evidence that suggested authorisation and knowledge inconsistent with the plaintiffs’ allegations. In an abuse of process analysis, such inconsistency can support a finding that the proceedings are manifestly groundless or are being used for an improper purpose. The court’s approach therefore treated the evidential mismatch as central to whether the plaintiffs were using the court’s process honestly and fairly.
Finally, the court’s decision to dismiss the appeals also reflected the procedural history. The plaintiffs had already had OS 1358/09 dismissed, and they did not appeal. Suit 935/10 was filed about nine months later, after the discovery attempt failed. The High Court implicitly considered whether the plaintiffs were attempting to relitigate or circumvent the earlier dismissal by reframing their claim and seeking to obtain, through trial pleadings and amendments, what they had failed to obtain through pre-action discovery.
What Was the Outcome?
The High Court dismissed both appeals brought by the plaintiffs. It upheld the Assistant Registrar’s decision to strike out the Statement of Claim and dismiss the action. It also affirmed the dismissal of the plaintiffs’ application to amend the Statement of Claim, including the broader amendments that went beyond what the Assistant Registrar had earlier indicated might be permissible.
Practically, the effect of the decision was that the plaintiffs’ claims for an account of transactions and damages to be assessed could not proceed in the pleaded form. The termination of the action at the pleadings stage prevented the matter from going to trial, reflecting the court’s conclusion that the proceedings were an abuse of process and that the plaintiffs’ core allegations were not tenable in light of the evidential record.
Why Does This Case Matter?
This decision is significant for banking litigation in Singapore because it demonstrates that courts will scrutinise not only the substantive merits of customer claims against banks, but also the integrity of the litigation process. Where a plaintiff’s pleaded narrative is contradicted by documentary confirmations and recorded communications, the court may be prepared to strike out the claim as manifestly groundless or as an abuse of process, rather than allowing the case to proceed to trial.
For practitioners, the case also highlights the limits of pre-action discovery and the potential consequences of using discovery as a “fishing expedition” to construct a case. The plaintiffs’ earlier failed OS 1358/09 application, coupled with the later attempt to plead inability to provide particulars “until discovery”, created a procedural context in which the court was willing to infer improper purpose. Lawyers should therefore ensure that pleadings are anchored in a coherent factual basis known to the client, and that discovery requests are genuinely targeted rather than speculative.
More broadly, the case reinforces the structured abuse-of-process framework from Chee Siok Chin and shows how that framework can be applied in commercial disputes. It serves as a cautionary authority for both plaintiffs and defendants: plaintiffs must plead honestly and consistently with available evidence, while defendants can rely on abuse-of-process arguments to seek early termination where the litigation is being used improperly.
Legislation Referenced
- Not specified in the provided extract.
Cases Cited
- Chee Siok Chin v Minister for Home Affairs [2006] 1 SLR(R) 582
- [2011] SGCA 55
- [2012] SGHC 30
Source Documents
This article analyses [2012] SGHC 30 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.