Case Details
- Citation: [2022] SGHC 294
- Title: Anpex Pte Ltd v Cheng Yong Sun and another
- Court: High Court of the Republic of Singapore (General Division)
- Date of decision: 25 November 2022
- Judges: Choo Han Teck J
- Judgment reserved: Yes
- Hearing dates: 3, 20 October, 11 November 2022
- Suit number: Suit No 415 of 2021
- Plaintiff/Applicant: Anpex Pte Ltd
- Defendants/Respondents: (1) Cheng Yong Sun; (2) Lee Chai Yun, Winnie
- Legal area: Civil Procedure – Costs
- Procedural context: Costs decision following a prior substantive judgment in the same dispute
- Key statutory framework: Legal Aid and Advice Act (Cap 160, 2014 Rev Ed)
- Substantive judgment referenced: Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115 (delivered 20 May 2022)
- Representation: Farhan Tyebally (Gomez & Vasu LLC) for the plaintiff; First defendant absent and unrepresented; Ng Boon Gan (VanillaLaw LLC) for the second defendant; Sheela Kumari Devi and Suriakumari Sidambaram (Legal Aid Bureau) for the third party (watching brief)
- Third party: Legal Aid Bureau (watching brief)
- Judgment length: 5 pages; 1,149 words
Summary
This High Court decision concerns costs only. It follows an earlier substantive judgment in which the court found that the first and second defendants had conspired to misappropriate funds from the plaintiff and knowingly caused the plaintiff to lose $578,347.30. The first defendant had judgment entered against him and was subsequently made bankrupt, so the trial proceeded only against the second defendant. The plaintiff then sought an order that the second defendant—who was legally aided throughout the proceedings—should nevertheless be liable for the plaintiff’s costs.
The court rejected the plaintiff’s application. Although the plaintiff argued that the second defendant’s defence was improper and that she should be treated as an “aided person” who had acted improperly in defending the proceedings, the court held that the mere fact that her defence failed was not enough. The plaintiff did not discharge the burden of proving that the statutory threshold for costs orders against legally aided persons was met. The court also considered whether the legal aid grant might have been obtained by fraud or misrepresentation, but accepted evidence from the Legal Aid Bureau that the second defendant was technically entitled to legal aid at the time of application. Accordingly, the application for costs was dismissed.
What Were the Facts of This Case?
The dispute between Anpex Pte Ltd (“the plaintiff”) and the two defendants arose from findings made in a prior substantive judgment, Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115 (“the Substantive Judgment”). In that earlier decision, the High Court found that the first and second defendants had conspired to misappropriate funds from the plaintiff. The court further found that both defendants knowingly caused the plaintiff to lose $578,347.30. As a result, the defendants were held jointly and severally liable to compensate the plaintiff for that sum.
After the Substantive Judgment, the procedural posture changed. The first defendant had judgment entered against him and was later made bankrupt. Consequently, the plaintiff’s enforcement and further proceedings effectively proceeded only against the second defendant. The second defendant, however, was legally aided throughout the proceedings. This legal aid status became central to the costs application, because the Legal Aid and Advice Act generally protects legally aided persons from adverse costs orders to other parties in the proceedings for which they were aided.
In the costs phase, the plaintiff sought to overcome that statutory protection. The plaintiff’s position was that, although the second defendant’s defence was framed around her alleged lack of knowledge of the misappropriation, her conduct in defending the case was improper. Counsel for the plaintiff submitted that the second defendant’s defence depended on the assertion that the first defendant had lied to her about the nature of the transactions. The plaintiff argued that the second defendant should have called the first defendant to corroborate her account. The plaintiff further contended that, because the plaintiff succeeded on its conspiracy claim against both defendants, the second defendant’s attempt to portray herself as an unwitting accomplice should be dismissed, and costs should follow.
The second defendant resisted the costs application by relying on the statutory scheme for legally aided persons. The Legal Aid Bureau was also involved as a third party (watching brief). The court therefore had to examine not only the merits of the second defendant’s defence (in the limited sense relevant to costs), but also whether the legal aid grant could be attacked on the basis that it was obtained by fraud or misrepresentation, or whether the second defendant had acted improperly in defending the proceedings.
What Were the Key Legal Issues?
The first key issue was whether the plaintiff could obtain a costs order against the second defendant despite her legal aid status. Under the Legal Aid and Advice Act, an aided person is generally not liable for costs to another party for the proceedings for which the aid was granted. The plaintiff therefore needed to bring itself within the statutory exceptions that permit the court to order an aided person to pay costs of all or any of specified persons, including the other party.
Within that framework, the court had to consider two alternative statutory grounds. The first was whether the second defendant “acted improperly in bringing or defending any legal proceedings, or in the conduct of those proceedings” (s 14(3)(b) of the Act). The second was whether the “grant of aid issued to the aided person has been obtained by fraud or misrepresentation” (s 14(3)(a) of the Act). The plaintiff’s submissions primarily focused on the alleged impropriety of the second defendant’s defence, but the court also considered the possibility of fraud or misrepresentation in the legal aid application.
A further practical issue was evidential: what level of proof is required to establish impropriety under s 14(3)(b), and what evidence would be sufficient to show fraud or misrepresentation under s 14(3)(a). The court’s approach to the burden of proof and the type of evidence needed to satisfy the statutory threshold was therefore central to the outcome.
How Did the Court Analyse the Issues?
The court began by setting out the legal backdrop. The plaintiff’s application for costs had to be assessed against the Legal Aid and Advice Act. The court noted that, pursuant to s 12(4)(c) of the Act, where a litigant is legally aided, the litigant is generally not liable for costs to any other party in the proceedings for which the litigant is legally aided. This general rule reflects a policy choice: legal aid is intended to ensure access to justice, and the risk of adverse costs should not ordinarily deter aided persons from defending claims.
However, the court then turned to the exceptions in s 14. Under s 14(1)(c), where certain circumstances exist, the court may order the aided person to pay the costs of the other party. Those circumstances are enumerated in s 14(3). The court focused on s 14(3)(b) (improper conduct in bringing or defending proceedings) and s 14(3)(a) (fraud or misrepresentation in obtaining the grant of aid). The court treated these as alternative routes for the plaintiff to obtain a costs order.
On s 14(3)(b), the plaintiff’s argument was essentially that the second defendant’s defence failed and that her conduct was therefore improper. The court rejected that reasoning. It held that the failure of a defence is not, by itself, evidence of misconduct. The court emphasised that there must be evidence that the defendant conducted her defence in a way that a reasonable defendant would not. In other words, the statutory concept of “improper” conduct requires more than an unsuccessful defence; it requires a qualitative assessment of the manner in which the defence was conducted, supported by evidence.
Applying that standard, the court found that the plaintiff had not provided the necessary evidence. The second defendant’s position was that she did not know the plaintiff had misappropriated the plaintiff’s money, and that the “largesse” she enjoyed was paid from her own money. The court had disbelieved her account in the Substantive Judgment for reasons already set out there. But, for costs purposes under s 14(3)(b), the court held that disbelieving the defence does not automatically establish improper conduct. The court also offered a policy-based caution: if every plaintiff who succeeds against a legally aided defendant could obtain costs merely because the defence failed, then the statutory protection for legally aided persons would be undermined. That outcome could not be correct.
Having rejected s 14(3)(b) on the evidence, the court then considered s 14(3)(a). The court acknowledged that there was a “possibility” that the second defendant’s legal aid grant might have been obtained by fraud or misrepresentation. This possibility arose from the Substantive Judgment’s findings that the first and second defendants misappropriated a total of $578,347.30 from the plaintiff, coupled with evidence that the second defendant made several large purchases of jewellery, cosmetic products and beauty services between August and October 2020. The court therefore asked for evidence on how legal aid was applied for and approved.
The Legal Aid Bureau provided an affidavit through an Assistant Director, Ms Suriakumari Sidambaram. The affidavit explained the means-testing criteria and the second defendant’s legal aid application. The court was informed that, at the time the second defendant applied for legal aid in May 2021, her savings and non-CPF investments were $10,000 or lower, and she did not own any other property besides her HDB flat. The court also learned that the legal aid applicant was not asked to furnish bank statements prior to April 2021, because wealth is assessed at the point of application. The court further noted that there was no reason to suspect that the second defendant earned a salary above what was declared in her CPF statements, and that the Legal Aid Bureau had no information suggesting concealment of assets.
On the evidence, the court concluded that the second defendant was “technically entitled” to legal aid at the material time. The court accepted that the second defendant might have had more monies in her bank account at an earlier time, but likely spent it all by the time she made her application, as evidenced by the large purchases in the months before the application. Importantly, the court reasoned that this did not exclude her from legal aid because the relevant requirement was to furnish bank statements for the period required for the application, not to prove the absence of funds at all earlier times. The court therefore found no basis to order costs against the legally aided defendant.
In sum, the court’s analysis reflects a structured approach: it first applied the statutory general rule against costs orders for legally aided persons, then examined whether the plaintiff could satisfy either of the statutory exceptions. It required evidence of improper conduct beyond mere failure of the defence, and it required proof of fraud or misrepresentation in the legal aid application, which was not established on the evidence before the court.
What Was the Outcome?
The High Court dismissed the plaintiff’s application for costs. The court held that the plaintiff failed to prove that s 14(3)(b) of the Legal Aid and Advice Act was satisfied, because the mere fact that the second defendant’s defence failed was not evidence that she acted improperly in defending the proceedings. The court also found that s 14(3)(a) was not satisfied, as the evidence from the Legal Aid Bureau showed that the second defendant was technically entitled to legal aid at the time of application and there was no basis to conclude that the grant was obtained by fraud or misrepresentation.
Practically, this meant that even though the second defendant was found liable in the Substantive Judgment (and the plaintiff had succeeded against her on the merits), she was not ordered to pay the plaintiff’s costs because she remained protected by the legal aid costs regime. The plaintiff therefore bore its own costs, subject to whatever costs arrangements or funding consequences followed from the legal aid framework.
Why Does This Case Matter?
This case is significant for practitioners because it clarifies how courts approach costs applications against legally aided persons under the Legal Aid and Advice Act. The decision underscores that the statutory exceptions are not automatic consequences of losing a case. A plaintiff cannot obtain a costs order simply by pointing to the fact that the legally aided defendant’s defence was rejected. Instead, the plaintiff must adduce evidence showing that the aided person’s conduct in defending the proceedings was improper in the sense contemplated by s 14(3)(b).
For litigators, the case provides a useful evidential benchmark. The court required evidence that the defendant conducted the defence in a way that a reasonable defendant would not. This suggests that, in future cases, plaintiffs seeking costs against legally aided defendants should focus on concrete aspects of litigation conduct—such as unreasonable procedural steps, misleading submissions supported by evidence, or other demonstrable departures from what a reasonable litigant would do—rather than relying solely on the substantive outcome of the trial.
The decision also illustrates the court’s willingness to consider s 14(3)(a) where there is a factual basis for suspicion, but it demonstrates that the evidential threshold remains meaningful. Where the Legal Aid Bureau can provide a credible explanation of the means-testing process and the information available at the time of the application, courts may be reluctant to infer fraud or misrepresentation from later evidence of spending or lifestyle. The court’s reasoning about “wealth determined at the point of application” is particularly relevant for practitioners advising clients on legal aid applications and for parties assessing whether a costs challenge is viable.
Legislation Referenced
- Legal Aid and Advice Act (Cap 160, 2014 Rev Ed), s 12(4)(c)
- Legal Aid and Advice Act (Cap 160, 2014 Rev Ed), s 14(1)(c)
- Legal Aid and Advice Act (Cap 160, 2014 Rev Ed), s 14(3)(a)
- Legal Aid and Advice Act (Cap 160, 2014 Rev Ed), s 14(3)(b)
Cases Cited
- Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115
- Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 294
Source Documents
This article analyses [2022] SGHC 294 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.