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)
- Suit No: Suit No 415 of 2021
- Date of Decision: 25 November 2022
- Judgment Reserved / Dates Heard: Judgment reserved; heard on 3, 20 October and 11 November 2022
- Judge: Choo Han Teck J
- Plaintiff/Applicant: Anpex Pte Ltd
- Defendants/Respondents: (1) Cheng Yong Sun; (2) Lee Chai Yun, Winnie
- Legal Area: Civil Procedure – Costs
- Key Statute Referenced: Legal Aid and Advice Act (Cap 160, 2014 Rev Ed)
- Specific Provisions Discussed: ss 12(4)(c), 14(1)(c), 14(3)(a), 14(3)(b)
- Related Earlier Decision: Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115 (“Substantive Judgment”)
- Judgment Length: 5 pages; 1,149 words (as provided)
- Counsel: Farhan Tyebally (Gomez & Vasu LLC) for the plaintiff; Ng Boon Gan (VanillaLaw LLC) for the second defendant; Legal Aid Bureau (watching brief) through Sheela Kumari Devi and Suriakumari Sidambaram
- Procedural Posture: Costs decision following a substantive finding of conspiracy/unlawful means against both defendants, with trial proceeding only against the second defendant due to bankruptcy of the first defendant
Summary
This costs judgment arose after the High Court’s earlier substantive decision in Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115, where 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. Although liability was established against both defendants in the substantive proceedings, the subsequent trial on the remaining defendant proceeded only against the second defendant because the first defendant had bankruptcy proceedings and judgment had already been entered against him.
In [2022] SGHC 294, the plaintiff sought an order that the second defendant—who was legally aided throughout the proceedings—should nevertheless be made liable for the plaintiff’s costs. The plaintiff relied on the Legal Aid and Advice Act framework, arguing that the second defendant’s defence was improper and that she had obtained legal aid by fraud or misrepresentation. The High Court (Choo Han Teck J) dismissed the costs application, holding that the plaintiff failed to prove that the statutory threshold for costs orders against legally aided persons was met.
What Were the Facts of This Case?
The underlying dispute concerned the plaintiff, Anpex Pte Ltd, and two defendants, Cheng Yong Sun (the first defendant) and Lee Chai Yun, Winnie (the second defendant). In the substantive judgment ([2022] SGHC 115), the court concluded that the defendants had conspired to misappropriate funds from the plaintiff using unlawful means. The court further found that the defendants knowingly caused the plaintiff to lose a total sum of $578,347.30, and that they were jointly and severally liable to compensate the plaintiff for that amount.
After the substantive findings, the procedural reality changed. The trial proceeded only against the second defendant because the first defendant had judgment entered against him and had since been made a bankrupt. As a result, the plaintiff’s subsequent application focused on costs against the second defendant alone.
Crucially, the second defendant was legally aided throughout the proceedings. Under the Legal Aid and Advice Act, legal aid generally protects an aided litigant from being ordered to pay costs to another party in the proceedings for which the litigant is legally aided. This statutory protection is designed to ensure access to justice and to prevent the legal aid regime from becoming a disincentive to defend claims where legal aid is granted.
Despite this protection, the plaintiff sought to pierce it by invoking exceptions in the Act. The plaintiff’s counsel argued that the second defendant’s defence was improper. The second defendant’s position, as described in the costs judgment, was that she did not know the plaintiff’s funds were being misappropriated and that the “largesse” she enjoyed came from her own money. The plaintiff contended that, although the second defendant claimed she was misled by the first defendant, she failed to call the first defendant to corroborate her account. The plaintiff therefore argued that her defence should be rejected and that this rejection should translate into a costs liability despite her legal aid status.
What Were the Key Legal Issues?
The central legal issue was whether the plaintiff could obtain a costs order against a legally aided defendant under the Legal Aid and Advice Act. The starting point was the general rule in 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.
The plaintiff’s application required it to bring itself within the statutory exceptions. Specifically, the court had to consider whether the circumstances in s 14(1)(c) and s 14(3) were satisfied. Those provisions allow the court to order an aided person to pay costs of the other party where (among other things) the grant of aid was obtained by fraud or misrepresentation (s 14(3)(a)) or where the aided person acted improperly in bringing or defending proceedings, or in the conduct of those proceedings (s 14(3)(b)).
Accordingly, the court had to decide two linked questions: first, whether the second defendant’s conduct in defending the proceedings amounted to “improper” conduct under s 14(3)(b); and second, whether there was sufficient evidence that the second defendant obtained legal aid by fraud or misrepresentation under s 14(3)(a). The plaintiff bore the burden of proving that the statutory threshold was met.
How Did the Court Analyse the Issues?
Choo Han Teck J approached the matter by first addressing the plaintiff’s argument under s 14(3)(b). The plaintiff’s case was essentially that the second defendant’s defence failed, and that her failure to call the first defendant to corroborate her version of events showed improper conduct. The judge, however, rejected the proposition that failure of a defence automatically equates to misconduct for the purposes of the Legal Aid and Advice Act.
The court emphasised that there must be evidence that the legally aided person conducted the defence in a manner that a reasonable defendant would not. In other words, the inquiry under s 14(3)(b) is not a merits-based inquiry (“did the defendant lose?”) but a conduct-based inquiry (“did the defendant act improperly in the way she defended the case?”). The judge noted that in the costs proceedings, the second defendant’s assertions were that she did not know of the misappropriation and that the benefits she received were from her own money. While the court had disbelieved her in the substantive judgment, that disbelief did not, by itself, establish that she acted improperly in the conduct of the defence.
The judge articulated a policy concern: if a legally aided person were found to be in breach of s 14(3)(b) merely because her defence failed, then every plaintiff who succeeded against a legally aided defendant would automatically be entitled to costs. That would undermine the statutory scheme and effectively nullify the general protection in s 12(4)(c). The court therefore required more than an adverse credibility finding; it required proof of improper conduct.
On the evidence before the court, the plaintiff did not discharge its burden. The judge found that the plaintiff had not shown that the second defendant’s defence conduct was unreasonable or improper in the relevant sense. The court therefore held that s 14(3)(b) was not satisfied and dismissed the costs application on that ground.
However, the judge did not stop there. Recognising that the plaintiff’s evidence might also support an alternative route, the court considered s 14(3)(a), which concerns whether the grant of legal aid was obtained by fraud or misrepresentation. This required a different evidential focus: not the conduct of the defence, but the circumstances surrounding the legal aid application and whether the applicant concealed assets or misrepresented means.
The judge observed that in the substantive judgment, the court had found that the first and second defendants misappropriated $578,347.30 in total. The judge also noted that there was evidence that the second defendant made several large purchases of jewellery, cosmetic products, and beauty services between August and October 2020. This created a “possibility” that she had obtained legal aid by fraud or misrepresentation, because the purchases suggested she might have had more funds than she declared at the time of her legal aid application.
To address this possibility, the judge asked for evidence on how legal aid was applied for and approved. The Legal Aid Bureau (LAB) provided an affidavit from an Assistant Director, Ms Suriakumari Sidambaram, explaining the means-testing criteria and the second defendant’s legal aid application in May 2021. The affidavit confirmed that at the time of application, the second defendant met the criteria: her savings and non-CPF investments were $10,000 or lower, and she did not own any other property besides her HDB flat. The LAB also explained that the applicant was not asked to furnish bank statements prior to April 2021, because wealth is determined at the point of application. The affidavit further stated there was no reason to suspect that she earned a salary above what was declared in her CPF statements, and that LAB had no information indicating she was concealing assets.
On this evidence, the judge concluded that the second defendant was “technically entitled” to legal aid at the material time. While the second defendant might have had more monies earlier, the court accepted that she likely spent those monies by the time she applied for legal aid in May 2021. The court treated the large purchases in August to October 2020 as consistent with the possibility that funds had been spent before the application, and it noted that only bank statements prior to the month of application were required for the legal aid application. In short, the evidence did not establish fraud or misrepresentation in the legal aid application process.
Having found neither s 14(3)(b) nor s 14(3)(a) satisfied, the judge held that there was no basis to order the legally aided second defendant to pay costs to the plaintiff. The plaintiff’s application was therefore dismissed.
What Was the Outcome?
The High Court dismissed the plaintiff’s application for costs against the second defendant. The practical effect was that, despite the plaintiff’s success in obtaining a substantive finding of conspiracy and unlawful means, the second defendant’s legal aid status remained protective of her from a costs order under the Legal Aid and Advice Act.
In doing so, the court reaffirmed that costs orders against legally aided persons require proof of the specific statutory circumstances—either improper conduct in defending the proceedings or fraud/misrepresentation in obtaining legal aid. Mere failure of a defence, or disbelief of a defendant’s account, was insufficient.
Why Does This Case Matter?
This decision is significant for practitioners because it clarifies the evidential and conceptual threshold for costs orders against legally aided litigants in Singapore. Many litigants and counsel may assume that once a defence is rejected in the substantive judgment, the legally aided defendant should automatically face costs consequences. [2022] SGHC 294 rejects that assumption and draws a careful distinction between (i) the merits of the defence and (ii) the conduct of the defence for the purposes of s 14(3)(b).
From a litigation strategy perspective, the case underscores that plaintiffs seeking costs against legally aided defendants must prepare evidence that goes beyond adverse credibility findings. They must show that the aided person acted improperly in a way that a reasonable defendant would not. This may require evidence of procedural abuse, unreasonable litigation conduct, or other demonstrable impropriety, rather than simply pointing to why the defence failed.
The judgment also provides practical guidance on the fraud/misrepresentation route under s 14(3)(a). Even where there is evidence suggesting the aided person may have had substantial funds at some time, the court will focus on the legal aid application point and the LAB’s means-testing process. The court’s acceptance that wealth is assessed at the time of application, and that only certain bank statements are required, indicates that plaintiffs must marshal evidence directly relevant to misrepresentation at the time the grant was obtained.
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
- [2022] SGHC 115
- [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.