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
- Judgment Reserved: 20 October 2022; delivered 25 November 2022 (with further hearing on 11 November 2022)
- Judge: Choo Han Teck J
- 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 on liability and damages
- Prior Substantive Judgment: Anpex Pte Ltd v Cheng Yong Sun and another [2022] SGHC 115 (“Substantive Judgment”)
- 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) of the Legal Aid and Advice Act
- Parties’ Representation: Farhan Tyebally (Gomez & Vasu LLC) for the plaintiff; Ng Boon Gan (VanillaLaw LLC) for the second defendant; first defendant absent and unrepresented; Legal Aid Bureau personnel (watching brief)
- Third Party: Legal Aid Bureau (LAB) (watching brief)
- Judgment Length: 5 pages; 1,149 words
Summary
This High Court decision concerns costs after the plaintiff obtained judgment in a conspiracy claim. In the Substantive Judgment, the court found that the first and second defendants conspired to misappropriate funds from the plaintiff and that the defendants knowingly caused the plaintiff to lose $578,347.30, resulting in joint and several liability. However, the first defendant had bankruptcy proceedings and the trial proceeded only against the second defendant for practical reasons.
Although the plaintiff succeeded on liability against the second defendant, the second defendant was legally aided throughout the proceedings. The plaintiff therefore sought an order that the legally aided second defendant should nonetheless pay costs. The court applied the Legal Aid and Advice Act’s general rule that an aided person is not liable for costs to other parties in the proceedings for which they were legally aided, subject to specific statutory exceptions.
The court dismissed the plaintiff’s costs application. It held that the plaintiff failed to prove that the second defendant acted improperly in defending or conducting the proceedings (s 14(3)(b)). The court also found that, while there was a “possibility” that the grant of aid might have been obtained by fraud or misrepresentation (s 14(3)(a)), the evidence from the Legal Aid Bureau showed that the second defendant was technically entitled to legal aid at the time of application. Accordingly, no costs order was made against the legally aided defendant.
What Were the Facts of This Case?
The dispute between Anpex Pte Ltd and the defendants arose from the plaintiff’s allegation that the defendants engaged in unlawful means conspiracy to misappropriate the plaintiff’s funds. In the Substantive Judgment delivered on 20 May 2022, the High Court found for the plaintiff. The court concluded that the first and second defendants conspired to misappropriate funds and knowingly caused the plaintiff to lose $578,347.30. As a result, the defendants were jointly and severally liable to compensate the plaintiff for that sum.
After the Substantive Judgment, the procedural posture shifted. The trial proceeded only against the second defendant because the first defendant had judgment entered against him and subsequently became a bankrupt. This meant that, for the purposes of enforcement and further proceedings, the second defendant remained the relevant target for the plaintiff’s post-judgment applications.
Throughout the proceedings, the second defendant was legally aided. This legal aid status is central to the costs analysis. Under the Legal Aid and Advice Act, legal aid is designed to ensure access to justice for persons who meet statutory criteria, and it generally shields aided persons from adverse costs consequences in the proceedings for which they were granted aid.
Following the plaintiff’s success on liability, counsel for the plaintiff sought to overcome that general protection. The plaintiff argued that the second defendant’s defence was improper and that she should be ordered to pay costs despite being legally aided. The plaintiff’s position was that the second defendant’s defence—that the first defendant had lied to her about the nature of the transactions—should not be accepted, particularly because she did not call the first defendant to corroborate her account. The plaintiff also contended that her “unwitting accomplice” narrative should be dismissed after the court’s findings of conspiracy and knowing misappropriation.
What Were the Key Legal Issues?
The principal legal issue was whether the court should order a legally aided defendant to pay costs to the other party, notwithstanding the general rule that an aided person is not liable for costs in the proceedings for which they were legally aided. This required the court to interpret and apply the exceptions in the Legal Aid and Advice Act, particularly ss 14(1)(c) and 14(3).
Two statutory pathways were relevant. First, under s 14(3)(b), the court may order an aided person to pay costs if the aided person “acted improperly in bringing or defending any legal proceedings, or in the conduct of those proceedings.” Second, under s 14(3)(a), the court may order costs if “the Grant of Aid issued to the aided person has been obtained by fraud or misrepresentation.” The plaintiff’s application effectively invited the court to find that one or both of these exceptions applied.
A further issue, closely tied to the above, was the evidential threshold. The court had to decide what constitutes “improper” conduct for the purposes of s 14(3)(b), and whether the mere fact that a defence failed (or that the defendant was disbelieved) is sufficient to establish misconduct. The court also had to assess whether the plaintiff had discharged its burden of proof on the fraud/misrepresentation exception, which required examining the legal aid application process and the information available to the Legal Aid Bureau at the time of grant.
How Did the Court Analyse the Issues?
The court began by situating the costs application within the statutory framework. It noted that s 12(4)(c) of the Legal Aid and Advice Act provides the general rule that where a litigant is legally aided, the aided person is generally not liable for costs to any other party in the proceedings for which they are legally aided. This reflects a policy choice: legal aid should not be undermined by the threat of costs orders against aided persons simply because they lose.
The plaintiff relied on s 14(1)(c), which empowers the court to order an aided person to pay costs of the “other party” where the circumstances in s 14(3) exist. The court focused first on s 14(3)(b), which concerns improper conduct in bringing or defending proceedings or in their conduct. The plaintiff argued that the second defendant’s defence was improper because she did not call the first defendant to corroborate her account and because, in the plaintiff’s view, her “unwitting accomplice” position should have been rejected.
In rejecting this argument, the court drew a clear distinction between an unsuccessful defence and improper conduct. The judge held that the fact that the second defendant’s defence failed was “not in itself” evidence of misconduct. The court emphasised that there must be evidence that the defendant conducted the defence in a way that “a reasonable defendant would not.” This formulation indicates an objective standard: the inquiry is not whether the court ultimately disbelieved the defendant, but whether the defendant’s litigation conduct fell below what would be expected of a reasonable litigant in the circumstances.
Applying that standard, the court found that the plaintiff had not provided evidence of improper conduct. The second defendant’s defence was essentially that she did not know the plaintiff’s money had been misappropriated, and that the “largesse” she enjoyed was paid from her own money. The court disbelieved her for reasons set out in the Substantive Judgment, but disbelieving a witness does not automatically establish that the witness acted improperly in the conduct of the proceedings. The judge warned against an approach that would treat every failed defence by a legally aided defendant as misconduct, because that would effectively convert the statutory protection into a dead letter: every plaintiff who succeeds would be able to obtain costs against legally aided defendants.
Having found that s 14(3)(b) was not satisfied, the court turned to s 14(3)(a). Although the plaintiff’s application did not succeed on the “improper defence” route, the judge identified a separate possibility that the grant of legal aid might have been obtained by fraud or misrepresentation. This was based on the court’s earlier findings in the Substantive Judgment that the first and second defendants misappropriated $578,347.30, and on evidence suggesting that the second defendant made large purchases of jewellery, cosmetic products, and beauty services between August and October 2020. The court reasoned that, given these expenditures, it was possible that the second defendant’s legal aid application might have involved misrepresentation of means.
To address this, 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. The affidavit explained the means-testing criteria and the second defendant’s application in May 2021. It 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 property besides her HDB flat. The affidavit also addressed documentary requirements, including that the applicant’s wealth is determined at the point of application and that the Legal Aid Bureau did not require bank statements prior to April 2021 before granting aid.
Crucially, the affidavit stated that there was no reason to suspect that the second defendant earned more than what was declared in her CPF statements, and that LAB had no information indicating concealment of assets. The court accepted this evidence and concluded that the second defendant was “technically entitled” to legal aid at the material time. The judge acknowledged that the second defendant might have had more monies in her bank account at an earlier time, but found it likely that she had spent those funds by the time she applied for legal aid, as evidenced by the large purchases in late 2020. The court held that this did not exclude her from legal aid because only bank statements prior to the month of application were required to be furnished, and the relevant wealth assessment was tied to the application date.
On that basis, the court found “no reason” to order the legally aided second defendant to pay costs. The plaintiff’s application was dismissed. The reasoning demonstrates a careful balancing of two competing considerations: the integrity of legal aid grants (preventing fraud and misrepresentation) and the protection of legally aided litigants from costs exposure absent proof of the statutory exceptions.
What Was the Outcome?
The High Court dismissed the plaintiff’s application for costs against the second defendant. The court held that the plaintiff did not discharge the burden of proving that s 14(3)(b) of the Legal Aid and Advice Act was satisfied, because the failure of the defence and the court’s disbelief of the second defendant were not, without more, evidence of improper conduct in the defence or conduct of the proceedings.
Although the court considered that s 14(3)(a) might potentially be engaged due to evidence of substantial spending, the evidence from the Legal Aid Bureau showed that the second defendant met the means-testing criteria at the time of application and that there was no basis to conclude that the grant of aid was obtained by fraud or misrepresentation. Accordingly, no costs order was made.
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 defendants under the Legal Aid and Advice Act. It underscores that the statutory exceptions are not automatic consequences of losing on liability. A plaintiff cannot obtain costs merely by pointing to an unsuccessful defence or to the court’s disbelief of a legally aided defendant’s account.
For litigators, the case provides a practical framework for assessing whether s 14(3)(b) (“acted improperly”) can be established. The court’s insistence on evidence that the defendant conducted the defence in a way that a reasonable defendant would not is a demanding standard. It suggests that plaintiffs seeking costs must identify concrete litigation misconduct—such as procedural abuse, bad faith conduct, or objectively unreasonable steps—rather than relying on substantive findings of liability or credibility.
The decision also illustrates how courts approach the fraud/misrepresentation exception under s 14(3)(a). Even where there is evidence of significant expenditure, the court will examine the legal aid application process, the timing of means assessment, and what documents were required and considered. The court’s acceptance of LAB’s explanation about the wealth assessment date and documentary requirements indicates that courts will not infer fraud solely from later or earlier spending patterns; rather, they will require a link to misrepresentation at the time of application.
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.