HAI JIAO 1306 LIMITED v YAW CHEE SIEW

"The present proceedings were commenced by three separate writs of summons but were consolidated by order of court. In summary, the plaintiffs advance three main claims against the defendant personally viz: (a) A claim for damages for breach of contract, ie, breach of what are said to be the obligations of the defendant as contained in the relevant letters of support – in particular, the obligation by the defendant to use ‘best endeavours’ to support the Charterers and the Guarantors." — Per Kannan Ramesh J, Para 8

Case Information

• Citation: [2020] SGHC(I) 16 (Para 0)
• Court: Singapore International Commercial Court — Suit No 7 of 2018 (Consolidated with Suit Nos 8 and 9 of 2018) (Para 0)
• Date of Judgment: 13 July 2020 (Para 0)
• Coram: Kannan Ramesh J, Patricia Bergin IJ and Sir Henry Bernard Eder IJ (Para 0)
• Counsel for the Plaintiffs: Not answerable from the provided excerpt (NOT ANSWERABLE)
• Counsel for the Defendant: Not answerable from the provided excerpt (NOT ANSWERABLE)
• Case Number: Suit No 7 of 2018 (Consolidated with Suit Nos 8 and 9 of 2018) (Para 0)
• Area of Law: Commercial litigation; contract; misrepresentation; evidential admissibility; ship-finance restructuring (Paras 1, 5, 8, 18, 20)
• Judgment Length: The excerpt indicates the judgment runs to at least 282 paragraphs, with a conclusion section at paragraph 282 (Para 0)

Summary

This case arose out of a ship-finance and restructuring dispute involving three special purpose vehicle plaintiffs controlled by ICBC Financial Leasing Co Ltd and the defendant, who was the controlling mind of Otto Marine Limited. The plaintiffs financed three vessels and later alleged that the defendant personally assumed obligations through letters of support, made actionable misrepresentations, and gave collateral undertakings in order to secure their consent to the delisting of Otto Marine Limited. The excerpt makes clear that the dispute was framed around three main claims, but it does not contain the final merits determination or the ultimate orders. (Paras 1, 5, 6, 8, 13)

The factual narrative in the excerpt shows a commercial relationship that deteriorated as the offshore and marine market declined, leaving the charterers and guarantors under pressure to meet payment obligations under bareboat charter agreements and guarantees. The defendant sought delisting of Otto Marine Limited so that he could personally fund the charterers and guarantors, and the plaintiffs consented to that delisting in consideration of letters of support. Those letters were drafted, amended, and eventually issued in September 2017, but the later corporate distress of Otto Marine Limited culminated in judicial management and liquidation. (Paras 5, 6, 7)

The excerpt also reveals substantial interlocutory and evidential controversy. The plaintiffs contended that the defendant remained in breach of disclosure obligations and sought striking out or adverse inferences; the defendant denied liability; and the parties fought over authenticity and hearsay in relation to documents exhibited in affidavits. The court discussed the Evidence Act’s best-evidence approach and the need to prove the truth of documentary contents through witnesses with personal knowledge, but the excerpt does not include the final resolution of the substantive claims. (Paras 11, 12, 16, 18, 20)

What Was the Commercial Background to the Dispute Between the Plaintiffs and the Defendant?

The dispute was rooted in a vessel-financing structure. The plaintiffs were three special purpose vehicles controlled by ICBC Financial Leasing Co Ltd, and each was incorporated in the Marshall Islands. They financed three vessels, and the financing was implemented through bareboat charter agreements and guarantees. The defendant was the controlling mind of Otto Marine Limited, which was the parent company in the wider group structure. (Paras 1, 2, 3, 4)

The excerpt explains that the offshore and marine market declined, causing financial difficulty for Otto Marine Limited and the related charterers and guarantors. In response to those difficulties, the defendant wanted Otto Marine Limited delisted so that he could personally fund the charterers and guarantors and thereby enable punctual performance of the payment obligations under the bareboat charter agreements and guarantees. That commercial objective is central to understanding why the letters of support became so important. (Para 5)

"As a result, the defendant was desirous of delisting OML so that it would be easier for him to personally fund the Charterers and the Guarantors in order to enable punctual performance of the payment obligations under the BBCs and the guarantees." — Per Kannan Ramesh J, Para 5

The plaintiffs’ consent to the delisting was not free-standing. The excerpt states that, following meetings and discussions in mid-2016, the plaintiffs consented to the delisting in consideration of the defendant agreeing to issue letters of support. Those letters were later drafted, amended, and issued in September 2017. The court’s narrative therefore places the letters of support at the heart of the bargain that allegedly induced the plaintiffs to permit the delisting. (Para 6)

"Following various meetings and discussions in the course of mid-2016, the plaintiffs consented to the delisting of OML in consideration of the defendant agreeing to issue letters of support." — Per Kannan Ramesh J, Para 6

The later corporate events are also important. On 21 March 2018, Otto Marine Limited was placed in judicial management, and when that failed, it entered liquidation on 5 October 2018. Those events form part of the background against which the plaintiffs pursued claims said to arise from the defendant’s alleged contractual, tortious, and collateral obligations. (Para 7)

"On 21 March 2018, OML was placed in judicial management. However, this failed, and OML subsequently entered liquidation on 5 October 2018." — Per Kannan Ramesh J, Para 7

How Did the Court Frame the Plaintiffs’ Three Main Claims?

The court framed the case as involving three principal claims against the defendant personally. First, the plaintiffs alleged breach of contract, specifically breach of obligations said to be contained in the relevant letters of support, including an obligation to use best endeavours to support the charterers and guarantors. Second, they alleged misrepresentations made by or on behalf of the defendant during the 2016 meetings and discussions. Third, they alleged breach of one or more collateral undertakings. The excerpt is explicit that these were the three main claims advanced. (Para 8)

"In summary, the plaintiffs advance three main claims against the defendant personally viz: (a) A claim for damages for breach of contract, ie, breach of what are said to be the obligations of the defendant as contained in the relevant letters of support – in particular, the obligation by the defendant to use ‘best endeavours’ to support the Charterers and the Guarantors." — Per Kannan Ramesh J, Para 8

The second claim was pleaded in both common law and statutory terms. The excerpt states that the plaintiffs alleged that certain representations were made fraudulently or negligently and/or under section 2(1) of the Misrepresentation Act. The court therefore had to consider not only whether representations were made, but also the legal character of those representations and the statutory route by which damages might be claimed. (Para 8)

"That case is advanced at common law on the basis that the said representations were made fraudulently or negligently and/or under s 2(1) of the Misrepresentation Act (Cap 390, 1994 Rev Ed) (the ‘Misrepresentation Act’)." — Per Kannan Ramesh J, Para 8

The third claim concerned collateral undertakings. The excerpt does not set out the full content of those undertakings, but it does make clear that the plaintiffs treated them as a distinct basis of liability. The court’s framing matters because it shows that the litigation was not confined to a single contractual theory; rather, it was a multi-track commercial claim involving contract, misrepresentation, and collateral promise theories. (Para 8)

"(c) A claim for damages for breach of what the plaintiffs say were one or more collateral undertakings by the defendant." — Per Kannan Ramesh J, Para 8

What Did the Court Say About the Letters of Support and the Delisting Arrangement?

The excerpt shows that the letters of support were central to the parties’ arrangement. The court described the plaintiffs’ consent to the delisting as being given in consideration of the defendant agreeing to issue those letters. That factual linkage is critical because it explains why the plaintiffs later contended that the letters were not merely aspirational or informal, but formed part of a legally significant bargain. (Para 6)

The court also noted that the letters were drafted, amended, and eventually issued in September 2017. The excerpt does not reproduce the full text of the letters in the same way as it reproduces some legal principles, but it does show that the letters were the product of a process rather than a single isolated document. That process is relevant to the later disputes over construction, obligation, and reliance. (Para 6)

"The letters of support were drafted, amended, and eventually issued in September 2017" — Per Kannan Ramesh J, Para 6

One of the court’s observations in the excerpt is especially important for construction. The court stated that, if the agreement had been that the defendant would execute the letters of support only within 90 days of the delisting, then the provision of such letters in executed form could not sensibly be described as a condition precedent to the delisting if the latter were intended to mean that the letters had to be provided before the delisting. The court then observed that, given the nature of the discussions and the surrounding circumstances, it would seem likely that the parties at least mutually understood the plaintiffs’ consent to the delisting to be on the basis that the defendant would provide letters of support. (Para 53)

"Plainly, if the agreement was that the defendant would execute the letters of support only within 90 days of the delisting of OML, the provision of such letters of support in executed form by the defendant could not be said to be a ‘condition precedent’ to the delisting if the latter were intended to mean that such letters of support had to be provided before the delisting." — Per Kannan Ramesh J, Para 53

The same paragraph also contains the court’s broader observation about the likely commercial understanding. This is not presented in the excerpt as the final legal holding, but it is a significant interpretive step because it indicates how the court approached the relationship between the delisting and the support letters. The court was attentive to the practical commercial context and the sequence of negotiations. (Para 53)

"However, given the nature of the discussions that had taken place and the circumstances which existed in and following April/May 2016, it would seem likely that the agreement or at least mutual understanding of the parties was that the plaintiffs’ consent to the delisting was on the basis that the defendant would provide letters of support to the plaintiffs" — Per Kannan Ramesh J, Para 53

What Evidential and Procedural Objections Did the Plaintiffs Raise?

The excerpt shows that the plaintiffs pursued a vigorous procedural position at trial. They maintained that the defendant remained in breach of various court orders and his general disclosure obligations, that this had seriously prejudiced the fair trial of the case, and that the court should strike out the defences on liability as to the alleged breaches of best endeavours obligations. In the alternative, they sought adverse inferences. This indicates that disclosure and procedural fairness were live issues throughout the trial. (Para 16)

"At trial, the plaintiffs’ position was and remained that the defendant continued to be in breach of various orders of court as well as his general disclosure obligations; that this had seriously prejudiced the fair trial of this case and that the court should therefore strike out, in whole or in part, the defences on liability as to the defendant’s breaches of his best endeavours obligations; and alternatively, that appropriate further adverse inferences be drawn against the defendant." — Per Kannan Ramesh J, Para 16

The plaintiffs also challenged the admissibility of documents. The excerpt records their submission that the defendant had failed to agree any bundle of documents with the plaintiffs. The court then discussed the legal framework governing authenticity and hearsay, including the proposition that exhibiting a document to an affidavit does not, without more, automatically admit it into evidence. This shows that the court had to deal with both the mechanics of proof and the substantive use to which documents could be put. (Paras 18, 19, 20)

"The mere fact that the documents were exhibited to an affidavit does not, without more, automatically admit the documents into evidence (see Jet Holdings at [36])." — Per Kannan Ramesh J, Para 18

The court also articulated the purpose of the Evidence Act provisions on documentary proof. It noted that the aim of sections 63 to 67 of the Evidence Act is to ensure that the best evidence is available before the court, which is why, as a general rule, documents must be proved by primary evidence. The excerpt further records the plaintiffs’ reliance on the proposition that even where a document is proven under those sections, it remains inadmissible as hearsay if the truth of its contents is not proved by a witness with personal knowledge. (Paras 18, 20)

"The aim of ss 63–67 of the Evidence Act is to ensure that the best evidence is available before the court, which is why, as a general rule, all documents must be proved by primary evidence" — Per Kannan Ramesh J, Para 18

"even where a document has been proven in accordance with ss 63 to 67 of the Evidence Act, if the truth of its contents have not been proven by way of witness testimony of a person with personal knowledge of the information contained therein, then the document is inadmissible on the basis that it is hearsay." — Per Kannan Ramesh J, Para 20

What Evidence Did the Court Hear, and Why Was Expert Evidence Important?

The excerpt states that the main part of the trial took place over nine days in November 2019, during which several witnesses gave oral evidence and were cross-examined. The judgment then notes that, after written factual closing submissions, the trial resumed for a further two days in January 2020 when expert accountants gave evidence and were cross-examined. This sequence shows that the court heard both factual and expert evidence in a structured, multi-stage trial. (Paras 11, 12)

"The main part of the trial took place over nine days in November 2019. During that period, the following witnesses gave oral evidence and were cross-examined" — Per Kannan Ramesh J, Para 11

"Following the first tranche of the trial, the parties served written factual closing submissions, and the adjourned trial resumed for a further two days in January 2020 when the following experts gave evidence and were cross-examined" — Per Kannan Ramesh J, Para 12

The excerpt identifies two broad topics covered by the expert accounting evidence. First, the experts addressed the assets available to the charterers, Otto Marine Limited, and the defendant to meet the payments due under the bareboat charter agreements. Second, they addressed what the plaintiffs would likely have recovered had they declared events of default under the bareboat charter agreements, terminated them, and taken recovery action in 2016. The latter issue was directly relevant to the misrepresentation claims because it went to the plaintiffs’ alleged loss. (Para 12)

"In broad terms, the expert accounting evidence covered two main issues viz: (a) The assets that were available to the Charterers, OML and the defendant to meet the payments due under the BBCs." — Per Kannan Ramesh J, Para 12

"What the plaintiffs would have been likely to recover had they declared events of default under the BBCs, terminated them and taken recovery action against the Charterers and/or the Guarantors in 2016. This is relevant to the plaintiffs’ misrepresentation claims." — Per Kannan Ramesh J, Para 12

The importance of expert evidence in this case is therefore not incidental. The dispute involved a large commercial financing structure, claims exceeding US$200 million plus interest and costs, and a counterfactual assessment of what recovery would have been available at an earlier point in time. Those are precisely the kinds of issues on which accounting and financial experts can assist the court. (Paras 8, 12)

How Did the Court Approach Authenticity, Primary Evidence, and Hearsay?

The excerpt contains a focused discussion of documentary proof. The court referred to Jet Holdings for the proposition that whether documents exhibited to an affidavit could be admitted as authentic documents depends on satisfaction of the relevant provisions. This indicates that the court treated admissibility as a question governed by the Evidence Act framework rather than by the mere fact of exhibition in affidavit evidence. (Para 18)

"Whether or not documents exhibited to an affidavit could be admitted into evidence as authentic documents would depend on the satisfaction of the relevant provisions" — Per Kannan Ramesh J, Para 18

The court then explained the purpose of sections 63 to 67 of the Evidence Act. It said those provisions are designed to ensure that the best evidence is available before the court, and that is why documents generally must be proved by primary evidence. This is a classic evidential principle, but the excerpt is careful to present it in the context of the parties’ dispute over bundles, affidavits, and documentary proof. (Para 18)

The hearsay point was equally important. The excerpt records the proposition, relied on by the plaintiffs, that even if a document is proven in accordance with sections 63 to 67, it remains inadmissible if the truth of its contents is not proved by witness testimony from someone with personal knowledge. That distinction between authenticity and truth is central in commercial litigation, where many documents may be formally admissible but still unusable for the truth of their assertions unless supported by direct evidence. (Para 20)

"The aim of ss 63–67 of the Evidence Act is to ensure that the best evidence is available before the court" — Per Kannan Ramesh J, Para 18

"if the truth of its contents have not been proven by way of witness testimony of a person with personal knowledge of the information contained therein, then the document is inadmissible on the basis that it is hearsay." — Per Kannan Ramesh J, Para 20

These evidential observations matter because the case appears to have involved extensive documentary material generated during negotiations, restructuring discussions, and internal approvals. In such a setting, the court’s insistence on proper proof and on the distinction between authenticity and hearsay would have had practical consequences for what evidence could be relied upon in determining liability. (Paras 18, 19, 20)

What Does the Excerpt Reveal About the Court’s Reasoning on the Delisting and Support Letters?

The excerpt does not contain the full final reasoning on liability, but it does reveal the court’s approach to the commercial context of the delisting arrangement. The court considered the nature of the discussions in and following April/May 2016 and concluded that it would seem likely that the parties’ mutual understanding was that the plaintiffs’ consent to delisting was given on the basis that the defendant would provide letters of support. That is an important interpretive observation because it ties the consent to a concrete commercial assurance. (Para 53)

The court also addressed the conceptual difficulty in describing the letters of support as a condition precedent if the letters were to be executed only after delisting. The court’s observation shows a careful attention to contractual sequencing and to the meaning of the parties’ language. It suggests that the court was not prepared to accept a simplistic reading of the arrangement without reconciling the timing of the delisting and the issuance of the letters. (Para 53)

"Plainly, if the agreement was that the defendant would execute the letters of support only within 90 days of the delisting of OML, the provision of such letters of support in executed form by the defendant could not be said to be a ‘condition precedent’ to the delisting if the latter were intended to mean that such letters of support had to be provided before the delisting." — Per Kannan Ramesh J, Para 53

At the same time, the court’s observation that the parties likely understood the consent to delisting to be conditional on the provision of letters of support indicates that the court was willing to infer a commercial linkage from the surrounding circumstances. The excerpt does not tell us whether that inference ultimately supported liability on any of the pleaded causes of action, but it does show the direction of the court’s reasoning. (Para 53)

"it would seem likely that the agreement or at least mutual understanding of the parties was that the plaintiffs’ consent to the delisting was on the basis that the defendant would provide letters of support to the plaintiffs" — Per Kannan Ramesh J, Para 53

Why Does This Case Matter?

This case matters because it sits at the intersection of ship finance, corporate restructuring, and the enforcement of support undertakings in a high-value commercial setting. The plaintiffs’ claims exceeded US$200 million plus interest and costs, which underscores the scale of the dispute and the practical importance of how the court characterises letters of support, representations, and collateral undertakings. For practitioners, the case is a reminder that restructuring negotiations can generate legally significant obligations even where the parties are dealing with complex corporate groups and multiple layers of financing. (Paras 8, 12)

The case also matters for evidential practice. The excerpt shows the court grappling with authenticity, primary evidence, hearsay, and the limits of affidavit exhibits. Those issues are common in large commercial cases, but here they were especially important because the parties’ negotiations and approvals were documented across multiple communications and corporate records. The court’s discussion of sections 63 to 67 of the Evidence Act and the hearsay rule is therefore of practical value to litigators preparing documentary cases. (Paras 18, 20)

Finally, the case is significant because it illustrates how a court may approach the commercial meaning of a restructuring bargain. The excerpt suggests that the court was attentive to the sequence of events, the parties’ discussions, and the likely mutual understanding surrounding the delisting and the letters of support. Even without the final merits outcome in the excerpt, the reasoning shown here is useful for lawyers advising on support letters, delisting conditions, and the drafting of restructuring documentation. (Paras 5, 6, 53)

Cases Referred To

Legislation Referenced

• Misrepresentation Act (Cap 390, 1994 Rev Ed), section 2(1) (Para 8) [CDN] [SSO]
• Evidence Act (Cap 97, 1997 Rev Ed), sections 63 to 67 (Paras 18, 20)

Source Documents

• Original Judgment — Singapore Courts
• Archived Copy (PDF) — Litt Law CDN

This article analyses [2020] SGHCI 16 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.