Case Details
- Citation: [2003] SGHC 86
- Court: High Court of the Republic of Singapore
- Date: 2003-04-10
- Judges: Judith Prakash J
- Plaintiff/Applicant: Nganthavee Teriya alias Gan Hui Poo
- Defendant/Respondent: Ang Yee Lim Lawrence and Others (Lim Eng Hock Peter and Another, Third Parties)
- Legal Areas: Civil Procedure — Striking out, Civil Procedure — Third party proceedings
- Statutes Referenced: Civil Law Act, Civil Law Act (Cap 43), English Act
- Cases Cited: [2003] SGHC 86, K and Another v P and Others [1993] CH 140
- Judgment Length: 11 pages, 7,076 words
Summary
This case involves a dispute between the plaintiff, Nganthavee Teriya alias Gan Hui Poo, and the defendants, Ang Yee Lim Lawrence, Tan Leong Ko William, and Foo Jong Long Dennis. The plaintiff claimed that the defendants conspired to defraud her and her husband by diluting their shareholdings in two companies, Europa Holdings Pte Ltd and Erasmia Pte Ltd, and procuring the sale of their shares at an undervalue. The defendants denied liability and filed a third-party notice against Lim Eng Hock Peter and the plaintiff's husband, Tan Buck Chye, seeking indemnity or contribution. The court ultimately struck out the defendants' third-party claims, finding that they did not have a valid basis to seek contribution from the third parties.
What Were the Facts of This Case?
The plaintiff, Ms. Teriya Nganthavee, and her husband, Mr. Tan Buck Chye, were shareholders and directors of two Singapore companies, Europa Holdings Pte Ltd and Erasmia Pte Ltd, until June 1997. The defendants, Ang Yee Lim Lawrence, Tan Leong Ko William, and Foo Jong Long Dennis, were also shareholders and directors of the two companies. Subsequently, the plaintiff and her husband sold their shares in the companies to the defendants.
In June 2002, the plaintiff commenced an action against the three defendants, claiming damages for misrepresentation, breach of an oral agreement, breach of fiduciary duties, and conspiracy. The plaintiff alleged that the defendants embarked on a conspiracy to defraud her and her husband by diluting their shareholdings in the companies and procuring the sale of their shares at an undervalue.
The disputes between the parties arose after Europa Holdings Pte Ltd embarked on a project called the RTC (Raffles Town Club) project, which involved the construction and management of a private recreation club. To obtain land for the club's premises, Europa Holdings Pte Ltd successfully tendered for a 30-year leasehold interest in a piece of vacant land at the junction of Dunearn Road and Whitley Road for $100 million. Due to the large sum involved, another investor, Lim Eng Hock Peter, was brought in as an investor in the RTC project.
What Were the Key Legal Issues?
The key legal issues in this case were:
1. Whether the defendants had a valid basis to claim an indemnity or contribution from the third parties, Lim Eng Hock Peter and Tan Buck Chye, in respect of any liability they may have to the plaintiff.
2. Whether the court should strike out the defendants' third-party claims against Lim Eng Hock Peter and Tan Buck Chye.
How Did the Court Analyse the Issues?
The court examined the relevant provisions of the Civil Law Act (Cap 43) regarding the right of a defendant to claim an indemnity or contribution from a third party. Specifically, the court looked at Section 11 of the Act, which confers the right of a tortfeasor to recover contribution from another tortfeasor who is liable in respect of the same damage.
The court noted that the right of contribution under Section 11 does not depend on any contractual or tortious relationship between the two tortfeasors, but rather on whether the second tortfeasor would also have been responsible to the plaintiff for the damages sustained. However, the court also recognized that Section 11(2) gives the court the power to exempt any person from liability to make a contribution or to direct that the contribution to be recovered shall amount to a complete indemnity.
The court was "somewhat perturbed" by the notion that Section 11 would allow a tortfeasor who was a party to a conspiracy to claim a contribution from a fellow conspirator, as this would seem to go against the ex turpi causa maxim (the principle that a person cannot base a cause of action on their own illegal act). The court then examined the English case of K and Another v P and Others [1993] CH 140, which dealt with a similar issue.
In K v P, the court held that the liability imposed under the English equivalent of Section 11 was intended to enable claims for contribution to be made as between parties who had no claim to contribution under the general law, and that the defence of ex turpi causa non oritur actio (no action arises from a base cause) could not be relied on in answer to a claim for contribution under the Act.
Applying the reasoning in K v P, the court in the present case concluded that the defendants' proposed amended third-party statement of claim did not disclose any basis on which they could claim an indemnity or contribution from Tan Buck Chye in respect of any liability they had to the plaintiff. The court found that the proposed amendments could not cure the fundamental flaws in the defendants' case against Tan Buck Chye.
What Was the Outcome?
The court dismissed the defendants' appeals against the assistant registrar's decisions to strike out their third-party statement of claim against Tan Buck Chye and to dismiss their application to amend the third-party notice and statement of claim. The court upheld the striking out of the defendants' third-party claims, finding that they did not have a valid basis to seek contribution from Tan Buck Chye.
Why Does This Case Matter?
This case provides important guidance on the scope and limitations of the right of contribution under Section 11 of the Civil Law Act. It clarifies that even if a defendant is sued by a plaintiff for damages arising from a conspiracy, the defendant may not be able to claim contribution from a fellow conspirator if doing so would effectively allow the defendant to retain part of the wrongful gain.
The court's reliance on the English case of K v P suggests that Singapore courts may be willing to adopt a similar approach to interpreting the contribution provisions, even in cases involving alleged illegal conduct. This case serves as a reminder that the right of contribution is not absolute and that the court has the discretion to limit or deny such claims based on the principles of equity and justice.
For legal practitioners, this case highlights the need to carefully consider the merits of any third-party claims for contribution, particularly in cases involving allegations of fraud or conspiracy. The court's reasoning in this case may inform how similar issues are approached in future disputes.
Legislation Referenced
- Civil Law Act (Cap 43)
- English Act (Civil Liability (Contribution) Act, 1978)
Cases Cited
- [2003] SGHC 86
- K and Another v P and Others [1993] CH 140
Source Documents
This article analyses [2003] SGHC 86 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.