Case Details
- Citation: [2013] SGHCR 22
- Title: Total English Learning Global Pte Ltd and anor v Kids Counsel Pte Ltd
- Court: High Court of the Republic of Singapore
- Date of Decision: 12 September 2013
- Coram: Justin Yeo AR
- Case Number: Suit No 420 of 2013 (Summons No 3218 of 2013)
- Procedural Context: Application to strike out the Statement of Claim (and/or portions of it)
- Plaintiffs/Applicants: Total English Learning Global Pte Ltd and Total English Learning International Pte Ltd
- Defendant/Respondent: Kids Counsel Pte Ltd
- Counsel for Plaintiffs: Mr Mark Goh (Mark Goh & Co)
- Counsel for Defendant: Mr Wong Siew Hong, Ms Poonaam Bai and Ms Jolin Lin (Eldan Law LLP)
- Legal Areas: Copyright – Infringement; Civil Procedure – Pleadings; Tort – Conversion; Trade Marks and Trade Names – Infringement
- Key Statutes Referenced (as stated in metadata): Australia Act; Australia Act 1968; Copyright Act; Copyright Act 1968; Trade Marks Act; Trade Marks Act; (as applicable in the judgment excerpt: Copyright Act (Cap 63, 2006 Rev Ed); Trade Marks Act (Cap 332, 2005 Rev Ed))
- Rules of Court Referenced: O 18 rr 19(1)(a), 19(1)(b), 19(1)(d), and 19(2) of the Rules of Court (Cap 322, R 5, 2006 Rev Ed)
- Judgment Length: 16 pages, 8,883 words (as provided in metadata)
- Nature of Application: Strike out for being scandalous, frivolous or vexatious / abuse of process; and alternatively strike out portions for disclosing no reasonable cause of action / abuse of process
Summary
This High Court decision concerned a franchise dispute that was pleaded alongside intellectual property causes of action. The plaintiffs, who franchised an English literacy programme branded “I Can Read!” (“ICR”), sought to sue a franchisee after alleging that the franchise had expired and that the franchisee continued to use the programme’s materials without authorisation. The defendant applied to strike out the plaintiffs’ Statement of Claim, arguing that the pleadings were an abuse of process and that certain pleaded causes of action—particularly those relating to copyright infringement, trade mark infringement, and conversion—disclosed no reasonable cause of action.
The court (Justin Yeo AR) declined to strike out the entire claim. Applying the established cautionary approach to summary striking out, the court emphasised that only “plain and obvious” cases should be removed at the pleadings stage. It also reiterated that, for the “no reasonable cause of action” limb, the pleaded facts are presumed true and the court should not conduct a mini-trial. On the specific “moratorium” argument based on a non-disclosure agreement (“NDA”), the court held that the issue turned on contested facts and could not be resolved on a striking out application.
What Were the Facts of This Case?
The plaintiffs were franchisers of the ICR system, an educational programme and associated educational materials designed to address English literacy. The programme was developed by an Australian company, Total Literacy (Australia) Pty Ltd, following extensive research by Australian educational psychologists. The plaintiffs’ case was that the ICR system is protected by intellectual property rights and that franchisees are permitted to use the system only during the subsistence of the franchise arrangement.
In Singapore, the first plaintiff claimed to be the registered proprietor of two trade marks. One trade mark (Class 16) covered paper goods and art materials, while the other (Class 41) covered educational services and reading instruction. The second plaintiff claimed to be the assignee of “all other intellectual property rights including all copyrights” under a deed of assignment dated 19 July 2012. The second plaintiff therefore joined as a co-plaintiff, asserting ownership of various artistic, literary, and musical works relating to the ICR system, as particularised in the pleadings.
The defendant, Kids Counsel Pte Ltd, operated an ICR franchise at the Goldhill Centre. The defendant had purchased the business in 2005 from a person (Chong) who had entered into the franchise agreement in October 2002. The franchise agreement had an initial term of ten years with an option to renew for a further five years. The defendant’s principal director and shareholder at the relevant time (Lum) acquired the defendant’s shares in 2008. Lum alleged that he met with the managing director of Total Literacy (Singapore) Pte Ltd (“TLS”) and requested that the franchise agreement be varied so that the ten-year period would be waived. Lum relied on an undated piece of paper allegedly signed in August 2008 to support this claim, and alleged that from 2008 to 2012 he repeatedly requested formalisation of the variation and waiver.
In December 2012, the plaintiffs issued a letter of demand alleging that the franchise agreement had expired. The plaintiffs’ position was that the defendant was using the ICR system without authorisation and therefore infringed the plaintiffs’ trade marks and copyrights. On 2 January 2013, the parties entered into an NDA for the purpose of negotiating the sale of the defendant’s business to the plaintiffs. The NDA contained a clause providing that it would remain in effect until the earlier of termination by written agreement or twelve months from the date written above. Despite the dispute, the plaintiffs continued to supply materials and collect royalties, and the defendant remained listed as an authorised ICR centre and remained on the plaintiffs’ email distribution list for operational matters.
What Were the Key Legal Issues?
The court framed four issues corresponding to the plaintiffs’ four pleaded causes of action. First, it had to decide whether the NDA and/or the plaintiffs’ subsequent conduct created a “moratorium” such that it would be scandalous, frivolous, or vexatious—and/or an abuse of process—for the plaintiffs to sustain the action against the defendant. This issue was essentially whether the plaintiffs’ conduct and the NDA could be pleaded to prevent or delay litigation.
Second, the court had to determine whether the pleaded conduct in paragraphs 16 to 19 of the Statement of Claim disclosed copyright infringement under ss 31 read with 26(1)(a)(iv) of the Copyright Act. Third, it had to decide whether the pleaded conduct relating to the Class 16 trade mark constituted infringement under s 27(1) of the Trade Marks Act. Fourth, it had to assess whether the conversion claim—based on the pleaded conversion of the copyright material—disclosed a reasonable cause of action.
Underlying these issues was the procedural question of the proper scope of a striking out application. The court reminded itself that striking out is exceptional and should not become a substitute for trial, particularly where factual disputes exist or where the legal sufficiency of the claim depends on evidence not yet tested by cross-examination.
How Did the Court Analyse the Issues?
The court began by restating the governing principles for striking out under O 18 r 19. It emphasised that only plain and obvious cases should be struck out. The court cited the caution in Gabriel Peter & Partners v Wee Chong Jin that the power should not be exercised after a “minute and protracted examination” of documents and facts to see whether the plaintiff really has a cause of action. It also referred to The Tokai Maru, warning against “usurp[ing] the position of the trial judge” and conducting a “trial in chambers” without discovery and without oral evidence tested by cross-examination.
For the “no reasonable cause of action” limb under O 18 r 19(1)(a), the court reiterated that the threshold is low: if the statement of claim discloses some cause of action or raises some question fit to be decided by the court, the claim should not be struck out merely because it appears weak or unlikely to succeed. Evidence is not admissible for the purposes of this inquiry, and the pleaded facts are presumed to be true in favour of the claimant at this stage. The court also noted that the inquiry is essentially a question of law, not a factual assessment.
On Issue 1 (moratorium), the defendant argued that the NDA created an implied forbearance to sue, or an implied extension of the franchise agreement, and that the plaintiffs’ conduct after 2 January 2013 indicated waiver or estoppel. The defendant also relied on the plaintiffs’ continued supply of materials and royalty collection, and on the defendant’s continued listing as an authorised ICR centre. The plaintiffs responded that there could be no moratorium because the defendant had not shown the elements necessary for promissory estoppel (a promise not to sue) or for estoppel by convention (a shared assumption that parties would not sue).
The court dismissed the moratorium argument at the striking out stage. It held that the issue could not be resolved properly without determining contested factual matters, including what was agreed under the NDA, what representations were made, and what the parties’ conduct meant in context. The court pointed to the defendant’s reliance on an alleged agreement to perpetuate the franchise term, noting that factual issues such as the absence of parties’ names and the timing of the document (a 2005 date) were not suitable for determination on a summary application. In short, the court concluded that the striking out application was not the proper forum to decide whether the NDA and subsequent conduct created a moratorium or estoppel.
Although the excerpt provided truncates the remainder of the judgment, the court’s approach to Issues 2 to 4 would necessarily follow the same procedural discipline: it would assess whether the pleaded facts, taken as true, fit within the statutory causes of action invoked, without weighing evidence. For copyright infringement, the court would focus on whether the pleaded acts amounted to “communicating to the public” (as indicated by the defendant’s argument in the truncated portion) and whether the pleaded facts satisfied the statutory elements under the Copyright Act. For trade mark infringement, the court would examine whether the pleaded use of the Class 16 trade mark fell within the infringement provision invoked, and whether the pleaded acts were capable of constituting use “in the course of trade” and in a manner that engages the statutory test. For conversion, the court would consider whether the pleaded facts supported the existence of a property interest in the relevant “copyright material” and whether the defendant’s alleged conduct could amount to conversion in law, noting that conversion traditionally concerns interference with goods and that intellectual property claims sometimes require careful pleading to fit within tort principles.
What Was the Outcome?
The court declined to strike out the entire Statement of Claim. It held that the moratorium/abuse of process argument could not be determined on a striking out application because it depended on contested facts and would require a trial-level assessment of the parties’ agreements and conduct.
While the provided extract does not include the final disposition on Issues 2 to 4, the decision’s procedural reasoning indicates that the court was unwilling to remove the intellectual property and conversion claims at the pleadings stage unless the legal elements were clearly absent on the face of the pleadings. The practical effect of the ruling was that the plaintiffs’ claims would proceed, at least to the extent not successfully struck out in the remainder of the judgment.
Why Does This Case Matter?
This case is a useful illustration of the Singapore courts’ restrained approach to striking out applications under O 18 r 19. For practitioners, it reinforces that summary disposal is exceptional and that courts will not “try the case in chambers” by resolving factual disputes or by assessing the evidential strength of the claim. The decision is particularly relevant where intellectual property claims are pleaded alongside contractual or franchise-related allegations, because the meaning of parties’ conduct and the existence of implied terms, waiver, or estoppel often require evidence.
From a substantive perspective, the case also highlights how copyright and trade mark infringement claims are assessed at the pleadings stage. Even where a defendant argues that the pleaded acts do not meet the statutory threshold (for example, whether conduct amounts to “communicating to the public” for copyright purposes), the court will still ask whether the pleadings raise a question fit for determination. This means that plaintiffs can survive striking out if they plead the statutory elements in a way that is legally arguable, even if the defendant disputes the facts.
Finally, the case is instructive for tort pleading—specifically conversion—where plaintiffs seek to characterise interference with intellectual property-related materials as conversion. Although conversion is traditionally associated with tangible goods, the court’s willingness to entertain the claim at the pleadings stage (subject to the remainder of the judgment) underscores that the legal sufficiency of such claims depends on how the property interest and interference are pleaded and whether the claim can be framed within recognised legal categories.
Legislation Referenced
- Rules of Court (Cap 322, R 5, 2006 Rev Ed): O 18 rr 19(1)(a), 19(1)(b), 19(1)(d), 19(2)
- Copyright Act (Cap 63, 2006 Rev Ed): ss 26(1)(a)(iv), 31 (as referenced in the excerpt)
- Trade Marks Act (Cap 332, 2005 Rev Ed): s 27(1) (as referenced in the excerpt)
- Australia Act; Australia Act 1968 (as stated in metadata)
- Copyright Act 1968 (as stated in metadata)
- Trade Marks Act; Trade Marks Act 1968 (as stated in metadata)
Cases Cited
- Gabriel Peter & Partners v Wee Chong Jin [1997] 3 SLR(R) 649
- The Tokai Maru [1998] 2 SLR(R) 646
- Tan Eng Khiam v Ultra Realty Pte Ltd [1991] 1 SLR(R) 844
Source Documents
This article analyses [2013] SGHCR 22 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.