Aries Telecoms (M) Bhd v ViewQwest Pte Ltd (Fiberail Sdn Bhd, third party)

• Jurisdiction: Singapore
• Judge: Woo Bih Li J
• Judgment Date: 06 September 2019
• Neutral Citation: [2019] SGHC 206
• Plaintiff Counsel: Yeo Siew Chye Troy (M/s Chye Legal Practice) and Ong Pang Meng (M/s C K Tan & Partners)
• Date: 21 March 2019
• Published date: 11 September 2019
• Hearing Date: 08 August 2018,07 August 2018,25 October 2018,26 July 2018,24 October 2018,19 November 2018,13 February 2019,21 March 2019,20 November 2018,25 July 2018,18 October 2018,22 October 2018,17 October 2018
• Subject Matter: Damages,Assessment
• Docket Number: Suit No 860 of 2013 (Assessment of Damages No 16 of 2018)
• Defendant Counsel: Sze Kian Chuan John and Loh Hui Chen Nicola (Joseph Tan Jude Benny LLP)
• Court: High Court (Singapore)
• Citation: [2019] SGHC 206
• Year: 2019

Woo Bih Li J: Introduction

The main action was a claim by the plaintiff, Aries Telecoms (M) Bhd (“Aries”), against the defendant, ViewQwest Pte Ltd (“VQ”), for conversion arising from VQ’s refusal to allow Aries to reclaim certain information technology equipment. The main action was commenced on 26 September 2013. Although the equipment was eventually returned to Aries on 2 September 2015, the legal proceedings continued. The initial trial commenced on 2 February 2016. This was a bifurcated trial in that it was to establish the liability of VQ with damages to be assessed separately.

Eventually, VQ consented on 11 October 2016 to an interlocutory judgment to be granted against it with damages to be assessed. I granted the interlocutory judgment that same day.

The present proceedings only concern the assessment of damages (“A/D”) arising from VQ’s conversion of the equipment. I set out below the background leading to the A/D.

Facts Dramatis personae

Aries is a Malaysian-registered company in the business of providing internet and fibre optic connections. It was incorporated in 1996 and was formerly known as V Telecoms Berhad.¹ I have referred to the plaintiff as “Aries” in this judgment. Any references to “VTel” and “V-Tel” should also be taken to refer to the plaintiff.

VQ is a Singapore-incorporated company in the business of providing internet, connectivity and international private leased circuit (“IPLC”) services in Singapore.² The proceedings concerned equipment located at two data centres in Singapore, which were referred to as “Equinix” and “Global Switch”.³

Fiberail Sdn Bhd (“Fiberail”), which was initially the third party in these proceedings, is a Malaysian company that provides services to telecommunication companies.⁴

The information technology equipment that was the subject of the conversion claim is a dense wavelength division multiplexing machine referred to as “DWDM-1” in the proceedings. For convenience I will use that description as well. It was placed at Equinix and Global Switch. The DWDM-1 equipment comprised 77 component parts and was used to provide IPLC services. It was agreed that the DWDM-1 equipment was capable of providing 10 gigabits per second (“Gbps”)⁵ of unprotected bandwidth and 20Gbps of protected subdivided bandwidth.⁶ BTI Systems Inc (“BTI”) was the vendor of the DWDM-1 equipment.⁷

I set out a table of dramatis personae of some of the persons involved at the material time and/or in these proceedings for easy reference:

Abbreviation	Individual
Aries
Mustafa	Mr Sayed Mustafa Ali Zaminali, the Chief Technology Officer of Aries, and a factual witness in the A/D
Suppiah	Mr Anthony Suppiah, the Executive Director of Aries at the material time
Wan Alias	Mr Wan Alias Bin Wan Ngah @ W Yahya, the Chief Operating Officer of Aries and a factual witness in the initial trial
VQ
Liew	Mr Kenneth Liew Jau Tze, the Business Development Director of VQ, and a factual witness in the A/D
Lim	Mr Lim Hock Koon, the Senior Vice President of VQ, and a factual witness in the initial trial
Tan	Mr Tan Shao Yi, the Head of the Optical Transport Network department of VQ, and a factual witness in the A/D
Fiberail
Norazmi	Mr Norazmi Bin Termuzi, the Head of International Alliance of Fiberail at the material time, and a factual witness in the A/D
Rossman	Mr Rossman Omar, the Chief Executive Officer of Fiberail at the material time
Suhaini	Mr Suhaini Bin Kasmuri, the Chief Financial Officer of Fiberail at the material time
BTI
Fahim	Mr Fahim Sheikh, the Vice President, APAC Sales of BTI Systems Singapore Pte, a subsidiary of BTI

Background

VQ received the DWDM-1 equipment in separate batches beginning from mid-2010. The last batch of DWDM-1 equipment was delivered to VQ in March 2011. Although VQ alleged that the DWDM-1 equipment was delivered pursuant to its contract with Fiberail, Aries’ account was that the DWDM-1 equipment had been delivered pursuant to its own contract with VQ.

It was not disputed that VQ and Aries entered into three purchase orders (all dated 9 March 2011) for Aries to provide fibre network services to VQ. The first purchase order was issued on 9 March 2011, and the second and third purchase orders were issued on 25 April 2011 and 7 June 2011 respectively to reflect amendments made to the first purchase order.⁸ The operative contract between Aries and VQ was constituted by the third and last purchase order issued on 7 June 2011.⁹ I will use the term “Purchase Order” to refer to the contract between Aries and VQ.

On 30 July 2012, VQ informed Aries that it was terminating its contract with Aries with effect from 31 August 2012.¹⁰ About six months later, Aries sent a letter to VQ dated 5 March 2013 (“the 5 March 2013 letter”) that stated its intention to reclaim “the following items shipped directly from our vendor, [BTI], to [VQ]”. Fiberail was copied on the letter.¹¹ It was undisputed that by the 5 March 2013 letter, Aries was seeking to reclaim the DWDM-1 equipment from VQ even though only 42 items were listed in an attachment to the letter. The letter was also sent by email dated 6 March 2013 from Aries to VQ.¹²

On 20 March 2013, VQ sent an email rejecting Aries’ request for the return of the DWDM-1 equipment, stating that Fiberail was the correct party to retrieve the equipment, and that if Fiberail so requested, VQ would return it to Fiberail.¹³

I will elaborate later on what transpired between the parties and Fiberail between 20 March 2013 and 26 September 2013, when Aries commenced legal action in Suit No 860 of 2013 against VQ for the return of the DWDM-1 equipment and various reliefs. But in brief, Aries followed up on VQ’s reply by sending a letter on 20 March 2013 to Fiberail to request for Fiberail’s consent to withdraw the DWDM-1 equipment.¹⁴ Fiberail initially replied on 24 April 2013 by letter (“Fiberail’s 24 April 2013 letter”) to state that it did not have any record or evidence of any arrangement between Aries and VQ, and that it was not the right party to give any consent to VQ to release the DWDM-1 equipment “as they do not belong to us”.¹⁵ Although it was disputed whether a copy of Fiberail’s 24 April 2013 letter was sent by Aries to VQ in May 2013, VQ accepted that it was handed a physical copy of the letter on 19 September 2013 by a legal counsel of Aries in Singapore.

In the meantime, VQ wrote to BTI on 10 April 2013 to enquire about the ownership of the DWDM-1 equipment. BTI replied on the same day via email, stating that the DWDM-1 equipment belonged to Aries. BTI qualified that it was unaware if the DWDM-1 equipment had been transferred from Aries to Fiberail.¹⁶ However, VQ still did not release the DWDM-1 equipment to Aries as, according to Liew, BTI’s records were contrary to VQ’s records, which stated that Fiberail owned the DWDM-1 equipment.¹⁷

After a hard copy of Fiberail’s 24 April 2013 letter was handed to VQ in Singapore on 19 September 2013, Liew arranged a meeting with Suhaini, Norazmi and another Fiberail employee to clarify Fiberail’s 24 April 2013 letter.¹⁸ Liew alleged that this meeting was held in September 2013 before Aries commenced the action in Singapore on 26 September 2013.¹⁹

On 3 October 2013, I granted Aries an Anton Piller order to access VQ’s storage cabinets at the Equinix and Global Switch premises. Pursuant to that order, Aries could, inter alia, search and download the system logs, take records, video and take photographs of the DWDM-1 equipment.²⁰ Pursuant to that order, VQ’s premises were searched on 7 and 9 October 2013.²¹ The parties continued to correspond about the ownership of the DWDM-1 equipment over September and October 2013.

On 28 October 2013, Fiberail sent a letter to Aries offering to purchase the DWDM-1 equipment from Aries.²² This letter was not copied to VQ, but it replicated a draft letter that Fiberail had sent to VQ via email on 23 October 2013.²³

VQ commenced a third party action against Fiberail on 29 October 2013. Fiberail filed a memorandum of appearance in the third party action on 13 November 2013.

According to VQ, VQ commenced a “migration” of the DWDM-1 equipment from late October 2013 to January 2014 to remove the DWDM-1 equipment from its systems.²⁴ The migration was completed on 24 January 2014.²⁵ VQ claimed that the DWDM-1 equipment was placed in storage thereafter.²⁶

Fiberail filed its initial defence in the third party action on 14 May 2014, pleading that it did not own the DWDM-1 equipment and that it was not entitled to possession of the equipment.²⁷

On 2 July 2014, VQ sent an email to its solicitors stating its intention to settle the suit.²⁸ Its solicitors sent a letter dated 19 August 2014 to Aries’ solicitors to offer to return the DWDM-1 equipment. After various emails and letters, which included other proposals to return the DWDM-1 equipment, Aries agreed on 10 March 2015 in principle to accept the return of the DWDM-1 equipment, subject to the finalisation of the terms of BTI’s appointment to supervise the return of the equipment.²⁹ The parties’ solicitors corresponded between March and August 2015 on the terms of BTI’s appointment. In the meantime, VQ discontinued the third party action against Fiberail on 5 June 2015.

The parties accepted that by 28 August 2015, they made final arrangements for Aries’ collection of the DWDM-1 equipment.³⁰ The DWDM-1 equipment was collected by Aries on 2 September 2015.

Litigation history after 11 October 2016

After interlocutory judgment was granted on 11 October 2016 by consent, Aries filed Summons No 5786 of 2016 for the determination of a preliminary issue pursuant to O 14 r 12 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed), as to the nature of relief it was entitled to claim.

I decided on 7 February 2017 that...