Art Trend Ltd v Blue Dolphin (Pte) Ltd and Others

• Jurisdiction: Singapore
• Judge: Chua F A J
• Judgment Date: 04 May 1983
• Neutral Citation: [1983] SGCA 7
• Docket Number: Civil Appeal No 38 of 1982
• Date: 04 May 1983
• Year: 1983
• Published date: 19 September 2003
• Plaintiff Counsel: M Beloff QC and Yang Lih Shyng (Rodyk & Davidson)
• Citation: [1983] SGCA 7
• Defendant Counsel: M Karthigesu and Abdul Rashid bin Abdul Gani (Khattar Wong & Pnrs)
• Court: Court of Appeal (Singapore)
• Subject Matter: Mareva injunctions,Power of High Court to order removal of injunction and award damages immediately,Civil Procedure,Interim injunction,Hardship caused to defendants

On 5 May 1982 the appellants, an English company, commenced an action against the respondents. The claim against the first respondent, a Singapore company, was for (1) the sum of US$33,943.05 under a bill of exchange due on 17 July 1981 drawn by the plaintiffs and accepted by the first respondent plus interest and commission under a discounting and financing agreement entered into between them and dated 12 February 1980; and (2) the sum of US$326,202.17 under a written guarantee dated 11 November 1981 given by the first respondent in favour of the plaintiffs and in which the first respondent had guaranteed the payment of all the liabilities of a Nigerian company known as Ojomo Industries (Nigeria) Ltd (hereinafter referred to as `Ojomo`) plus interest at the date of the writ amounting to US$128,394.23 and further interest and commission payable under the guarantee.

The claim against the second respondent, a partnership firm of three brothers dealing in textiles, in real estate and electronic goods, was for (1) the sum of US$182,407.93 under a bill of exchange due on 6 May 1981 drawn by the plaintiffs and accepted by the second respondent plus interest as at the date of the writ amounting to US$56,521.27 and further interest and commission payable under a discounting and financing agreement entered into between them and also dated 12 February 1980; and (2) the sum of US$326,202.17 under a written guarantee dated 21 April 1980 given by the second respondent in favour of the plaintiffs and in which the second respondent had guaranteed payment of all the liabilities of the first respondent plus interest as at the date of the writ amounting to US$128,394.23 and further interest and commission.

On 6 May 1982 the appellants obtained, ex parte, an interim Mareva injunction against both respondents which in effect restrained them from removing from Singapore or otherwise disposing, whether within or without the jurisdiction, of any of their assets (including immovable properties and moneys in bank accounts) in which they (including the partners of the second respondent) were beneficially interested, or otherwise pledging them or giving them by way of security. The respondents were also restrained from re-directing any payments made or to be made by their debtors from the accounts with their, several banks. Paragraph 3 of the injunction stated as follows:

The defendants shall not be prevented from dealing in any way with their assets in so far as the assets of the defendants available to meet the plaintiffs` claim herein exceed in aggregate the sum of US$1,230,000.

At least 12 banks were served with the injunction order of 6 May 1982 as a result of which the business operations of the respondents were completely halted. The proviso exempting dealings in any way with the respondents` assets as contained in the said para 3 of the injunction order was of no assistance to the respondents. Unless each of the respondents had assets in a bank which exceeded US$1.23m, the banks served with the order would not allow any further transactions in the accounts of both respondents. It would also appear that as the effective total claims against both respondents were for US$728,468.65 plus further interest and commission the freezing of US$1,23,000 worth...