Asian Corporate Services (SEA) Pte Ltd v Eastwest Management Ltd (Singapore Branch)

Judgment Date16 January 2006
Date16 January 2006
Docket NumberCivil Appeal No 27 of 2005
CourtCourt of Appeal (Singapore)
Asian Corporate Services (SEA) Pte Ltd
Eastwest Management Ltd (Singapore Branch)

[2006] SGCA 1

Chao Hick Tin JA


Andrew Ang J

Civil Appeal No 27 of 2005

Court of Appeal

Civil Procedure–Anton Piller orders–Appeal against judge in chambers' decision to set aside Anton Piller order–Whether tests for grant of Anton Piller order satisfied–Civil Procedure–Disclosure of documents–Whether failure to disclose corporate flowchart amounting to material non-disclosure in ex parte application for Anton Piller order

The appellant brought an action against the respondent, amongst others, for conspiracy to injure by unlawful means. Two of the respondent's three directors, Duncan Merrin (“Merrin”) and his wife, were the fifth and sixth defendants in the action. The appellant alleged that the respondent had knowingly and dishonestly assisted Merrin in the breach of his fiduciary obligations to the appellant by diverting the business of the appellant to, amongst others, the respondent.

Merrin, who had also been the managing director of the appellant, had allegedly provided inadequate and incorrect information regarding the loss of the appellant's clientele in the course of the handover of his duties in anticipation of his resignation. In addition, Merrin also had all the data in his laptop computer deleted, contrary to the appellant's instructions, before returning the laptop computer to the appellant.

Consequently, the appellant sought and was granted an Anton Piller order against all the defendants, including the respondent. However, on hearing further arguments, the learned judge in chambers discharged the Anton Piller order against the respondent and ordered that there be an inquiry as to damages which might have been suffered by the respondent on account of the Anton Piller order. The appellant appealed against that decision.

Held, allowing the appeal:

(1) To warrant the issue of an Anton Piller order, four tests had to be satisfied: (a) whether the plaintiff had shown that it had an extremely strong prima facie case; (b) whether the damage suffered by the plaintiff would have been very serious; (c) whether there was a real possibility that the defendants would destroy relevant documents; and (d) whether the effect of the Anton Piller order would be out of all proportion to the legitimate object of the order: at [14].

(2) There was clear evidence that companies previously serviced by the appellant had moved their patronage to, amongst others, the respondent. Merrin and his wife were managing the respondent and had helped the respondent in servicing the companies, which service was previously rendered to those companies by the appellant: at [16].

(3) Merrin and his wife were two of the three directors of the respondent, the third being resident out of Singapore. To say that, in those circumstances, Merrin and his wife did not control and manage the respondent would fly in the face of the factual and legal position: at [17].

(4) As a director of the respondent, Merrin's actions, which were carried out for the benefit of the respondent, had necessarily to be attributable to the respondent. There being the intent to injure the appellant, even if the primary purpose of the conspirators was to further their own legitimate interests, it sufficed to make their conduct tortious that they used unlawful means: at [18].

(5) It was incorrect to say that the liability of the respondent was restricted to the loss suffered in the transfer of the business of the companies away from the appellant. The case made against the respondent was one of conspiracy, and if that was eventually proven, the respondent, together with the other co-conspirators could each be jointly and severally liable for all the losses which the appellant had suffered on account of the conspiracy. The question of whether the respondent benefited was merely extraneous. The liability of a co-conspirator arose from the fact that it acted in concert with others and it did not matter that the co-conspirators might not have benefited equally: at [23] to [25].

(6) There was clear evidence that Merrin had destroyed company data in the laptop computer which the appellant had provided to him for his use as the managing director of the appellant. With such propensity, and having regard to the fact that Merrin was the person managing the respondent's affairs in Singapore, it was reasonable to hold that there were grounds to believe that Merrin would destroy documents in the respondent's possession to save his own skin: at [29].

(7) The respondent only served companies within its own group and the Anton Piller order was specific in its scope. The respondent could carry on its business as per normal, no wholesale removal of documents was involved and the execution was carried out discreetly. In the circumstances, an Anton Piller order would not be very damaging to the defendant: at [39].

(8) The only material document which the respondent alleged the appellant did not produce before the judge hearing the ex parte application was a corporate flow chart showing the shareholding structures and the flow of funds between the entities in the group to which the respondent belonged. However, this non-disclosure was innocent and having regard to the conduct of Merrin, who was apparently dishonest and the fact that he was both the de jure and de facto manager of the respondent, the Anton Piller order would have been made even if the chart had been produced before the judge hearing the ex parte application: at [46] and [48].

Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55 (folld)

Brink's Mat Ltd v Elcombe [1988] 1 WLR 1350 (folld)

Chiarapurk Jack v Haw Par Brothers International Ltd [1993] 2 SLR (R) 620; [1993] 3 SLR 285 (folld)

CHS CPO GmbH v Vikas Goel [2005] 3 SLR (R) 202; [2005] 3 SLR 202 (folld)

Dunlop Holdings Ltd and Dunlop Ltd v Staravia Ltd [1982] Com LR 3 (folld)

H L Bolton (Engineering) Co Ltd v TJ Graham & Sons Ltd [1957] 1 QB 159 (folld)

Hadmor Productions Ltd v Hamilton [1983] AC 191 (folld)

King, The v The General Commissioners for the Purposes of the Income Tax Acts for the District of Kensington, ex parte Princess Edmond de Polignac [1917] 1 KB 486 (folld)

Lock International Plc v Beswick [1989] 1 WLR 1268 (folld)

Lonrho plc v Fayed [1992] 1 AC 448 (folld)

Nikkomann Co Pte Ltd v Yulean Trading Pte Ltd [1992] 2 SLR (R) 328; [1992] 2 SLR 980 (folld)

Quah Kay Tee v Ong and Co Pte Ltd [1996] 3 SLR (R) 637; [1997] 1 SLR 390 (folld)

R v Siracusa (1990) 90 Cr App R 340 (folld)

Siporex Trade SA v Comdel Commodities Ltd [1986] 2 Lloyd's Rep 428 (folld)

Tay Long Kee Impex Pte Ltd v Tan Beng Huwah [2000] 1 SLR (R) 786; [2000] 2 SLR 750 (folld)

Andy Leck, Dinesh Dhillon and Rachel Chong (Wong & Leow LLC) for the appellant

Jimmy Yim SC and Kelvin Tan (Drew & Napier LLC) for the respondent.

Judgment reserved.

Chao Hick Tin JA

(delivering the judgment of the court):

1 This is an appeal by Asian Corporate Services (SEA) Pte Ltd (“the appellant”) against the decision of V K Rajah J [see Asian Corporate Services (SEA) Pte Ltd v Impact Pacific Consultants Pte Ltd [2005] 4 SLR (R) 61] discharging an Anton Piller order (“the AP Order”) which the appellant had obtained on an ex parte basis against Eastwest Management Ltd (Singapore Branch) (“the respondent”), and ordering that there be an inquiry as to damages which may have been suffered by the respondent on account of the AP Order. Similar orders were obtained against six other defendants but, pursuant to an agreement between the parties, none of those defendants has challenged the orders made against them.

The background

2 The appellant is a Singapore-incorporated private limited company and its principal activity is the provision of business management and consultancy services. Such services include the incorporation of Singapore and offshore companies, provision of nominee directorships, appointment of local agents for foreign companies with branches in Singapore, company secretarial and administration, and accounting services.

3 In Suit No 834 of 2004 (“Suit 834/2004”) the appellant sued seven parties for, inter alia, conspiracy to injure by unlawful means. To understand how the alleged conspiracy came about, it is necessary to understand the relationships between the seven defendants. Among the defendants, the main personality is the fifth defendant, Duncan Samuel Rothwell Merrin (“Merrin”), who, prior to the year 2000, owned all the issued shares of the appellant except for one. Merrin was also its managing director. By 2002, Merrin had sold all his shares in the appellant to a New Zealand company called European Trust Company Ltd (“ETC”). We should mention that before ETC became the owner, the appellant was known by another name. However, nothing turns on this change of name.

4 Although by 2002 Merrin no longer owned any shares in the appellant, the new owner, ETC, continued to retain Merrin as the managing director of the appellant until 30 June 2004. Merrin also continued with the appellant as a director and company secretary until 19 October 2004, the date on which the AP Order was executed.

5 The first defendant in Suit 834/2004 is Impact Pacific Consultants Pte Ltd, a Singapore company which was established to provide business management and consultancy services. The second defendant is Impact Pacific Management Pte Ltd, a Singapore company incorporated for the purposes of developing other software and multimedia works. Both these companies share the same registered office and it was the plan that they be brought within the group of companies known as the Kennedy group of companies. The first defendant is wholly owned by Mayseille Intl Ltd (another entity in the Kennedy group). The second defendant is 50% owned by the seventh defendant and 50% owned by the first defendant.

6 The third defendant...

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