B2C2 Ltd v Quoine Pte Ltd

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeSimon Thorley IJ
Judgment Date18 July 2018
Date18 July 2018
Docket NumberSuit No 7 of 2017 (Summons No 14 of 2018)

[2018] SGHC(I) 8

Singapore International Commercial Court

Simon Thorley IJ

Suit No 7 of 2017 (Summons No 14 of 2018)

B2C2 Ltd
and
Quoine Pte Ltd

Danny Ong, Sheila NgandRachel Low (Rajah & TannSingapore LLP) for the plaintiff;

Paul Ong, Ivan LimandMarrissa Karuna (Allen & Gledhill) for the defendant.

Case(s) referred to

B2C2 Ltd v Quoine Pte Ltd [2018] 4 SLR 1 (refd)

B2C2 Ltd v Quoine Pte Ltd [2018] 4 SLR 67 (refd)

Jurong Town Corp v Wishing Star Ltd [2004] 2 SLR(R) 427; [2004] 2 SLR 427 (folld)

Pacific Integrated Logistics Pte Ltd v Gorman Vernel International Freight Ltd [2007] 1 SLR(R) 1017; [2007] 1 SLR 1017 (folld)

Teras Offshore Pte Ltd v Teras Cargo Transport (America) LLC (Singapore International Commercial Court Suit No 1 of 2016) (refd)

Legislation referred to

Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 23 r 1, O 110 r 45 (consd); O 14, O 23, O 23 r 1(1), O 23 r 1(1)(a), O 23 r 1(2), O 110 r 45(1A), O 110 r 45(1B), O 110 r 45(1B)(a), O 110 r 45(1B)(a)(iv), O 110 r 45(2), O 110 r 45(2A)

Civil Procedure — Costs — Security for costs — Plaintiff being foreign registered company — Case transferred to Singapore International Commercial Court — Whether foreignness of plaintiff could be considered for transfer cases — Order 110 r 45 Rules of Court (Cap 322, R 5, 2014 Rev Ed)

Facts

The defendant (“the Defendant”) operated a currency exchange platform (“the Platform”) which enabled third parties to trade virtual currencies for other virtual currencies or for fiat currencies. The plaintiff (“the Plaintiff”) traded on the Platform. On 19 April 2017, the Platform experienced a technical glitch, and seven of the Plaintiff's orders to purchase Bitcoin for Ethereum were met. These orders were made at a rate that was approximately 250 times the then market rate. After the Defendant became aware of the technical glitch, it unilaterally reversed the trades. The Plaintiff contended that this reversal was in breach of the Terms and Conditions of the Platform and in breach of trust.

The Plaintiff commenced proceedings in the High Court seeking relief for those breaches. By consent, the action was transferred to the Singapore International Commercial Court (“SICC”) on 24 August 2017. Prior to this transfer, the Defendant sought security for costs from the Plaintiff and the parties agreed that the Plaintiff would provide the sum of S$80,000 as security for costs up to the date of trial by way of a solicitor's undertaking. On the Plaintiff's part, it was expressly stated that such security was given without any acknowledgment or admission in relation to the Defendant's entitlement to any further security and that it reserved its position in this regard.

On 8 September 2017, the Plaintiff made an application for summary judgment. On 5 December 2017, this application was heard and dismissed. The Judge found that the Plaintiff had a prima facie case but that there were, at least, two arguable defences. In the Judge's written grounds (B2C2 Ltd v Quoine Pte Ltd[2017] SGHC(I) 11), the Judge expressed the view that on the basis of the information before the court if neither of those arguments succeeded, he was not persuaded that the rest of the arguments would succeed.

On 14 May 2018, the Defendant filed Summons No 14 of 2018, seeking a further sum of S$70,000 in respect of the costs up to the commencement of trial and S$120,000 for the Defendant's costs of the trial. The Defendant argued that (a) the Plaintiff, being a UK company, was a foreign registered company ordinarily resident out of the jurisdiction; (b) the Plaintiff did not have a place of business in Singapore and had no fixed assets here; (c) the enforcement of any order as to costs in the UK would involve the expense of instructing solicitors in the UK; and (d) the order for security would not stifle the Plaintiff's claim. The Plaintiff opposed the making of the order on three levels. First, in contrast to O 23 r 1 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (“the Rules”), foreign residency is not a ground for ordering security for costs under O 110 r 45. Secondly, it would not be just to order security on the facts of the case. Thirdly, and in any event, the Plaintiff contended that the quantum sought was too high and that the security already provided was adequate.

Held, dismissing the application:

(1) The spirit underlying O 110 r 45 of the Rules as a whole was that where a case was commenced in the SICC, this would be because the case was international in nature. It was therefore likely to include foreign corporations so this fact should not be material in assessing whether to order security. The focus should be on the plaintiff's status and/or conduct rather than its nationality. Conversely, in a transfer case, the parties would not have at the outset agreed to litigate in the SICC. The plaintiff had elected to sue the defendant in the High Court where “foreignness” was a relevant consideration in determining whether to order security against the plaintiff, and the defendant should not lose this right by virtue of the transfer. The overall effect of the wording of O 110 r 45 of the Rules was that the fact that the plaintiff was ordinarily resident out of the jurisdiction was to be notionally added to the threshold conditions of O 110 r 45(1B): at [28] and [29].

(2) Although security would not follow as a matter of course whenever a foreign plaintiff was involved, it would generally be ordered where the circumstances were evenly balanced. This resulted not from an inherent presumption or predisposition in favour of granting security but, rather, as a matter of discretion because a plaintiff's foreign residence would often tip the finely-balanced scales of justice in favour of such an order: at [30] and [31].

(3) On the facts of the case, the balance lay on the side of not granting security. The Plaintiff was an established company and there was no reason to believe that it would not be good for the sums that might be awarded in costs. Further, the Plaintiff's conduct of the litigation was such that there was no reason to believe that it would avoid or frustrate an order for costs. Finally, the bilateral enforcement regime between Singapore and the UK and the enforcement procedures in UK were tried and tested and efficient. This reduced the weight that should be attached to the Defendant's argument that there would be inconvenience, delay and expense in enforcing any costs order. The strength of the parties’ cases was a neutral factor, and no view had been expressed in the summary judgment proceedings, save that the two proposed defences were arguable. This being the case, matters were not evenly balanced and the fact that the Plaintiff was a foreign corporation did not serve to tip the balance in the Defendant's favour: at [34] to [36].

18 July 2018

Judgment reserved.

Simon Thorley IJ:

Introduction

1 On 14 May 2018, the defendant (“the Defendant”) filed an application for security for costs in this ongoing litigation. I have already given two judgments on interlocutory matters; the first, on 27 December 2017 (B2C2 Ltd v Quoine Pte Ltd[2018] 4 SLR 1), on an application for summary judgment under O 14 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (“the Rules”)...

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