B2C2 Ltd v Quoine Pte Ltd

CourtInternational Commercial Court (Singapore)
JudgeSimon Thorley IJ
Judgment Date18 July 2018
Neutral Citation[2018] SGHC(I) 8
Citation[2018] SGHC(I) 8
Published date25 July 2018
Plaintiff CounselDanny Ong, Sheila Ng and Rachel Low (Rajah & Tann Singapore LLP)
Defendant CounselPaul Ong, Ivan Lim and Marrissa Karuna (Allen & Gledhill)
Docket NumberSuit No 7 of 2017 (Summons No 14 of 2018)
Hearing Date13 June 2018,12 July 2018
Date18 July 2018
Subject MatterCivil Procedure,Costs,Security for costs
Simon Thorley IJ: Introduction

On 14 May 2018, 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 [2017] SGHC(I) 11), on an application for summary judgment under O 14 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (the “Rules”) and the second, on 20March 2018 (B2C2 Ltd v Quoine Pte Ltd [2018] SGHC(I) 04), on the question of disclosure of confidential information.

Background facts

It is not necessary for the purpose of this judgment to rehearse the facts in any further detail, beyond the following.

The Defendant is a Singapore registered company which operates a currency exchange platform (the “Platform”) enabling third parties to trade virtual currencies for other virtual currencies or for fiat currencies such as Singapore or US dollars. The two virtual currencies involved in this action are Bitcoin (“BTC”) and Ethereum (“ETH”).

The Plaintiff is a company registered in England and Wales trading inter alia as an electronic market maker providing liquidity on exchange platforms by actively buying or selling at the prices it quotes for virtual currency pairs, thereby generating trading revenue.

On 19 April 2017, the Plaintiff placed a number of ETH/BTC orders on the Defendant’s platform, of which seven orders are the subject of this litigation.

According to the Defendant, sometime after 23:30 on that day, a “technical glitch” arose on the Platform as a result of which those orders were met at a rate approximately 250 times the then market rate previously quoted for ETH/BTC exchange. On discovering this, the Defendant unilaterally reversed the trades, which the Plaintiff contends constituted a breach of the agreement between them.

The action was originally commenced in the Singapore High Court but was subsequently transferred to the Singapore International Commercial Court (“SICC”) on 24 August 2017.

In response to the plaintiff’s application for summary judgment (referred to at [1] above), the Defendant put forward a number of proposed defences, two of which I held to be arguable. These were referred to in the judgment under the headings “Issue (b): The Risk Disclosure Statement argument” and “Issue (c): Unilateral mistake at common law”. Of the other proposed defences, I said this at [29]:

Since the matter is to go to trial, I shall not give any reasoning in relation to the other issues. However, as I indicated, based on the material before me at present, I am not persuaded that any of the other defences could succeed if both issues (b) and (c) did not. It is however a matter for the Defendant and its advisers, having heard the arguments on this hearing, to decide whether they would like the trial judge to rule on those defences.

Since that date, the Defendant has decided to have all the issues considered at trial with the consequence that the current estimate of the length of trial is about six days.

Prior to the transfer into this Court, 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. This was done on 27 July 2017 and, 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.

The present application

By this application, the Defendant seeks 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 application is based on the following grounds: The Plaintiff, being a UK company, is a foreign registered company that is ordinarily resident out of the jurisdiction. The Plaintiff does not have a place of business in Singapore and has no fixed assets here. Although there is a bilateral enforcement regime between Singapore and the UK, if it will be necessary to enforce any order as to costs, this would involve the expense of instructing solicitors in the UK. The order for security will not stifle the Plaintiff’s claim.

The Plaintiff opposes the making of the order on the following grounds. In contrast to O 23 r 1, foreign residency is not a ground for ordering security for costs under O 110 r 45 of the Rules. On the facts of this case it would not be just to order security because: the Plaintiff is an established company, both in the UK and globally, with over $6 million of paid-up capital and millions of dollars in retained earnings; it has an aggressive growth strategy in South-East Asia, particularly in Singapore; there are no grounds for suggesting that the Plaintiff will not comply with any order for costs since the Plaintiff has throughout the action complied with all orders and directions of the Court; enforcement through the UK courts will be a relatively easy matter if the Plaintiff did not comply with orders made by the Court; and the Plaintiff’s case is a strong one. In any event, the Plaintiff contends that the quantum sought is far too high and that the security already provided is adequate. In particular, any increased costs were due to the Defendant’s decision to continue pursuing all issues raised.

Order 23 r 1 and O 110 r 45 of the Rules

Order 23 r 1 of the Rules applies to applications for security for costs in the High Court and the relevant part of the rule provides as follows:

Security for costs of action, etc. (O. 23, r. 1)

Where, on the application of a defendant to an action or other proceeding in the Court, it appears to the Court that the plaintiff is ordinarily resident out of the jurisdiction; that the plaintiff (not being a plaintiff who is suing in a representative capacity) is a nominal plaintiff who is suing for the benefit of some other person and that there is reason to believe that he will be unable to pay the costs of the defendant if ordered to do so; ...

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2 cases
  • SK Lateral Rubber & Plastic Technologies (Suzhou) Co Ltd v Lateral Solutions Pte Ltd
    • Singapore
    • International Commercial Court (Singapore)
    • 17 April 2020
    ...case unless the High Court orders otherwise when ordering the transfer, which it did not. As explained in B2C2 Ltd v Quoine Pte Ltd [2018] 5 SLR 105 (“B2C2”) at [28]-[30], since the plaintiff sued in the High Court where being ordinarily resident out of the jurisdiction is a condition for o......
  • Larpin, Christian Alfred and another v Kaikhushru Shiavax Nargolwala and another
    • Singapore
    • International Commercial Court (Singapore)
    • 24 November 2020
    ...as envisaged in O 110 r 45(2A) of the Rules was made upon transfer. It was common ground that, as explained in B2C2 Ltd v Quoine Pte Ltd [2018] 5 SLR 105 at [28]–[29], in such a case the ground that the plaintiff is ordinarily resident out of the jurisdiction is notionally added to the cond......
1 books & journal articles
  • Civil Procedure
    • Singapore
    • Singapore Academy of Law Annual Review Nbr. 2018, December 2018
    • 1 December 2018
    ...109 See paras 8.76, 8.126–8.128 and 8.148–8.150 above. 110 Sia Chin Sun v Yong Wai Poh [2018] SGHC 142 at [50]. 111 [2018] 4 SLR 38. 112 [2018] 5 SLR 105. 113 See paras 8.10 and 8.159–8.161 above, and paras 8.176–8.179 below. 114 See paras 8.165–8.167 above. 115 [2018] 4 SLR 67. 116 [2018] ......

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