Bachmeer Capital Limited v Ong Chih Ching and others

• Jurisdiction: Singapore
• Court: International Commercial Court (Singapore)
• Judge: Vivian Ramsey IJ
• Judgment Date: 24 May 2019
• Neutral Citation: [2019] SGHC(I) 7
• Citation: [2019] SGHC(I) 7
• Published date: 20 February 2020
• Plaintiff Counsel: Foo Maw Shen, Chu Hua Yi, Ng Sook Zhen and Michelle Lee Ying-Ying (Dentons Rodyk & Davidson LLP)
• Defendant Counsel: Yim Wing Kuen Jimmy SC, Chia Voon Jiet, Lee Yicheng Andrew and Dierdre Grace Morgan (Drew & Napier LLC),Vergis S Abraham and Lim Mingguan (Providence Law Asia LLC),the seventh and eighth defendants unrepresented.
• Date: 24 May 2019
• Hearing Date: 29 January 2018,08 February 2018,01 February 2018,02 February 2018,13 February 2018,06 February 2018,12 February 2018,18 April 2018,31 January 2018,05 February 2018,09 February 2018,07 February 2018,30 January 2018
• Docket Number: Suit No 2 of 2017
• Subject Matter: Publication,Contract,Choice of law,Conspiracy by unlawful means,Conspiracy,Defamation,Conflict of Laws,Tort,Termination

Vivian Ramsey IJ: Introduction

These proceedings concern a dispute between the plaintiff and the first defendant (“Ms Ong”), the second defendant (“Ms Suparman”), the fourth defendant (“KOPSG”), the fifth defendant and the sixth defendant (those defendants being referred to together as “the KOP defendants”) and the third defendant (“Mr Shport”), in relation to a project known as Project Winterland, in Shanghai, China.

By a counterclaim, KOPSG and Ms Ong make a claim for defamation against the plaintiff, the second defendant by counterclaim (“Ms Wang”) and the third defendant by counterclaim (“Mdm Hu”), KOP Properties (HK) Ltd (“KOPHK”) and KOP Management Services (Shanghai) Co., Ltd (“Bodi”).

Background

Mdm Hu is a successful businesswoman, having developed and managed shopping malls and other properties in China and then becoming Chief Executive Officer of a leading apparel company in China. Ms Wang is Mdm Hu’s daughter and the sole shareholder and controlling director of the plaintiff at the material time. She attended university in the United States and has an MBA from Harvard University. Ms Wang and Mdm Hu came to know Ms Suparman who, for a time, was working for the real estate company, CBRE, in Shanghai. In turn, Ms Suparman introduced Ms Wang and Mdm Hu to Ms Ong.

Ms Ong is a successful businesswoman in Singapore. She attended university in England and practised as a lawyer in her own firm Koh, Ong & Partners in Singapore before taking on interests in real estate development and other businesses in Singapore. Ms Ong and Ms Suparman are shareholders in and directors of KOP Limited, Ms Ong being the Executive Chairman and Ms Suparman the Chief Executive Officer of that company. KOP Limited is a Singapore-listed company with business interests in the real estate development, hospitality and entertainment industries. KOP Limited wholly owns KOPSG. KOP Limited, KOPSG and other companies controlled by Ms Ong and Ms Suparman shall be referred to collectively as the KOP Group.

In the course of meetings in Shanghai on 13 April 2013 and in Singapore on 2 May 2013, Ms Ong, Ms Suparman, Ms Wang and Mdm Hu developed plans to work together. The arrangements between them, or the companies by which they acted, have been described as a collaboration, a joint venture and a partnership. There is dispute between them as to the precise nature of the arrangement and the rights and liabilities to which it gave rise. I shall refer to it as “the Joint Venture”.

The structure of the proposed Joint Venture was set out in an attachment to an email from Ms Wang to Ms Ong and Ms Superman of 3 May 2013. In summary it proposed that a company, KOPHK, would be established in Hong Kong in which KOPSG would have a 51% shareholding and the plaintiff would have a 49% shareholding. A further company, Bodi, would be established in China, in which KOPHK would own 100% of the shares.

On 3 June 2013, the seventh defendant, KOPHK was incorporated with a paid-up capital of HK$1m and on 12 September 2013, the eighth defendant, Bodi was incorporated in Shanghai as a wholly-owned foreign entity.

The start of Project Winterland

In early 2012, Ms Ong met Mr Shport to explore his plans to develop an indoor winter park. Ms Ong suggested that the concept could be developed in the form of an integrated winter resort, with ski slopes, hotels, retail outlets, food and beverage outlets and other entertainment (“the Winterland Concept”). Together, Ms Ong and Mr Shport presented plans to the Singapore Tourism Board to construct such a resort. Although these plans did not eventually materialise, Ms Ong (through KOPSG) and Mr Shport decided to develop the concept jointly and entered into two memoranda of understanding dated 13 August 2012 and 21 December 2012. Under those memoranda of understanding, there were further unsuccessful attempts to find a suitable location for an integrated winter resort in Singapore, Jakarta and Hong Kong.

In September 2013, Ms Wang became aware of the Winterland Concept. After discussing the matter with Ms Ong and Ms Suparman, it was agreed that they would explore the possibility of implementing the Winterland Concept in China.

In or around October 2013, KOPSG (represented by Ms Ong and Ms Suparman) and Ms Wang agreed to undertake Project Winterland in the Qing Pu district in China as part of the Joint Venture. The parties agreed that Ms Wang and Mdm Hu would be in charge of running the day-to-day affairs of the project and in liaising with the Qing Pu government on land acquisition matters.

On 1 October 2013 Ms Wang made contact with Mr Shport who provided further information about the Winterland Concept.

At this stage, Ms Wang was invited by Ms Ong to become a shareholder in KOPSG. Ms Wang accepted this invitation on about 18 September 2013 and became a nominee of 1.5m shares for S$12m. On 10 October 2013, Ms Wang was appointed Director of Business Development for KOPSG at a salary of S$8,000 per month.

The early efforts to carry out Project Winterland in Qing Pu

When Ms Wang returned to China, she carried out some preliminary research into the feasibility of implementing the Winterland Concept in Shanghai, which she thought would be a suitable location. She then identified the new Hongqiao Commercial zone in West Shanghai as the target area, after having studied the Pudong Disneyland area and the Qian Tan World Expo Site. After considering the four districts in the Hongqiao Commercial zone, she came to the view that the most suitable piece of land was in the Qing Pu district (“the Qing Pu Land”).

After discussing the matter with Ms Suparman, Ms Wang prepared an investment analysis dated 18 October 2013 as well as a presentation containing an analysis of the location of the Qing Pu Land. The investment analysis and that presentation were discussed with Ms Ong and Ms Suparman, who visited the site in October or November 2013.

This led to the signing of a framework agreement on about 25 November 2013 (“the West Hongqiao Framework Agreement”) between KOPSG and Shanghai West Hongqiao Commercial Development Co., Ltd (“West Hongqiao”), the specially invested limited liability company established by the Qing Pu district government in Shanghai for the development and construction of the Shanghai Hongqiao central business district (“CBD”). Ms Ong attended the signing ceremony and signed the West Hongqiao Framework Agreement on behalf of KOPSG.

Ms Wang continued to pursue the acquisition of the Qing Pu Land. On 16 December 2013, Colliers International Property Consultants (Shanghai) Co., Ltd (“Colliers”) provided a proposal to carry out a feasibility study and was engaged by Bodi to do so.

In January 2014, Bodi engaged Kohn Pedersen & Fox Associates PC (“KPF”), architects and planning consultants in the United States to provide “architectural design consultancy services for Project Shanghai Winterland”. To deal with local planning regulations and rules, Bodi also engaged East China Architectural Design and Research Institute ("ECADI") in January 2014.

On or about 6 January 2014, a two-day kick-off meeting for Project Winterland took place in Shanghai attended by Colliers, KPF and ECADI with Ms Ong, Ms Suparman, Mr Shport, Ms Wang and Mdm Hu in attendance.

On 13 February 2014, Mr Shport, through his company Xpanse Pte Ltd (“Xpanse”) entered into a project management agreement (“the First Project Management Agreement”) with Bodi to provide intensive services up to completion of the project, which was described as being located in Hongqiao district, Shanghai and as being a “multifunction complex Winterland”. Much of the work was to be done by an employee of Xpanse, Mr Arthur Lim.

In March or April 2014 for reasons which appear to be disputed, but involved questions of Mr Arthur Lim’s suitability and the need for project management services prior to the land acquisition, the First Project Management Agreement with Xpanse was terminated, as Mr Shport put it “for the benefit of the project”. On 1 May 2014, Bodi entered into a new project management agreement with another company controlled by Mr Shport, SIV Engineering Pte Ltd, for project consulting services for Project Winterland from that date up to land acquisition (“the Second Project Management Agreement”).

The Qing Pu Land consisted of three plots, Plots A, B and C. The Pan Long River ran through the site, and a planned road, Hui Ding Road, ran through Plot A. In order to use the Qing Pu Land for Project Winterland, it was necessary to seek the agreement of the government authorities for the re-routing of Pan Long River and removal of Hui Ding Road. But before I continue outlining the events that occurred in relation to the attempt to carry out Project Winterland on the Qing Pu Land, I pause to briefly set out the parties’ financial arrangements for Project Winterland, which had assumed importance in the intervening period.

The parties’ capital contributions to the Joint Venture

In early 2014, there were various issues which had to be dealt with in respect of the interests in the Joint Venture. The share capital of KOPHK was HK$1m and the share capital of Bodi was US$1m. The plaintiff contributed HK$1,757,464.85 which roughly equated to US$1m. In January 2014 it was agreed that, of this sum, US$510,000 would be treated as KOPSG’s contribution of 51% to the share capital of KOPHK.

On 12 April 2014 two meetings took place. At one meeting attended by Ms Ong, Ms Suparman, Ms Wang and Mr Shport, it was recorded that the following was agreed: 1. [Mr Shport] has a cost of 120,000SGD for Xpanse PM work in China. It will be a personal loan from [Ms Wang] and [Ms Suparman] and [Ms Ong]. [Ms Wang] will pay RMB equal to 60,000SGD to [Mr Shport] in China, and [Ms Ong]/[Ms Suparman] will write a check for additional 60,000SGD to [Mr Shport] in Singapore. 2. [Ms Ong] will prepare the lending note for [Mr Shport] to sign,...