Baker, Michael A (executor of the estate of Chantal Burnison, deceased) v BCS Business Consulting Services Pte Ltd and others

• Jurisdiction: Singapore
• Judge: Andre Maniam J
• Judgment Date: 23 January 2024
• Neutral Citation: [2024] SGHC(I) 2
• Court: International Commercial Court (Singapore)
• Docket Number: Suit No 3 of 2018 (Summonses Nos 9 and 22 of 2023)
• Hearing Date: 23 October 2023,06 September 2023
• Citation: [2024] SGHC(I) 2
• Year: 2024
• Plaintiff Counsel: Woo Shu Yan, Tay Hong Zhi Gerald, Mok Hin Kyong Jonathan (Mo Xianqiang), and Foo Hsien Li (Drew & Napier LLC)
• Defendant Counsel: Chua Han Yuan Kenneth (Cai Hanyuan) and Ang Kai Le (TSMP Law Corporation),Kam Su Cheun Aurill (Legal Clinic LLC) and Seow Wai Peng Amy (Adroit Law LLC)
• Subject Matter: Contempt of Court,Civil contempt,Companies,Directors,Disqualification
• Published date: 01 January 2021

Andre Maniam J (delivering the judgment of the court): Introduction

This is a judgment about the consequences of disobeying an anti-suit injunction (“ASI”).

At the hearing on 6 September 2023, we decided that defendants BCS Business Consulting Services Pte Ltd (“BCS”) and Mr Marcus Weber (“Weber”) – BCS’s sole shareholder and sole director – had committed contempt of court by disobeying the ASI issued against them on 19 November 2021. We reserved our decision on the punishment for their contempt.

In relation to Mr Hartono Sianto (“Sianto”), who was previously the sole director of BCS, we reserved our decision on whether he had committed contempt, and if so, what punishment would be appropriate.

Besides the application for an order of committal in SIC/SUM 9/ 2023 (“SUM 9”), we also had before us an application by SIC/SUM 22/2023 (“SUM 22”) to amend SUM 9 to seek a director disqualification order against Weber under s 154(2)(a) of the Companies Act 1967 (2020 Rev Ed) (the “Companies Act”). We directed the relevant parties to make further submissions on SUM 22, which we have since received and considered.

Background The Dispute

Dr Chantal Burnison (“Chantal”) was the co-inventor of a compound called Ethocyn, a skin product said to make the skin look younger and better toned. Ethocyn was supplied to cosmetic manufacturers such as Nu Skin International (“Nu Skin”). Nu Skin made payments to BCS under a supply and distribution agreement.

A dispute arose over the rights to the inventions and patents relating to Ethocyn (the “Ethocyn Rights”). The plaintiff, Mr Michael Baker (“Baker”), as the executor of Chantal’s estate, contended that there was a trust (“the Trust”) whereby Weber held the Ethocyn Rights and any income or proceeds generated from them on trust for Chantal (the “Trust Assets”), less 5% of such income and proceeds going to Weber as a commission – that trust covered 95% of monies paid by Nu Skin to BCS (the “Trust Moneys”).

Weber contended that he had purchased the Ethocyn Rights as a personal investment opportunity, and that all moneys earned from them belonged to him and his companies (including BCS and the third defendant, Renslade Holdings Limited (“Renslade (HK)”)).

The Suit 3 Judgment

On 20 November 2017, Baker sued BCS, Weber and Renslade (HK) (collectively, the “Defendants”) in HC/S 1070/2017, which was transferred to the Singapore International Commercial Court (“SICC”) as SIC/S 3/2018 (“Suit 3”). After a trial, on 29 April 2020 the SICC gave Baker judgment¹ (in Baker, Michael A (executor of the estate of Chantal Burnison, deceased) v BCS Business Consulting Services Pte Ltd and others [2020] 4 SLR 85 (the “Suit 3 Judgment”)) for the following: a declaration that BCS and/or Renslade (HK) held the Ethocyn Rights and the Trust Assets (including the Trust Moneys) on trust for the estate of Chantal; the Defendants were to provide a detailed account of all the transactions which had taken place in respect of the Trust Assets and Trust Moneys within 14 days from the date of judgment; the Defendants were to account to Baker the Trust Assets and Trust Moneys, and Baker was at liberty to trace and recover the Trust Assets and Trust Moneys, if necessary. The Defendants had to pay Baker all sums due to Baker on the taking of the account of the Trust Assets and Trust Moneys; the parties were at liberty to apply to the court for any orders or directions in relation to the taking of accounts of the Trust Assets and Trust Moneys; Weber was to pay to Baker CHF9.5m plus interest at the rate of 3% per annum calculated from the date the sum of CHF9.5m was loaned to Weber to the date of judgment and the post judgment interest rate of 5.33% calculated from after the date of judgment until the said sum of CHF9.5m plus interest was repaid; the sum of US$10,330,658.91, which was paid by Renslade (HK) into court pursuant to SIC/ORC 2/2020 dated 11 January 2020, was to be released to Baker and/or his solicitors; and the Defendants were to pay Baker the costs of the action.

By CA/CA 76/2020 (“CA 76”), the Defendants appealed against the Suit 3 Judgment. The appeal was dismissed on 19 January 2021.² With reference to the Suit 3 Judgment, the Court of Appeal stated: “We agree with the comprehensive judgment of the court below. In our view, we see no reason to disturb any of the findings made therein, or the orders made.” (see Baker, Michael A (executor of the estate of Chantal Burnison, deceased) v BCS Business Consulting Services Pte Ltd and others [2022] 3 SLR 103 (the “ASI Judgment”) at [24])

The ASI Judgment and ASI Appeal

After Baker sued the Defendants in Singapore in November 2017, on 8 August 2019, BCS sued Baker and BCS Pharma corporation (“BCS Pharma”) – one of Chantal’s US companies – in California (the “Californian Proceedings”). In the Californian Proceedings, BCS alleged, inter alia, that Baker and BCS Pharma had interfered with the contractual relationship between BCS and Nu Skin (the “Initial Complaint”). By agreement, BCS, Baker, and BCS Pharma thereafter agreed to a stay of the Californian Proceedings pending the outcome of the Defendants’ appeal against the Suit 3 Judgment, ie, CA 76, and the Californian Proceedings were stayed on 30 June 2020. As mentioned, CA 76 was dismissed on 19 January 2021. On 26 March 2021, the stay on the Californian Proceedings was lifted. On 16 June 2021, Baker applied by SIC/SUM 37/2021 (“SUM 37”) for an ASI to restrain the prosecution of the Californian Proceedings. On 19 November 2021, the SICC granted the ASI against the Defendants by way of the ASI Judgment.

BCS filed various versions of its Complaint which set out its claim in the Californian Proceedings (the full details of which may be found in the ASI Judgment at [29]–[42] and BCS Business Consulting Services Pte Ltd and others v Baker, Michael A (executor of the estate of Chantal Burnison, deceased) [2023] 1 SLR 1 (the “ASI Appeal”) at [27]–[28]): on 8 August 2019, BCS filed its Initial Complaint; on 27 April 2021, BCS filed a “First Amended Complaint”; on 27 August 2021, BCS filed a “Second Amended Complaint”; and on 7 April 2022 (after the ASI was issued on 19 November 2021), BCS filed a “Third Amended Complaint”.

In the ASI Judgment, the SICC found as follows (at [91]):

… many of the claims pursued by BCS in the Californian Proceedings amount to an attempt at relitigating matters already decided by this court, and thus vexatious and oppressive and amount to an abuse of process. We also find that BCS’s claims are vexatious and oppressive towards the Estate. Moreover, these claims relitigating the same issues that have been decided by this court amount to a collateral attack of this court’s Judgment … This justifies the issuance of an ASI against BCS, to restrain BCS from relitigating the subject-matter of the Suit against the Estate and the US Defendants through the Californian Proceedings.

The SICC thus issued the ASI, in the following terms: (1) [BCS] is hereby restrained, whether acting by itself, its officers, its servants or agents or otherwise, from prosecuting or continuing to prosecute proceedings under Case No. 2:19-cv-06914-JWH-JPR [ie, the Californian Proceedings], commenced by [BCS] in the United States District Court for the Central District of California in the United States of America on 8 August 2019, against [Baker], both in his individual and personal capacity and as well as his capacity as the Executor of the Estate of Chantal Burnison, deceased, and against [BCS Pharma], Heika Burnison (“Heika”), Birka Burnison (“Birka”), Grey Pacific Labs, LLC (“Grey Pacific Labs”) and Grey Pacific Science, Inc (“Grey Pacific Science”), insofar as such proceedings relate to the existence, validity and/or enforceability of the Trust in the Ethocyn Rights and assets held on behalf of [Chantal] and now, her estate (“Estate”), and any issues relating to the reliance on and/or assertion of the said Trust or any issues litigated before the Singapore Courts in SIC/S 3/2018, the Judgment dated 29 April 2020 and CA/CA 76/2020. (2) [BCS] shall not be restrained in Case No. 2:19-cv-06914-JWH-JPR, commenced by [BCS] in the United States District Court for the Central District of California in the United States of America on 8 August 2019, from pursuing claims against [Baker], BCS Pharma, Heika, Birka, Grey Pacific Labs and Grey Pacific Science for claims against [Baker] for allegedly holding himself out as an officer of [BCS] or for signing of the assignment agreement transferring the trademark rights, and the settlement agreement with Nu Skin, and for claims against Heika, as an officer of Grey Pacific Labs, for allegedly willingly entering into the assignment agreement for the trademark rights knowing that [Baker] is not an officer of [BCS], or for claims related thereto, provided always that they do not relate to the existence, validity and/or enforceability of the Trust in the Ethocyn Rights and assets held on behalf of [Chantal] and now, her Estate, and any issues relating to the reliance on and/or assertion of the said Trust or any issues litigated before the Singapore Courts in SIC/S 3/2018, the Judgment dated 29 April 2020 and CA/CA 76/2020. (3) [BCS] and [Renslade (HK)] are hereby restrained, whether acting by themselves, their officers, their servants or agents or otherwise, and [Weber] is hereby restrained, whether acting by himself, his servants or agents or as a director, officer or servant or agent or shareholder of [BCS] and [Renslade (HK)] or otherwise, from prosecuting or continuing to prosecute proceedings in the United States of America or anywhere else in the world against [Baker], whether in his personal capacity and/or his capacity as the Executor of the Estate, Heika and/or Birka, insofar as any such proceedings relate to the existence, validity and/or enforceability of the Trust in the Ethocyn Rights and...