Baker, Michael A v BCS Business Consulting Services Pte Ltd

• Jurisdiction: Singapore
• Judge: Quentin Loh JAD,Carolyn Berger IJ,Dominique Hascher IJ
• Judgment Date: 19 November 2021
• Court: High Court (Singapore)
• Docket Number: Suit No 3 of 2018 (Summons No 37 of 2021)

Baker, Michael A (executor of the estate of Chantal Burnison, deceased)

and

BCS Business Consulting Services Pte Ltd and others

[2021] SGHC(I) 14

Quentin Loh JAD, Carolyn Berger IJ and Dominique Hascher IJ

Suit No 3 of 2018 (Summons No 37 of 2021)

Singapore International Commercial Court

Civil Procedure — Injunctions — Anti-suit injunctions — Defendants making arguments on illegality and public policy in Singapore on basis of testator's misrepresentations to US courts — Singapore court having dealt with and dismissed defendants' arguments in hearings on merit — Defendant making argument on “judicial estoppel” in the US also based on testator's misrepresentations — Whether defendant seeking to re-litigate same issues before US courts — Whether argument on judicial estoppel could, and should, have been raised before Singapore courts — Whether defendant's conduct in US proceedings amounted to collateral attack of Singapore judgment — Whether balance of convenience justified granting anti-suit injunction

Civil Procedure — Injunctions — Anti-suit injunctions — Plaintiff winning suit against defendants in Singapore — Defendant commencing suit against plaintiff and parties related to plaintiff in the US — US defendants including parties related to plaintiff who were non-parties to Singapore proceedings — Whether Singapore courts could grant anti-suit injunction in favour of non-parties to Singapore proceedings

Held, allowing the application in part:

(1) The jurisdiction to grant an ASI was to be exercised when the “ends of justice” required it. The court would consider factors such as the defendant's amenability to the court's jurisdiction, the natural forum of the resolution of the dispute between the parties, and the alleged vexation or oppression to the plaintiffs if the foreign proceedings were to continue. It would be vexatious and oppressive for a defendant to re-litigate issues decided by the forum court in the foreign proceedings. The court would also grant an ASI to prevent the abuse of its processes and to protect the court's own judgment from being undermined by a defendant in the foreign proceedings: at [45], [46], [49] and [53].

(2) The Defendants were amenable to the court's jurisdiction. The Defendants did not object to the court's jurisdiction, and willingly participated in the Singapore proceedings, including those for the “Accounting Application” heard together with the ASI Application. That the California court was the natural forum was immaterial so long as the forum court had sufficient interest with the case. The court had sufficient interest in protecting its judgment from a collateral attack: at [62] and [65].

(3) The Intercepted Payment Claims were an attempt by the Defendants to re-litigate matters already decided in the Judgment, contradicting its findings in the Judgment that the Trust Assets and Trust Moneys belonged to the Estate beneficially. But with respect to the Trade mark Claims, in so far as they pertained to Baker's holding out as the officer of BCS, that did not amount to re-litigation: at [67] and [68].

(4) The Judicial Estoppel Claim was also an attempt to re-litigate the issue of Chantal's false declarations before the US Bankruptcy Courts. It was vexatious to re-litigate issues that could and should have been brought before the forum court. The Defendants failed to raise the Judicial Estoppel Claim at all, despite having extensively raised issues as to the existence, validity and enforceability of the Trust under Singapore and US laws, including the defence of illegality and public policy; all of which arose from the same facts. It was therefore oppressive for the Defendants to pursue the Judicial Estoppel Claim in the Californian Proceedings and it was also an abuse of process: at [69], [70], [73] to [76] and [81].

(5) The Wrongful Settlement Claims were not an attempt at re-litigation, because the facts were uncovered after the Appeal concluded, and did not concern the ownership of the Ethocyn Rights: at [82] and [83].

(6) As the Californian Proceedings were at an early stage with discovery yet to be completed, there would be no wastage of resources; the balance of convenience therefore pointed towards granting the ASI: at [84].

(7) The ASI further applied to the other US Defendants who were not parties to this Suit. The claims against the US Defendants were based on BCS's absolute ownership of the Ethocyn Rights, which contradicted the court's findings and threatened to denude the Judgment of any real practical effect: at [86] and [89].

Case(s) referred to

Airbus Industrie GIE v Patel [1999] 1 AC 119 (refd)

Baker, Michael A v BCS Business Consulting Services Pte Ltd [2020] 4 SLR 85 (refd)

Beckkett Pte Ltd v Deutsche Bank AG [2011] 1 SLR 524, HC (refd)

Beckkett Pte Ltd v Deutsche Bank AG [2011] 2 SLR 96, CA (folld)

Crescendo Maritime Co v Bank of Communications [2016] 1 Lloyd's Rep 414 (refd)

Goh Nellie v Goh Lian Teck [2007] 1 SLR(R) 453; [2007] 1 SLR 453 (folld)

Henderson v Henderson (1843) 3 Hare 100; [1843–1860] All ER Rep 378 (folld)

Koh Kay Yew v Inno-Pacific Holdings Ltd [1997] 2 SLR(R) 148; [1997] 3 SLR 121 (distd)

Lakshmi Anil Salgaocar v Jhaveri Darsan Jitendra [2019] 2 SLR 372 (folld)

Masri v Consolidated Contractors (No 3) [2009] QB 503 (refd)

Noble Assurance v Gerling-Konzern [2006] EWHC 253 (Comm) (refd)

Royal Bank of Scotland NV, The v TT International [2015] 5 SLR 1104 (folld)

Société Nationale Industrielle Aerospatiale v Lee Kui Jak [1987] AC 871 (folld)

Sun Travel & Tours Pvt Ltd v Hilton International Manage (Maldives) Pvt Ltd [2019] 1 SLR 732 (folld)

VKC v VJZ [2021] 2 SLR 753 (distd)

Facts

The plaintiff, Michael Baker (“Baker”), was the executor of the estate of Chantal Burnison (“the Estate”). Chantal was the co-inventor of a compound called “Ethocyn” used in various cosmetic and anti-aging skin products. The intellectual property rights in the Ethocyn (“the Ethocyn Rights”) were held by companies controlled by Chantal, which entered into bankruptcy proceedings in the US (“the US Bankruptcy Proceedings”) in February 1999. The Ethocyn Rights were acquired by Renslade New Zealand with the approval of the US Bankruptcy Court in October 1999, and subsequently transferred to Renslade Singapore, sometime between 2000 and 2001 or 2002 and eventually to BCS on 1 April 2002.

In November 2017, the Estate commenced suit in SIC/S 3/2018 (“the Suit”) against the defendants (BCS, Marcus Weber (“Weber”) and Renslade Holdings Ltd (“Renslade (HK)”)) (collectively, “the Defendants”), alleging that the Defendants were trustees of the Ethocyn Rights for the Estate, and had breached their fiduciary duties. In August 2019, while the Suit was underway, BCS commenced proceedings in the US District Court for the Central District of California (“the Californian Proceedings”) against Baker and BCS Pharma Corp (“BCS Pharma”), alleging that Baker had wrongfully diverted payment due to BCS to BCS Pharma (“the Intercepted Payment Claim”). The Californian Proceedings were stayed in June 2020 because of the Singapore proceedings.

The Singapore International Commercial Court (“SICC”) rendered its judgment in Baker, Michael A v BCS Business Consulting Services Pte Ltd[2020] 4 SLR 85 (“the Judgment”) on 29 April 2020. In the Judgment, the court held that there was a valid and enforceable trust agreement governed by Singapore law as between Weber and Chantal (“the Trust”). Chantal was the beneficial owner of the Ethocyn Rights, and the moneys and income generated therefrom (“the Trust Assets and Trust Moneys”). The bulk of the Trust Moneys were derived from a supply and distribution agreement between the Defendants and one Nu Skin International Inc (“Nu Skin”). In particular, the SICC rejected the defence of illegality raised by the Defendants. The Trust remained valid and enforceable in spite of Chantal's false declaration to the US Bankruptcy Court to conceal her interest in the transfer of the Ethocyn Rights from the Chantal companies to Renslade New Zealand.

The Defendants' appeal against the Judgment (“the Appeal”) was dismissed by the Court of Appeal in January 2021.

In March 2021, the US District Court lifted the stay on the Californian Proceedings. BCS then joined Chantal's daughters (“the Daughters”) and two companies incorporated by the Daughters, one Grey Pacific Labs LLC and Grey Pacific Science, Inc (“Grey Pacific Companies”) as defendants to the Californian Proceedings, and included further complaints against Baker, BCS Pharma, the Daughters and Grey Pacific Companies (collectively, “the US Defendants”). BCS's complaints included, inter alia, that Baker wrongfully caused all trade mark rights related to the Ethocyn Rights to be conveyed to the Grey Pacific Labs LLC, cutting the Defendants out of business (“the Trade mark Claim”), that Baker was “judicially estopped” from asserting the existence of the Trust in the California courts (“the Judicial Estoppel Claim”), and that Baker had wrongfully held himself out as a representative of BCS in reaching a settlement agreement with Nu Skin (“the Wrongful Settlement Claims”), in addition to the Intercepted Payment Claim.

On 16 June 2021, the plaintiff made the present application for an anti-suit injunction (“the ASI Application”), on the basis that the Californian Proceedings were a collateral attack on the Judgment, as BCS took the position in the Californian Proceedings that BCS remained the absolute owner of the Ethocyn Rights, contrary to the SICC's findings affirming the existence of the Trust. BCS's conduct was therefore vexatious and oppressive, and an anti-suit injunction (“ASI”) should be granted.

BCS, however, argued that it did not seek to undermine the Judgment, as the causes of action in the Californian Proceedings were separate and distinct from those adjudicated upon by the court. The Californian Proceedings also concerned new facts discovered after the Appeal, including the new...