Bank Central Asia v Rosenberg

• Jurisdiction: Singapore
• Judge: Chao Hick Tin J
• Judgment Date: 30 November 1994
• Neutral Citation: [1994] SGCA 136
• Docket Number: Civil Appeal No 8 of 1994
• Date: 30 November 1994
• Year: 1994
• Published date: 19 September 2003
• Plaintiff Counsel: Scott Thillagaratnam and Kenny Chooi (Khattar Wong & Pnrs)
• Citation: [1994] SGCA 136
• Defendant Counsel: K Gopalan (Rajah Loo & Chandra)
• Court: Court of Appeal (Singapore)
• Subject Matter: 'Such business or work','Control or management',Governing principles,O 10 r 2(1) Rules of the Supreme Court 1990,O 10 r 2(1)(b) Rules of the Supreme Court 1990,Service,Service on agent within jurisdiction,Words and Phrases,Whether manager of representative office had personally the control or management of the appellants' business in Singapore,Civil Procedure,Foreign defendant

Cur Adv Vult

This is an appeal against a decision of the High Court allowing an appeal from an order of the senior assistant registrar setting aside an ex parte order made on 1 October 1993 authorizing the service of the writ on an agent or manager of the appellant, pursuant to O 10 r 2(1) of the Rules of the Supreme Court 1990 (RSC). [See [1994] 1 SLR 798 .]

Background

The respondent, a resident of Denmark, brought this action against the appellants, an Indonesian bank, as the drawer of five bankers` cheques for a total sum of US$1m. The cheques, dated 24 August 1993 and issued by the appellants` Jakarta main office, were drawn upon Banque Nationale de Paris, Singapore. They were payable to one Aylen Salim and endorsed to the respondent. The cheques were presented for payment on 1 September 1993 and dishonoured. On 12 September 1993, notice of dishonour was given to the appellants. On 23 September 1993, the respondent filed the present writ of summons.

On 1 October 1993, the respondent`s solicitors made an ex parte application for leave to effect personal service of the writ and statement of claim on Heng Kim Yong (Heng), the manager of the appellants` representative office in Singapore. The application was made under O 10 r 2(1) of the RSC, the interpretation of which forms the substance of this appeal. Order 10 r 2(1) provides:

Where the Court is satisfied on an ex parte application that -

(a) an action relates to any business or work against a person who does not reside within Singapore or who is absent from Singapore;

(b) an agent or manager has, at the time of service, personally the control or management of such business or work for such person within Singapore; and

(c) at the time of the application either the agent`s or manager`s authority has not been determined, or he is still in business relations with the principal,

the Court may authorise service of a writ of summons to be effected on such agent or manager instead of the principal.

The assistant registrar granted an order in terms of the application and on 2 October 1993, the writ of summons, statement of claim and order of court were duly served on Heng and copies forwarded to the appellants in Indonesia.

On 22 October 1993, after filing a memorandum of appearance, the appellants` applied to court for, inter alia, the following three reliefs: (1) that the writ of summons be set aside on the grounds of want of jurisdiction and for irregularity, (2) that the respondent`s action be struck out in the event that the writ is set aside, and (3) alternatively, that the order of court granted on 1 October 1993 be set aside.

In support of their application, counsel for the appellants filed an affidavit which deposed, inter alia, to the following. Firstly, the cheques arose out of the appellants` business in Indonesia and Singapore courts lacked jurisdiction. Secondly, the respondent had not shown that O 10 r 2(1)(b) of the RSC had been satisfied as it had not been shown what business the appellants had within the jurisdiction and whether the cheque transactions related to the business or work of the appellants within the jurisdiction or at all. In fact, the Monetary Authority of Singapore (MAS) had only approved the appellants` presence in Singapore on the condition that they did not carry out any banking business here. The representative office merely did liaison work between the appellants in Jakarta and their customers in Singapore. Thirdly, the allegation that the representative office had control and management of the appellants` business in Singapore was inconsistent with the order of the court that service be effected on Heng personally. For service to be effected on Heng personally, he had to be shown to be personally in control and management of such business for the appellants. In fact, Heng did not have control or management of the defendants` alleged business or work within Singapore as he was merely an employee who was not entitled to transact any business or work on behalf of the appellants.

The respondent`s counsel filed an affidavit in rebuttal which addressed the jurisdictional issue by saying that the cheques were presented for payment in Singapore and were dishonoured in Singapore, and that therefore the cause of action arose in Singapore and the law applicable is Singapore law by virtue of s 72 of the Bills of Exchange Act (Cap 23). As regards the question of compliance with O 10 r 2(1), the affidavit went on to state that the action related to the business of the appellants, that Heng was the manager representative of the appellants and that by carrying out liaison work, he was performing work related to the appellants` banking business in Indonesia. In any case, Heng was being held out to third parties as the person in charge of the appellants` representative office in Singapore and hence the person authorized to accept service on behalf of the appellants.

On 8 November 1993, the application came before the senior assistant registrar who made no order in respect of the first two prayers but ruled that, in respect of the third prayer, the order of court dated 1 October 1993 be set aside. The respondent appealed against this decision. The learned judicial commissioner [as she then was] initially affirmed the decision of the senior assistant registrar and dismissed the appeal. Upon hearing further arguments, pursuant to a request of the respondent, the learned judicial commissioner reversed her earlier decision, allowed the respondent`s appeal and reinstated the court order of 1 October 1993.

The grounds of decision in the High Court

In her grounds of decision, the learned judicial commissioner rejected the appellants` submission that the burden was on the respondent to show that Heng had personally the control and management of the appellants` business in Singapore and that this burden had not been discharged. She said that it would be putting too onerous a burden on the respondent to require him to prove that Heng, besides being the manager, was actually the person in control of the representative office. She acknowledged that in the case relied on by the appellants, , the court placed the onus squarely on the plaintiff to show that the local agent actually had personal control and management of the foreign principal`s business within the jurisdiction. However, she distinguished that case on the basis that the agent and principal in were two separate legal entities whilst, in the present case, the representative office was clearly a part of the appellants. Thus, because the representative office was clearly that of the appellants, there was no need to show anything more in this regard than that Heng was the manager of that office.

The learned judicial commissioner also rejected the appellants` submission that the representative office had to be conducting banking business for the appellants before service could be effected on that office under O 10 r 2(1). She said that there was nothing in r 2(1)(b) itself which required that the words `such business or work` must refer to the `main business` of the appellants. She held that it was sufficient that `such...