Banque Cantonale Vaudoise v RBG Resources Plc and Others (Lim Tau Hee and Others, Third Parties)

• Jurisdiction: Singapore
• Judge: Woo Bih Li JC
• Judgment Date: 07 November 2002
• Neutral Citation: [2002] SGHC 264
• Published date: 19 March 2013
• Court: High Court (Singapore)
• Plaintiff Counsel: Jainil Bhandari and Adrian Tan (Rajah & Tann)
• Defendant Counsel: Janice Lai (Lee & Lee),Kenneth Lie and R Doraisamy (Joseph Tan Jude Benny),David Kong (Shook Lin & Bok),R Srinivathsan (Haridass Ho & Partners),Lawrence Teh (Rodyk & Davidson)

Judgment

GROUNDS OF DECISION

1 This was an application by the second defendant Fujitrans (Singapore) Pte Ltd (‘Fujitrans’) for a stay of all proceedings commenced by the plaintiff, a bank known as Banque Cantonale Vaudoise (‘BCV’).

2. From about September 1998 to about April 2002, BCV had been financing the purchases of metal commodities by the first defendant, which was known as Allied Deals Plc and then RBG Resources Plc (‘RBG’). During arguments, Counsel have referred to the metal commodities as ‘metal cargo’ and I will adopt this description but in plural as there are different lots of cargo and different types of metal cargo involved, for example, nickel cathodes, tin ingots, zinc ingots and copper cathodes. BCV says that it financed the purchase of the metal cargoes in reliance on documents emanating from various warehousemen, one of whom was Fujitrans, confirming that the metal cargoes were held to the order of BCV. BCV also alleges that from time to time, RBG would inform it that RBG had sold the metal cargoes, purchased with financing from BCV, and consequently BCV would send stock releases to Fujitrans to instruct it to release the metal cargoes.

3. BCV’s claims against Fujitrans relate to various groups of metal cargoes, one of which is listed in Schedule 3 of its Statement of Claim (‘the Schedule 3 claim’ and ‘the Schedule 3 cargoes’ respectively). BCV alleges that the Schedule 3 cargoes never existed or, if they did, are no longer in the warehouse of Fujitrans. As regards the metal cargoes which are still in Fujitrans’ warehouse, and over which BCV claims security, BCV has agreed to a stay of this claim pending the determination by the court of competing claims to such cargoes. However, BCV does not agree to a stay of its claim in respect of the Schedule 3 cargoes.

4. RBG is a company incorporated in the United Kingdom. Winding up orders over RBG have been made in the United Kingdom and in Singapore and liquidators appointed. Similar orders may have also been made in other jurisdictions in which RBG conducted business.

5. It is alleged by various parties that RBG had obtained financing from various banks to purchase metal cargoes and operated a fraudulent scheme whereby it, inter alia, obtained financing to purchase non-existent metal cargoes and/or obtained financing from more than one bank to purchase the same metal cargoes without informing the banks involved of this. Accordingly, the security which it purportedly granted to each bank over each metal cargo was in respect of non-existing metal cargo, metal cargo subsequently sold but for which the bank or banks have not been paid or metal cargo still remaining in warehouses, including Fujitrans’ warehouse, for which there is more than one claimant.

6. According to Mr Kenneth Lie, Counsel for Fujitrans, six banks have filed six actions against Fujitrans. In three of them, RBG is named as a defendant too. I understand that one of the banks is claiming not as a secured creditor but as a purchaser of certain metal cargoes. As there were several claimants over the...