Beng Tiong Trading, Import and Export (1988) Pte Ltd v Maria Janda Achmad Bin Abdullah Wachdin Basharahil alias Maria and Others

• Jurisdiction: Singapore
• Judge: Dawn Tan Ly-Ru AR
• Judgment Date: 08 October 2003
• Neutral Citation: [2003] SGHC 232
• Year: 2003
• Published date: 22 October 2003
• Citation: [2003] SGHC 232
• Plaintiff Counsel: George Lim Teong Jin (Wee, Tay & Lim),Stanley Wong Hoong Hooi (Jing Quee & Chin Joo)
• Court: High Court (Singapore)

1. This was an application made by way of summons-in-chambers (number 600440 of 2003) (“SIC 600440 of 2003”) to set aside the order of court dated 19 July 1999 (“the order of court”), inter alia, declaring that the plaintiffs were entitled to the rights, interests, benefits and entitlements of the 1^st, 2^nd, 3^rd, 5^th, 6^th, 9^th, 10^th and 12^th defendants in the immovable properties identified in an agreement dated 12 August 1993. The four named applicants were the 1^st, 9^th, 10^th and 12^th defendants, and in this application they prayed that the order of court be set aside to the extent that all references to them in paragraphs 1, 2 and 5 thereof be deleted.

2. I allowed the application and now give my reasons.

The background

3. The facts are not in dispute, and are succinctly summarised in the judgment of the Court of Appeal in related proceedings: see Lee Siong Kee v Beng Tiong Trading, Import and Export (1988) Pte Ltd [2000] 4 SLR 559. It is thus proposed to restate only those facts that are directly relevant to the application at hand.

4. The four applicants are among the beneficiaries, numbering 14 in total, of the estate of one Shaik Ahmad bin Adbullah Wachdin Basharahil, deceased, under a will dated 3 September 1938. Shaik Ahmad passed away in 1953 and probate was granted to one of the executors and trustees named in the will. By an order of court dated 11 October 1976 in Originating Summons No 80 of 1976, the Public Trustee was appointed sole trustee of the will, and the properties belonging to the estate became vested in the Public Trustee. The properties continued to be held by the Public Trustee as trustee of the trusts under the will until they were subsequently sold with leave of court obtained in Originating Summons No 1030 of 2000.

5. Sometime in August 1993, the 1^st to 12 defendants claiming to be the beneficiaries of the estate entered into an agreement with the plaintiffs, by which the 1^st to 12^th defendants consented to the sale of the properties to the plaintiffs for the sum of $8.26m (“the beneficiaries agreement”). A draft agreement for sale and purchase was annexed to the beneficiaries agreement, which was titled “Consent to Sale of Properties by Private Treaty.” The 1^st to 12^th defendants also agreed to appoint one Syed Ali Redha Alsagoff and one Robert Ng, or “such other persons as the competent Court, Singapore shall decide” as trustees of the estate and upon such appointment in place of the Public Trustee, to direct the trustees to ratify, confirm and execute the sale agreement. In consideration, the beneficiaries received the total sum of $240,000 (inclusive of a sum of $108,000 paid earlier through one Lee Siong Kee) and a receipt for that amount in the name of the plaintiffs.

6. The beneficiaries duly took out an application in Originating Summons No 489 of 1993 seeking an order to appoint Syed Ali and Robert Ng as trustees. That application had been filed prior to the beneficiaries agreement, but it appears that shortly after the beneficiaries agreement was signed, 11 of the 12 beneficiaries changed their minds and sought instead to repudiate it. The application was also opposed by the Public Trustee on the ground that only 12 out of 14 beneficiaries under the will had signed the beneficiaries agreement. The application was eventually abandoned or withdrawn sometime between November 1993 and January 1994.

7. In the event, an agreement for the sale of the properties by the estate to the plaintiffs was never signed. In fact, at a meeting with some of the beneficiaries in November 1993, the plaintiffs’ managing director, one Chiang Siew Chee Maggie, was informed that the majority of the beneficiaries was opposed to the sale of the properties to the plaintiffs.

8. Relying on the beneficiaries agreement, the plaintiffs instituted the present action against the beneficiaries claiming, inter alia, the following reliefs:

(a) specific performance of the beneficiaries agreement;

(b) a declaration that the plaintiffs were entitled to the rights, interests, benefits and entitlements of the 1^st to 12^th defendants in the properties under the will; and

(c) an order that the 13^th defendant (the Public Trustee) as trustee of the will, take such steps as are necessary in cognisance of the above and to vest the rights, interests, benefits and entitlements to the properties of the 1^st to 12^th defendants in the plaintiffs, including but not limited to the execution of a Deed of Assent.

9. A declaratory judgment in default of appearance was entered against eight of the beneficiaries on 19 July 1999, inter alia, declaring that the plaintiffs were entitled to the rights, interests, benefits and entitlements of the named defendants in the properties. It is this order of court that the applicants sought to set aside, to the extent that references in various paragraphs therein were made to them.

The law

10. Order 13 rule 8 of the Rules of Court states:

The Court may, on such terms as it thinks just, set aside or vary any judgment entered in pursuance of this Order.

Where a defendant wishes to defend the action notwithstanding the entry of a regular judgment against him, he may apply under this provision to set aside the judgment. It is also established that the application should be made as promptly as possible, and must be supported by an affidavit stating facts showing a defence on the merits and the reasons for allowing judgment to be entered.

11. Whether or not a defence on the merits is disclosed is the major consideration, not as a rule of law but as a matter of common sense: there is no point in setting aside a judgment if the defendant has no defence, conversely, if the defendant can show merits, the court will not let judgment pass on which there has been no proper adjudication. The unconditional discretionary power of the court to set aside a default judgment is unfettered, and in exercising its discretion the court does not only weigh the evidence in support of the defence against the evidence in support of the claim – it balances the strength of the putative defence against the excusability of the defendant’s conduct in allowing judgment to go by default. In this regard, it is incorrect to elevate into the status of a condition precedent to relief the establishment of a satisfactory explanation for the default. See Alpine Bulk Transport Co Inc v Saudi Eagle Shipping Co, Inc; The Saudi Eagle [1986] 2 Lloyd’s Rep 221, CA, followed in the local cases of Abdul Gaffer v Chua Kwang Yong [1995] 1 SLR 484 and Zulkifli Baharudin v Koh Lam Son [2000] 2 SLR 233.

The application

12. In their affidavit in support, the applicants did not seek to allege that the judgment was irregular or otherwise bad. It is pertinent to note in this connection that the 6^th defendant had previously succeeded in setting aside the order of court in summons-in-chambers 600275 of 2003 in so far as it affected him, on the basis that the service of the writ was bad. The plaintiffs’ appeal vide registrars’ appeal 600020 of 2003 was dismissed on 24...