Brody, White & Co Inc v Chemet Handel Trading (S) Pte Ltd

JurisdictionSingapore
CourtCourt of Three Judges (Singapore)
JudgeChua F A J
Judgment Date13 October 1992
Neutral Citation[1992] SGCA 66
Citation[1992] SGCA 66
Date13 October 1992
Defendant CounselP Suppiah (P Suppiah & Co)
Docket NumberCivil Appeal No 51 of 1991
Plaintiff CounselRandhir Ram Chandra (Haridass Ho & Partners)
Published date19 September 2003

(delivering the grounds of judgment of the court): The appellants and the respondents in the present appeal are respectively the defendants and the plaintiffs in Suit No 1706 of 1990. The respondents applied ex parte by way of summons-in-chambers entered No 5464 of 1990 for an interim injunction to restrain the appellants (until further order) from collecting or receiving any moneys pursuant to a demand made for payment made or to be made under the Letter of Credit No SB900030/90 dated 10 August 1990 for US$400,000 issued by the Bank of America, Singapore to the appellants. On 22 September 1990 Chan Sek Keong J (as he then was) granted the respondents the injunction sought. The appellants proceeded to apply by way of summons-in-chambers entered No 5771 of 1990 for the discharge of the above injunction. On 15 March 1991 Goh Joon Seng J ordered that the injunction was to be continued. He made no order on the appellants` application. The appellants now appeal against Goh Joon Seng J`s decision. The facts of the case are as follows.

The appellants are a company of commodity traders incorporated in the United States while the respondents are a company incorporated in Singapore. By an agreement dated 21 May 1990 (`the agreement`), the respondents appointed the appellants as their commodity brokers to trade in metals on their behalf in the New York Commodities Exchange and in the London Metal Exchange. Under the agreement the respondents agreed, inter alia, to provide the appellants with margin as the appellants required. They further agreed that upon default on their part, the appellants were entitled to exercise a number of remedies, including closing out or hedging for their account any or all open positions in their account with the appellants and/or any affiliates.

On 18 June 1990 pursuant to the agreement, the respondents provided, in favour of the appellants, a margin requirement of US$200,000 by way of irrevocable letter of credit issued by the Swiss Bank Corporation. In addition, the respondents extended to the appellants a credit line of US$500,000.

On 30 July 1990 the margin requirement was increased to US$500,000. The letter of credit issued by the Swiss Bank Corporation was correspondingly increased to US$500,000.

On 10 August 1990 a further increase in the margin requirement of US$400,000 was provided by the respondents by way of an irrevocable stand-by letter of credit issued by the Bank of America in Singapore. This is the letter of credit numbered SB900030/90 which formed the subject matter of the respondents` application in summons-in-chambers entered No 5464 of 1990.

On 6 September 1990 another increase in the margin requirement by US$78,000 was effected by cable transfer. The respondents contended that as of 6 September 1990, the credit facilities they had made available to the appellants totalled US$1,478,000 (US$500,000 + 500,000 + 400,000 + 78,000).

On 10 September 1990 the appellants made a margin call upon the respondents in the sum of US$425,400. The respondents made various promises to comply but no payments were received by the appellants. On 13 September 1990 the appellants made another margin call upon the respondents in the sum of US$1,181,714 but again, the respondents failed to satisfy this demand. On 14 September 1990 the appellants wrote to the respondents, demanding the full amount of the respondents` account deficit, US$1,613,804.69. The respondents were given until 10am New York time on 17 September 1990 to make payment of the said sum, failing which the appellants intended to commence liquidating all open positions in the respondents` account as well as to take other appropriate action. On 17 September 1990 the appellants faxed a letter to the respondents, informing them that they had entered stop-loss orders on the respondents` position until such time as all credit and margin issues were...

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13 cases
  • Kumagai-Zenecon Construction Pte Ltd (in liquidation) and Another v Arab Bank plc (Low Hua Kin, Third Party)
    • Singapore
    • High Court (Singapore)
    • 11 February 1997
    ...Construction Pte Ltd v AG [1995] 2 SLR (R) 262; [1995] 2 SLR 733 (folld) Brody, White and Co Inc v Chemet Handel Trading (S) Pte Ltd [1992] 3 SLR (R) 146; [1993] 1 SLR 65 (distd) Gian Singh & Co Ltd v Banque de L'Indochine [1974-1976] SLR (R) 83; [1972-1974] SLR 16 (refd) Indian Overseas Ba......
  • Rajaram v Ganesh trading as Golden Harvest Trading Corp and Others
    • Singapore
    • High Court (Singapore)
    • 25 July 1994
    ...of Homs Refinery [1984] 1 WLR 392; [1984] 1 Lloyd's Rep 251 (folld) Brody, White and Co Inc v Chemet Handel Trading (S) Pte Ltd [1992] 3 SLR (R) 146; [1993] 1 SLR 65 (folld) Edward Owen Engineering Ltd v Barclays Bank International Ltd [1978] QB 159; [1978] 1 Lloyd's Rep 166 (folld) Hampste......
  • Bocotra Construction Pte Ltd and Others v Attorney General (No 2)
    • Singapore
    • Court of Three Judges (Singapore)
    • 23 May 1995
    ...Oil SA v Chase Manhattan Bank NA [1984] 1 Lloyd's Rep 251 (folld) Brody, White and Co Inc v Chemet Handel Trading (S) Pte Ltd [1992] 3 SLR (R) 146; [1993] 1 SLR 65 (folld) Deutsche Rückversicherung AG v Walbrook Insurance Co Ltd [1995] 1 WLR 1017; [1994] 4 All ER 181 (refd) Edward Owen Engi......
  • Agritrade International Pte Ltd v Industrial and Commercial Bank of China
    • Singapore
    • High Court (Singapore)
    • 31 January 1998
    ...now to quote the essence of the legal position as stated by Lai Kew Chai J in Brody, White & Co Inc v Chemet Handel Trading (S) Pte Ltd [1993] 1 SLR 65 CA: An irrevocable credit constitutes an independent contract between the issuing banker and the beneficiary, which is not affected by any ......
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2 books & journal articles
  • AN ANALYSIS OF RECENT JUDICIAL DEVELOPMENTS IN SELECTED AREAS OF CIVIL PROCEDURE
    • Singapore
    • Singapore Academy of Law Journal Nbr. 1996, December 1996
    • 1 December 1996
    ...storage, sale or other disposal of any property or thing under the control of any party’. 115 [1995] 2 SLR 523, at p 540. 116 [1993] 1 SLR 65, at p 70. 117 [1995] 2 SLR 733, at pp 744—745. 118 [1984] 1 Lloyd’s Rep 251, at p 257. 119 [1993] 1 SLR 65. 120 Ibid, at p 70. In The ‘Bhoja Trader’[......
  • Banking Law
    • Singapore
    • Singapore Academy of Law Annual Review Nbr. 2000, December 2000
    • 1 December 2000
    ...Co[1994] 4 All ER 181. It was similarly endorsed by our Court of Appeal in Brody, White & Co Inc v Chemet Handel Trading (S) Pte Ltd[1993] 1 SLR 65. Lai Kew Chai J, delivering the judgment of the court, opined (at 72): It was irrelevant that the injunction in the present case was one which ......

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