Chan Cheng Wah Bernard and others v Koh Sin Chong Freddie

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 29 October 2010
• Neutral Citation: [2010] SGHC 324
• Court: High Court (Singapore)
• Docket Number: Suit No 33 of 2009
• Published date: 09 November 2010
• Year: 2010
• Hearing Date: 16 March 2010,17 March 2010,04 March 2010,30 September 2009,28 September 2009,24 September 2009,18 March 2010,05 March 2010,01 October 2009,02 October 2009,29 September 2009,02 March 2010,23 March 2010,20 March 2010,19 March 2010,21 March 2010,23 September 2009,25 September 2009,15 March 2010,22 March 2010,03 March 2010,04 June 2010
• Plaintiff Counsel: Tan Chee Meng SC, Chang Man Phing and Reina Chua (WongPartnership LLP)
• Defendant Counsel: Hri Kumar Nair SC, Wilson Wong and Melissa Liew (Drew & Napier LLC)
• Subject Matter: Tort
• Citation: [2010] SGHC 324

Judith Prakash J: Introduction

This defamation action arose out of events that took place in the Singapore Swimming Club (“the Club”) between November 2007 and the end of November 2008.

The Club is run by a management committee consisting of members who have been elected to various posts by the members at the Annual General Meeting (“AGM”). Each management committee holds office for a period of one year from one AGM to the next. The plaintiffs were members of the management committee that was in office during the period from May 2007 to May 2008 (“the previous MC”). During the term of the previous MC, the first plaintiff held the position of President of the Club, the second plaintiff was the Vice-President and the third and fourth plaintiffs were, respectively, the Treasurer and Facilities Chairman.

At the elections held during the AGM held in May 2008 (“the 2008 AGM”), the defendant was elected as President and a slew of new persons were elected as members of the 2008/2009 management committee (“the current MC”). Only one member of the previous MC was re-elected. The defendant was re-elected as President for a further year in May 2009 and he held this position during the course of the proceedings before me.

The plaintiffs’ case is that libellous statements concerning them were published in the minutes of the meetings of the current MC held on 29 October 2008 and 26 November 2008. These minutes were posted on the Club’s notice board. The defamatory allegations complained of are as follows:

First set of defamatory allegations published on 29 October 2008 (“the First Statement”)

President suggested that MC should correct the misrepresentation of facts made by the previous MC to influence the ratification of the expenditure at the last AGM.

Second set of defamatory allegations published on 26 November 2008 (“the Second Statement”)

(c) From the foregoing President summarized the Treasurer’s findings as follows: • That the Club did not need a new water system to rectify the breakdown of the then existing filtration system which led to the shutdown of the competition pool. • After the installation of the new water system it was found that the filtration pumps needed to be replaced as the backwash water was still dirty. When the filtration pumps were changed, they worked perfectly and the water was clear. • The Club had purchased the new water system without budget approval. • Therefore it appeared that the justifiable emergency spending was to replace the filtration pumps at $42K and that would rectify the pool water in the 2 pools and Jacuzzis. The new water system at $168K was a ‘nice to have’ feature and the capital expenditure spent to install the system without budget approval was unwarranted. • It could be a case of misrepresentation of facts to the AGM to get ratification for a capital expenditure for a water system that could not be justified under the urgent/emergency reason. The new water system was only an add-on system as the current filtration was still the same as before and there was still a need to replace the pumps.

The defendant denies that the words complained of bear the defamatory meanings ascribed to them by the plaintiffs. In the alternative, he seeks to justify those allegations and, in the further alternative, to rely on qualified privilege.

The background

The Club, which is over 100 years old, prides itself on being a premier swimming club. One of the top priorities of each management committee is to ensure that the swimming facilities are in good condition. The Club has two large Olympic-size swimming pools, one a recreational pool and the other used mainly for serious training and competitions. The Club is also equipped with two Jacuzzis.

The general administration of the Club is under the charge of a general manager who reports to the management committee. In November 2007, the general manager was one Mr Richard Phua.

On 10 November 2007, the Club’s competition pool was closed by the general manager as there were complaints that the water in the pool had turned yellowish and that children using the pool had developed rashes. A special meeting of the previous MC was being held that day to consider matters relating to the upgrading of the area surrounding the competition pool and the general manager decided to table the issue of the pool water and the filtration system for discussion at the same meeting.

The meeting started with a presentation by a company called The Water Consultant Pte Ltd (“TWC”) on a water system called the Natural Water System (“NWS”). The representation was given by one Mr Jeremy Rawle (“Mr Rawle”) and his wife, Ms Sylvia Chan. The meeting was informed that the NWS was an innovative and advanced technology which maintained water in its natural and neutral form without chemicals. TWC represented that the NWS could solve the filtration problem at the competition pool. After the presentation, Mr Phua informed the meeting that the only operational sand filtration tank serving the competition pool had become choked that morning and this had caused the water to change colour. The filtration tanks at the recreational pool were partially choked and would break down in a matter of months. As for the pumps, they were in need of an overhaul.

To solve the filtration problem, Mr Phua told the meeting that the Club could either choose to carry out conventional repairs, ie sandblast the filtration tanks, or install the NWS. The cost of sandblasting was approximately $480,000 (this estimate was later reduced to $280,000) whilst TWC had offered the Club a special package price of $168,800 for its system. This price would include the NWS at both pools and the installation of another system, the mineral water system (“MWS”), at the Jacuzzis.

After considering the information presented, the previous MC was in favour of installing the NWS on the grounds of cost, the time that would be taken to get the competition pool back in use and the healthier swimming environment that the NWS would provide. The previous MC gave its in-principle approval to Mr Phua to install the NWS at a cost of $168,000. In the event, the contract when signed in December 2007 provided for a sum of $168,800. This figure which I will hereinafter sometimes refer to as “the expenditure” was, according to the contract, made up of the following components:

(a)	Mineral water system for the Jacuzzis	$18,800
(b)	Natural water system for the competition pool	$51,800
(c)	Pipe work modifications and waterproof housing for the competition pool	$13,000
(d)	Natural water system for the recreational pool	$51,800
(e)	Pipe work modifications and waterproof housing for the recreational pool	$14,000
(f)	On demand sanitizer controllers (Auto-Dozers)
	plus stirrers plus tanks at $9,700 per pool	$19,400
		_______
		$168,800

The previous MC directed the general manager to ensure that due diligence was carried out before the contract was signed and to negotiate the best possible terms. No budget had been provided for the purchase of the NWS but the Club’s financial rules allowed a management committee, in case of an emergency, to authorise the expenditure required to resolve the emergency and to subsequently seek approval for the same from the members at the next AGM. The previous MC considered that the issue confronting it was of an emergency nature and therefore gave its in-principle approval for the expenditure on the NWS on the basis that the same had to be ratified later by the AGM.

The next meeting of the previous MC was held on 27 November 2007. The members of the previous MC were informed of the series of events that had, from April 2007, led to the breakdown of the filtration system of the competition pool. The general manager also briefed the previous MC on his actions in relation to due diligence in respect of the TWC proposal.

On 6 December 2007, the previous MC held another special meeting. Mr Phua briefed the meeting on follow-up action that he had taken in accordance with instructions given at the meeting of 27 November 2007. The previous MC then gave its approval to Mr Phua to proceed to execute the contract with TWC.

Installation of the NWS took place thereafter. The competition pool was reopened on 11 January 2008. On 22 January 2008, Mr Phua informed the previous MC that the installation of the system at the competition pool and the spas had been completed but that installation of the system at the recreation pool would be delayed as new pumps were required and would be installed in March 2008.

The 2008 AGM took place on 25 May. As the expenditure incurred on the systems supplied by TWC and the new pumps had not been provided for in the budget for the 2007-2008 budget year, these items were put up for members’ approval at the AGM as emergency expenditure. Apparently, the 2008 AGM was attended by more than 2,000 members though, since it spanned several hours, not all of them may have been present throughout the meeting.

The first plaintiff in his capacity as President explained to the meeting why there was a need to ratify the expenditure. The general manager also addressed the meeting on these items. Many questions were asked relating to whether the expenditure was justifiable and one of the members proposed that an audit committee (“the Audit Committee”) be appointed to conduct an independent review of the whole project before the expenditure was ratified. The motion proposed was:

That Items 9(a), (b), (c) and (d) of the AGM Agenda be not ratified but be referred to the Special Ad Hoc Audit Committee for review of the whole process and project and be reported back to the Management Committee and Members within 3 months from date of the...