Chia Kok Kee v Tan Wah and others

• Jurisdiction: Singapore
• Judge: Tay Yong Kwang J
• Judgment Date: 21 February 2012
• Neutral Citation: [2012] SGHC 36
• Court: High Court (Singapore)
• Docket Number: Suit No. 97 of 2011 (Registrar’s Appeal No 273 of 2011, No 274 of 2011 and No 275 of 2011)
• Published date: 22 February 2012
• Year: 2012
• Hearing Date: 23 November 2011
• Plaintiff Counsel: The plaintiff in person
• Defendant Counsel: Wong Yao Fang (Fabian & Khoo),The third defendant in person.
• Subject Matter: Civil Procedure,Striking Out
• Citation: [2012] SGHC 36

Tay Yong Kwang J:

The plaintiff, Chia Kok Kee, appealed against the decision of the Assistant Registrar (“the AR”) in Summonses No 1111 of 2011, 1645 of 2011 and 1658 of 2011. In Summons No 1111/2011, the AR dismissed the plaintiff’s application to strike out the first, second and third defendant’s defences. In the latter two summonses, i.e, No 1645 of 2011 and No 1658 of 2011, the AR granted the applications by the defendants to strike out the plaintiff’s action.

The plaintiff was not represented by solicitors. He spoke in English during the hearing before me. After hearing the parties’ arguments, I dismissed the plaintiff’s appeals.

Facts Parties

The plaintiff is an investor in a hydroelectric power plant joint venture in Dujiangyan, Sichuan Province, People’s Republic of China (the “Chinese Investment”).

The first defendant is similarly an investor in the Chinese Investment. A company, HX Investment Pte Ltd (“HX”), was set up to be the investment vehicle through which the parties participated in the Chinese Investment. The directors and shareholders of HX comprised the plaintiff’s mother and the first defendant.

The second defendant was the auditor and corporate secretary of HX. He assisted with the capitalisation of HX in its early years.

The third defendant was the solicitor acting for the first defendant in the previous related matters, namely, Suit No 558 of 2005, Civil Appeal No 127 of 2005 and Originating Summons No 331 of 2010.

Background to the case

As mentioned above, the plaintiff and the first defendant were both investors in the Chinese Investment and both contributed monies towards the venture using HX as their investment vehicle. In 1995, an oral agreement was made between them as to their respective shares but the terms of this agreement were greatly disputed. The plaintiff’s version was that it was agreed that he would invest $300,000 and obtain a 40% shareholding together with a 10% bonus for his efforts in facilitating the investment, his mother would invest $100,000 and obtain a 10% shareholding, while the first defendant would invest $600,000 and obtain a 50% shareholding.

The plaintiff said while his mother put in the $100,000 as planned, he eventually poured in $326,467 of his monies and the first defendant invested $640,000 in the Chinese Investment. The plaintiff alleged however that his investment of $326,467 was left unaccounted for and unrecorded in HX’s books, with the first defendant recording the total investment as $831,098 instead of $1,066,467.

He further alleged that the first defendant had wrongly accused him of mishandling dividend payouts from the Chinese investment and had those dividend payouts stopped in 2004.

According to the plaintiff, this triggered him to institute action against HX in Suit 558 of 2005 to affirm his share in the Chinese Investment and to obtain his share of dividends.

The plaintiff failed to prove his case in Suit No 558 of 2005, where he claimed a 40% share of the Chinese Investment (comprising a 30% investment by the plaintiff and 10% investment by his mother), facilitation fees of 10% and a further 10% as bonus for successfully securing the joint venture on the basis of the prior oral contract made (see [7]). The High Court judge held that the shareholdings in the Chinese Investment were 40% in favour of the plaintiff and his mother and 60% in favour of the first defendant. She dismissed the claims for facilitation fees and the bonus.¹

The appeal against this decision in Civil Appeal No 127 of 2007 was dismissed with costs.² The plaintiff’s application for a new trial in Originating Summons No 331 of 2010 was similarly dismissed with costs.³

In Suit No 97 of 2011, in which the present appeals arose, the plaintiff alleged fraud against the first defendant, accusing her of deliberate omission to record in HX’s books his investment monies of $326,467. As for the second defendant, the plaintiff alleged that he had assisted the first defendant with the fraud because he was involved in the initial capitalisation of HX when the above-mentioned sum was omitted. As regard the third defendant, the plaintiff alleged that in the conduct of Suit No 558 of 2005, the third defendant colluded with the first defendant and other witnesses to give false evidence at the trial causing an unfavourable judgment to be given against him.

Simply put, the plaintiff alleged that the defendants worked together to perpetrate fraud against him, to conceal the incorrect accounts of HX and to deliberately omit his investment contribution in HX.

In response, the defendants argued in their respective defences that the plaintiff was in effect re-litigating his former claims in respect of the Chinese Investment and the dividend payouts, since these have been dealt with and dismissed by the High Court (see [11]) and the Court of Appeal (see [12]) previously. They argued that his present claims are res judicata and/or an abuse of process of court and further, that the plaintiff’s allegations of fraud were not supportable on the facts.

The Striking out applications

The plaintiff proceeded to take out an application under Summons No 1111 of 2011 to strike out the defendants’ defences pursuant to Order 18 rule 19 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed). The defendants responded by applying to strike out the plaintiff’s claim: Summons No 1645 of 2011 was taken out by the first and second defendants while Summons No 1658 of 2011 was taken out by the third defendant for this purpose.

The AR’s decision

The plaintiff argued before the AR that the respective defences of the defendants failed to address his fraud claim and reiterated that his claim for dividends and his investment monies remain unaddressed.⁴ The defendants’ response in brief was that that the proceedings in Suit No 97 of 2011 were a re-litigation of concluded matters and the plaintiff’s claims were therefore an abuse of process.⁵

The AR dismissed the plaintiff’s application to strike out the defendants’ defences. She granted the defendants’ applications to strike out the plaintiff’s claims pursuant to O 18 r 19(1)(a), (b) and (d) of the Rules of Court.

Her reasons were that if the plaintiff’s claims of fraud were to be proceeded with, that would amount to a re-litigation of issues tried previously in Suit No 558 of 2005 and Originating Summons No 331 of 2010. Additionally, she found that in the light of the procedural history of this matter, no reasonable cause of action could be sustained for the plaintiff’s claim for future dividends and damages for fraud.⁶

She ordered costs of $25,000 on an indemnity basis to be paid by the plaintiff to the first and second defendants. She made the same costs order between the plaintiff and the third defendant.

Parties’ arguments

On appeal before me, the plaintiff’s argument was in essence that because of the allegedly fraudulent actions of the defendants in misleading the court and thus obtaining judgment against him wrongfully, he ought to be allowed now to pursue the present suit so that he could obtain an account of his investment monies of $326,467 and his entitlement to his share of future dividends.

The plaintiff emphasized that his investment monies remained unaccounted for despite having gone through proceedings in Suit No 558 of 2005 and argued that the res judicata doctrine could not be used to uphold a judgment obtained by fraud.

The first and second defendants submitted that the plaintiff’s claim amounted to an abuse of process and ought to be struck out as these claims concerning the Chinese Investment and future dividends have already been adjudicated previously in Suit No 558 of 2005, Civil Appeal No 127 of 2007 and Originating Summons 331 of 2010. They argued that the plaintiff was merely launching a collateral attack against the previous decisions without having adduced any fresh evidence in support.⁷ They also highlighted that presently the plaintiff still retained a 40% share in the Chinese Investment and thus could not argue that he had lost his investment.

The third defendant echoed the first and second defendants in arguing that the plaintiff’s claim was an abuse of process as it was a re-litigation of issues which had already been dealt with in the previous proceedings. He also submitted that the plaintiff’s allegations against him and the other defendants did not constitute fraud at all. He submitted further that the plaintiff’s claim for future dividends had no basis in law as it was not due and owing to the plaintiff yet.

The decision of the court

The court may strike out a pleading under any one of the four grounds under O 18 r 19 which provides: (1) The court may at any stage of the proceedings order to be struck out or amended any pleading or the endorsement of any writ action, or anything in any pleading or in the endorsement, on the ground that – (a) it discloses no reasonable cause of action or defence, as the case may be; (b) it is scandalous, frivolous or vexatious; (c) it may prejudice, embarrass or delay the fair trial of the action; or (d) it is otherwise an abuse of the process of the Court,

and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.

(2) No evidence shall be admissible on an application under paragraph (1)(a). (3) This Rule shall, as far as applicable, apply to an originating summons as if it were a pleading.

The court’s power to strike out a pleading would only be exercised in “plain and obvious” cases: Gabriel Peter & Partners v Wee Chong Jin [1997] 3 SLR(R) 649 (“Gabriel Peter”) at [18]; The Osprey [1999] 3 SLR(R) 1099 at [6]. While the court does not seek to deprive a plaintiff of his day in court, it would grant applications to strike out pleadings to prevent harassment of parties or to avoid putting them to expense by frivolous,...