Chiam Taw Song v Prime Motor & Leasing Pte Ltd

• Jurisdiction: Singapore
• Judge: Wong Peck
• Judgment Date: 16 November 2022
• Neutral Citation: [2022] SGDC 271
• Court: District Court (Singapore)
• Docket Number: District Court Suit No 2575 of 2020, District Court Appeal No 40 of 2022
• Published date: 22 November 2022
• Year: 2022
• Hearing Date: 01 April 2022,20 May 2022,23 May 2022,26 May 2022,05 September 2022,21 September 2022
• Plaintiff Counsel: Darren Tan and Shane Yeo (Invictus Law Corporation)
• Defendant Counsel: Beh Eng Siew Jeffrey and Shaun Sim (Lee Bon Leong & Co)
• Subject Matter: TORT,Misrepresentation,Fraud and deceit,Negligent misrepresentation
• Citation: [2022] SGDC 271

District Judge Wong Peck: Introduction

This suit related to the sale of a 4.5 years old Mercedes S400 (“the Mercedes vehicle”) by the defendant to the plaintiff for the sale price of $212,500. As part of the same transaction, the plaintiff had traded in his 9 years old BMW 730Li (“the BMW vehicle”) to the defendant. Prior to the sale of the Mercedes vehicle, the plaintiff who is a director of Probuilt Construction & Service Pte Ltd, was engaged by the defendant to carry out construction works at the defendant’s place of business at 5 Benoi Place, Singapore. Subsequently, as the plaintiff was unhappy with the Mercedes vehicle that he had purchased, he sued the defendant based on the tort of misrepresentation.

At the end of the trial, I dismissed the plaintiff’s claim. Being dissatisfied, the defendant has since appealed against my decision. These are the full grounds of my decision.

Facts The parties

It was undisputed that the defendant had sold the Mercedes vehicle to the plaintiff and that the plaintiff had traded in his BMW vehicle as part of the transaction. In addition, it was undisputed that the defendant also provided in- house financing through a Hire Purchase Agreement (“HPA”) to the plaintiff for purchase of the Mercedes vehicle in the sum of $106,761.20 for 35 months of instalments. The instalment plan was 34 months at $2,966 per month with a final instalment of $2,951.20. It was undisputed that the plaintiff had paid 7 monthly instalments of $2,966 between 9 September 2019 to 9 March 2020 before defaulting on the HPA.

The parties’ cases The plaintiff’s version

The plaintiff’s version was that Mr Neo Nam Heng (“NNH”) of the defendant made verbal representations to the plaintiff on 4th August 2019 and 16 August 2019 when the plaintiff attended at 5 Benoi Place, Singapore to monitor the progress of the construction works. Such representation had induced the plaintiff to purchase the Mercedes vehicle from the defendant through a Sale and Purchase Agreement (“SPA”) dated 30 August 2019 for the sum of $212,500. The plaintiff pleaded in [4] of the Statement of Claim (Amendment No 1) that: The Mercedes vehicle was used sparingly and was used to chauffer the senior Mr Neo until his death and that the vehicle had not been used since the death; The vehicle was a 4.5 years old vehicle; The vehicle had a mileage of 33,700km; and The plaintiff would be purchasing the vehicle at a “friendship price” given the good condition of the vehicle.

Pursuant to the SPA, the plaintiff paid $114,500 by cash of $68,300 and trading in his BMW vehicle for the sum of $46,200. Relying upon the representation, the plaintiff also entered into the HPA with the defendant in which the defendant financed the remaining $98,000.

According to the plaintiff, sometime around February 2020, he found a rental agreement dated 29 September 2017 evidencing that the Mercedes vehicle was rented out prior to the sale of the vehicle to the plaintiff. This rental agreement was located in the glove compartment of the vehicle.

As the plaintiff was unhappy about this situation, he claimed that he demanded an explanation from Mr NNH. The plaintiff claimed that Mr NNH told him that he would check the defendant’s internal records about the rental of such vehicle and would revert. In the meantime, the plaintiff could withhold making payments under the HPA.

However, Mr NNH did not revert to the plaintiff Instead, the plaintiff claimed that 3 re-possession attempts were made by the defendant on 15 September 2020, 16 September 2020 and 14 October 2020.

The plaintiff’s pleaded case was that his daughter, Ms Adeline Chiam Wei Min (“Ms Chiam”) then spoke to Mr Steve Neo of the defendant on 13 July 2020 over the telephone during which Mr Steve Neo admitted that the vehicle had been rented out prior to the sale to the plaintiff. According to the Chiams, Ms Chiam had been actively assisting the plaintiff in the matter since around the time the vehicle was purchased from the defendant.

On 30 October 2020, the defendant commenced DC/DC 2594/2020 against the plaintiff for the sum of $85,482.02 which was outstanding under the HPA. On 1 March 2021, the plaintiff paid $86,967.41 in full and final settlement of the HPA. On 22 March 2021, the plaintiff sold the Mercedes Vehicle for the sum of $159,888 through another dealer.

The defendant’s version

The defendant’s version was straightforward. It denied that such verbal representations were made including the alleged representation in February/March 2020 to the effect that the plaintiff could withhold making payments pending Mr NNH’s investigation into the rental vehicle issue.

The defendant did not dispute that the Mercedes vehicle was rented out prior to its sale to the plaintiff. The defendant also did not dispute that a Notice to Re-possess dated 3 July 2020 was issued. It also agreed that the sum of $86,967.41 was paid to resolve DC/DC 2594/2020.

Issues to be determined

The issues before the court were as follows: Issue 1- Was the defendant liable for the alleged misrepresentation as claimed by the plaintiff? Issue 2- Assuming that there was misrepresentation made by the defendant, did the plaintiff suffer any loss?

Decision of the court Issue 1- Was the defendant liable for the alleged misrepresentation as claimed by the plaintiff?

The law on fraudulent misrepresentation is trite. The plaintiff has to establish: Representation of fact by words or conduct; Made with intention that it should be acted upon by the plaintiff; Made with knowledge of its falsity or in absence of any genuine belief that it is true; Which the plaintiff acted on; and The plaintiff has suffered damage.

As for the plaintiff’s claim for negligent misrepresentation under section 2(1) of the Misrepresentation Act (Cap 390, Rev Ed), he has to establish that: The defendant made false representation of fact; Which induced reliance; and Caused damage to the plaintiff.

In [4] of the Statement of Claim (Amendment No 1), the plaintiff pleaded that there had been verbal representation allegedly made by Mr NNH of the defendant on 4th and 16th August 2019. I discerned from the pleadings and the plaintiff’s evidence in court that in essence, his main unhappiness if not the only unhappiness, was that Mr NNH had informed the plaintiff that the Mercedes vehicle was used to ferry senior Mr Neo around when he was alive and the vehicle had not been utilised since the death and Mr NNH did not inform the plaintiff that the Mercedes was rented out during the period after the death of senior Mr Neo to the time of its sale to the plaintiff. In short, the plaintiff’s main unhappiness was that the Mercedes vehicle was rented out prior to its sale to the plaintiff and being a former rental vehicle, there would be safety issues. According to the plaintiff, this lack of information about the Mercedes vehicle having been rented out before its sale to the plaintiff amounted to misrepresentation.

The plaintiff conceded during cross examination that the rest of the representation in [4b] to [4d] of the Statement of Claim (Amendment No 1) were true. As for [4d] about the friendship price of $212,500, the plaintiff conceded that he had found from vehicle advertisements that the price of a similar vehicle was $226,000 which meant that he had bought the Mercedes vehicle at a significant discount.

I shall now focus on the remaining [4a] of the Statement of Claim (Amendment No 1) which was the plaintiff’s main unhappiness as outlined earlier. To recapitulate, this was the issue about the defendant’s alleged failure in not informing the plaintiff about the usage of the vehicle after the death of senior Mr Neo; in particular, that it was a rental vehicle.

I found that the defendant was not liable for the alleged misrepresentation. It was undisputed that there was no mention of the Mercedes vehicle being a rental vehicle prior to its sale to the plaintiff. It was also undisputed that the vehicle was a rental vehicle prior to its sale to the plaintiff as per the rental agreement¹ . The agreement was evidence of the rental of this vehicle to one Cargotec CHS Pte Ltd from 29 September 2017 to 29 April 2019.

I accepted the defendant’s evidence that Mr NNH did not make the representation as pleaded in [4] of the Statement of Claim (Amendment No 1) at all. This would be consistent with the undisputed fact that he did not make any representation about the Mercedes Vehicle being a rental vehicle prior to its sale to the plaintiff. This was unsurprising as Mr NNH being the Chairman of a Case Trust company, which is in the business of selling and renting out hundreds if not thousands of vehicles, would not personally make such representation to sell this one vehicle.

It was undisputed that in this suit, alleged misrepresentation, if any, was oral and the plaintiff bore the burden of proof that such misrepresentation were made by Mr NNH as pleaded. The plaintiff’s counsel had asked the court to draw an adverse inference under section 116(g) of the Evidence Act (Cap 97, Rev Ed 1990) against the defendant for its failure to call Mr NNH as he was a critical witness. I declined to do so as there was adequate evidence from other witnesses and the defendant’s pleaded case was simply that Mr NNH denied having made such representation. This meant that the plaintiff was seeking for the defendant to prove a negative when the burden of proof was with the plaintiff to prove a positive in that such misrepresentation was made.

I found the plaintiff to be less than truthful in his evidence to the court....