Choy Chee Keen Collin v Public Utilities Board

• Jurisdiction: Singapore
• Judge: Karthigesu JA
• Judgment Date: 03 December 1996
• Neutral Citation: [1996] SGCA 75
• Citation: [1996] SGCA 75
• Defendant Counsel: Chan Hian Young and Andrew Ho (Allen & Gledhill)
• Published date: 19 September 2003
• Plaintiff Counsel: Alvin Yeo and Nishith K Shetty (Wong Partnership)
• Date: 03 December 1996
• Docket Number: Civil Appeals Nos 93, 94 and 95 of 1996
• Court: Court of Appeal (Singapore)
• Subject Matter: Interim preservation order sought,Real risk of dissipation,Injunction not for exerting unfair pressure to provide discovery or furnish particulars,Injunction in the nature of interim preservation order,Proprietary nature of claim,Mareva injunctions,Injunction limited to value of pleaded claim,Requirement of 'solid evidence' of risk of dissipation,Grounds for increasing limit of injunction,Whether real risk of dissipation demonstrated,Civil Procedure,Whether injunction sought to extract security for claim,Purpose of injunction,Insufficient material to support upward variation

These three appeals arose from the decisions of the High Court on the three summonses-in-chambers Nos 8010 of 1995 and 1389 and 1551 of 1996. All the three appeals were heard together, and at the conclusion we allowed the appeals. We now give our reasons.

The central figure involved in the proceedings below, which are still pending, is the first defendant (Choy) who is currently serving sentence at Changi prison. He was an employee of the respondents (the plaintiffs) and at the material time was the deputy chief executive (operations) and the director of the plaintiffs` electricity department. While he was in the employ of the plaintiffs, Choy conspired with one Lee Peng Siong (Lee), who was at one time also an employee of the plaintiffs, to obtain and did obtain enormous sums of gratification from a number of foreign contractors who had substantial contracts with the plaintiffs for various projects. In late 1995 he was charged in court on 30 counts of corruption under the Prevention of Corruption Act (Cap 241, 1993 Ed) (the Act). He pleaded guilty to five charges and was convicted accordingly, the remaining 25 charges being taken into consideration for the purpose of determining the sentence.

Following his conviction, the plaintiffs initiated proceedings against Choy and five other defendants, who are members of his family, to recover the bribe moneys, as moneys had and received, as debts recoverable under s 14 of the Act and/or as moneys held by them on constructive trusts. The second defendant is the former wife of Choy who is at large, her whereabouts being presently unknown. The third defendant, the appellant in these appeals (the third defendant) is the son of Choy and the second defendant, and is working and residing in Singapore. The fourth defendant is the daughter of Choy and the second defendant, and is also at large. The sixth defendant is the present wife of Choy and the fifth defendant, who is mentally subnormal, is the sister of the sixth defendant.

The plaintiffs` claim against the first defendant is for S$356,828 and HK$60,732,559.36 (equivalent to S$12,240,613.31) being secret commissions paid to him by Lee and/or Lee`s nominees. The plaintiffs` claims against the other defendants are for the various amounts out of these two sums which the plaintiffs averred had been received by them on behalf of Choy. As against the second, third and fourth defendants, the plaintiffs claim the sum of HK$2,831,288.98 made up of three sums which were paid to an allegedly joint account, No 88044637, of the second, third and fourth defendants with the Hankow Centre branch of Citibank NA, Hong Kong as follows:

23.12.1987	HK$	1,100,000.00
30.9.1988	HK$	1,131,288.98
7.8.1990	HK$	600,000.00
	HK$	2,831,288.98

The first two payments were made by way of two cashier`s orders drawn by Barclays Bank plc in favour of the second defendant, and the third payment was made by a cheque drawn by Portolan International Ltd, a nominee company of Lee, on Barclays Bank plc.

On 25 November 1995, the plaintiffs obtained ex parte a worldwide Mareva injunction (the injunction) against all the six defendants prohibiting disposal of their assets. As against the third defendant the injunction prohibited him jointly with the second and fourth defendants from disposing of their assets up to the value of HK$2,831,288.98. This injunction also prohibited the disposal of an immovable property known as No 24 Sunset Place, Singapore (24 Sunset Place) which was, and is still, held in the sole name of the second defendant. In addition, the injunction applied specifically to moneys in eight foreign bank accounts located in Hong Kong and the United States of America (the eight foreign accounts) which were allegedly in the joint names of the second, third and fourth defendants, and these accounts are as follows:

(i) Account No 88044637 with the Hankow Centre branch of Citibank NA Hong Kong;

(ii) Account No 6365-41689-019 with Bank of America, Hong Kong;

(iii) Account No 13877-010 with B A Finance, Hong Kong;

(iv) Account No 05776805 with Citibank NA, Hong Kong;

(v) Account No 96457001 with Citibank NA, USA;

(vi) US Time Deposit Account No 600-0-06066 with Bank of America;

(vii) US Time Deposit Account No 600-1-07210 with Bank of America; and

(viii) Account No 57310700 with New York Equities and Fixed Income Portfolio Management of Citibank NA, New York.

The injunction was complemented by an order requiring, inter alia, the third defendant to furnish information of all the assets held by him whether in or outside Singapore (the disclosure order). Further, an order restraining the third defendant from leaving Singapore and requiring him to deliver up his passport to the sheriff was also obtained (the passport order).

In response to these orders the third defendant applied by summons-in-chambers No 8010 of 1995 on 15 December 1995 to strike out the action or alternatively to dissolve or vary the injunction and set aside the passport order. Subsequently, on 1 March 1996 the third defendant took out another application in summons-in-chambers No 1389 of 1996 to vary the injunction to the extent that as against the third defendant it applies only to 24 Sunset Place. The plaintiffs, on the other hand, on 8 March 1996 took out an application in summons-in-chambers No 1551 of 1996 seeking an order that pending full compliance by the second, third and fourth defendants of the disclosure order the limit of the injunction against these defendants be increased to S$10m.

The three summonses were heard together before a judge in chambers and at the conclusion the learned judge made the following orders. In respect of the summons-in-chambers No 8010 of 1995, he made no order on the application to strike out the action as it had been withdrawn, and he dismissed the application to dissolve or vary the injunction. He ordered that the passport order be discharged upon the third defendant using his best efforts to provide certain information. In respect of the summons-in-chambers No 1389 of 1996 the learned judge made no order to vary the injunction by confining it to 24 Sunset Place. On the plaintiffs` application, summons-in-chambers No 1551 of 1996, the learned judge ordered that the injunction restraining disposal of properties as against the second, third and fourth defendants be extended to the limit of $10m.

The passport order has since been discharged and was not the subject of appeal before us. What was under appeal was the learned judge`s decision refusing to vary the injunction and extending the limit of the injunction to $10m.

Variation of the injunction

At the outset of the hearing before us, counsel for the third defendant stated that the third defendant had furnished letters of authorisation to the plaintiffs to enable the latter to make enquiries in relation to the eight accounts, and the banks concerned had responded in respect of six of them confirming that the third defendant did not hold any accounts with them. In respect of the remaining two accounts, namely the accounts with Hankow Centre branch of Citibank NA and with Citibank NA, Hong Kong, the bank had yet to respond. In respect of the disclosure order, the third defendant provided a list of his assets in the affidavit filed on 23 December 1995. He maintained that he had no knowledge or recollection of the existence of the eight accounts, or of their account balances. He disclaimed any beneficial interest in the moneys, if any, in these accounts.

Counsel for the third defendant further informed us that he had made an open offer to the plaintiffs to retain the injunction up to the limit of HK$2,831,288.98 over the eight accounts and over 24 Sunset Place. The unencumbered value of 24 Sunset Place as at 24 March 1994, according to the valuation given by Jones Lang Wootton in their report made on 7 October 1994, was $3,350,000, and was therefore more than sufficient to satisfy the pleaded claim of HK$2,831,288.98 against the second, third and fourth defendants. However, that offer, unfortunately, was not accepted by the plaintiffs. Hence, the third defendant before us sought to discharge the injunction or failing that to vary it so that as against him it would be limited to HK$2,831,288.98 and extend only to the eight foreign accounts and 24 Sunset Place.

Real risk of dissipation

The main plank of the arguments advanced by counsel for the third defendant was that the plaintiffs had not shown by `solid evidence` that there was a real risk of dissipation of assets by the third defendant. They had not even asserted in any of the affidavits that there was a real risk that the third defendant would dissipate his assets; nor had they shown any material facts from which a reasonable inference could be drawn of a risk of such dissipation. On the material before us, we found ourselves in agreement with counsel.

The learned judge was conscious that the risk of dissipation was the `very essence` of the plaintiffs` application for Mareva relief, but with respect, he did not have sufficient regard to the fact that the evidence of such a risk was wholly lacking in the instant case. From the affidavit of Kong Seng Kwong (Kong), the principal legal officer of the plaintiffs, affirmed on 25 November 1995 in support of the application for the injunction, the following passages purportedly raised the real risk of dissipation:

56 The plaintiffs verily believe that unless restrained by an injunction there is a strong likelihood that the first defendant and Lee Peng Siong would seek to frustrate any judgment obtained by the plaintiffs. The nature of the wrong committed by both the first defendant and Lee Peng Siong support the plaintiffs` case for an injunction. The defendants have been advised that they have defrauded the plaintiffs. The first defendant in particular has abused the trust placed on him by the plaintiffs.

57 The first defendant has previously...