Columbia Asia Healthcare Sdn Bhd and another v Hong Hin Kit Edward and another

CourtHigh Court (Singapore)
JudgeWoo Bih Li J
Judgment Date09 September 2016
Neutral Citation[2016] SGHC 188
Citation[2016] SGHC 188
Published date14 September 2016
Plaintiff CounselHarish Kumar and Jonathan Toh (Rajah & Tann Singapore LLP)
Defendant CounselNiru Pillai, Liew Teck Huat and Jason Yeo (Global Law Alliance LLC)
Docket NumberSuit No 964 of 2009 (Assessment of Damages No 6 of 2016)
Hearing Date26 April 2016,08 July 2016,27 April 2016,28 April 2016,22 July 2016
Date09 September 2016
Subject MatterDamages,Assessment
Woo Bih Li J: Introduction

Suit No 964 of 2009 (“Suit 964”) was an action by Columbia Asia Healthcare Sdn Bhd (“Columbia”) and PT Nusautama Medicalindo (“PTNM”) against Edward Hong Hin Kit and Albert Hong Hing Kay (collectively “the Hongs”). There were also two other related suits, viz, Suit Nos 861 and 862 of 2008. All three sets of proceedings were consolidated and heard together. The proceedings arose out of an agreement by Columbia to buy shares in a Singapore company, Universal Medicare Pte Ltd (“UMPL”) which in turn owned shares in an Indonesian company, ie, PTNM, which owned a hospital erected on land in Medan, Indonesia. On 10 April 2014, I issued my judgment (“the Judgment”) in respect of the three proceedings. For Suit 964, I granted various reliefs to Columbia against the Hongs. The one that is relevant for present purposes was an order I made granting Columbia judgment against the Hongs for damages to be assessed for the reasonable costs of taking the necessary measures to remove a charge from the land title certificate. This charge was referred to as “the MEC charge”. MEC was the acronym for a Singapore company Medical Equipment Credit Pte Ltd which had lent money to UMPL and its loan was secured by the MEC charge.

The Hongs appealed to the Court of Appeal against various decisions of mine in the proceedings including the above particular order for an assessment of damages to be paid by them for the reasonable costs of removing the MEC charge. They failed in their appeal against this particular order.

The present hearing is for the assessment of damages which I had ordered. In the assessment, Columbia was claiming to recover legal costs incurred and paid to four law firms:

S/N Name Sum (US$)
1 Kusnandar & Co (“Kusnandar”) US$183,261.90 183,261.90
2 MC Kaban & Associates (“MC Kaban”) IDR2,000,000,000 207,684.00
3 Rajah & Tann (“R&T”) S$18,097.30 13,183.77
4 Alan Lim & Salawati (later known as Tengku Mohamed & Alan Lim) (“TMAL”) MYR44,104 14,466.00
Total: 418,595.67

The invoices from three of the law firms were addressed to and paid by PTNM. The invoices from TMAL were addressed to Columbia but apparently paid by PTNM.1

Issues

The Hongs raised many issues in the assessment. I set out the main issues below.

First, they submitted that the order allowed Columbia to recover the reasonable costs incurred by Columbia itself to remove the MEC charge. In other words, it did not allow Columbia to recover costs incurred by PTNM to remove the MEC charge. As some of the removal costs claimed in the assessment were incurred by PTNM, Columbia was not entitled to recover such costs, even if reasonably incurred, from the Hongs.

Second, the Hongs submitted that insofar as six invoices (out of 16) from Kusnandar, an Indonesian law firm, were not originals but copies, they should not be admissible in evidence and that the claim based on these six invoices must be rejected outright.

Third, the Hongs submitted that even if all the invoices (including the six invoices) and various Statements of Hours were admissible in evidence, the contents thereof are hearsay evidence and ought to be rejected as the maker of the documents were not called to give evidence.

Fourth, the Hongs contended that the total amount claimed by Columbia was manifestly excessive and unreasonable. This point covers both the steps taken by various lawyers and the amount charged by them.

The scope of the order on assessment of damages

I will first address the scope of my order. The order did not specifically state that Columbia could claim the removal costs only if Columbia had incurred the costs. The Hongs were interpreting the order to have that constraint. On the other hand, it is also true that the order did not specifically state that Columbia could claim the removal costs even where such costs were incurred by PTNM.

The answer to this issue lies in the background leading to the making of the order. As Columbia submitted at the assessment hearing, the trial judge was aware that the costs that Columbia was claiming had been incurred by PTNM. The Judgment states at [120] that “Columbia alleged that PTNM incurred costs, including legal costs, to remove the MEC Charge …”. The Hongs were also aware that costs had been incurred by PTNM.

Since the trial judge was prepared to grant Columbia judgment for the reasonable costs of removing the MEC charge, it would follow that the trial judge intended to allow Columbia to claim such costs even where such costs were not incurred by Columbia itself but by PTNM. Otherwise, the order would have been meaningless right from the time it was made. As the trial judge, I can confirm that that was my intention.

In the Hongs’ reply submission for the assessment hearing, the Hongs submitted at para 68 that:

The short point is that the liability for the costs was incurred by PTNM and not Columbia. This was always obvious and if it was the intention to claim for PTNM’s loss, an appeal could have been filed on this issue or clarification sought. Columbia must live with the consequences.

I am of the view that the above submission applies equally to the Hongs. First, as already mentioned, the parties knew that the costs of removing the MEC charge were incurred by PTNM, not Columbia. Secondly, the Hongs could have sought clarification of my order or filed an appeal. Not having done so, the Hongs must live with the consequences.

There is one other point on this issue. Columbia had relied on s 8.4.2 of the share sale agreement (“SSA”) to claim the reasonable costs of removing the MEC charge for the assessment hearing. I have set out the terms of s 8.4.2 at [122] of the Judgment. The Hongs submitted at the assessment hearing that at [130] of the Judgment, the trial judge had said that he did not accept that s 8.4.2 was applicable. I would say that the Hongs had taken that ruling out of context. The argument then was whether Columbia was entitled to claim for diminution in the value of the shares it had acquired by reason of the existence of the MEC charge or whether it was entitled to claim only the reasonable costs of removing the MEC charge. The trial judge had concluded that s 8.4.2 did not allow Columbia to claim the diminution in the value of the shares since the diminution was not permanent, as the MEC charge was eventually removed.

I was and am of the view that s 8.4.2, and in particular, s 8.4.2.2 of the SSA allows Columbia to claim from the Hongs the reasonable costs incurred to remove the MEC charge even where the costs were incurred by PTNM. In any event, that was and is the scope of my order.

Whether originals of invoices must be produced and whether hearsay evidence is admissible

The second and third issues relate to the legal costs paid by PTNM to Kusnandar and may be dealt with together.

As already mentioned, the Hongs submitted that the court should reject six out of the 16 invoices from Kusnandar as the originals were not produced. Furthermore, it was argued that the invoices and various Statements of Hours should not be admitted in evidence as the maker of the documents was not called to give evidence.

Columbia relied on s 32(1)(b)(iv) of the Evidence Act (Cap 97, 1997 Rev Ed) (“the EA”). This provision states as follows:

Cases in which statement of relevant fact by person who is dead or cannot be found, etc., is relevant

32.—(1) Subject to subsections (2) and (3), statements of relevant facts made by a person (whether orally, in a document or otherwise), are themselves relevant facts in the following cases:

or is made in course of trade, business, profession or other occupation;

when the statement was made by a person in the ordinary course of a trade, business, profession or other occupation and in particular when it consists of — a document constituting, or forming part of, the records (whether past or present) of a trade, business, profession or other occupation that are recorded, owned or kept by any person, body or organisation carrying out the trade, business, profession or other occupation,

and includes a statement made in a document that is, or forms part of, a record compiled by a person acting in the ordinary course of a trade, business, profession or other occupation based on information supplied by other persons;

It is not in dispute that this provision was an amendment to the EA to introduce a more flexible exception to the rule against hearsay evidence. In other words, the business records exception allows business records to be admissible in evidence even though the maker of the document does not give evidence.

The Hongs however submitted that Columbia must first satisfy that the invoices are admissible under s 66 of the EA before Columbia can rely on s 32(1)(b)(iv). This is because s 66 of the EA requires primary evidence of documents. Secondly, under s 32(3) of the EA, the court may still conclude that evidence which is relevant (or admissible) under s 32(1)(b) shall not be relevant if it would not be in the interests of justice to treat it as relevant.

I am of the view that the Hongs’ reliance on s 66 is misplaced. It is true that s 66 states that documents must be proved by primary evidence except in the cases mentioned in s 67. Under s 64 of the EA, primary evidence means that the document itself must be produced for the inspection of the court. It can be seen that s 66 read with s 64 means that the original must be produced. That is a different question from whether hearsay evidence may be admitted. The Hongs had conflated the two arguments. An original document may be produced but the maker of the document may not have given evidence on the making of the document. Section 66 deals with the former point and...

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    ...(Emphasis by the High Court) The High Court also cited Columbia Asia Healthcare Sdn Bhd and another v Hong Hin Kit Edward and another [2016] 5 SLR 735 as an illustration of the effect of s 67A EA. In that case, the court held that s 66 EA must be read subject to s 67A EA, such that the six ......
1 books & journal articles
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    • International Journal of Evidence & Proof, The No. 25-4, October 2021
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