Computer Supermarkets (S) Pte Ltd v Goh Chin Soon Ricky and Others

• Jurisdiction: Singapore
• Judge: Karthigesu JA
• Judgment Date: 14 August 1997
• Neutral Citation: [1997] SGCA 34
• Docket Number: Civil Appeal No 153 of 1996
• Date: 14 August 1997
• Year: 1997
• Published date: 19 September 2003
• Plaintiff Counsel: Indranee Rajah and Kareen Looi (Drew & Napier)
• Citation: [1997] SGCA 34
• Defendant Counsel: Thomas Tan (Haridass Ho & Partners)
• Court: Court of Appeal (Singapore)
• Subject Matter: Whether first respondents personally liable for cost of computer systems,Whether conditions satisfied,Claim for goods sold and delivered,Sale of two sets of computer systems,Sale of goods,Agreement that systems be installed by sellers at buyers' premises and that systems to function as promised by sellers,Rights of agent,Whether judge erred in findings of fact,Whether second respondents entitled to reject system for incomplete installation,First respondent negotiated for sale of two sets of computer systems on behalf of second and third respondents,Agency,Indemnity,Commercial Transactions,Whether first respondent contracted as agent for second and third respondents

(delivering the judgment of the court)

The appellants, Computer Supermarkets (S) Pte Ltd, are a company in the business of distribution of personal computers and computer accessories. The second respondents, Cash Box Piano Lounge KTV Pte Ltd, are a company that carries on the business of a night-club of the same name. The third respondent is the sole proprietor of a night-club known as Regent Night Club. The first respondent, Ricky Goh, is the honorary chairman of both night-clubs.

The appellants` claim against the respondents was for the price of two computer systems, amounting to $156,380, which they delivered and installed in the second respondents` night club (Cash Box) and the third respondent`s night-club (Regent Night Club), at the request of the first respondent. It is not in dispute that the computerisation of both night-club`s operations was intended to cover three main areas: the ordering of drinks and beverages, the booking of hostesses and the selection of karaoke songs. The computer system in question was known as the Infrared Rays Network System. The system comprised several components: hand-held terminals, receivers, a control terminal, a personal computer and printers. Briefly described, the hand-held terminals are carried by the waiters or captains of the night-club. When the customer makes an order for drinks, books a hostess or selects a particular song for karaoke, the waiter or captain keys the order into the hand-held terminal. The message is then sent by infrared rays to a receiver that captures the data. The receiver in turn sends the message electronically by wire to the control terminal. The data is processed by the control terminal which then transmits the message to the relevant printers located at the bar counter, the disc jockey stand or the hostess section as the case may be, as well as to a printer located at the cashier so that a bill for all orders made can be drawn up at the end of the evening. The appellants` case was that both systems were fully installed and functional at the night-clubs but the respondents withheld payment for no valid reason. The respondents` defence was that the sale of the systems was on a trial basis and it turned out that the systems could not function as promised. Hence, the respondents were entitled to reject the systems and withhold payment. The first respondent also denied that he was personally liable for the price of the computer systems as he was, on all material occasions, acting as an the agent for both the second and third respondents. The trial judge accepted the respondents` version of the facts and dismissed the appellants` suit. Her grounds of decision are reported at [1997] 2 SLR 283.

Against this decision, the appellants have appealed. They have challenged many of the judge`s findings on the evidence. The thrust of counsel`s arguments is that the judge did not arrive at the correct findings of facts because she had failed to properly assess the evidence of the witnesses and had drawn certain crucial inferences that were plainly in error. In order for us to properly consider counsel`s contentions, it will be necessary for us to set out in some detail each party`s contrasting account of the events that unfolded and the judge`s findings on the various issues of fact. But, before proceeding to do that, it is perhaps appropriate at this juncture to remind ourselves once again of the established principles that are applicable when an appellate court carries out the unenviable task of evaluating a trial judge`s findings of fact. In the judgment of this court in Teknikal dan Kejuruteraan Pte Ltd v Resources Development Corp (Pte) Ltd [1994] 3 SLR 743 , it was said at p 754 of the report:

The principles governing the review by an appellate court of findings of fact of the trial court are well established. The issues before us concern to an extent the evaluation of the quality of the evidence given by RDC`s witnesses. The evaluation involves testing a witness`s evidence against inherent probabilities or against uncontroverted facts, including the conduct of the parties at the relevant time. We are in this instance in as good a position as the court of first instance, although we must, where appropriate, give due allowance to the fact that we have not had the advantage of seeing the witnesses that the trial court had.

As for inferences drawn by the trial judge from primary findings of fact, s 37 of the Supreme Court of Judicature Act (Cap 322) provides that appeals to the Court of Appeal shall be by way of rehearing and at sub-s (4) it is stated:

The Court of Appeal may draw inferences of facts, and give any judgment, and make any order which ought to have been given or made, and make such further or other orders as the case requires.

An identical provision is found at O 57 r 13(3) of the Rules of Court 1996. In the House of Lords decision in Benmax v Austin Motor Co Ltd [1955] AC 370 , Viscount Simonds, while considering a similarly worded rule in the English Rules of Supreme Court, was reported to have said at p 373 of the report:

This does not mean that an appellate court should lightly differ from the finding of a trial judge on a question of fact, and I would say that it would be difficult for it to do so where the finding turned solely on the credibility of a witness. But I cannot help thinking that some confusion may have arisen from failure to distinguish between the finding of a specific fact and a finding of fact which is really an inference from facts specifically found, or, as it has sometimes been said, between the perception and evaluation of facts. An example of this distinction may be seen in any case in which a plaintiff alleges negligence on the part of the defendant. Here it must first be determined what the defendant in fact did and, secondly, whether what he did amounted in the circumstances (which must also so far as relevant be found as specific facts) to negligence. A jury finds that the defendant has been negligent, and that is the end of the matter unless its verdict can be upset according to well established rules. A judge sitting without a jury would fall short of his duty if he did not first find the facts and then draw from the inference of fact whether or not the defendant had been negligent. This is a simple illustration of a process in which it may often be difficult to say what is simple fact and what is inference from fact, or, to repeat what I have said, what is perception, what is evaluation. Nor is it of any importance to do so except to explain why, as I think, different views have been expressed as to the duty of an appellate tribunal in relation to a finding by a trial judge. For I have found, on the one hand, universal reluctance to reject a finding of specific fact, particularly where the finding could be founded on the credibility or bearing of a witness, and, on the other hand, no less a willingness to form an independent opinion about the proper inference of fact, subject only to the weight which should, as a matter of course, be given to the opinion of the learned judge.

The appellants` version of events

The appellants` managing director, one Steven Lek (Lek), met the first respondent sometime in early 1990 as a result of some property deal. Sometime in May 1990, the first respondent requested Lek to help him computerise part of his night-club operations so as to make them more efficient. Lek told the first respondent that the appellants` business was mainly to do with distribution of personal computers, but, out of goodwill, he would source for a suitable computer system with a customised software program for use in the night-clubs. As a result of this discussion, Lek flew to Japan to meet one of his business associates, Mr Homma, who specialised in computer software and hardware design. Mr Homma recommended to Lek the Infrared Rays Network System - the operation of which has been briefly described above - to meet the requirements of the night-clubs. When Lek returned from Japan, he sent a quotation dated 6 June 1990 for two sets of the system, with the relevant brochures, to the first respondent.

In the first week of July 1990, Lek met the first respondent at the latter`s office at Regent Night Club and provided him with full details of the workings of the computer system. Lek and the first respondent then reached an oral agreement on the following terms: the first respondent would purchase the computer systems at the prices stated in the quotation; he would provide Lek with a price list of the drinks sold at the two night-clubs so as to enable Mr Homma to develop a customised software program; he would also provide Lek with the floor plans of the two night-clubs; the two computer systems would be fully installed at both night-clubs by the end of September 1990.

On 4 July 1990, Lek flew to Japan to hand the relevant information to Mr Homma for the development of the computer software. He returned on 9 July 1990 and wrote to the first respondent the next day to confirm the delivery and installation of the two computer systems. On 20 July 1990, the appellants opened an irrevocable letter of credit in favour of the Japanese suppliers of the computer systems. On or about 25 July 1990, Lek sent one Leow Tay Meng (Leow) to undergo six days of training in order to learn how to install and use the computer system. Leow was a computer technician, employed by Lek Meng Professional Training Centre, who was asked by Lek to carry out the installation of the computer systems at the two night-clubs.

On 1 August 1990, the sets of two computer systems arrived in Singapore. They were delivered to Regent Night Club on 20 August 1990 and to Cash Box on 24 September 1990. After installation, both systems were tested and found to be working perfectly by Leow and a computer programmer known as Kong Peng Hoi (Kong). At the time of the trial, Kong was employed as a systems...