Elis Tjoa v United Overseas Bank

• Jurisdiction: Singapore
• Judgment Date: 02 January 2003
• Date: 02 January 2003
• Docket Number: Suit No 603 of 2002
• Court: High Court (Singapore)

Tjoa Elis

Plaintiff

and

United Overseas Bank Ltd

Defendant

[2003] SGHC 1

Woo Bih Li JC

Suit No 603 of 2002

High Court

Banking–Duty of bank–Banker's books–Customer instructing bank to debit plaintiff's current account for purchase of shares–Plaintiff disputing instructions–Whether customer forging plaintiff's signatures on instructions–Contract–Contractual terms–Conditions–Clause requiring plaintiff to verify correctness of bank statement and to notify the defendants of any discrepancies–Whether clause was onerous and unreasonable–Whether defendants have taken sufficient steps to draw the plaintiff's attention to that clause–Tort–Negligence–Duty of care–Concurrent liability in contract and tort–Whether plaintiff can avoid exemption clause in agreement by claiming in tort

The plaintiff, an Indonesian Chinese businesswoman residing in Indonesia, was a customer of the defendant, United Overseas Bank Limited (“UOB”), a Singapore bank.

In April 1997, the plaintiff's sister, Ms Tjoa Siu Ngo (“Ngo”) introduced the plaintiff to Ms Lily Lim (“Lily”), an employee of UOB. The plaintiff then opened a current account with UOB, by signing the relevant application form.

In December 1998, Ngo informed Lily that the plaintiff had agreed to help Ngo pay for a purchase of shares, by debiting the plaintiff's current account. Lily then prepared a draft fax instruction. She faxed this to Ngo, who then procured the plaintiff's signature. The signed fax later was sent to UOB. This transaction was undisputed.

On 1 and 22 March 2000, Ngo informed Lily that the plaintiff had again agreed to help Ngo pay for shares. A similar procedure was carried out. Later, Ngo purportedly obtained the plaintiff's signatures on them. These transactions were disputed.

Although the plaintiff claimed not to have received her bank statements since the beginning of 2000, she did not complain about this to UOB until she allegedly discovered the two fax instructions on 15 May 2001. She disputed the instructions, claiming that the signatures on them were forged.

Held, dismissing the plaintiff's claim:

(1) Even if the plaintiff did not sign on the disputed instructions, the signatures were appended to those instructions with her authority either before each instruction was sent or thereafter: at [64].

(2) The plaintiff fully understood the nature of the application form, and was bound by the Rules stipulated in the application form: at [81].

(3) Clause 13 of the Rules, stipulating that a customer was required to check his statement when it is sent to his designated address and to notify the bank promptly of any unauthorised transaction reflected on his statement, was clear and wide enough to exclude UOB from liability in the circumstances. Clause 13 was reasonable irrespective of any negligence of UOB. The founding of claim in tort was not allowed. Mere negligence or breach of contract did not constitute estoppel and did not estop UOB from relying on cl 13: at [95] to [99], [109] and [110].

Consmat Singapore (Pte) Ltd v Bank of America National Trust & Savings Association [1992] 2 SLR (R) 195; [1992] 2 SLR 828 (folld)

Jian He, The [1999] 3 SLR (R) 432; [2000] 1 SLR 8 (folld)

MCST Plan No 1166 v Chubb Singapore Pte Ltd [1999] 2 SLR (R) 1035; [1999] 3 SLR 540 (folld)

Ri Jong Son v Development Bank of Singapore Ltd [1998] 1 SLR (R) 824; [1998] 3 SLR 64 (refd)

Stephan Machinery Singapore Pte Ltd v Oversea-Chinese Banking Corp Ltd [1999] 2 SLR (R) 518; [2000] 2 SLR 191 (folld)

Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163 (refd)

Yogambikai Nagarajah v Indian Overseas Bank [1996] 2 SLR (R) 774; [1997] 1 SLR 258 (folld)

Tan Cheow Hin and Sheerin Ameen (Cheow Hin & Partners) for the plaintiff

Hri Kumar and Gary Leonard Low (Drew & Napier LLC) for the defendant.

Judgment reserved.

Woo Bih Li JC

Introduction

1 The plaintiff, Elis Tjoa (“Elis”), is an Indonesian Chinese residing outside Medan, Indonesia. The defendant, United Overseas Bank Limited (“UOB”), is a Singapore bank. At all material times, Elis was a customer of UOB's branch at MacPherson Road (“the MacPherson Branch”). Elis' claim is for payment by UOB of $270,000 debited by UOB from her current account in two tranches in March 2000. The debit was to pay for share purchases of her sister Tjoa Siu Ngo (“Ngo”) and the moneys were transferred from Elis' account to Ngo's.

2 In my judgment:

AEIC	means	Affidavit of Evidence-in-chief
AB	means	Agreed Bundle of Documents
NE	means	Notes of Evidence, followed by the page number

Background

3 Ngo and her husband Lie Kwek Pau (“Kwek Pau”) had been a customer of Chung Khiaw Bank Limited before it was merged with UOB. They were known to a bank officer Lily Lim (“Lily”). They had been granted a housing loan by Chung Khiaw Bank Limited but that has been redeemed.

4 Elis is a businesswoman. At the time of the trial in November 2002, she had been in business for 15 years. During the trial, she gave evidence in Hokkien through an interpreter.

Opening of Elis' “i” account

5 Apparently Elis and Ngo had come into some money from their father's estate.

6 On or about 19 April 1997, Ngo introduced Elis to Lily. At that time, Lily was and still is the First Vice-President and Regional Manager of UOB's Kallang Regional Centre (“KRC”). At that time, Lily was also the manager of the MacPherson Branch until February 1999. KRC is on the second floor of the same building as the MacPherson Branch which occupies the first floor. On that day, ie 19 April 1997, Elis opened a current account called an “i” account with UOB, ie Account No 104-312-226-1. An “i” account is a current account earning interest. It is not an investment account although pleaded as such in para 2 (a) of the Amended Defence. Elis signed the relevant application form which states, inter alia:

A copy of the Bank's Rules Governing Current and i-Account set out overleaf has been furnished to me/us and I/we have read and understood the same and agree to be bound thereby. [emphasis added]

I will refer to such rules as “the Rules”. The bank officer attending to Elis for the opening of her “i” account was Lee Chong Meng, a customer service officer at the MacPherson Branch. In oral testimony, he said it was his standard practice to hand over a set of the Rules to a customer when an “i” account is opened and he did do so to Elis before she signed the application form. However, this was not mentioned in his AEIC. Elis denied his oral evidence. So did her daughter, Henty, who was supposed to have accompanied her. However, the Rules are part of the application form ie the application form is a document comprising four pages. The first page is where the particulars of the customer are stated and the customer signs. The second to fourth pages contain the Rules. Therefore, even if a set of the Rules was not handed to Elis then, the fact is that they are a part of the application form and the contract between Elis and UOB.

7 Elis said that no one had interpreted or explained the application form or the Rules to her. However, she admitted that she did have two accounts with banks in Indonesia for her business and she knew that such banks had their own terms and conditions. Also, she did not assert that she had asked for an interpretation or an explanation. Neither did she assert that she did not understand the nature of the document she was signing.

8 Both Elis and Ngo enjoyed a close relationship. In fact, when Elis opened her “i” account, the home address she gave was the address of Ngo in Medan, Indonesia. Elis said that this was because it was uncertain whether she would receive mail where she stayed, which was some two hours away from Medan. This home address of Ngo was the same address given by Ngo when she opened her “i” account two years earlier on 10 February 1995.

9 Statements of account in respect of Elis' “i” account were initially sent to the Indonesian address she had provided. Subsequently she gave instructions to change her address in UOB's records to a Singapore address ie Block 5 Moi Hwan View #02-01 Golden Hill Condominium, Singapore 568290. In March 1998, she again gave instructions to change her address to Block 227 Bishan Street 23 #07-77, Singapore 570227.

10 In cross-examination, Elis said she had received the statements of account when they were sent to the Indonesian address but she decided to change her address because a domestic helper at Ngo's Indonesian address did not keep mail carefully. She had wanted UOB to keep her statements for her but was told by UOB that it could not accede to this request. She chose the addresses which I have mentioned because Ngo's son Moktar (or spelt as “Muktar”) was residing in Singapore at those addresses. She had arranged with him to bring her statements to her whenever he returned on holiday to Indonesia. She said that she had received the statements for her “i” account up to and including December 1999 but not thereafter.

11 In the circumstances, para 10 of Elis' AEIC stating that she had provided a Singapore address at UOB's request was not true.

The fax instruction dated 11 December 1998

12 In December 1998, Ngo contacted Lily to say that her sister Elis had agreed to help her (Ngo) pay for her share purchase (of 100,000 Hotel Property shares). This would be done by debiting Elis' “i” account. Lily then caused a draft of a fax instruction to be prepared and forwarded this by fax to Ngo who then procured Elis to sign the fax and the signed fax was then sent back to UOB. The fax instruction was dated 11 December 1998. The amount debited was $86,424.68 and payment was made in favour of UOB Securities Pte Ltd (“UOB Securities”). Elis does not dispute this fax instruction and UOB placed much reliance on it to show that such an instruction had been given before the two disputed instructions in 2000 which I shall come to...