Engine Holdings Asia Pte Ltd v JTrust Asia Pte Ltd

• Jurisdiction: Singapore
• Judge: Woo Bih Li JAD
• Judgment Date: 18 October 2021
• Neutral Citation: [2021] SGHC(A) 14
• Citation: [2021] SGHC(A) 14
• Docket Number: Originating Summons No 42 of 2021
• Year: 2021
• Published date: 21 October 2021
• Plaintiff Counsel: Teh Kee Wee Lawrence, Chia Huai Yuan, Elias Benyamin Arun, Pan XingZheng Edric and V Santhosh (Dentons Rodyk & Davidson LLP)
• Defendant Counsel: Chan Leng Sun SC, Colin Liew (instructed), Ang Hsueh Ling Celeste, Danitza Hon Cai Xia, Lee Zhe Xu and Yiu Kai Tai (Wong & Leow LLC)
• Hearing Date: 15 September 2021
• Court: High Court Appellate Division (Singapore)

Woo Bih Li JAD (delivering the judgment of the court): Background

AD/OS 42/2021 (“the present OS”) is an application by Engine Holdings Asia Pte Ltd (“Engine”) for leave to appeal against the decision of the High Court judge (“the Judge”) in HC/RA 209/2021 (“RA 209”). In RA 209, the Judge had affirmed the decision of an Assistant Registrar (“the AR”) in HC/SUM 2413/2021 (“the Striking Out Summons”) not to strike out HC/S 1000/2020.

The respondent to the present OS is JTrust Asia Pte Ltd (“JT”). In 2017, JT filed HC/S 1212/2017 (“the 1st Action”) against eight defendants, alleging that they had unlawfully conspired to defraud JT into investing in Group Lease Public Co Ltd (“GL”). JT sought to recover sums which it had invested in GL via three investment agreements (see JTrust Asia Pte Ltd v Group Lease Holdings Pte Ltd and others [2020] 2 SLR 1256 (“CA Judgment”) at [13]). The High Court judge in the 1st Action had dismissed the claim (see JTrust Asia Pte Ltd v Group Lease Holdings Pte Ltd and others [2020] SGHC 29 (“HC Judgment”) at [25]), but this was overturned by the Court of Appeal which held that the first and second defendants had deceived JT, and that the first to seventh defendants had conspired to defraud JT (see CA Judgment at [202] and [257]). However, the Court of Appeal only granted JT’s claim in part, finding that JT’s claim for US$130 million in damages in relation to the second investment agreement (“2IA”) was premature as the 2IA stipulated that the investment was only due for repayment on 1 August 2021 and it had not been shown that GL would not repay (CA Judgment at [13(b)], [244] and [245]).

In October 2020, JT filed HC/S 1000/2020 (“the 2nd Action”) against Engine and APF Holdings Co Ltd (“APF”), claiming that they were part of the same unlawful means conspiracy as the defendants in the 1st Action.¹ The 2nd Action is the action which is the subject of the present OS for leave to appeal. In the 2nd Action, JT sought to recover the moneys which it did not recover in the 1st Action.² In May 2021, Engine filed the Striking Out Summons to strike out the 2nd Action.³ At the hearing of the summons, Engine advanced three grounds on which to strike out the 2nd Action: (a) the claim is an abuse of process as it should have been brought together with the 1st Action;⁴ (b) the claim is legally unsustainable as the loss to JT has not yet accrued, since 2IA had yet to mature;⁵ and (c) the claim is factually unsustainable as JT has not asserted that Engine committed any act prior to the date 2IA was concluded, which induced JT to enter into 2IA.⁶

The decisions of the AR and the Judge

The AR dismissed the Striking Out Summons. First, applying the law that a claim could only be struck out on grounds of abuse of process if such abuse was “plain or obvious” (applying Beyonics Asia Pacific Ltd and others v Goh Chan Peng and another and another appeal [2021] SGCA(I) 2 (“Beyonics”)⁷ at [50] to [53] and Antariksa Logistics Pte Ltd and others v Nurdian Cuaca and others [2018] 3 SLR 117 (“Antariksa (HCJ)”) at [74] to [79]), he found on the facts that it was not plain or obvious that the 2nd Action constituted an abuse of court process.⁸ This was because: (a) JT’s conduct of suing the defendants in the 2nd Action is permitted by s 17 of the Civil Law Act (Cap 43, 1999 Rev Ed) (“CLA”) which expressly permits successive actions against joint tortfeasors;⁹ and (b) the documents relied upon by Engine did not prove that JT knew about its involvement in the conspiracy early enough such that JT should reasonably have joined Engine as a defendant in the 1st Action.¹⁰ Instead, JT most likely did not know about Engine’s involvement until September 2019 (one month before the trial of the 1st Action), and it was reasonable not to have joined Engine into the 1st Action at that time.¹¹

Second, the AR found that the claim was legally sustainable despite the fact that 2IA had not matured, because the risk that JT would be unable to recover its moneys under the agreement gives rise to a good arguable case that JT has suffered pecuniary loss which constitutes actionable damage.¹²

Third, the claim is factually sustainable despite Engine’s argument to the contrary (see [3] above) as JT’s case is not only that they were induced to enter into 2IA but also that they were induced by Engine to subsequently complete payment obligations under 2IA.¹³

Engine then filed RA 209 to appeal the AR’s decision, but the Judge dismissed the appeal, without providing any reasons.¹⁴

Thereupon, Engine filed the present OS, seeking that: It be granted leave to appeal RA 209; It be granted leave to file an affidavit in support of its leave to appeal application (and if allowed, the substantive appeal), to address the following three matters: JT’s commencement of HC/OS 780/2021 (“the 3rd Action”) on 3 August 2021 against six of the eight defendants in the 1st Action claiming damages for a conspiracy to defraud, arising out of transactions similar to those that were the subject of the 1st Action; various cause papers, affidavits, applications, and submissions made in the 3rd Action; and an invitation to JT to respond to paragraphs 11 to 27 of the 5th affidavit of one Muneo Tashiro (filed under solicitor’s cover affidavit dated 13 July 2021); and Upon the grant of leave to file an affidavit, that directions be given for the filing of the said affidavit, for the filing by JT of an affidavit in response, and for the filing by Engine of an affidavit in reply.

Issues

Engine relies on the usual three grounds to seek leave to appeal to this court – namely, that there is: a prima facie case of error; a question of general principle decided for the first time; and a question of importance upon which further argument and a decision of a higher tribunal would be to the public advantage.

With respect to the first ground of a prima facie error, Engine seeks to appeal on the basis of errors of both law and fact. However, this is misconceived as the general principle is that the prima facie error must be one of law and not of fact (see IW v IX [2006] 1 SLR(R) 135 at [20] and Hwa Aik Engineering Pte Ltd v Munshi Mohammad Faiz and another [2021] 1 SLR 1288 at [8]). It may be that in exceptional circumstances leave to appeal may also be granted if there is an error of fact which is obvious from the record but it is unnecessary for us to consider this exception because, as we elaborate later, there was no such error in this case.

With respect to the second and third grounds, we note that they are disjunctive but Engine in its written submissions (“EWS”) addressed both grounds together and we will do likewise as it serves no purpose in the present circumstances to address them separately.

In so far as the alleged errors of law that Engine relies on in respect of the first ground overlap with the questions that Engine raises with respect to the second and third grounds, we will address them together. The questions that Engine relies on with respect to the second and third grounds are: Whether the “plain and obvious” test, which applies generally to striking out applications, also applies specifically to the striking out of an action on the ground of abuse of process based on the extended doctrine of res judicata as stated in Henderson v Henderson (1843) 67 ER 313 (“the 1st Issue”). We will refer to this type of abuse as the Henderson abuse of process. How the guidelines from the English case of Aldi Stores Ltd v WSP Group plc and others [2008] 1 WLR 748 (“Aldi”) should be applied in Singapore (“the 2nd Issue”). What the legislative intent behind s 17 of the CLA is (“the 3rd Issue”).

At the outset, we mention a preliminary point. The main thrust of Engine’s application before the AR was that it was a Henderson abuse of process for JT to commence the 2nd Action when it ought to have included Engine as a defendant in the 1st Action. However, according to JT, this argument on Henderson abuse of process had already been raised by Engine in two earlier applications in the 2nd Action.¹⁵

The first application was HC/SUM 4532/2020, which was JT’s application for a Mareva injunction (“MI”) against Engine filed on 16 October 2020. At an opposed ex parte hearing of that application, Engine had already argued that the 2nd Action was a Henderson abuse of process to resist the application.¹⁶ JT’s point is that as the Judge had granted the MI, this must mean that she was of the view that the 2nd Action was not a Henderson abuse of process.

The second application was HC/SUM 4970/2020 which was an application by JT filed on 13 November 2020 to seek leave to disclose Engine’s affidavit of assets in related proceedings, among other things. At a contested hearing, Engine again argued that the 2nd Action was a Henderson abuse of process.¹⁷ The Judge granted leave to disclose the affidavit in related proceedings.¹⁸

The Striking Out Summons is hence the third time in which Engine has raised the argument of Henderson abuse of process. JT thus seems to be implying that the doctrine of issue estoppel applies to estop Engine from raising the same argument in the Striking Out Summons and related appeals or applications. The AR did not rule on the issue estoppel point, and as mentioned, no reasons were given by the Judge for her decision in RA 209. Before us, JT’s written submissions (“JTWS”) merely mentioned the previous instances when Engine had raised the Henderson abuse of process argument and stopped short of explicitly asserting issue estoppel. In the circumstances, we will say no more about it.

The 1st Issue

Turning to the 1st Issue, it seems to us that Engine has wrongly assumed that the observations made in the English case of Angeli Luki Kotonou v National Westminster Bank plc [2017] 1 All ER (Comm) 350 (“Kotonou”), which were endorsed by a judge in the High Court case of Antariksa (HCJ) at [78], were...