Foo Jong Peng and others v Phua Kiah Mai and another

• Jurisdiction: Singapore
• Judge: Andrew Phang Boon Leong JA
• Judgment Date: 08 October 2012
• Neutral Citation: [2012] SGCA 55
• Court: Court of Appeal (Singapore)
• Hearing Date: 24 May 2012
• Docket Number: Civil Appeal No 4 of 2012
• Plaintiff Counsel: S Magintharan, B Uthayacharan and James Liew (Essex LLC)
• Defendant Counsel: Hee Theng Fong and Leong Kai Yuan (RHTLaw Taylor Wessing LLP)
• Subject Matter: Civil Procedure,Appeals,Contract,Implied Terms
• Published date: 11 October 2012

Andrew Phang Boon Leong JA (delivering the grounds of decision of the court):

This was an appeal against a decision of the High Court judge (“the Judge”) in Phua Kiah Mai and another v Foo Jong Peng and others [2012] SGHC 14 (“the Judgment”) granting declarations, inter alia, that the Management Committee (“Management Committee”) of the Singapore Hainan Hwee Kuan (“the Association”) did not have the power to remove office bearers from their positions on the Executive Committee (“Executive Committee”). We dismissed the appeal and now set out the detailed grounds of our decision.

Background Facts Parties to the dispute

All the parties to this appeal are members of the Management Committee of the Association. The Association was registered with the Registry of Societies on 18 December 1890. For purposes of clarity, the parties will be addressed by name and the positions held by the parties will be described as they were prior to the disputed Management Committee meeting held on 20 October 2011 (hereafter referred to as “the 20 October 2011 Meeting”).

The First Respondent, Phua Kiah Mai, is the President of the Association and the Second Respondent, Hun Chin Guan, is the Honorary Secretary General.

The First Appellant, Foo Jong Peng, was President for two consecutive terms from January 2006 to January 2010 and is presently the First Vice President. The Second Appellant, Lee Teck Hai, is the Head of the Public Relations Division and had proposed the motions for the removal of Phua Kiah Mai and Foo Jong Peng from their positions. The Third Appellant, Han Tan Juan, is Head of the Cultural & Education Division and had proposed the motion for the removal of Hun Chin Guan from his position. The Fourth Appellant, Foo Shick Thai, and Fifth Appellant, Pang Fui Nam, were elected as the new President and Honorary Secretary General respectively after resolutions to remove Phua Kiah Mai and Hun Chin Guan were passed at the 20 October 2011 Meeting.

Management structure of the Association

Under Rule 8 of the Rules of the Singapore Hainan Hwee Kuan (“the Rules”), Management Committee members will be elected by a vote of the general body of members at the Annual General Meeting (“AGM”). Rule 7 provides that the elected Management Committee members shall hold office for a term of two years. The Management Committee administers the affairs of the Association, and has the duties and powers to implement resolutions passed by the General Meeting, formulate the overall policy for the Association and control the budget and finances.

The elected Management Committee members then elect from amongst themselves the office bearers (“office bearers”) of the Association – the President, three Vice-Presidents and the heads and deputy heads of ten committees each dealing with a specific aspect of the Association’s affairs – under Rule 9. The functions and duties of each office bearer are defined in the Rules. Pursuant to Rule 13, all the elected office bearers will then collectively form a smaller Executive Committee. Pursuant to Rule 16, the Executive Committee has the powers to, inter alia, implement resolutions passed by the Management Committee and to oversee the general administration of the Association.

Background to the dispute

The parties were all voted in as members of the Management Committee by the general body of members at the AGM held in January 2010. The parties – save for Hun Chin Guan, who was only elected after the previous Honorary Secretary General resigned in May 2011 – were then elected to their respective positions by the members of the Management Committee.

The Kheng Chiu Tin Hou Kong and Burial Ground (“Tin Hou Kong”) is a company incorporated in Singapore and limited by guarantee. It effectively operates as the financial arm of the Association and provides the funds needed to support the Association’s activities. Foo Jong Peng is the Chairman of Tin Hou Kong’s board of directors and Phua Kiah Mai is the Vice-Chairman. All the parties to this appeal except Hun Chin Guan also sit on the board.

Sometime in March 2011, a dispute arose between Foo Jong Peng and Phua Kiah Mai over the management of the financial affairs of Tin Hou Kong. During a meeting of the Tin Hou Kong board of directors on 26 July 2011, Foo Jong Peng expressed the view that he was no longer able to work with Phua Kiah Mai and proposed to table a motion to remove Phua Kiah Mai as Vice-Chairman. The other directors objected to this motion as proper notice had not been given. At a subsequent meeting of the Management Committee of the Association held on the same day, Foo Jong Peng again attempted to table a motion to remove Phua Kiah Mai as President of the Association. Phua Kiah Mai – who was chairing the meeting – rejected the motion as it was not in accordance with the agenda. Foo Jong Peng proposed that a special Management Committee meeting be called to remove Phua Kiah Mai as President of the Association and Hun Chin Guan then requested Foo Jong Peng to provide a reason for removal and to send in an official proposal to table the motion.

On 3 August 2011, Foo Jong Peng wrote to Hun Chin Guan in the latter’s capacity as the Honorary Secretary General, calling for a special meeting of the Management Committee on 16 August 2011 with the proposed agenda of “re-organising” the Management Committee.¹ The letter was signed by 26 members of the Management Committee. An intervening Management Committee meeting was held on 5 August 2011, but the meeting was inquorate.

Phua Kiah Mai then sought the advice of his solicitors M/s RHTLaw Taylor Wessing LLP (“RHTLaw”). RHTLaw replied to Foo Jong Peng, stating that the Honorary Secretary General was not in a position to convene a special Management Committee meeting for the sole purpose of removing the President as the Management Committee had no power to remove an office bearer under the Rules. Foo Jong Peng nonetheless proceeded to convene a meeting of the Management Committee on 16 August 2011, purportedly upon the request of 25 other Management Committee members. Phua Kiah Mai and Hun Chin Guan did not attend the meeting, and no resolutions were passed in their absence.

On 12 September 2011, Lee Teck Hai wrote to Hun Chin Guan, proposing a motion to remove Phua Kiah Mai as the President of the Management Committee and to elect a new President, to be voted upon at the next Management Committee meeting.² Lee Teck Hai sent a second letter on 15 September 2011 to table a further motion to remove Foo Jong Peng as the First Vice President of the Association and for the election of a new First Vice President.³ Hun Chin Guan replied on 19 September 2011, reiterating the alleged legal position that the Management Committee had no power to remove the President and First Vice President in the absence of express provisions in the Rules and that any resolution passed to this effect would be ultra vires and void; it would thus be meaningless for the two proposed motions to be placed on the agenda.⁴

Following an adjournment of a Management Committee meeting on 28 September 2011 due to a lack of quorum, Lee Teck Hai sent a letter on 7 October 2011 advising Hun Chin Guan that a meeting of the Management Committee should be convened on an urgent basis for the purpose of adopting and approving the accounts for the Financial Year 2010, and that the continued failure to do so would put the Management Committee in breach of the Association’s Rules and statutory requirements.⁵ This was followed by a letter from Tan Han Juan to Hun Chin Guan on 10 October 2011, proposing a third motion to remove Hun Chin Guan as the Honorary Secretary General and for an election to fill the vacancy.⁶

Hun Chin Guan did not respond to Lee Teck Hai or Tan Han Juan. Lee Teck Hai then requested Foo Jong Peng to convene a Management Committee meeting. On 12 October 2011, Foo Jong Peng issued a notice – in his capacity as First Vice President – convening the 20 October 2011 Meeting. The notice stated that the meeting had been convened upon the request of over half of the Management Committee members, and the listed agenda included the approval of the Association’s accounts for the Financial Year 2010 and the motions to remove Phua Kiah Mai, Foo Jong Peng and Hun Chin Guan from their respective positions.⁷ Notice of the meeting was duly served on all members of the Management Committee.

On 17 October 2011, RHTLaw wrote to Foo Jong Peng, stating that the notice to convene the meeting was improper. The proposed meeting was nevertheless held on 20 October 2011 and was attended by a sufficient quorum of 27 Management Committee members. Phua Kiah Mai and Hun Chin Guan were both absent from the meeting. The members approved the Association’s accounts for the Financial Year 2010 and resolutions were passed removing Phua Kiah Mai and Hun Chin Guan from their positions. The motion to remove Foo Jong Peng as First Vice President was defeated, and Foo Shick Thai and Pang Fui Nam were elected as the new President and Honorary Secretary General, respectively, following a vote by the members present at the meeting.

Phua Kiah Mai and Hun Chin Guan then filed Originating Summons No 975 of 2011 (“the Originating Summons”) in the High Court.

Decision below

The Respondents’ prayers in the Originating Summons were as follows:

1. A declaration that [Foo Jong Peng] had no power to convene the Singapore Hainan Hwee Kuan Management Committee meeting held on 20 October 2011;

2. A declaration that the Singapore Hainan Hwee Kuan Management Committee meeting held on 20 October 2011 is invalid;

3. A declaration that the Singapore Hainan Hwee Kuan Management Committee has no power to remove their President, First Vice President and Honorary Secretary General and elect a new President, First Vice President and Honorary Secretary General;

4. A declaration that [Lee Teck Hai’s] proposal to table the motions for the...