Global Distressed Alpha Fund I Ltd Partnership v PT Bakrie Investindo

JurisdictionSingapore
CourtHigh Court (Singapore)
Judgment Date16 January 2013
Date16 January 2013
Docket NumberOriginating Summons No 595 of 2011 (Registrar's Appeals Nos 392 and 393 of 2012)

High Court

Woo Bih Li J

Originating Summons No 595 of 2011 (Registrar's Appeals Nos 392 and 393 of 2012)

Global Distressed Alpha Fund I Ltd Partnership
Plaintiff
and
PT Bakrie Investindo
Defendant

Hri Kumar Nair SC and Emmanuel Chua (Drew & Napier LLP) for the plaintiff/judgment creditor

Suresh Damodara (Damodara Hazra LLP) for the defendant/judgment debtor

.

Antony Gibbs & Sons v La Société Industrielle et Commerciale des Métaux (1890) 25 QBD 399 (refd)

Global Distressed Alpha Fund I Ltd Partnership v Integrated Financial Advisory Ltd [2012] SGHC 152 (refd)

Global Distressed Alpha Fund 1 Ltd Partnership v PT Bakrie Investindo [2011] 1 WLR 2038; [2011] EWHC 256 (Comm) (refd)

Hong Pian Tee v Les Placements Germain Gauthier Inc [2002] 1 SLR (R) 515; [2002] 2 SLR 81 (folld)

Kok Seng Chong v Bukit Turf Club [1992] 3 SLR (R) 772; [1993] 2 SLR 388 (refd)

Madihill Development Sdn Bhd v Sinesinga Sdn Bhd [2012] 1 SLR 169 (folld)

Mohamed Said bin Ali v Ka Wah Bank [1989] 1 SLR (R) 689; [1989] SLR 667 (refd)

Poh Soon Kiat v Desert Palace Inc [2010] 1 SLR 1129 (folld)

Tay Long Kee Impex Pte Ltd v Tan Beng Huwah [2000] 1 SLR (R) 786; [2000] 2 SLR 750 (refd)

Vasiliy Golovnin, The [2008] 4 SLR (R) 994; [2008] 4 SLR 994 (folld)

Westacre Investments Inc v The State-Owned Company Yugoimport SDPR [2009] 2 SLR (R) 166; [2009] 2 SLR 166 (folld)

Yong Tet Miaw v MBF Finance Bhd [1992] 2 SLR (R) 549; [1992] 2 SLR 761 (folld)

Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed) ss 3 (1) , 3 (2) (f) (consd) ;s 3

Rules of Court (Cap 322, R 5, 2006 Rev Ed) O 67 r 9 (3) (consd) ;O 67 r 7

Conflict of Laws—Foreign judgments—Enforcement—Judgment debtor appealing against decision not to set aside order allowing registration of foreign judgment and order allowing examination into judgment debtor's assets—Whether setting aside should be allowed because enforcement of foreign judgment in Singapore would not be just and convenient—Whether setting aside should be allowed because foreign judgment was in respect of cause of action contrary to public policy—Whether setting aside should be allowed because of non-disclosure of material facts by the judgment creditor—Sections 3 (1) and 3 (2) (f) Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed)—Order 67 r 9 (3) Rules of Court (Cap 322, R 5, 2006 Rev Ed)

Global Distressed Alpha Fund I Limited Partnership (‘the Judgment Creditor’) sued BT Bakrie Investindo (‘the Judgment Debtor’) on a guarantee in the United Kingdom (‘the UK’) and obtained judgment for the sum owed to it and costs (‘the Foreign Judgment’). The Judgment Creditor then filed Originating Summons No 595 of 2011 (‘OS 595’) to register the Foreign Judgment as a judgment of the High Court of Singapore pursuant to s 3 of the Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed) (‘the RECJA’) and O 67 r 7 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed). The assistant registrar (‘the AR’) granted an order in terms of OS 595 (‘the Registration Order’). The Judgment Creditor subsequently applied for, and was also granted, an order for the examination of the former President Commissioner of the Judgment Debtor as to the Judgment Debtor's assets (‘the EJD Order’).

The Judgment Debtor subsequently filed two applications seeking, inter alia,to set aside the Registration Order and the EJD Order. These two applications were dismissed by the AR. The Judgment Debtor then filed Registrar's Appeal No 392 of 2012 (‘RA 392’) and Registrar's Appeal No 393 of 2012 (‘RA 393’) to appeal against the AR's decision not to set aside the Registration Order and the EJD Order respectively.

Held, dismissing the appeals:

(1) In determining whether to register a foreign judgment under the RECJA or set aside a previous registration, the court had to consider all the circumstances of the case and should permit registration only if it was just and convenient that the judgment should be enforced in Singapore. However, the phrase ‘just and convenient’ did not grant an untrammelled discretion to the court; the court would set aside the registration of a foreign judgment only where it was practicable and required by the interests of justice: at [20] .

(2) The court rejected the Judgment Debtor's argument that the Judgment Creditor knew that the Judgment Debtor did not have any asset, and that it was thus not just and convenient for the Foreign Judgment to be enforced in Singapore under s 3 (1) of the RECJA and O 67 r 9 (3) of the Rules of Court. Even though the Judgment Creditor had taken the position that the Judgment Debtor had no asset, the Judgment Creditor did not know, one way or another, whether this was true. However, the issue that was more relevant was whether the Judgment Debtor in fact had any asset and not whether the Judgment Creditor thought at any point of time that the Judgment Debtor did not have any asset. There were some suggestions on the facts that the Judgment Debtor had some assets: at [28] to [33] .

(3) The court rejected the Judgment Debtor's argument that the effect that registration of the Foreign Judgment would have on the composition arrangement that the Judgment Debtor had with some of its creditors as ratified by the Indonesian courts made it not just and convenient for the Foreign Judgment to be enforced in Singapore under s 3 (1) of the RECJA. If assets of the Judgment Debtor were uncovered and the Judgment Creditor managed to execute the Foreign Judgment on the Judgment Debtor, that was not a voluntary act of payment by the Judgment Debtor in contravention of the Indonesian orders. As for the Judgment Debtor's further argument that the floodgates would be opened for other creditors to disregard the bankruptcy laws of Indonesia under the jurisdiction of Singapore, not every creditor would be able to commence action in a foreign jurisdiction and obtain a favourable judgment from a foreign jurisdiction: at [36] and [37] .

(4) The court rejected the Judgment Debtor's argument that there was very real prejudice because the Judgment Creditor would be able to repeatedly apply to examine and harass past and present officers of PT Bakrie. A holistic approach should be taken. It was uncertain whether the Judgment Debtor has any assets: at [38] .

(5) The court rejected the Judgment Debtor's argument that pursuant to international comity and s 3 (2) (f) of the RECJA, it would be contrary to public policy to register the Foreign Judgment. Under that provision, the court identified the cause of action that the judgment was based on and examined whether it was contrary to public policy. The underlying cause of action in the Foreign Judgment was based on a contract of guarantee which was not in any way contrary to the public policy of Singapore. The court did not look at the effect of registering and enforcing a judgment under the RECJA: at [40] and [42] .

(6) The doctrine of comity did not necessarily aid the Judgment Debtor. The principle of universality and the doctrine of comity should be considered under the just and convenient factor in s 3 (1) of the RECJA. The principle of universality had been considered by the UK court applying English law as the governing law of the guarantee. The UK court decided that the discharge of the Judgment Debtor's obligation under Indonesian law was of no effect under English law. The Judgment Debtor did not file an appeal against this decision. Accordingly, the court was not persuaded to set aside the Registration Order: at [43] to [47] .

(7) The Judgment Creditor failed to disclose several material facts in the affidavit filed in support of OS 595, although the non-disclosures were the result of a lack of competence and/or attention and/or co-ordination, rather than deliberate conduct. The duty to make material disclosures was no less stringent in cases not involving Mareva injunctions: at [57] and [59] .

(8) In all the circumstances, it was in the interest of justice to dismiss RA 392 and, consequently, RA 393: at [60] and [61] .

Woo Bih Li J

Introduction

1 In Originating Summons No 595 of 2011/C (‘OS 595’), Global Distressed Alpha Funds I Limited Partnership (‘GDAF’) obtained an order under the Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed) (‘RECJA’) to register a judgment that it obtained in its favour in the United Kingdom against PT Bakrie Investindo (‘PT Bakrie’). GDAF also applied via Summons No 2944 of 2012/J (‘SUM 2944’) to examine one Robertus Bismarka Kurniawan (‘Kurniawan’), a former President Commissioner of PT Bakrie. PT Bakrie subsequently applied via Summons No 4443 of 2012/M (‘SUM 4443’), seeking, inter alia, to set aside the order for the registration of the judgment. PT Bakrie also applied via Summons No 4682 of 2012/S (‘SUM 4682’), seeking, inter alia, to set aside the order to examine Kurniawan. An assistant registrar (‘the AR’) heard both parties and dismissed SUM 4443 and SUM 4682. PT Bakrie appealed against the AR's dismissal of SUM 4443 and SUM 4682 in Registrar's Appeals Nos 392 and 393 of 2012 (‘RA 392’ and ‘RA 393’) respectively. Both RA 392 and RA 393 were heard by me. After hearing both parties' submissions, I dismissed both appeals. PT Bakrie has appealed against my decision. I now give the grounds of mydecision.

Facts

2 GDAF is a company that is part of a group which invests in different types of private distressed commercial and sovereign debt claims around the world. PT Bakrie is a company incorporated in the Republic of Indonesia. It was established in July 1991 to act as an investment holding company for investments made by a prominent merchant family in Indonesia.

3 In 1996, one of PT Bakrie's subsidiaries, Bakrie Indonesia BV (‘the Issuer’), issued US$50m worth of loan notes. PT Bakrie guaranteed the payment of sums due under the notes through a guarantee dated 9 December 1996 (‘the...

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