Global Distressed Alpha Fund I Ltd Partnership v PT Bakrie Investindo

• Jurisdiction: Singapore
• Judge: Lai Siu Chiu J
• Judgment Date: 14 May 2013
• Neutral Citation: [2013] SGHC 105
• Court: High Court (Singapore)
• Docket Number: Originating Summons No 595 of 2011 (Summons No 957 of 2013)
• Year: 2013
• Published date: 22 May 2013
• Hearing Date: 25 March 2013
• Plaintiff Counsel: Hri Kumar Nair SC, Emmanuel Duncan Chua and James Low (Drew & Napier LLC)
• Defendant Counsel: Suresh Damodara (Damodara Hazra LLP)
• Subject Matter: Contempt of Court,Civil Contempt
• Citation: [2013] SGHC 105

Lai Siu Chiu J:

Pursuant to leave of court that was granted on 7 February 2013, Global Distressed Alpha Fund I Limited Partnership (“the Plaintiff”) filed the present application for, inter alia, Robertus Bismarka Kurniawan (“Kurniawan”), the Ex-President Commissioner and Ex-Chairman of the Supervisory Board of PT Barkrie Investindo (“the Defendant”), to stand committed to prison and/or fined and for a Warrant for Arrest to be issued for refusing to comply with an order made by the Assistant Registrar (“AR”) on 14 June 2012 for, inter alia, the examination of Kurniawan as an ex-officer of the Defendant in its capacity as a judgment debtor (“the EJD Order”). At the conclusion of the hearing, I allowed the application. As the Defendant has appealed against my decision (in Civil Appeal No 41 of 2013), I shall now set out the grounds for my decision.

The background to the EJD Order

The Plaintiff was a company that was part of a group which invested in different types of private distressed commercial and sovereign debt claims around the world. The Defendant was an investment holding company of a prominent family in Indonesia. Kurniawan was the President Commissioner and Chairman of the Defendant at all material times until 2 January 2012. He was/is, at all material times, ordinarily resident in Indonesia.

In 1996, one of the Defendant’s subsidiaries (“the Issuer”) issued US$50m worth of loan notes (“the Notes”), and the Defendant guaranteed the payment of sums due under the Notes pursuant to a guarantee that was governed by English law (“the Guarantee”). In 1999, the Issuer defaulted on the payment of sums due under the Notes and the Defendant consequently became liable under the Guarantee. In addition, the Defendant faced mounting debts from other sources. The Defendant’s debts, including its liability under the Guarantee, amounted to over US$500m.

Pursuant to Indonesian bankruptcy laws, the Defendant entered into an arrangement (“the Composition Plan”) with some of its creditors. Under the Composition Plan, participating creditors swapped their claims against the Defendant for shares in two special purpose vehicles into which the Defendant transferred its assets. On 6 March 2002, the Commercial Court of the Central Jakarta District Court ratified the Composition Plan (“the Indonesian Ratification Order”) such that thereupon, under Indonesian law, creditor claims against the Defendant, including those under the Guarantee, were discharged.

In 2009, the Plaintiff bought US$2m worth of the Notes. The Issuer subsequently defaulted on payment of sums due under the Notes. The Plaintiff then sued the Defendant on the Guarantee in the United Kingdom (“UK”). The Plaintiff obtained final judgment in UK on its claim and the Defendant was ordered to pay to the Plaintiff: (a) US$2,000,000; (b) US$1,283,333.32 by way of interest accrued; (c) interest continuing to accrue on the total amount of US$3,282,333.32 or such lesser amount as may from time to time be outstanding, at a rate of 9.625% per annum from 17 February 2011; and (d) costs on a standard basis to be the subject of detailed assessment if not agreed (“the UK Judgment”).

Pursuant to the UK Judgment, the Plaintiff submitted for taxation its bill of costs, which was not contested by the Defendant. On 10 June 2011, the UK High Court issued a Default Costs Certificate (“the UK Default Costs Certificate”), requiring the Defendant to pay to the Plaintiff: (a) costs of £205,327.98 with interest at the rate of 8% per annum from 17 February 2011; and (b) costs of £140 with interest at the rate of 8% per annum from 10 June 2011.

No appeal was filed against the UK Judgment or the UK Default Costs Certificate (collectively, “the Entire UK Judgment”). The time for appeal has now long since expired. The Defendant did not satisfy any part of the Entire UK Judgment.

On 18 July 2011, the Plaintiff filed Originating Summons No 595 of 2011 (“the OS”), seeking, inter alia, an order that: (a) the Entire UK Judgment be registered 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); and (b) the Defendant be at liberty to apply to set aside the said registration within 14 days after service upon it (within the jurisdiction of Indonesia) of notice of such registration pursuant to O 67 r 7 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“Rules of Court”) if it had any grounds for so doing, and execution upon the Entire UK Judgment would not issue until after the expiration of that period or any extension of that period granted by the court or, if an application was made to set aside the registration, until such application had been disposed of.

On 18 July 2011, the AR granted an order in terms of the OS (“the Registration Order”). The Registration Order was served on the Defendant in Indonesia on 4 August 2011. No application to set aside the Registration Order was made within 14 days of the service of the Registration Order.

On 14 June 2012, pursuant to an application by the Plaintiff in Summons No 2944 of 2012, the AR made the EJD Order as follows: Kurniawan was to attend before the Registrar of the Supreme Court (“the Registrar”) and to be orally examined as to whether any, and if so, what debts are owing to the Defendant and whether the Defendant has any, and if so, what property or other means of satisfying the Entire UK Judgment (“Order 1”). Kurniawan was to produce upon such examination all books or documents in his possession, custody or power relevant to the matters referred to above, including but not limited to: bank account statements of all bank accounts held in the name of the Defendant; and all documents evidencing the assets and properties owned by the Defendant (“Order 2”). Kurniawan should, by way of an affidavit, provide all the answers and documents sought by the Plaintiff in an attached questionnaire (“the Questionnaire”) not less than seven days before any hearing fixed for the oral examination (“Order 3”). Costs of this application and of the said examination thereunder were to be in the discretion of the Registrar conducting the examination. The EJD Order was the order that formed the subject matter of the committal proceedings before this court.

The notice prescribed under O 45 r 7(4) of the Rules of Court informing Kurniawan that if he disobeyed the EJD Order he would be liable to the process of execution for the purposes of compelling him to obey the same was endorsed on the EJD Order. On 16 June 2012, Kurniawan was personally served with the EJD Order while he was at a taxi-stand at Changi Airport.

Subsequent events after the grant of the EJD Order

The EJD was fixed for hearing on 3 July 2012 (“the 1st EJD Hearing”). On 29 June 2012, the solicitor acting for both the Defendant and Kurniawan, Mr Suresh Damodara (“Mr Damodara”), wrote to the Registrar of the Supreme Court (“the Registrar”) requesting that the 1st EJD Hearing be adjourned as: (a) Kurniawan was on a family vacation; (b) he needed time to take instructions; and (c) he would be away from 1 to 8 July 2012. The Registrar did not respond to this request before the 1st EJD Hearing. On 3 July 2012, Kurniawan did not attend the 1st EJD Hearing. Mr Damodara’s colleague explained the situation to the AR at the hearing. The AR re-fixed the EJD to 14 August 2012 (“the 2nd EJD Hearing”).

On 13 August 2012, Mr Damodara wrote to the Registrar requesting that the 2nd EJD Hearing be adjourned as he had been instructed to set aside the Registration Order. The Registrar did not respond to this request before the hearing. On 14 August 2012, Kurniawan did not attend the 2nd EJD Hearing. Mr Damodara explained to the AR that he had instructions to set aside the Registration Order. The AR re-fixed the EJD to 4 September 2012 (“the 3rd EJD Hearing”).

On 31 August 2012, the Defendant filed an application to set aside the Registration Order and the EJD Order in Summons No 4443 of 2012 (“the 1st Setting Aside Application”). The fact that Kurniawan had resigned as the President Commissioner and Chairman of the Supervisory Board of the Defendant on 2 January 2012 was first made known to the Plaintiff via Kurniawan’s first affidavit of 31 August 2012 filed in support of the 1st Setting Aside Application. Kurniawan also stated in this affidavit that the Defendant was dormant without any staff and had no assets. On 31 August 2012, Mr Damodara wrote to the Registrar requesting that the 3rd EJD Hearing be adjourned in view of the 1st Setting Aside Application. The Registrar replied that “[t]he [3rd EJD Hearing] will remains [sic] on 04 September 2012 at 9am”. On 4 September 2012, Kurniawan did not attend the 3rd EJD Hearing. The AR re-fixed the EJD to 16 October 2012 (“the 4th EJD Hearing”). There was no Pre-Trial Conference fixed for 4 September 2012, and it was clear from the context that the Registrar was actually referring to the 3rd EJD Hearing.

On 14 September 2012, the AR heard the 1st Setting Aside Application and directed the Defendant to amend the same to remove its prayer for the EJD Order to be set aside and for that prayer to be filed in a separate summons. The Defendant complied and filed a separate application in Summons No 4682 of 2012 (“the 2nd Setting Aside Application”) for the EJD Order to be set aside. On 24 September 2012, the AR heard the 1st and 2nd Setting Aside Application and dismissed both. On 25 September 2012, the Defendant filed Registrar’s Appeal No 392 of 2012 and Registrar’s Appeal No 393 of 2012 (collectively, the “Setting Aside RAs”) respectively against the AR’s dismissals of the 1st and 2nd Setting Aside Application. The Setting Aside RAs were heard by Woo Bih Li J on 11 October 2012, who reserved judgment.

On 11 October 2012, Mr Damadora wrote to the Registrar requesting that the 4th EJD Hearing be adjourned pending Woo J’s...