Guan Ming Hardware & Engineering Pte Ltd v Chong Yeo & Partners and Another

• Jurisdiction: Singapore
• Judge: Christopher Lau JC
• Judgment Date: 29 June 1996
• Neutral Citation: [1996] SGHC 130
• Docket Number: Suit No 2069 of 1993
• Date: 29 June 1996
• Year: 1996
• Published date: 19 September 2003
• Plaintiff Counsel: Devinder Rai and Melvin Khoo (Harry Elias & Pnrs)
• Citation: [1996] SGHC 130
• Defendant Counsel: Wong Meng Meng and Monica Chong (Wong Partnership)
• Court: High Court (Singapore)
• Subject Matter: Rights,Immunity,Whether advocate and solicitor could claim retainer where breach of duty proved against him,O 14 r 2(8) Rules of the Supreme Court,Evidence in support of an affidavit,Retainer,Act of third party,Advocates and solicitors,Failure to exhibit evidence in support of an affidavit for summary judgment,Whether chain of causation broken,Relevance of Rondel v Worsley in Singapore,Negligence,Entitlement,Civil Procedure,Tort,Scope of immunity,Legal Profession,Breach,Professional negligence,Causation,Summary judgment,Professional conduct

Cur Adv Vult

This is an action in either contract or tort by Guan Ming Hardware & Engineering Pte Ltd (the plaintiffs) against Chong Yeo & Partners (the first defendant), a firm of solicitors in Singapore and Tongel Yeo (the second defendant), the partner having conduct of the matter whom the plaintiffs had instructed to act on their behalf, for failing to exercise due care, skill and diligence in advising, pursuing claims and enforcing judgments against two companies in Singapore, Argos Engineering Pte Ltd (AE) and Argos Steel Structure (S) Pte Ltd (AS) for S$89,920.40 and S$16,404.70 respectively.

Background

In 1991, the plaintiffs were owed sums of money by the two companies, AE and AS. They decided to instruct solicitors to commence proceedings in the courts to recover these amounts. In October 1991, the precise date as to which there is a dispute, the plaintiffs instructed the defendants to act on their behalf and to commence proceedings immediately against AE and AS. Proceedings were commenced and judgments were obtained. However, the plaintiffs discovered to their great chagrin, the recovery proceedings were wholly unsuccessful. The circumstances leading to this result (much of which is disputed), and whether liability for this unsuccessful recovery falls on the defendants is the subject matter of this action.

The claim

I will refer to the plaintiffs` case in the context of the plaintiffs` claims against each of the companies AE and AS.

A AE

(i) The AE cheque

The plaintiffs allege that on or about 24 October 1991, Mr Larry Lee, the plaintiffs` managing director (Mr Lee), sought advice from the second defendant, an advocate and solicitor of some seven years standing, as to whether the plaintiffs ought to accept a cheque for S$20,600.30 received from AE in part payment of the sum owed of S$82,920.40 and that the second defendant`s advice to Mr Lee was to reject the cheque on the grounds that it would complicate the proceedings against AE. The plaintiffs further allege Mr Lee acted on that advice and returned the cheque for S$20,600.30 to AE.

The first ground then of the plaintiffs` claim against the defendants is that the defendants` advice to return the cheque was negligent. Had such advice not been given, the plaintiffs say they would have recovered a sum of S$20,600.30 as early as October 1991 in respect of their claim against AE for S$82,920.40.

(ii) Commencement and conduct of the claim

Next, the plaintiffs allege various instances of failure by the defendants to exercise due care, skill and diligence in the commencement and conduct of the claim against AE. Firstly, they allege the defendants only issued a writ of summons against AE on 24 October 1991 when the plaintiffs say instructions were given by the plaintiffs to the defendants much earlier - in early October 1991. The plaintiffs were not specific about the date except to allege that it would have been on or about 17 October 1991. Secondly, the plaintiffs allege that although appearance was entered by AE on 31 October 1991, it was not until 20 November 1991 - about 20 days later - that the defendants (who had already received the necessary documentary evidence from the plaintiffs to enable them to proceed with a summary judgment application against AE) filed a summary judgment application. The application was set down for a 13 January 1992 hearing. Thirdly, the plaintiffs allege that although AE had failed to file its defence to the claim by 14 November 1991 (the date when its defence was due), the defendants did not, as they could have, enter judgment in default. Fourthly, it is alleged that the defendants could have pressed for a date earlier than 13 January 1992 for the hearing of the summary judgment application but had not done so.

But the gravamen of the plaintiffs` case here and their fifth allegation, is that the defendants filed a defective affidavit in support of the application for summary judgment because at the hearing before the assistant registrar on 13 January 1992, the assistant registrar ruled that the affidavit, which the second defendant said he had prepared, was defective as it did not comply with the recently revised O 14 r 2(8) of the Rules of the Supreme Court (RSC) (the rule). The rule came into effect on 1 August 1991. The assistant registrar considered the defendants ought to have exhibited documentary evidence to that affidavit in support of the plaintiffs` claim, as the rule required. Instead, all that the affidavit did was to refer to the statement of claim that had been filed, allege the sum claimed was due and owing and alleged that there was no defence to the claim. The statement of claim stated:

1 The plaintiffs` claim against the defendants the sum of $82,920.40 in respect of goods sold and delivered to the defendants, at the defendants` request, full particulars of which the defendants are already aware and short particulars whereof as follows:

Particulars

Statement of account as at September 1991 = $82,920.40

2 Despite repeated requests and demands, the defendants have failed, neglected and/or refused to make payment of the said sum of $82,920.40 or any part thereof.

And the plaintiffs claim:

(a) The sum of $82,920.40;

(b) Interest at the rate of eight (8%) per cent per annum from the date of issuance of this writ till judgment or payment whichever is the earlier; and

(c) Costs.

In effect, the affidavit was a standard form affidavit prepared in accordance with the requirements of O 14 of the Rules of the Supreme Court, prior to its revision in August 1991. The omission to exhibit the supporting documents was not caused, the plaintiffs say, by the defendants not having the necessary documentary evidence because the plaintiffs had sent these, well before the hearing of the summary judgment application, to the defendants.

So the hearing on 13 January 1992, despite the defendants` objections, was adjourned to 16 March 1992 to enable the plaintiffs to file a supplementary affidavit to remedy these defects by exhibiting the necessary documentary proof of the plaintiffs` claim and to show that AE had no defence to the claim in accordance with the provisions of the rule. Such further affidavit was then filed, and at the adjourned hearing before the assistant registrar on 16 March 1992, after arguments were heard, the plaintiffs obtained judgment against AE for S$82,920.40, costs and S$1,976.46 in interest. Had the affidavit not been defective, however, the plaintiffs say they would have obtained judgment on their claim against AE on 13 January 1992 which in turn would have allowed the plaintiffs to proceed with execution proceedings much earlier, the inference being that they in such event would have recovered the full amount owed. In support of this assertion, the plaintiffs adduced evidence of a successful recovery by another creditor, First Hydraulics Pte Ltd (First Hydraulics), of sums owed to it by AE. First Hydraulics had obtained judgment against AE on 25 January 1992.

(iii) Execution

Subsequently after judgment was obtained on 16 March 1992, and notwithstanding the second defendant`s advice that winding-up was the most effective recovery remedy, the plaintiffs allege Mr Lee instructed the second defendant to garnish AE`s accounts at two banks immediately but that the defendants did not do so as they only applied for an order nisi on 31 March 1992, an apparent delay of about fifteen days.

The order nisi having been obtained on 31 March 1992, the hearing for an order absolute which was to have been on 4 May 1992, was, however, adjourned indefinitely. That was because on 24 April 1992, a winding-up petition of AE was filed by another of AE`s creditors. The plaintiffs say that had the defendants filed the garnishee proceedings when instructed, and obtained an early return date in early April 1992 instead of on 4 May 1992 for an order absolute, which the plaintiffs further allege the defendants ought to have done as the defendants were also well aware or had been made aware by the plaintiffs of other claims against AE by other creditors, then the order absolute would have been obtained before 24 April 1992 and the amount owed would have been recovered. Even though the winding-up petition, as it turned out, was dismissed on 22 May 1992, its dismissal offered no consolation to the plaintiffs because on 20 May 1992, a receiver of the company had been appointed by yet another creditor.

The plaintiffs assert that each of or all of these instances of the defendants` negligence or breach of duty, deprived the plaintiffs of a successful recovery.

B AS

The plaintiffs were similarly unsuccessful in their recovery efforts in respect of AS even though the defendants had obtained default judgment against AS in November 1991 for S$16,404.70, interest and costs. The plaintiffs readily admitted they had instructed the defendants not to initiate garnishee proceedings until about late February 1992. The plaintiffs say that was because the plaintiffs did not wish to execute on the judgment until after they had obtained judgment on their claim against AE. The plaintiffs were concerned (a concern they say the defendants were aware of) that execution on their judgment against AS alone, which was for a far smaller sum, would result in the closure by AE of AE`s bank accounts, prejudicing the plaintiffs` claim against AE. Hence the plaintiffs say they were content to wait until 13 January 1992 when they assumed summary judgment against AE would be given. The plaintiffs` complaint then is, as the defendants were aware of the plaintiffs` concern that AE might close its accounts, that the defendants ought to have advised the plaintiffs that they could have applied for a Mareva injunction to prevent dissipation of AE`s assets if necessary, and that had such advice been given, the plaintiffs would have instructed the defendants not only to apply for a Mareva...