Ho Yew Kong v Sakae Holdings Ltd and other appeals and other matters

CourtCourt of Appeal (Singapore)
JudgeSundaresh Menon CJ
Judgment Date29 June 2018
Neutral Citation[2018] SGCA 33
Citation[2018] SGCA 33
Published date04 July 2018
Plaintiff CounselLee Eng Beng SC, Rethnam Chandra Mohan, Yuen Djia Chiang Jonathan, Jeremy Gan, Chia Ming Yee Doreen and Gaw Wai Ming Daniel (Rajah & Tann Singapore LLP),Chacko Samuel, Lim Shack Keong, Anne Marie John and Too Fang Yi (Legis Point LLC)
Defendant CounselSiraj Omar, Lee Wei Alexander and Audie Wong Cheng Siew (Premier Law LLC),Davinder Singh s/o Amar Singh SC, Jaikanth Shankar, Pardeep Singh Khosa, Navin Shanmugaraj Thevar, Lydia Ni and Jaspreet Singh (Drew & Napier LLC)
Docket NumberCivil Appeals Nos 86, 87, 103 and 104 of 2017, Summons No 126 of 2017 and Originating Summons No 13 of 2017
Hearing Date28 November 2017
Date29 June 2018
Subject MatterAppeals,Duties,Civil Procedure,Companies,Submission of no case to answer,Minority shareholders,Contribution,Directors,Extension of time,Pleadings,Oppression,Third party proceedings,Notice
Sundaresh Menon CJ (delivering the judgment of the court): Introduction

The present matters arise out of the decisions made in two consolidated actions, Suits Nos 1098 and 122 of 2013 (“Suit 1098” and “Suit 122” respectively; and collectively, either “the two Suits” or “both Suits”), both of which were commenced by Sakae Holdings Ltd (“Sakae”). In Suit 1098, Sakae sought relief under s 216 of the Companies Act (Cap 50, 2006 Rev Ed), alleging that Ong Siew Kwee (“Andy Ong”), Ong Han Boon and Ho Yew Kong (“Ho”), as well as various companies owned and controlled by Andy Ong, had engaged in acts that were oppressive to it as a minority shareholder of a joint venture company, Griffin Real Estate Investment Holdings Pte Ltd (“the Company”). The alleged oppressive acts consisted of seven transactions by which (among other things) a substantial amount of money was diverted from the Company to entities that were either directly or indirectly related to Andy Ong. A total of 11 defendants were involved in Suit 1098. As for Suit 122, it involved a claim by Sakae against Andy Ong alone for breach of the fiduciary duties which he owed as a director of Sakae and for the tort of inducing a breach of contract by the Company, both in relation to one specific transaction out of the seven impugned transactions. Third party proceedings were subsequently commenced in both Suits by nine of the defendants against Douglas Foo Peow Yong (“Foo”), who was the chairman of Sakae’s board at all material times. In the third party proceedings, these nine defendants sought indemnification against or contribution in respect of any liability that they might incur arising from Sakae’s claims against them.

The High Court judge who presided over the trial (“the Judge”) dealt with the matters raised in the two Suits in two separate judgments. The first judgment, Sakae Holdings Ltd v Gryphon Real Estate Investment Corp Pte Ltd and others (Foo Peow Yong Douglas, third party) and another suit [2017] SGHC 73 (“the Main Judgment”), which was issued on 7 April 2017, dealt with Sakae’s claims in the two Suits; while the second judgment, Sakae Holdings Ltd v Gryphon Real Estate Investment Corp Pte Ltd and others (Foo Peow Yong Douglas, third party) and another suit [2017] SGHC 100 (“the Third Party Judgment”), which was issued on 4 May 2017, dealt with the third party claims. In the Main Judgment, the Judge allowed most of Sakae’s claims, finding that six of the seven impugned transactions were oppressive to Sakae and that Andy Ong had breached the fiduciary duties which he owed as a director of Sakae. The Judge also ordered the Company to be wound up. In the Third Party Judgment, the Judge dismissed the third party claims against Foo and ordered indemnity costs against Andy Ong, Ong Han Boon and Ho.

Civil Appeals Nos 86 and 87 of 2017 (“CA 86” and “CA 87” respectively; and collectively, “the Main Appeals”) are appeals by Ho (in CA 86) and seven of the other defendants in Suit 1098 (in CA 87) against the Judge’s findings in the Main Judgment; while Civil Appeals Nos 103 and 104 of 2017 (“CA 103” and “CA 104” respectively; and collectively, “the Third Party Appeals”) are appeals by Andy Ong and Ong Han Boon (in CA 103) and Ho (in CA 104) against the Judge’s findings in the Third Party Judgment. There is also an application by Andy Ong in Court of Appeal Originating Summons No 13 of 2017 (“OS 13”) for a retroactive extension of time to file an appeal against the findings made by the Judge (in both the Main Judgment and the Third Party Judgment) in respect of Suit 122, having filed notices of appeal only in respect of Suit 1098.

The present appeals raise (among other issues) two matters of legal significance in relation to oppression actions brought under s 216 of the Companies Act (“s 216”). The first, which lies at the heart of the Main Appeals, is the question concerning the sometimes fine and elusive distinction between personal wrongs against shareholders of a company and corporate wrongs against the company, as well as the related questions of who may seek relief in circumstances where both types of wrongs have been committed and what sort of relief may be sought. One view is that the proper remit of an oppression action under s 216 should be tightly circumscribed such that it is confined to claims for relief which are solely for personal wrongs committed against shareholders. As against this, corporate wrongs, which are wrongs committed in substance against the company rather than against its shareholders, should be remedied by way of a statutory derivative action under s 216A of the Companies Act (“s 216A”). In broad terms, this was the position that we took in Ng Kek Wee v Sim City Technology Ltd [2014] 4 SLR 723 (“Ng Kek Wee”). Whilst this view is theoretically sound in principle, it can sometimes be challenging to apply in practice, as has proved to be the case in the matters that are now before us. The second issue of legal significance is the question of whether a breach of the duty of care, skill and diligence (as opposed to the fiduciary duties) that a director owes a company would suffice to support a finding of commercial unfairness for the purposes of an oppression action under s 216. In this judgment, we address these issues, among various others.

Having considered all the pertinent facts and submissions, we allow Ho’s appeal in CA 86 and accordingly make no order for Ho’s appeal in CA 104, save that we set aside the Judge’s order of indemnity costs against Ho in respect of the third party proceedings; and we dismiss in the main CA 87 (save on some limited issues) and CA 103 in its entirety. We agree with many of the Judge’s findings, particularly on the facts; and where we have disagreed with any of them, we have explained our reasons in this judgment. We begin by setting out the parties and the relevant background facts. We then outline the key aspects of the parties’ cases and the Judge’s findings in both the Main Judgment and the Third Party Judgment before assessing these findings and explaining our decision on the issues before us.


The genesis of the present dispute is the joint venture agreement (“the JVA”) that was entered into between the Company, Sakae and Gryphon Real Estate Investment Corporation Pte Ltd (“GREIC”). Under the JVA, the Company was intended to be the vehicle through which the parties would invest in units at Bugis Cube, a shopping mall located at 470 North Bridge Road, Singapore.

The parties

Sakae (the sole respondent in the Main Appeals) is a listed company, and Foo (the sole respondent in the Third Party Appeals) is the chairman of its board. Foo and Andy Ong (the second appellant in CA 87 and the first appellant in CA 103) were friends who had known each other for more than 20 years. In July 2003, Foo suggested that Andy Ong be appointed as an independent director of Sakae. The appointment was duly made and Andy Ong remained an independent director of Sakae until 18 March 2013.

GREIC is an investment holding company whose shareholders at all material times included Andy Ong and his two associates, Ong Han Boon (the third appellant in CA 87 and the second appellant in CA 103) and Ho (the sole appellant in CA 86 and CA 104). At the time of the trial, Ho was the sole director of GREIC.

ERC Holdings Pte Ltd (“ERC Holdings”) is a company which is 86.85% owned by Andy Ong, who is also its chief executive officer and founder. ERC Holdings is the ultimate holding company of a group of companies, including the following: Gryphon Capital Management Pte Ltd (“GCM”) (the fourth appellant in CA 87), a company established to manage the Company’s real estate investment. Its directors at all material times were Andy Ong and Ong Han Boon. Sakae acquired 20% of the shares in GCM at the time the JVA was entered into. ERC Unicampus Pte Ltd (“ERC Unicampus”) (the fifth appellant in CA 87), an investment holding company. Ho was the sole director of ERC Unicampus until 12 July 2013, when he was replaced by Ong Han Boon, who remained the sole director at the time of the trial. ERC Institute Pte Ltd (“ERC Institute”) (the sixth appellant in CA 87), a professional training and consultancy company. At all material times, its directors were Andy Ong and Ong Han Boon. ERC Consulting Pte Ltd (“ERC Consulting”) (the seventh appellant in CA 87), a company providing business consulting and education services. Andy Ong was one of its two directors at all material times. These companies, together with ERC Holdings, are referred to as “the ERC Group”. Andy Ong allegedly controls all the companies in the ERC Group.


Sometime in late 2009, Andy Ong made a proposal to Foo that they come together to acquire more than 90% of the units in Bugis Cube. By doing so, they stood to be able to redevelop Bugis Cube and then sell the entire project at a profit. Foo agreed and suggested that some of the funding be provided by Sakae. Following this, on 3 September 2010, Sakae entered into the JVA with the Company and GREIC for the purposes proposed by Andy Ong. Sakae was the minority shareholder in the Company, holding 24.69% of the Company’s issued share capital, while GREIC held the remaining 75.31%.

The JVA included the following provisions: The board of the Company would consist of four directors, with GREIC and Sakae each entitled to appoint two directors, regardless of their relative shareholding positions in the Company. For certain defined matters (“Shareholder Reserved Matters”), the Company could act only if it obtained the prior unanimous approval of all its shareholders in a general meeting, who were required to act reasonably and in the best interests of the Company and the shareholders when exercising their voting rights. For other defined matters (“Board Reserved Matters”), the Company could act only if it obtained the prior majority approval of its directors,...

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38 cases
8 books & journal articles
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    • Singapore Academy of Law Journal No. 2019, December 2019
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    ...[1999] 1 SLR(R) 337 at [43]; and Over & Over Ltd v Bonvests Holdings Ltd [2010] 2 SLR 776 at [77]. 101 Ho Yew Kong v Sakae Holdings Ltd [2018] 2 SLR 333 at [81]. This is similar to what was said in Over & Over Ltd v Bonvests Holdings Ltd [2010] 2 SLR 776 at [81], where the Court of Appeal o......
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