Hwang Yue Eye Rose and Others v Malayan Banking Bhd

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeLim Teong Qwee JC
Defendant CounselPatrick Ong Kok Seng (PK Wong & Advani)
Subject MatterCivil Procedure,Striking out,Whether claim frivolous and vexatious and an abuse of court's process,Pleadings,Whether statement of claim discloses reasonable or probable cause of action,Whether new evidence exists since judgment in support of allegations of fraud,Statement of claim to set aside judgment of Court of Appeal on ground of fraud,Whether allegations of fraud are pleaded with sufficient particulars
Date09 July 1998
Plaintiff CounselJB Jeyaretnam (JB Jeyaretnam & Co)
Docket NumberSuit No 1892 of 1997 (Registrar's
Published date19 September 2003
Judgment:

LIM TEONG QWEE JC

This is an appeal against the order of an assistant registrar made on 19 December 1997 that the statement of claim in this action be struck out on the ground that it is frivolous and vexatious and is an abuse of the process of court and that the action be dismissed with costs. After hearing counsel for the plaintiffs I invited him to consider whether the statement of claim disclosed a reasonable or probable cause of action. Mr Jeyaretnam applied for an adjournment to prepare a draft amended statement of claim and I gave certain directions and granted an adjournment. In the event the matter came before me again on 8 April 1998 when counsel tendered a draft amended statement of claim. After hearing further submissions I dismissed the appeal.

2.In Suit No 1126 of 1992 the defendant in this action (`bank`) was the plaintiff and the plaintiffs in this action were the defendants. In that action (`bank`s action`) the bank claimed against the first plaintiff (`customer`) as its customer for balance of money due for banking facilities and against the second plaintiff (`Patrick Tan`) and the third plaintiff (`Tan Sr`) as guarantors of the customer`s indebtedness. Paragraph 6 of the statement of claim in the bank`s action alleged that the bank issued a standby letter of credit for RM13m and as security for the facility the customer placed a cash deposit of $7,745,400 with the bank. Paragraph 7 alleged that at the request of the customer part of the cash deposit was used to purchase on behalf of the customer AUD14,860,000 NatWest Australia Bank Ltd zero coupon bonds due on 15 January 2002 and it was agreed that the bonds would be registered in the name of the bank and be held by the bank as security for the facility. Paragraph 16 alleged that on or about 22 April 1992 the bank paid on the standby letter of credit and para 17 alleged:

On 27 May 1992 the [bank] as they were entitled to, sold the bonds for AUD 5,500,000.

There was a shortfall and the bank claimed against the customer the balance of her indebtedness. The claims against Patrick Tan and Tan Sr were based on written guarantees given by them.

3.Separate defences were delivered by each of the defendants in the bank`s action. First the customer alleged that she was a nominee for a third party and was not liable on her account with the bank. This is not relevant for the purpose of the present action. Secondly in para 12 of her defence she alleged:

The [customer] denies para 17 of the amended statement of claim. The [bank] did not, before issuing the standby letter of credit, give the [customer] any letter of offer setting out the terms and conditions upon which they would be prepared to issue the standby letter of credit.

Paragraphs 17 and 18 alleged:

17 At the date of the sale by the [bank] the bonds had a value of $7.94m which value was informed to the [bank] by [Patrick Tan] by his letter of 26 May 1992.

18 The [bank] in hastily disposing of the bonds by private treaty has caused a loss of $1.2m.

Paragraph 20 alleged:

The [customer] further states that the [bank] before selling the bonds failed to give the [customer] a reasonable opportunity to find a purchaser at the best price for the bonds ...

Patrick Tan and Tan Sr relied on other defences which are not relevant for the present purpose but Patrick Tan also adopted the customer`s defence.

4.The bank`s action was dismissed but on appeal to the Court of Appeal judgment was on 26 February 1997 given for the bank against all the plaintiffs as claimed. See Malayan Banking Bhd v Hwang Rose & Ors [1997] 2 SLR 1 . The claim in this action is for an order to set aside the judgment of the Court of Appeal on the ground that the judgment was obtained by the fraud of the bank.

5.Paragraph 1 of the statement of claim states the relief claimed and para 2 identifies the parties to the bank`s action. Paragraph 3 states the claims in the bank`s action and para 4 says that the customer`s account was secured by the bonds. Paragraphs 5, 6, 9, 10 and 11...

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