Kalki Jewellery (suing as a firm) v Mani Samikkannu

CourtHigh Court (Singapore)
JudgeS Rajendran J
Judgment Date28 May 1999
Neutral Citation[1999] SGHC 145
Citation[1999] SGHC 145
Date28 May 1999
Defendant CounselRamalingam Kasi (Raj Kumar & Rama) and M Ravi (Naranjan & Co)
Docket NumberSuit No 304 of 1998
Plaintiff CounselB Rengarajoo (B Rengarajoo & Associates)
Published date19 September 2003
Subject MatterDuties of holder,Whether defendant merely fronting for plaintiffs in return for commission,Evidence,Action for price of goods sold and delivered by plaintiffs to defendant,s 67(1)(c) Evidence Act (Cap 97, 1997 Rev Ed),s 59(3) Bills of Exchange Act (Cap 23, 1999 Rev Ed),Whether photocopies of thermal copies of faxes admissible,Discharge of accommodation bill as a result of payment by accommodated party,Whether plaintiffs holder in due course,Admissibility of evidence,s 29 Bills of Exchange Act (Cap 23, 1999 Rev Ed),Bills of Exchange and Other Negotiable Instruments,Liability of accommodation party,Commercial Transactions,Sale of goods,Bills of exchange,Secondary evidence,Accommodation bill,Whether bill subject to defects of title and personal defences,Legal proceedings

: The plaintiffs are a firm of jewellery traders based in Trichirapalli, India. The principal witness for the plaintiffs, Kalai Ramakrishnan (`KR`) was the managing partner of the plaintiff firm. The defendant, Mani Samikkannu (`Mani`) is a Singapore businessman whose principal business was the import of computers and computer peripherals for sale in Singapore and for re-export in this region.

The plaintiffs alleged that on 28 January 1997 Mani had issued a standing order to them to deliver to him 5 to 10 kg of jewellery every 30 to 45 days. It was the plaintiffs` case that, pursuant thereto, the plaintiffs delivered three consignments of jewellery to Mani. Except for two payments totalling US$27,985, Mani failed to pay for the goods. Details of these consignments/payments were as follows:

Gross Weight
Consignment Value As per Amount Paid
Date (US$) Packing List (US$) Balance
1 22.4.97 72,335 6,174.85 20,000 (15.10.97) 44,350
7,985 (23.1.98)
2 30.4.97 51,082 4,404.53 - 51,082
3 05.6.97 123,440 10,721.47 - 123,440
21,300.85 218,852

The plaintiffs in these proceedings are claiming for the balance of the purchase price amounting to US$218,852 and interest thereon at 20% per annum.

In respect of each of the three consignments the plaintiffs had, together with the shipping documents, forwarded to the Singapore branch of the Indian Bank, a bill of exchange for the invoice amount payable within 120 days of acceptance to the City Union Bank at Trichirapalli, India, the bankers of the plaintiffs. Mani had accepted these bills and the plaintiffs had discounted them with City Union Bank. However, when Mani failed to honour the bills, the plaintiffs paid the amount outstanding with interest at 20% per annum to City Union Bank and the bills were returned to the plaintiffs. The plaintiffs` alternative claim against Mani in these proceedings was for payment under these three bills. Initially, the plaintiffs had claimed as drawers of the bills but in the course of the hearing they amended their pleading to claim as holders.

Evidence was led that, prior to these three consignments, the plaintiffs had between June 1996 and January 1997 sent six other consignments to Mani on similar terms. Full payment for these six consignments had been received by the plaintiffs, although some of these payments were effected well outside the credit period stipulated.

The defence raised by Mani was that the purported purchases by him of the jewellery were not genuine purchases by him - he had merely lent his name, for a commission, to the plaintiffs to enable the plaintiffs to import and sell their goods in Singapore - and for that reason was not liable to the plaintiffs for the price of the goods or under the bill. Mani claimed that KR, having sent the goods from Trichirapalli to Singapore, would, for every consignment, come personally to Singapore, take control of the consignment and handle the sales to the plaintiffs` customers in Singapore and Malaysia. At KR`s request Mani would, whenever requested, issue invoices from Tradeworld Resources & Services in respect of sales made by KR. KR would, periodically, hand the proceeds of sale (cheque or cash) to Mani. Mani would deduct his expenses and his commission, of $2 per gramme of jewellery imported, from the amounts handed to him by KR and make payments as directed by KR including remittances to Trichirapalli in satisfaction of the bills of exchange he had accepted. That was how payment of the bills of exchange in respect of the first six consignments and part-payment of the seventh consignment (the first of the three consignments under this claim) came to be made. Mani claimed that it was because KR had not given him sufficient funds that the last three bills of exchange remained outstanding.

Mani also claimed that, as part of his arrangement with KR, he had signed various orders and letters that KR requested him to sign. These included various standing orders as well as letters, such as PB.82 and PB.87, asking for more time within which to make payment. KR had told Mani that the standing orders were required for obtaining export permits and the letters were needed for KR to placate the bankers in Trichirapalli who had advanced moneys to KR on the strength of the exports.

Mani accepted that some of the orders placed with the plaintiffs were those of his wife, Vijayalakshmi. Vijayalakshmi had experience in the jewellery trade - she was a partner in Viknesh Jewellers until February 1997 when the firm closed - and she had, at times, assisted KR in finding customers. As a favour for friends she had also, at times, placed orders with KR for items of jewellery. These orders, he claimed, constituted only a very small portion of the jewellery that the plaintiffs imported, through him, into Singapore.

Mani testified that although for the first six consignments the credit given was only for 90 days, the bills in respect of the second to sixth consignments were overdue by between 100 and 150 days before they were settled. On 10 January 1997, for instance, when the fifth consignment was sent, no payments in respect of the second, third and fourth consignments, amounting to some US$370,000 had been made. Inspite of this, some three weeks later, on 31 January 1997, the sixth consignment was shipped bringing the total outstanding on the bills of exchange to US$420,000. Despite such large sums being overdue for so long the plaintiffs continued to send jewellery and even increased the credit period for the seventh, eighth and ninth consignments to 120 days. It was submitted that the reason the plaintiffs were so lax in their credit control was because the business was in fact the plaintiffs` business and not Mani`s business.

Although evidence was led as to the history of the relationship between the plaintiffs and Mani, it was the seventh, eighth and ninth consignments that constituted the subject matter of the claim in this case. It was therefore these consignments that were the focus of much of the evidence. About 18,000 grammes out of the 21,300 grammes sent to Singapore under these three consignments were delivered to a firm of jewellery merchants in Singapore called Kim Kiong Jewellers (`KK Jewellers`). It would be necessary to examine these three consignments in some detail. As it was Mani who was alleging that the consignments to him were not what they seemed to be on the surface, I will deal with Mani`s...

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