Koh Kim Teck v Shook Lin & Bok LLP

• Jurisdiction: Singapore
• Judge: S Mohan JC
• Judgment Date: 29 April 2020
• Neutral Citation: [2020] SGHC 86
• Court: High Court (Singapore)
• Hearing Date: 03 February 2020
• Docket Number: Originating Summons (Bankruptcy) No 129 of 2019 (Registrar’s Appeal No 353 of 2019)
• Plaintiff Counsel: Derek Kang Yu Hsien and Ashok Kumar Rai (Cairnhill Law LLC)
• Defendant Counsel: Goh Keng Huang and Leong Woon Ho (Shook Lin & Bok LLP)
• Subject Matter: Insolvency Law,Bankruptcy,Statutory demand
• Published date: 05 May 2020

S Mohan JC: Introduction

In Originating Summons (Bankruptcy) No 129 of 2019 (“OSB 129”), the plaintiff, Koh Kim Teck (the “plaintiff”), applied (a) for an extension of time to set aside a statutory demand dated 30 September 2019 (the “SD”) served on him by the defendant, Shook Lin & Bok LLP (the “defendant”), and (b) to set aside the SD. The application was heard on 19 November 2019 and dismissed by the assistant registrar. The plaintiff appealed against the dismissal of his application and the appeal came before me.

After hearing arguments, I dismissed the appeal. Dissatisfied with my decision, the plaintiff has appealed. These are my grounds of decision.

Facts Background to the dispute

The plaintiff is a former client of the defendant, a law firm. From sometime in early May 2013 till 22 January 2018, the defendant acted for the plaintiff in two consolidated suits heard in the High Court namely, Suit Nos. 942 of 2013 and 1123 of 2014 (the “Consolidated Suits”). Thereafter, the plaintiff discharged the defendant and appointed another firm of solicitors, Optimus Chambers LLC (“Optimus Chambers”),¹ to represent him in the Consolidated Suits in place of the defendant.

Two of the defendant’s invoices issued to the plaintiff remained outstanding namely, Invoice No. 150722 dated 26 October 2017 (the “26 October invoice”) and Invoice No. 152152 dated 13 March 2018 (the “13 March invoice”).² Both invoices related to work done by the defendant when it represented the plaintiff in the Consolidated Suits. Following various communications between the defendant, the plaintiff and Optimus Chambers during the period March 2018 to November 2018, the defendant wrote to Optimus Chambers enclosing a statutory demand dated 29 November 2018 issued by the defendant against the plaintiff on the basis of the 26 October invoice.³ The defendant enquired if Optimus Chambers had instructions to accept service of that statutory demand on the plaintiff’s behalf. The defendant did not receive a response. No further steps were thereafter taken by the defendant with regard to this statutory demand.⁴

On 15 January 2019, Originating Summons 67 of 2019 (“OS 67”) was filed by the plaintiff. In OS 67, the plaintiff applied for (a) leave to be granted for an order for taxation in respect of the 26 October invoice, and (b) an order for taxation in respect of the 13 March invoice.⁵ The defendant contested OS 67 only in respect of the 26 October invoice, on the basis that more than 12 months had passed since delivery of the bill to the plaintiff and no special circumstances had been shown by the plaintiff justifying leave as required under s 122 Legal Profession Act (Cap 161, 2009 Rev Ed) ( “Legal Profession Act”).⁶

OS 67 was heard by Justice Aedit Abdullah on 27 March 2019. Abdullah J dismissed the prayer in OS 67 that sought leave for an order for taxation in respect of the 26 October invoice, on the ground that the plaintiff had not shown special circumstances.⁷ The plaintiff did not seek to appeal that part of Abdullah J’s order. An order for taxation in respect of the 13 March invoice was granted (that was in any event not objected to by the defendant).⁸

The defendant proceeded to file a Bill of Costs (BC 95/2019) on 23 July 2019 in respect of the 13 March Invoice (the “taxation proceedings”). The plaintiff appointed his current solicitors, Cairnhill Law LLC (“Cairnhill Law”), for the taxation proceedings on 20 August 2019. The taxation proceedings were ongoing at the time of the appeal before me.

In respect of the 26 October invoice, the defendant issued a fresh statutory demand dated 10 May 2019 in relation to the same debt and sent it by registered post to the plaintiff at his last known address at 72 Bayshore Road, #26-15 Costa Del Sol, Singapore 469988 (the “last known address”) but it was returned uncollected. The defendant also attempted substituted service on the plaintiff by sending an email to the plaintiff and LVM Law Chambers, the latter being the plaintiff’s solicitors in his appeal against the trial judge’s decision in the Consolidated Suits. However, the defendant did not receive any reply to the email.⁹ Thereafter, no further steps were taken by the defendant in relation to this statutory demand.

The defendant then issued the SD in relation to the same debt. The SD was the subject of the appeal before me. The defendant decided to issue the SD instead of proceeding on the basis of the demand dated 10 May 2019 as the defendant had not received any response to its earlier email to the plaintiff and his solicitors LVM Law Chambers.¹⁰ The defendant first attempted to serve the SD on the plaintiff personally, prior to commencing bankruptcy proceedings. On 30 September 2019 and 1 October 2019, the defendant’s clerk attempted personal service on the plaintiff at the last known address but on each occasion the door to the premises was locked.¹¹ When those attempts at personal service were made, the defendant was already aware from a title search it had conducted on 5 September 2019 that the plaintiff no longer owned the property at the last known address and that the owner was one Ye Fanghua. In contrast, a previous title search undertaken by the defendant in March 2019 showed that the plaintiff was the owner although I note that even in that search, Ye Fanghua had already lodged a caveat as a purchaser.¹² The defendant also conducted an Enhanced Individual Search on the plaintiff on 29 October 2019, which did not reveal any details of the plaintiff’s residential address.¹³

Following the two unsuccessful attempts at personal service on the plaintiff, the defendant then placed an advertisement in the Straits Times on 4 October 2019 with a notice of the SD (the “advertisement”).¹⁴ The notice of the SD in the advertisement stated that it was given under r 96(4)(d) of the Bankruptcy Rules (Cap 20, R1, 2006 Rev Ed) (“BR”). The material parts of the notice were in the following terms:¹⁵

NOTICE OF STATUTORY DEMAND

UNDER RULE 96(4)(d) OF THE BANKRUPTCY RULES

STATUTORY DEMAND ISSUED ON THE

30th DAY OF SEPTEMBER 2019

UNDER SECTION 62 OF THE BANKRUPTCY ACT

TO: KOH KIM TECK

72 Bayshore Road

#26-15 Costa Del Sol

Singapore 469988

TAKE NOTICE that a Statutory Demand under Section 62 of the Bankruptcy Act has been issued against you by SHOOK LIN & BOK LLP, a limited liability partnership incorporated in Singapore and having its registered office at 1 Robinson Road #18-00 AIA Tower Singapore 048542 (“the Creditor”) on 30 September 2019, in which the Creditor claims against you the sum of S$106,133.52 as at 30 September 2019 being the amount due and owing by you pursuant to the Creditor’s Invoice No. 150722 dated 26 October 2017. The Creditor demands that you pay the above debt or secure or compound for it to the Creditor’s satisfaction within 21 days from the date of publication of this Notice. If you fail to do so, the Creditor may file a bankruptcy petition against you.

If you wish to have this Statutory Demand set aside or otherwise deal with this demand you must make an application to the High Court and do so within 14 days from the date of publication of this Notice.

The Statutory Demand can be obtained or is available for inspection and collection during office hours from:-

SHOOK LIN & BOK LLP

No. 1 Robinson Road

#18-01 AIA Tower Singapore 048542

[Ref: SSG/JMS/2190134]

Dated the 4th day of October 2019

In addition to the advertisement, a copy of the notice of the SD as advertised was sent by the defendant to the plaintiff’s solicitors in the taxation proceedings, Cairnhill Law, by an email on 4 October 2019 timed at 12.03pm (the “4 October 2019 email”).¹⁶ The defendant subsequently sent a copy of the SD itself to Cairnhill Law on 22 October 2019 by an email timed at 6.49pm (the “22 October 2019 email”).¹⁷ Prior to these emails and the issuance of the SD, the defendant had, on 18 September 2019, asked Cairnhill Law if it had instructions to accept personal service of process, including a statutory demand, on behalf of the plaintiff.¹⁸

The defendant filed the bankruptcy application (HC/B 2786/2019) against the plaintiff on 29 October 2019 based on the SD. On the same day, the defendant sent copies of the cause papers filed in the bankruptcy application to Cairnhill Law.¹⁹ OSB 129 was filed by the plaintiff two days later, on 31 October 2019.

The parties’ cases

The plaintiff submitted that should the court find that the advertisement constituted valid service of the SD, the defendant would be out of time to apply to set aside the SD and an extension of time should be granted to him. He argued that his application would, however, have been made in time if the court considered that valid service was only effected via the 22 October 2019 email.²⁰ In any event, neither the advertisement nor the 22 October 2019 email (or for that matter, the 4 October email) constituted valid service. According to the plaintiff, the SD should be set aside for the following reasons:²¹ the SD was not validly served; the debt was disputed on substantial grounds such that there were triable issues; and the plaintiff had a valid cross demand against the defendant which exceeded the debt.

The defendant, on the other hand, submitted that the SD was validly served on the plaintiff by the advertisement as well as the 4 October 2019 email, and an extension of time ought not to be granted to the plaintiff to apply to set aside the SD.²² In any event, the plaintiff would not be entitled to dispute the debt and there was no basis for the plaintiff to assert that the defendant had any valid cross demand.

Decision below

It is worth mentioning that at the hearing below, the defendant relied only on the advertisement as its means of substituted service and argued that it was valid service under r 96(4)(d) BR. The assistant registrar dismissed the plaintiff’s...