Ku Swee Boon (trading as Norb Creative Studio) v Thu Aung Zaw

• Jurisdiction: Singapore
• Judge: Tan May Tee
• Judgment Date: 29 August 2017
• Neutral Citation: [2017] SGDC 241
• Court: District Court (Singapore)
• Docket Number: District Court Suit No. 3647 of 2014; Registrar’s Appeal No. 46 of 2017
• Year: 2017
• Published date: 08 November 2017
• Hearing Date: 12 July 2017,24 July 2017
• Plaintiff Counsel: Mr Adrian Tan (August Law Corporation)
• Subject Matter: Civil procedure,Amendment of name of Plaintiff,Whether mistake in writ issued in business name of sole proprietor nullity or irregularity
• Citation: [2017] SGDC 241

District Judge Tan May Tee: Background

The Plaintiff is the sole proprietor of Norb Creative Studio (“Norb”) which is a business providing printing services. The Defendant and one Huang Ziting were the partners of a limited liability partnership called Adlogic Asia LLP (“Adlogic”) which had contracted with the Plaintiff for the supply of booklets of discount dining vouchers.

The Defendant and Huang had signed a guarantee dated 1 December 2011 which provided that in consideration of the Plaintiff having supplied and/or continuing to supply Adlogic with goods, they would irrevocably and unconditionally, jointly and severally, guarantee the payment of all sums of money at any time due and owing or payable to the Plaintiff by Adlogic including all legal costs, charges and expenses on an indemnity basis.

As at 27 February 2013, a sum of $72,574.54 was due and owing by Adlogic to the Plaintiff. When no payment was made by Adlogic or the Defendant after several demands, the present suit was commenced by the Plaintiff in the name of Norb against the Defendant premised on the written guarantee of 1 December 2011. The Defendant defended the action in person and filed his Defence. After pleadings were closed, the Plaintiff applied for summary judgment pursuant to O 14 r 1 of the Rules of Court. Judgment was granted on the Plaintiff’s claim, with interest and costs, after a contested hearing.

When the judgment debt was not satisfied, the Plaintiff commenced bankruptcy proceedings against the Defendant in HC/B 2527/2016. A week before the hearing of the bankruptcy action, the Defendant, who had by this time engaged solicitors, filed an originating summons in the High Court (HC/OS 325/2017) seeking, amongst other things, for an order that the judgment in the present action be declared void by reason that the Plaintiff lacks the requisite legal capacity to bring the claim in this suit.

The Plaintiff responded by filing DC/SUM 1246/2017 seeking leave under O 20 r 5(3) of the Rules of Court to amend its name in this suit from Norb to “Ku Swee Boon (trading as Norb Creative Studio)” on the ground that a mistake had been made. The application was granted by a deputy registrar (“DR”) with costs fixed at $600 to be paid by the Plaintiff to the Defendant. Dissatisfied with the decision made by the DR, the Defendant filed an appeal by way of Registrar’s Appeal (DC/RA 46/2017) which came before me for hearing. I affirmed the DR’s decision and dismissed the appeal with costs. My grounds for doing so are set out herein.

Issue in this appeal

From the arguments canvassed by the Defendant opposing the amendment application, the main issue that had to be decided was whether an action commenced by a sole proprietor in his business or trading name was a nullity such that an amendment could not be allowed.

Plaintiff’s contentions

The Plaintiff had premised his application on O 20 r 5(3) which provides as follows: (3) An amendment to correct the name of a party may be allowed under paragraph (2)¹ notwithstanding that it is alleged that the effect of the amendment will be to substitute a new party if the court is satisfied that the mistake sought to be corrected was a genuine mistake and was not misleading or such as to cause any reasonable doubt as to the identity of the person intending to sue or, as the case may be, intended to be sued.

Reliance was placed on the Court of Appeal decision in Lim Yong Swan v Lim Jee Tee & Anor [1992] 3 SLR(R) 940 (“Lim Yong Swan”) where the Court had provided an instructive analysis of the scope of the amendment rules. With regard to O 20 r 5(3) in particular, the Court explained at [16] thus:

Paragraph (3) deals with a mistake over the description of the identity of a party to the proceedings. Two conditions have to be satisfied to trigger its operation. Firstly, the mistake must be a genuine mistake. That should be an easy question to decide. Secondly, the mistake is not misleading or such as to cause any reasonable doubt as to the identity of the person as a plaintiff or a defendant. The underlying thrust of the paragraph is that in truth and in substance the litigant is known, although there is a nominal defect in form. If an amendment is allowed, even if allowed after any relevant period of limitation current at the date of the issue of the writ has expired, what has been done is in effect a mere correction of the nomenclature with which the party is labelled. The other party at all material times knew in fact and in substance who the opposing litigant was.

Taking guidance from Lim Yong Swan, counsel for the Plaintiff, Mr Adrian Tan, submitted that the amendment ought to be allowed on the following grounds: a genuine mistake had been made; the mistake was not misleading, or was such as to cause any reasonable doubt as to the identity of Ku Swee Boon as the Plaintiff; and there is no prejudice to the Defendant.

The Plaintiff further relied on the Malaysian Court of Appeal decision of Mohamed Mustafa v Syed Ahmad [1972] 2MLJ 241 (“Mohamed Mustafa”) as a case directly on point where the plaintiff, who was also a sole proprietor, had commenced the action in the name of his firm. At the trial, the court granted leave for an amendment to be made to the title of the action by substituting the name of his trading firm with the plaintiff’s name which decision was affirmed on appeal. I will return to Mohamed Mustafa later in these Grounds.

Defendant’s contentions

Counsel for the Defendant, Mr Chew Sijie (“Mr Chew”), argued that this was not a simple matter of merely amending the nomenclature as suggested by the Plaintiff. There was a more fundamental issue as it concerned the legal capacity in which the suit was initially brought, and whether the entity “Norb” as a sole proprietorship could actually have a cause of action in law.

The Defendant’s submissions at the appeal hearing on why the amendment should not be allowed are summarised below: It is settled law that a sole proprietorship cannot have a cause of action in the name of the firm. See Mason and Son v Mogridge (1892) 8 TLR 805, Akitek Bersatu v Sempurna Cekup Sdn Bhd [2004] 7 MLJ 45, Vu Siew Chin v Wong Fah Yoon [1982] 2 MLJ 221. As the earlier proceedings were brought and conducted by an entity which is not recognised by the courts, the proceedings should be seen as a nullity. Therefore, should the court allow the Plaintiff’s application to amend the writ and pleadings, this would arguably be the first time that the Defendant is faced with a properly constituted statement of claim. Correspondingly, the court should set aside the summary judgment previously granted, and also allow the Defendant to amend his defence. Relying on the Court of Appeal decision in Hwa Lai Heng Ricky v DBS Bank Ltd [2010] 2 SLR 710 (and several other cases cited therein) which held that while a court may have a wide power of amendment even after final judgment, the appropriate cases in which such a power should be exercised must necessarily be very limited. A key factor that must be borne in mind is whether the amendments would cause any prejudice to the other party which cannot be compensated in costs. Allowing the amendment at this stage would be very prejudicial to the Defendant, given that there is presently before the High Court, HC/OS 325/2017, where the Court is being asked to consider if the judgment given in this suit is in law a nullity. The...