Lee Kuan Yew v Tang Liang Hong and Other Actions (No 1)

• Jurisdiction: Singapore
• Judge: Lai Kew Chai J
• Judgment Date: 30 January 1997
• Neutral Citation: [1997] SGHC 27
• Plaintiff Counsel: Wong Meng Meng (Wong Partnership),Harry Elias (Harry Elias & Partners),K Shanmugam (Allen & Gledhill),Giam Chin Toon (Wee Swee Teow & Co),Davinder Singh (Drew & Napier),Tan Kok Quan (Lee & Lee)
• Date: 30 January 1997
• Published date: 19 September 2003
• Subject Matter: Applicable principles,Whether Mareva injunctions to be extended to defendant's wife,O 15 r 6(2)(b) Rules of Court 1996,Whether wife of defendant should be joined as second defendant to proceedings,Parties,Value of assets to be protected from dissipation,Disclosure of assets by defendant and his wife to plaintiff,Whether there was real risk of dissipation of assets,Joinder of a third party,Mareva injunction,Injunctions,Joinder,Civil Procedure
• Docket Number: Suits Nos 2523, 2524, 2525 and
• Citation: [1997] SGHC 27
• Court: High Court (Singapore)
• Year: 1997

Introduction

The plaintiffs are the leaders and prominent members of a political party known as the People`s Action Party (PAP). Some of them are Cabinet Ministers led by Mr Goh Chok Tong (Mr Goh), the Prime Minister. Mr Tang is an advocate and solicitor of the Supreme Court of Singapore, having been admitted on 10 April 1968. Mr Tang, a member of the Workers` Party (WP), was a candidate and he stood for elections in the Group Representative Constituency (GRC) of Cheng San in the Parliamentary General Elections held on 2 January 1997. Nomination day was 23 December 1996.

The plaintiffs in these actions are all claiming against the first defendant (Mr Tang) for damages for the torts of slander and libel allegedly committed on numerous occasions. On 27 January 1997 they filed 12 ex parte applications for, inter alia, (1) pre-judgment Mareva injunctions against Mr Tang and his wife, Teo Siew Har (Mrs Tang); (2) an order to join Mrs Tang as the second defendant; and (3) an order that both the defendants must inform the plaintiffs in writing at once all their assets whether in or outside Singapore and whether in their own name or whether solely or jointly owned, giving the value, location and details of all such assets.

At the conclusion of the hearing on 27 January 1997 I made an order in terms of the 12 applications. I went on to make the usual exceptions to the Mareva injunctions making it clear that the Mareva injunctions did not prohibit the defendants from spending $2,000 per week towards their ordinary living expenses nor, subject to timeous accounting, did the orders prohibit the defendants from dealing with or disposing of any of their assets in the ordinary and proper course of business. I now set out within a reasonably brief compass the law on Mareva injunction, the background, the evidence before me and the reasons I made the orders I did.

Joinder of Mrs Tang

Before I do so, and at the outset, I should deal with an issue of procedure and substance and set out the reasons why Mrs Tang was added as the second defendant and why she too was subject to the Mareva injunctions. In litigation it happens sometimes that issues or matters can arise which may affect the interest of a person who is not a party to the proceedings. It is desirable that all issues and matters are adjudicated and determined in the same proceedings by adding all necessary parties who would thereafter be bound by a judgment. The joinder of a third party would prevent a multiplicity of proceedings. In those circumstances, a procedure has been evolved to achieve those objectives. The procedure in the proceedings before me is provided under O 15 r 6(2)(b) of the Rules of Court 1996. The relevant parts provide as follows:

(2) ... at any stage of the proceedings in any cause or matter, the Court may, on such terms as it thinks just and ... on application -

(a) ...

(b) order any or the following persons to be added as a party, namely:

(i) any person ... whose presence before the Court is necessary to ensure that all matters in the cause or matter may be effectually and completely determined and adjudicated upon; or

(ii) any person between whom and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which in the opinion of the Court it would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter.`

Reverting to the evidence and assertions in these 12 applications, it was established that Mrs Tang is the registered owner of their matrimonial residence known as No 75 Hua Guan Avenue, Singapore 589171 (the property). The property is erected on a piece of land known as Lot 447 in Mukim XVI Bukit Timah, Singapore and has an area of 742.8 sq m. Mr Goh and Mr Lee asserted that they verily believed that although the property is in the name of Mrs Tang, Mr Tang owns, or has a substantial beneficial interest in it. The property was registered in Mrs Tang`s name on 12 February 1981. It was initially mortgaged. Mr Tang obviously paid for the purchase price and instalments as Mrs Tang never had any independent income at all material times. Reliance was placed on the fact that in December 1981 Mr Tang bought a property known as No 51 Jalan Lanjut in his own name. He sold it in or about May 1982, within about six months. It was asserted that in the circumstances Mrs Tang held the property upon trust for Mr Tang. Alternatively, it was pointed out that the property was matrimonial property and in all the circumstances he would be entitled to a half share in the property. The issue whether Mr Tang has any beneficial interest in the property, and if so, what is the extent and, alternatively, his share in the matrimonial property has to be determined at the trial of the suits recited in the title of these grounds of judgment.

I decided to grant the applications to add Mrs Tang as the second defendant and to issue against her the Mareva injunctions on the authority of TSB Private Bank International SA v Chabra [1992] 1 WLR 231 , which was cited to me by learned senior counsel for Mr Lee. In that case, a pre-judgment Mareva injunction was issued. I was greatly influenced by this case authority. The bank sued Mr Chabra on a guarantee and obtained a Mareva against him. It transpired that a company held substantial assets of which Mr Chabra was arguably the beneficial owner. The matter or issue had to be adjudicated later. The bank had no claims whatsoever against the company, just as the plaintiffs in the suits before me had not asserted any claims against Mrs Tang. Mummery J in that case, however, ordered the company be joined as a defendant under the English Rules of Supreme Court O 15 r 6(2)(ii) and granted a Mareva against the company as well. The English and Singapore rules of procedure are the same.

Before making the decision, I was satisfied that her addition as the second defendant was unavoidably necessary and that the injunction would cause no damage or any injustice to Mrs Tang. According to her husband, he intended to sell the property for the purpose of raising funds for legal costs. He claimed that he had the support of his wife and family. If she needs to sell the property, she could always apply to the High Court for liberty to sell the property and set aside sufficient sums from the net proceeds of sale to meet all reasonable and bona fide legal costs.

Orders for disclosures by defendants

I will now advert to my orders that Mrs Tang disclose all her assets. I relied on the decision of the English Court of Appeal in Mercantile Group (Europe) AG v Aiyela & Ors [1994] QB 366 . Chief Aiyela of Nigeria was an influential man who for a commission could procure lucrative contracts. The plaintiffs paid him but he defaulted. He was sued by the plaintiffs for US$1.8m plus interest. Eventually, in 1991 he consented to judgment for US$2.2m. He paid US$388,000 and nothing more. He then left his luxurious home in Hampstead, London and went abroad. But in 1992 he returned to England. The Aiyelas` style of living was just as grand as before. On 23 July 1992 the High Court ordered Mrs Aiyela to disclose crucial financial information relating to the assets of her husband. There was cogent evidence that she was holding assets of her husband upon trust. She suppressed an important piece of information and in December 1992 a judge of the High Court issued a world-wide injunction against her. The English Court of Appeal referred to Chabra `s case and ruled that the injunction against the company in that case `was ancillary` to the cause of action which the bank had against Mr Chabra.

I would like to set out the circumstances when a court will entertain an ex parte application, that is, an application from a party in the absence of the other party or parties. The general rule is that an opponent should be given notice of the ex parte application and invited to attend. This general rule is not immutable. The one exception is the application of a Mareva injunction where an applicant`s purpose can be defeated if the adversary is given prior notice: see Castle Fitness Consultancy Pte Ltd v Manz [1990] 1 MLJ 141 ; [1989] SLR 896 and Chiarapurk Jack & Ors v Haw Par Bros International Ltd [1993] 3 SLR 285 .

Mareva injunctions

Every judicial system, if it is to be effective and at the same time be fair and just to a successful litigant, has to provide, inter alia, a procedure to prevent a defendant from dissipating or concealing his assets so as to deny a successful plaintiff the fruits of his judgment if and when obtained. Mareva injunctions were developed to prevent any dishonest attempt to defeat a judgment. The granting of Mareva injunctions by courts in all common law jurisdictions has become a common occurrence over the last 21 years. This prophylactic and pre-emptive remedy, as many cases have shown, is being invoked in its full rigour in many cases so long as courts are satisfied that on the merits of each case it is just and convenient to issue a long-range Mareva order. This specie of injunctions took its name from the decision of the English Court of Appeal in The Mareva; Mareva Compania Naviera SA of Panama v International Bulk Carriers SA [1975] 2 Lloyd`s Rep 509. This relief, which is mostly but not always interlocutory, is collateral to the main actions.

Courts have required applicants for Mareva injunctions to show, inter alia, that they have a good arguable claim or there are serious questions to be tried and, further, they have to prove by `solid evidence` that there is a real risk of a defendant dissipating his assets, here and abroad, before a judgment or award is satisfied.

In Choy Chee Keen Collin v Public Utilities Board [1997] 1 SLR 604 , the Court of Appeal in its judgment delivered on 3 December 1996 laid down a number of rules....