Leona Poon Siew Hoon v De Chevron Carpentry Pte Ltd and another

• Jurisdiction: Singapore
• Judge: Theodore Tan
• Judgment Date: 14 February 2022
• Neutral Citation: [2022] SGMC 12
• Court: Magistrates' Court (Singapore)
• Docket Number: Magistrate Court Suit No 821 of 2020 (Summons No 5658 of 2021)
• Year: 2022
• Published date: 18 February 2022
• Hearing Date: 21 January 2022
• Plaintiff Counsel: Cheung Shu Jia Jessica (Edmond Pereira Law Corporation)
• Defendant Counsel: Yeo Hsien Yang Shane Anthony (Invictus Law Corporation),The first defendant absent and unrepresented.
• Subject Matter: Civil Procedure,Delay,Setting aside
• Citation: [2022] SGMC 12

Deputy Registrar Theodore Tan: Introduction

In U Myo Nyunt (alias Michael Nyunt) v First Property Holdings Pte Ltd [2021] 2 SLR 816 (“U Myo Nyunt”), the Court of Appeal set out the applicable test for the setting aside of both an interlocutory judgment for damages to be assessed entered in default of appearance under O 13 r 2 of the Rules of Court (2014 Rev Ed) (“ROC”), and a judgment obtained at an assessment of damages governed by O 35 r 2 of the ROC. Given that the decision was only handed down last year, it is perhaps unsurprising that there do not appear to have been any written decisions considering its application. The present application affords an interesting opportunity to consider the application of the test in U Myo Nyunt to a situation where a defendant is guilty of significant procedural defaults, but has managed to demonstrate that there are serious concerns with the viability of the plaintiff’s claims.

Facts

I begin by briefly setting out the facts. The present suit arises out of a contract entered into on or about 2 May 2019 between the plaintiff and the first defendant (“the Contract”) for the provision of certain constructions works in relation to a property owned by the plaintiff (“the Property”). The contract was signed on behalf of the first defendant by the second defendant. It suffices to note that the works were not completed.

Whether the various steps taken by the plaintiff to bring notice of the proceedings to the second defendant were successful was hotly contested in the hearing of the application. I only briefly set them out here and will consider them in greater detail later on in this judgment.

The plaintiff first sent a letter on 20 August 2019 to the first defendant’s then registered address at 13 Kaki Bukit Road 4 (“the Kaki Bukit Address”),¹ where she had apparently first met the second defendant, and various email addresses associated with the defendants, informing of her engagement of a chartered surveyor to conduct a survey of the Property. This was followed by letters of demand on 3 September 2019 and 24 September 2019.² The final letter of demand was also copied to the addresses of the first defendant’s officers (including the second defendant) as reflected in the Accounting and Corporate Regulatory Authority’s (“ACRA’s”) records.

The Writ of Summons against the defendants was issued on 17 January 2020.

The claims pleaded against the second defendant in the Statement of Claim include:³ Fraudulent and/or negligent misrepresentation; Piercing of the corporate veil to make him liable for the first defendant’s breaches of contract; Unlawful means conspiracy with the first defendant to cause loss to the plaintiff; Inducing the first defendant to breach its contract with the plaintiff; and Enforcement of a guarantee or undertaking under cl 18 of the Contract in relation to any damages or losses suffered by the plaintiff due to the negligence or wilful default of the first defendant.

The Writ of Summons was served on the first defendant at its registered address at 216 Joo Chiat Road (“the Joo Chiat Address”). The Plaintiff applied for and obtained an order for substituted service in respect of the second defendant by post to his last known address at 45A Edgefield Plains (“the Edgefield Address”), which was carried out on 24 February 2020.

Interlocutory judgment in default of appearance was entered against the defendants on 11 March 2020 for damages to be assessed (“the Interlocutory Judgment”). Thereafter, the plaintiff proceeded to bring the matter to an assessment of damages, which was heard on 21 May 2021. It appears that in the lead up to the assessment of damages, various letters were sent by the plaintiff to the defendants to keep them apprised of proceedings. The defendants were ultimately adjudged liable to pay the sum of $47,190.86 to the plaintiff, together with interest and costs (“the Assessment Judgment”).

Following this, the plaintiff sent a further letter on 4 June 2021 (“the 4 June 2021 Letter”) to the defendants enclosing the judgments.⁴ In respect of the second defendant, the letter was sent to both the Edgefield address and an address at 217A Sumang Walk (“the Sumang Address”). It is not disputed that the second defendant presently resides at the Sumang Address, which belongs to his parents, though he denies seeing this letter. There was no response from the second defendant. The second defendant only appointed his present solicitors and applied to set aside both the Interlocutory Judgment and the Assessment Judgment on 30 November 2021, after bankruptcy proceedings were commenced against him by the plaintiff. This appears to have been prompted by a letter sent by the Ministry of Law to the Sumang Address on 1 September 2021.⁵

The Law

There was some initial confusion on the applicable legal test to be applied. The parties’ submissions attempted to apply the test set out in Mercurine Pte Ltd v Canberra Development Pte Ltd [2008] 4 SLR(R) 907 for the setting aside of a default judgment. Both sides subsequently accepted in the hearing before me that the applicable test is that laid out in U Myo Nyunt. Under this, the court embarks on a two-stage balancing exercise (U Myo Nyunt at [74]): first, it has to identify and assess the seriousness and significance of the defaults and the reasons behind the procedural breaches; and second, it has to balance the considerations in (a) against all other relevant factors, bearing in mind the two competing interests of finality in litigation on the one hand, and the interests of justice in preventing a miscarriage of justice that might be occasioned in denying the relief sought.

With these principles in mind, I now turn to apply them to the instant case, addressing the parties’ submissions on the issues where necessary.

Analysis Seriousness and significance of defaults and reasons behind procedural breaches

The second defendant’s position is that he only became aware of the proceedings in September 2021 when the letter from the Ministry of Law concerning the bankruptcy proceedings was sent to the Sumang Address, upon which he promptly took out the present application to set aside the Interlocutory Judgment and Assessment Judgment.

According to the second defendant, the plaintiff’s attempts to bring the proceedings to his attention were unsuccessful for a number of reasons: First, he was not residing at the Edgefield Address in February 2020 when service was effected pursuant to the substituted service order. While this was his residential address in ACRA’s records, he had in fact moved in August 2019 to live with his parents at the Sumang Address owing to marital problems with his wife, who refuses to communicate with him.⁶ Second, while service was effected on the first defendant at its registered office at the Joo Chiat Address, the Joo Chiat Address had been tenanted out by that time and the first defendant was operating out of the Kaki Bukit Address.⁷ Third, he did not receive any of the letters sent to his personal email as he was constantly travelling from 31 July 2019 to 21 January 2020 and had limited access to email. His work emails had also been deactivated on or around August 2019.⁸ Fourth, he was not on talking terms with any of the first defendant’s other directors and any correspondence sent to them would not have been shared with him.⁹ Fifth, the letter sent by the plaintiff to the Sumang Address annexing the Interlocutory and Assessment Judgments did not reach him as he did not have access to the letterbox and was not informed by his elderly parents.¹⁰

The plaintiff’s position, unsurprisingly, is that the second defendant’s explanations should be rejected as he has provided little to no evidence on the alleged reasons for being unaware of the proceedings. The plaintiff contends that the second defendant was aware of the proceedings from the beginning and deliberately chose not to take part.¹¹

In my judgment, the second defendant was aware of the present proceedings long before the Ministry of Law’s letter was sent to him in September 2021, but for reasons best known to himself elected not to participate. The mere fact that the second defendant’s explanations have been put on affidavit does not mean that the court is bound to accept them unquestioningly. To my mind, the alleged chain of coincidences (see [13] above) that operated to render the second defendant unaware of the present proceedings from their commencement in January 2020 till September 2021 despite the plaintiff’s efforts to keep him informed is so incredible and unsupported by the evidence that it must be rejected.

The second defendant’s affidavits in many respects consists of little more than bare assertions, even where it would have been fairly easy to obtain and exhibit supporting evidence. This is of particular importance in the present matter given the long delay for which an explanation is required.

The second defendant first lays the blame on his wife for not informing him of the proceedings after he allegedly moved out of the Edgefield Address in August 2019. Given the seriousness of the matter to the second defendant with the pending bankruptcy proceedings, one would expect some attempt at eliciting an explanation as to why the various letters sent by the plaintiff and substituted service of the writ of summons were not brought to his intention (whether as a...