Lilyana Alwi v John Arifin

• Jurisdiction: Singapore
• Judge: Woo Bih Li J
• Judgment Date: 02 May 2019
• Neutral Citation: [2019] SGHC 113
• Plaintiff Counsel: Deborah Barker SC, Ushan Premaratne and Kenneth Yap Meng (KhattarWong LLP)
• Date: 02 May 2019
• Docket Number: Suit No 159 of 2016
• Hearing Date: 16 August 2018,14 August 2018,15 August 2018,15 October 2018,17 August 2018,30 August 2018,21 August 2018
• Subject Matter: Equity,Breach of trust,Fraud,Trusts,Resulting trusts,Presumed resulting trusts,Certainties,Express trusts
• Year: 2019
• Defendant Counsel: Narayanan Sreenivasan SC and Tan Kai Ning Claire (Straits Law Practice LLC)
• Court: High Court (Singapore)
• Citation: [2019] SGHC 113
• Published date: 07 May 2019

Woo Bih Li J: Introduction

The plaintiff, Lilyana Alwi, commenced Suit No 159 of 2016 on 18 February 2016 against the defendant, John Arifin, seeking: a declaration that she was the sole beneficiary of moneys held in certain joint accounts with the defendant, together with other orders to give effect to this declaration;¹ and that the defendant account as trustee for alleged breaches of trust and/or fiduciary duties.²

The plaintiff also sought the return of several pieces of jewellery (“the Jewellery”) which were allegedly handed over to the defendant to be held on trust for her sometime in 1998.

The two issues are distinct and I will discuss them separately.

Background

The plaintiff is an 86-year-old Indonesian citizen³ who resides in Jakarta.⁴ She has three sons from her marriage with the late Hasan Arifin (“Mr Arifin”), who was an Indonesian businessman: the defendant, Peter Arifin (“Peter”) and David Arifin (“David”). The defendant is the eldest son and is a Singapore citizen.

A central figure in the dispute between the parties is Mr Arifin. Mr Arifin was in the business of reselling electronics. He would purchase electronics from overseas for resale in Indonesia. As with any business, he had his ups and downs but it appears that for the most part his business did well until his later years. He was able to purchase multiple properties in Singapore and Indonesia and managed to send all three of his sons to universities in the United States (“US”).⁵

Although parties referred to various account numbers, there are two main joint accounts in the names of the plaintiff and defendant which are the subject of the present proceedings. One of the joint accounts in question is opened with Citibank Singapore Ltd (“Citibank”) while the other is opened with the Australia and New Zealand Banking Group Ltd (“ANZ”): ⁶

Bank	Account No.
Citibank	xxxxxxxx17
ANZ	xxxxxxxx87

Both the plaintiff and the defendant did not dispute that the funds in the joint accounts originated from the sale of a property in Simprug, Indonesia (“the Simprug Property”) in 2007 although they differ over the exact ownership of the Simprug Property. The funds were transferred into a Citibank account xxxxxxxx17 (“the Initial Citibank Joint Account”) on 10 July 2007 by the buyer of the Simprug Property.⁷ Several other similar joint accounts were opened over the years with other banks into which moneys from the Initial Citibank Joint Account were transferred. However, they have since been closed and are not relevant for the purposes of the present proceedings. I will refer to the various joint accounts, including the ones which have been closed, collectively as the “Joint Accounts”. The plaintiff claimed that she was a joint owner of the Simprug Property.⁸ The defendant maintained that it was owned entirely by Mr Arifin.⁹

The plaintiff claimed that she is the sole beneficial owner of the moneys in the Joint Accounts and that she is entitled to the entire credit balance in the Joint Accounts.

Second, the plaintiff alleged that there was an express trust agreement between her and the defendant which was formed orally (“the Express Trust Agreement”). According to the plaintiff, she had discussed the opening of joint accounts with Mr Arifin, following which she approached the defendant and his wife Anna Ho (“Mdm Ho”) for assistance. It was during this process that the Express Trust Agreement was formed.¹⁰ Under this agreement, the plaintiff would remit the sales proceeds of the Simprug Property into a joint account with the defendant in Singapore to be held on trust for her.¹¹ The defendant would help to manage the moneys in the joint account and would, as trustee, owe fiduciary duties including:¹² to hold the moneys solely for the benefit of the plaintiff, and to act only on her instructions in relation to the same; to act in good faith and in the best interests of the plaintiff; and not to place or allow himself to be placed in a situation or position whereby any of his duties and obligations to the plaintiff conflict or may conflict with his own personal interests.

The plaintiff relied primarily on the defendant’s conduct in relation to the Joint Accounts to prove the existence of the Express Trust Agreement.¹³ The plaintiff also relied on an email where the defendant stated that he was assisting the plaintiff in “[investing]… and [looking] after [her] account”.¹⁴

The plaintiff claimed that the following payments were made in breach of fiduciary duties owed to the plaintiff by the defendant:¹⁵ payment of US$19,000 to Trina Arifin (“Trina”), a daughter of the defendant, on 31 January 2008; payment of US$16,000 to Trina on 23 April 2008; payment of S$335,000 to the defendant allegedly for the setting up of an “Arifin Fund” for the benefit of the plaintiff’s grandchildren. On this sum, the defendant explained that it was derived from two payments of US$95,000 on 17 April 2008 and £76,726.05 on 28 May 2008, which were equivalent to about S$335,304.44 (based on agreed upon exchange rates).¹⁶ More will be said below about these two payments; payment of S$60,000 to the defendant on 7 January 2014, allegedly for the repayment of loans and reimbursement of medical expenses incurred on behalf of the plaintiff; and cumulative withdrawals of S$43,525.25 for alleged cumulative credit card payments of the plaintiff.

The plaintiff also claimed that a sum of S$128,581.99 remained unaccounted for in the Joint Accounts and that the defendant should provide an account for the same.¹⁷

The defendant denied that the plaintiff is the sole beneficiary of the moneys in the Joint Accounts. He also denied the existence of the Express Trust Agreement. The defendant’s position is that he is entitled to half of the moneys in the Joint Accounts as Mr Arifin had told him that the moneys in the Initial Citibank Joint Account were for him and the plaintiff.¹⁸ The defendant also relied on the fact that he is a joint account holder of the Joint Accounts to claim half of the moneys.¹⁹

After the commencement of the present action, the plaintiff applied to be allowed to withdraw half of the moneys in the Joint Accounts on the basis that she was entitled to at least half. Surprisingly, the defendant resisted this application. The plaintiff’s application was dismissed by an assistant registrar. On her appeal, I allowed the plaintiff to withdraw half of the moneys in the Joint Accounts.²⁰ What was left to be determined was the ownership of the remaining moneys.

The defendant did not dispute the six payments mentioned at [11] above. He alleged that the plaintiff had authorised them.²¹ The defendant relied on a few statements of account which purportedly evidenced a running account with Mr Arifin. I will elaborate on these statements later.

Apart from these statements, there was another document titled “Surat Keterangan” prepared by the defendant. It was signed by Mr Arifin and the plaintiff on 17 August 2007. I will also elaborate on this document later.

The defendant also denied that there was an unaccounted sum of S$128,581.99. He said that the plaintiff had used different exchange rates at different times to derive the unaccounted sum when actually there was no unaccounted sum.²²

Turning to the issue of the Jewellery, the plaintiff’s case was that the Jewellery was handed over to the defendant in Singapore to be held on trust in 1998 during riots in Indonesia.²³

The defendant’s position was that they were not handed to him at all, let alone for safekeeping, but rather the Jewellery was handed to his wife as gifts to his wife and daughters.²⁴

Issues to be determined

The issues to be determined are: the ownership of the moneys in the Joint Accounts, which requires a consideration of: (i) the ownership of the Simprug Property; and (ii) the extent of the plaintiff’s interest in the moneys in the Initial Citibank Joint Account; whether the plaintiff was able to establish the Express Trust Agreement; whether the defendant had breached his fiduciary duties in respect of the six disputed payments and the alleged unaccounted sum; and whether the plaintiff handed the Jewellery to the defendant to be held on trust for the plaintiff.

Ownership of the moneys in the Joint Accounts Ownership of the Simprug Property

As both the plaintiff and the defendant did not dispute that the moneys deposited into the Initial Citibank Joint Account (from which all moneys in the Joint Accounts were derived) represented about 80% of the proceeds of the sale of the Simprug Property in 2007,²⁵ it is important to determine whether the plaintiff held any interest in the Simprug Property.

While the plaintiff accepted that Mr Arifin held the legal title to the Simprug Property,²⁶ she took the position that she was a joint owner of the Simprug Property for the following reasons: Mr Arifin intended for his legal rights to the Simprug Property to be bequeathed to the plaintiff upon his death. This was evidenced by documents purporting to be Mr Arifin’s final will dated 11 October 2006 (“the Final Will”) and a draft will dated 11 October 2006 (“the Draft Will”);²⁷ the Simprug Property was purchased during her marriage to Mr Arifin and they had lived in it;²⁸ the plaintiff was actively consulted and involved in the sale process of the Simprug Property in 2007;²⁹ and the plaintiff’s consent to the sale was required under Indonesian law.³⁰

I do not think that the evidence shows that the plaintiff had any legal or beneficial interest in the Simprug Property at the time it was sold in 2007.

I do not think that much weight can be placed on the Final Will in determining whether the plaintiff was a joint owner of the Simprug Property. As I understood it, the plaintiff’s submission was that the signature of a notary on the Final Will to signify that he had witnessed the signatures...