Ma Hongjin v SCP Holdings Pte Ltd
Jurisdiction | Singapore |
Judge | George Wei J |
Judgment Date | 15 December 2017 |
Neutral Citation | [2017] SGHC 319 |
Plaintiff Counsel | Tan Chau Yee and Seet Yao Dong (Eversheds Harry Elias LLP) |
Date | 15 December 2017 |
Docket Number | Suit No 13 of 2017 (Registrar’s Appeal No 248 of 2017) |
Hearing Date | 05 October 2017 |
Subject Matter | Summary judgment,Civil Procedure |
Published date | 22 August 2018 |
Defendant Counsel | Tan Teng Muan and Loh Li Qin (Mallal & Namazie) |
Court | High Court (Singapore) |
Citation | [2017] SGHC 319 |
Year | 2017 |
This was a Registrar’s Appeal brought by the plaintiff, Ma Hongjin (“the Plaintiff”), against the decision of the learned Assistant Registrar Justin Yeo (“the AR”) in respect of the Plaintiff’s application for summary judgment under O 14 r 1 of the Rules of Court (Cap 322, R5, 2014 Rev Ed) (“ROC”). I note that whilst unconditional leave to defend was granted, the AR in deciding the appropriate costs order (which was “costs in the cause”) stated that the application was not so unmeritorious as to be considered to have been “dismissed”.1
After hearing the parties, I found that the defences raised by the defendant, SCP Holdings Pte Ltd (“the Defendant”), were speculative or supported only by bare assertions in the Defendant’s affidavits. I allowed the appeal and granted the Plaintiff summary judgment. As the Defendant has appealed against my decision, I shall now give my reasons.
Background facts Dramatis personaeThe Plaintiff is a Singapore permanent resident.2 Her husband, Han Jianpeng (“Han”), is a businessman.3
The Defendant is a Singapore-incorporated investment holding company. It has a substantial shareholding in Biomax Holdings Pte Ltd (“Biomax Holdings”). 4
Biomax Holdings is the sole shareholder of Biomax Technologies Pte Ltd (“Biomax Technologies”), which is in the business of wholesaling agriculture machinery, equipment and supplies, and also of manufacturing fertilisers and nitrogen compounds.5
Sim Eng Tong (“Sim”) is a director and former shareholder of the Defendant, as well as the director and chief executive officer of both Biomax Holdings and Biomax Technologies.6
Dealings between the partiesIn the second half of 2014, Han and Sim met for the first time at a geomancy shop in Singapore and became acquainted.7 Han and Sim subsequently entered into discussions regarding Sim’s involvement in the Defendant’s group of companies and the value of the group’s green technology for treating and converting organic waste into fertiliser.8 There is no dispute between the parties on their first serendipitous encounter at the geomancy shop.
On 6 January 2015, the parties entered into a convertible loan agreement (“the CLA”) under which the Plaintiff would loan $5m to the Defendant at an interest rate of 10% per annum (“the Loan”).
Under the terms of the CLA, the Defendant was to repay the $500,000 in interest by 5 January 2016. On the maturity date of 5 January 2017, the Plaintiff was entitled to choose to either have the Defendant:
On the day the CLA was signed, the Plaintiff and Han visited the Defendant’s office and advanced $2.4m in cash to the Defendant, representing the first loan payment.10 The Plaintiff made further loan payments to the Defendant of $1.1m and $1.5m in cash on 14 January 2015 and 30 March 2015 respectively. The three payments totalled $5m, just as the parties had agreed under the CLA.11
On 16 April 2015, the parties entered into a supplemental agreement to amend the CLA (“the SA”). Option B was amended such that the Plaintiff could choose to have the Defendant transfer 20% (instead of 15%) of the total shares in Biomax Holdings to her in full and final repayment of the Loan. In addition, the Defendant was to pay an additional lump sum “facility fee” of $250,000 along with the first $500,000 in interest by 5 January 2016.12
On the day the SA was signed, the parties also entered into a Shares Investment Agreement (“the SIA”). The SIA provided for another loan of $5m from the Plaintiff to Biomax Technologies. This loan was interest-free, but Biomax Technologies undertook to transfer to the Plaintiff 45% of its issued and paid-up ordinary shares in a new company which was to be incorporated in Singapore for the purpose of producing organic fertilisers for commercial sale, prior to the listing of Biomax Holdings on the Singapore Exchange.13 However, it appears that the loan under the SIA was never disbursed.14
Sometime around April or May 2015, Han requested to move his personal safe into the Defendant’s office. Han told Sim that he felt insecure leaving his safe at home as he had no security alarm system installed there. The Defendant’s office, on the other hand, was equipped with infrared detectors and security cameras. Sim agreed, and Han then moved his safe into the rear room of the Defendant’s office. Upon Han’s request, Sim arranged for renovation works to be carried out in the rear of the Defendant’s office, and as a result, an internal partition and a curtain, among other things, were added to obscure Han’s safe.15
From June to October 2015, the Plaintiff and Biomax Technologies entered into four more loan agreements. I note that these loans to Biomax Technologies (“the BT Loans”) do not form part of the subject matter of the present suit, but I briefly describe them here to provide some background on the other transactions which the parties were involved in. The loan monies were disbursed by the Plaintiff to Biomax Technologies by way of cash, cheque and telegraphic transfer. The first loan of $1m was promptly repaid to the Plaintiff in September 2015 along with the 10% interest as agreed. However, the other loans of $2m, $2m and $1m, as well as the 20% interest on each loan, were not repaid promptly. The Plaintiff granted extensions for repayment, but the principals and interest on the BT Loans were still not repaid in full by the final deadline of 2 July 2016.16
As regards the Loan, the Defendant repaid the $500,000 in interest by the stipulated repayment date of 5 January 2016. However, the $250,000 facility fee under the terms of the amended CLA was not repaid by the Defendant by 5 January 2016.
On 12 April 2016, the Plaintiff’s solicitors sent the Defendant a letter of demand stating its position that the Defendant was liable to pay a total of $750,000 in interest (thus characterising the $250,000 facility fee as interest), and that since the Defendant had only paid $500,000 to date, $250,000 remained due and owing.17 On the same day, the Plaintiff’s solicitors also sent Biomax Technologies a separate letter of demand for the repayment of the BT Loans.18 The Defendant and Biomax Technologies did not comply.
Procedural history Suit 765On 15 July 2016, the Plaintiff commenced Suit No 765 of 2016 (“Suit 765”) against the Defendant and Biomax Technologies. Against the Defendant, the Plaintiff claimed $250,000 in interest under the Loan. I note that the Plaintiff did not claim the principal under the Loan, which was not yet due to be repaid. Against Biomax Technologies, the Plaintiff claimed the principals (totalling $5m) and interest payable under the outstanding BT Loans.19
In their defence, the defendants in Suit 765 asserted the following:
Biomax Technologies thus counterclaimed damages, losses of profit and wasted expenses arising from its inability to complete construction of the factory.28
The Plaintiff applied for summary judgment under O 14 r 1 of the ROC. On 16 November 2016, without explaining his reasons, the Registrar granted the defendants unconditional leave to defend Suit 765.29 The Plaintiff did not appeal the Registrar’s decision.
The present suit On 9 January 2017,
The Plaintiff claimed the $5m principal under the Loan; interest at the rate of 10% per annum accruing on and after 6 January 2016; and damages in the alternative.30
In the defence, the Defendant stated its position,
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