Macquarie Bank Ltd v Graceland Industry Pte Ltd

• Jurisdiction: Singapore
• Judge: Henry Bernard Eder IJ
• Judgment Date: 24 January 2018
• Neutral Citation: [2017] SGHC(I) 12
• Plaintiff Counsel: Nish Kumar Shetty, Jerald Foo and Tay Jia Wei, Kenneth (Cavenagh Law LLP)
• Date: 24 January 2018
• Docket Number: Suit No 5 of 2017 (Summons No 41 of 2017)
• Hearing Date: 10 January 2018,08 January 2018,21 December 2017
• Subject Matter: Amendment,Civil procedure,Pleadings
• Year: 2018
• Defendant Counsel: and Abraham Vergis and Lim Mingguan (Providence Law Asia LLC),Wong Hin Pkin Wendell, Priscylia Wu Baoyi and Wong Zi Qiang, Bryan (Drew & Napier LLC)
• Court: International Commercial Court (Singapore)
• Citation: [2017] SGHC(I) 12
• Published date: 26 January 2018

Henry Bernard Eder IJ: Introduction

On 21 December 2017, I heard an application (the “first hearing”) on behalf of the Defendant, Graceland Industry Pte Ltd (“Graceland”) under O 20 r 5 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (the “Rules”) seeking leave to amend its defence and counterclaim. Following submissions on behalf of Graceland, the Plaintiff, Macquarie Bank Limited (“Macquarie”) and the Second Defendant in Counterclaim (“Mr Wolfe”), I informed the parties of my decision to grant Graceland leave to amend its defence and counterclaim, apart from the proposed amendments in para 8, the last sentence of para 12, para 15.7, para 26 and para 44.

Thereafter, counsel on behalf of Graceland sought to advance what were described as “further arguments” pursuant to s 28B(1) of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) in relation to the proposed amendments which I had disallowed, as set out in its letter to the Registry dated 27 December 2017. However, attached to this letter was a new draft amended defence and counterclaim which included additional proposed amendments. By its letter dated 28 December 2017, counsel on behalf of Macquarie submitted that such “further arguments” should be refused. In the event, I decided to have a further oral hearing in relation to such further arguments and the additional proposed amendments. That hearing took place on 8 January 2018 (the “second hearing”). In light of the further arguments, I decided to grant Graceland further leave to amend, as set out below, in respect of certain of the proposed amendments. However, other proposed amendments remained in a form which were, in my view and for various reasons, ambiguous or unsatisfactory. For that reason, I decided to give Graceland’s counsel a further opportunity to serve a yet further draft amended defence and counterclaim with a view to ensuring that Graceland’s case was properly pleaded without uncertainty and ambiguity.

Following the service of that further draft, it was unfortunately necessary to have a yet further oral hearing to hear further arguments and to finalise matters. That hearing took place on 10 January 2018 (the “third hearing”). In the event, at that hearing, I gave leave to amend the defence and counterclaim in a final form as referred to below and as subsequently extracted by the Registry. These are my brief reasons for the various decisions which I have taken.

The application for amendment of pleadings was originally issued on behalf of Graceland by Summons No 41 of 2017 dated 28 November 2017 supported by an affidavit of Sun Jiawen. Thereafter, there was served an affidavit of Amber Riley dated 7 December 2017 on behalf of Macquarie. On 12 December 2017, Graceland filed and served a second affidavit of Sun Jiawen in response, as well as its written submissions in support of the application. This was followed by Macquarie’s written submissions on 18 December 2017 in opposition to the application. Finally, on 19 December 2017, Graceland filed its written submissions in reply.

The parties’ cases

In summary, Graceland submitted that the proposed amendments were necessary to ensure that the relevant issues and facts would be fully canvassed at trial and/or for the purpose of determining the real questions in controversy between the parties. Further, the proposed amendments would not cause surprise to Macquarie and Mr Wolfe, or give rise to any form of prejudice. For instance, the proposed amendment in para 13 of the defence and counterclaim concerned a potential fertiliser derivative transaction (“the proposed DAP transaction”) which had been addressed in the affidavit of evidence-in-chief (“AEIC”) of Mr Liu Zhongjin filed on behalf of Graceland, the expert report of Mr Darrell Ingram filed on behalf of Graceland, and the expert report of Mr Joseph Bauman filed on behalf of Macquarie. From these documents, it was submitted, Macquarie would have known all along what Graceland’s case was. Graceland therefore asserted that the proposed amendments were simply clarificatory in nature, and did not materially change the complexion of its case.

Macquarie made several points in opposition to Graceland’s application. I should mention that underlying much of Macquarie’s written submissions was the suggestion that Graceland had commenced the present application in bad faith, with a view to seeking to vacate the trial dates fixed for 19–23 February 2018. However, as I made it clear to the parties during the first hearing that those trial dates would remain save for any exceptional circumstances, that objection fell away. Macquarie’s oral submissions therefore focused primarily on two points: Graceland’s failure to provide an adequate explanation for the lateness of its application, and Graceland’s egregious conduct.

On the first point, Macquarie pointed out that Graceland had not explained its reasons for bringing the amendment application beyond stating that “part of the impetus” for doing so was my prior decision in Summons No 32 of 2017.¹ I had there denied Graceland’s application for specific discovery of Macquarie’s internal correspondence relating to the proposed DAP transaction, on the basis that the relevance of the proposed DAP transaction had not been properly spelt out in Graceland’s pleadings. Macquarie submitted that the lack of proper explanation for the application and its lateness prevented the court from deciding on the proper consequential directions or cost orders.

On the second point, Macquarie raised, inter alia, the following arguments: The proposed amendments raised allegations that were based on facts entirely within Graceland’s knowledge or possession, control or power. Graceland had previously represented to this court, via the proposed case management plan filed in the parties’ joint case management bundle dated 10 July 2017, that it did not intend to amend its pleadings. The proposed amendments in paras 13, 16, 20.1 and 33.3 of the defence and counterclaim sought to introduce the very particulars that Graceland had earlier refused to provide pursuant to Macquarie’s letter of request dated 24 March 2017. Macquarie had then asked for details of the “language” and “correspondence” that formed the basis of Graceland’s case for mistake and misrepresentation, but Graceland had responded that Graceland was “not entitled as the same goes to evidence”.² Graceland’s proposed amendments were an attempt to take an impermissible second bite at the cherry and re-litigate an issue that has already been determined by the Singapore High Court. Macquarie had previously commenced an application to strike out Graceland’s defence and counterclaim. Macquarie’s appeal from the decision of the assistant registrar had been heard by Woo Bih Li J, who had, inter alia, struck out para 9 of the defence and counterclaim which averred that no contract had been concluded between Macquarie and Graceland.³ However, the proposed amendments purported to put in issue again whether there was a binding contract between the parties, and what the terms of that contract were. The proposed amendments were deficient. For instance, the proposed amendment at para 15.7, which referred to Graceland providing Macquarie with “commercially sensitive and confidential information belonging to Wengfu Group and [Graceland]” was vague.

I agreed with Macquarie that Graceland had displayed egregious conduct. Graceland’s application to amend its defence and counterclaim came very late in the day, close to the festive season and a mere eight weeks ahead of the trial fixed for February 2018. I also agreed with Macquarie that Graceland had had plenty of opportunities previously if they had wanted to make the necessary amendments, but they had either failed or refused to do so. As counsel for Macquarie, Mr Foo, correctly pointed out, Graceland had previously indicated to the court on at least one occasion that it was not going to make amendments to...