Madihill Development Sdn Bhd and another v Sinesinga Sdn Bhd (transferee to part of the assets of United Merchant Finance Bhd)

• Jurisdiction: Singapore
• Judge: Quentin Loh J
• Judgment Date: 21 October 2011
• Neutral Citation: [2011] SGHC 230
• Court: High Court (Singapore)
• Docket Number: Originating Summons No 187 of 2010 (Registrar’s Appeal No 191 of 2011)
• Published date: 27 October 2011
• Year: 2011
• Hearing Date: 01 August 2011
• Plaintiff Counsel: Fan Kin Ning (David Ong & Partners)
• Defendant Counsel: Chua Beng Chye and Ang Siok Hoon (Rajah & Tann LLP)
• Citation: [2011] SGHC 230

Quentin Loh:

The Respondent, Sinesinga Sdn Bhd (“SSB”), which is a transferee of the relevant part of the assets of United Merchant Finance Bhd (“UMF”), obtained judgment of RM5,078,368.03 together with interest and costs in the High Court in Kuala Lumpur, Malaysia against the 1st Appellant, Madihill Development Sdn Bhd (“MDS”), for monies due and outstanding under a loan facility granted by UMF to it and against the 2nd Appellant, Dato’ Rickie Tang Yong Kiat (“RT”), pursuant to a guarantee furnished by RT to UMF in respect of the loan facility to MDS. On 18 February 2010, SSB successfully applied to register the Malaysian judgment as a judgment in Singapore under the Reciprocal Enforcement of Commonwealth Judgments Act (Cap 264, 1985 Rev Ed) (“RECJA”, unless otherwise indicated, all references to statutory provisions are to those in the RECJA).

RT failed in his application on 27 June 2011 to set aside the Order of Court dated 18 February 2011 and appealed. I dismissed the appeal on 1 August 2011 and RT has appealed against my decision.

Chronology

A chronology would be helpful:

Date	Event
24 August 2009	SSB obtained judgment against MDS and RT in the High Court in Kuala Lumpur, Malaysia.
15 September 2009	MDS and RT filed a Notice of Appeal to the Malaysian Court of Appeal against the judgment.
17 February 2010	SSB filed Originating Summons No 187 of 2010/D (“OS 187/2010”), in Singapore to register the Malaysian judgment in Singapore under RECJA.
18 February 2010	SSB obtained an Order in OS 187/2010 to Register the Malaysian judgment in Singapore.
16 March 2010	SSB obtained an Adjudication Order and Receiving Order (“the Bankruptcy Orders”), in Malaysia against RT.
19 March 2010	RT filed a Notice of Appeal in Malaysia against the Bankruptcy Orders.
7 April 2010	RT filed an application in OS 187/2010 (Summons No 1545 of 2010) to set aside the 18 February 2010 Order to Register the Malaysian judgment.
30 April 2010	RT applied to the Malaysian Official Assignee for sanction to continue with the appeal to the Malaysian Court of Appeal.
12 November 2010	The Malaysian Official Assignee gave his in-principle sanction for RT’s appeal to the Malaysian Court of Appeal.
2 March 2011	The Malaysian Court of Appeal dismissed MDS and RT’s appeals.
15 March 2011	MDS and RT file a Notice of Motion to the Malaysian Federal Court for leave to appeal against the Malaysian Court of Appeal’s dismissal of their appeal.
14 June 2011	MDS and RT’s application for leave to appeal to the Malaysian Federal Court was dismissed.
17 June 2011	RT’s application in Summons 1545 of 2010 in OS 187/2010 to set aside the 18 February 2010 Order of Court (registering the Malaysian judgment in Singapore), is dismissed by an Assistant Registrar (“the AR”).
27 June 2011	RT filed a Notice of Appeal against the AR’s dismissal of RT’s application in Summons 1545 of 2010.

The issue

RT’s appeal is based on a short point. At the time the Malaysian judgment was registered under RECJA, there was an incurable defect as there was a pending appeal before the Malaysian Court of Appeal. Section 3(2)(e) reads:

3. …

Restrictions on registration.

(2) No judgment shall be ordered to be registered under this section if –

...

(e) the judgment debtor satisfies the registering court either that an appeal is pending, or that he is entitled and intends to appeal, against the judgment;

…

RT characterised this as a strict legislative prohibition against registration of a foreign judgment so long as an appeal or a right and intention to appeal is extant. The application was therefore wrong from the outset and had to be set aside.

SSB relies on s 3(1) as well as case law. Section 3(1) states:

3.—(1) Where a judgment has been obtained in a superior court of the United Kingdom of Great Britain and Northern Ireland the judgment creditor may apply to the High Court at any time within 12 months after the date of the judgment, or such longer period as may be allowed by the Court, to have the judgment registered in the Court, and on any such application the High Court may, if in all the circumstances of the case it thinks it is just and convenient that the judgment should be enforced in Singapore, and subject to this section, order the judgment to be registered accordingly.

SSB further contends that there is no longer any pending appeal as RT has exhausted all avenues of appeal in Malaysia and it is therefore just and convenient to dismiss RT’s application and to allow the 18 February 2010 registration of the Malaysian judgment to stand. Analysis of the authorities cited

Mr Fan Kin Ning (“Mr Fan”), counsel for RT, did not produce any authorities and only relied on the statutory provisions and what he contended was the proper construction. Mr Chua Beng Chye (“Mr Chua”), counsel for SSB, relied on four cases for his argument that RT’s construction of ss 3(1) and (2) was wrong. Strictly speaking, none of the authorities relied on by Mr Chua were applicable or relevant on their facts.

In the first case, Perwira Ariffin Bank Bhd (formerly known as Perwira Habib Bank Malaysia Bhd) v Lee Hai Pey and another [1997] 2 SLR(R) 498 (“Perwira Ariffin Bank”), a bank had obtained summary judgment in September 1998 in Malaysia against its borrower company and the individual guarantors. The successive appeals were dismissed in October 1990 and in November 1994. On 28 October 1996, the plaintiff applied ex parte to register the Malaysian judgment in Singapore under the RECJA. The guarantor applied to set the Singapore judgment aside on the ground that the Malaysian judgment was no longer enforceable as more than 6 years had passed since the Malaysian judgment was issued. The bank thereupon successfully applied in Malaysia, ex parte, on 23 May 1996 for leave to enforce the Malaysian judgment. With the Malaysian court order in hand, the bank applied afresh to register the Malaysian judgment. On 30 December 1996, the borrower company successfully set aside the Malaysian court order granting leave to enforce the judgment but the guarantor was unsuccessful. The bank and the guarantor filed appeals. The guarantor then applied to set aside the registration of the Malaysian judgment in Singapore pending the determination of the enforceability of the Malaysian judgment by the Malaysian appeal court. His application before the registrar failed and he appealed. On appeal, Warren L H Khoo J held that since the Malaysian judgment before him ceased to be enforceable unless leave of court was obtained, and leave had been obtained ex parte and confirmed by an inter partes hearing, the defendant was entitled to appeal against that decision and had done so. He therefore ordered a stay, pending the outcome of the appeal, as there was no telling which way the judgment will go on appeal.

Mr Chua submitted that a pending appeal in the Malaysian court did not prevent the registration of the Malaysian judgment in Singapore, citing Perwira Ariffin Bank at [10]:

I took the view that sub-s (2) does not, and is not intended to, set out in any exhaustive way the circumstances in which a judgment should not be registered. There is a general requirement, set out in sub-s (1), that the court must be satisfied that in all the circumstances it is just and convenient that the judgment be allowed to be enforced. …

That paragraph must be read in the context of the factual matrix. The judgment establishing the debt in that case was no longer under appeal. What was under appeal was the order of the Malaysian court granting leave to enforce a judgment after the passage of more than six years after its publication Section 3(2)(e) therefore was not in issue. In that context, what was before the learned judge was the s 3(1) requirement as to whether in all the circumstances it was just and convenient that the judgment be allowed to be enforced in Singapore. The learned judge cannot be said to have read s 3(2) as subordinate to s 3(1)’s requirements. Perwira Ariffin Bank therefore does not really answer RT’s contention.

The second case relied upon by Mr Chua, Perwira Affin Bank Bhd (formerly known as Perwira Habib Bank Malaysia Bhd) v Lee Hai Pey and another [2007] 3 SLR(R) 218, involved the same parties. By now, the appeals against the enforceability of the Malaysian judgment had come to an end. Judith Prakash J held that Khoo J had stayed enforcement as there were appeals pending and since those appeals had been finally dealt with, it was just and convenient to allow the Malaysian judgment to be enforced despite the long delays which had resulted from the guarantors’ utilisation of his right of appeal and not any dilatoriness by the bank. There is nothing in this judgment that assists SSB’s case.

The third case cited by Mr Chua is the Singapore Court of Appeal’s decision in Liao Eng Kiat v Burswood Nominees Ltd [2004] 4 SLR(R) 690 (“Burswood Nominees”). Although the ratio of that case involved the enforceability of a foreign judgment from Western Australia under RECJA in respect of a dishonoured cheque given to a casino to obtain gambling chips and considerations of public policy against gaming and wagering contracts under s 5(2) of the Civil Law Act (Cap 43, 1994 Rev Ed) and s 3(2)(f) of the RECJA, that judgment needs to be read with some care.

At [13] of the judgment, the Court of Appeal stated that:

… Registration will not be ordered if the appellant is able to establish any one of the limited number of exceptions in s 3(2) of the RECJA. The principal issue canvassed on appeal was whether s 5(2) of the [Civil Law Act (Cap 43, 1994 Rev Ed)] and s 3(2)(f) of the RECJA precluded registration of the Australian judgment on grounds of public policy. …

[emphasis added]

A proper reading of the judgment...