Narayanan Kolanji v Jlion Marine Construction & Engrg Pte Ltd and another

• Jurisdiction: Singapore
• Judge: Kow Keng Siong
• Judgment Date: 30 August 2022
• Neutral Citation: [2022] SGDC 198
• Court: District Court (Singapore)
• Docket Number: District Court Suit No. 190 of 2022, Registrar’s Appeal No. 59 and 60 of 2022
• Hearing Date: 29 August 2022
• Citation: [2022] SGDC 198
• Year: 2022
• Plaintiff Counsel: Ms Shabira Banu d/o Abdul Kalam Azad (K Ravi Law Corporation)
• Defendant Counsel: Mr Nicholas Leow Zhi Wei (Netto & Magin LLC)
• Subject Matter: Civil procedure,Costs,Security,Principles for determining whether to security for costs ought to be imposed under O 23 r 1 of the Rules of Court 2014,Framework for determining whether plaintiff's claim has a reasonably good prospect of success
• Published date: 21 April 2023

District Judge Kow Keng Siong: Introduction

This matter arose from a Deputy Registrar’s decision to require the Plaintiff in DC/DC 190/2022 (“DC 190”) to furnish security for costs.

DC 190

The Plaintiff is an Indian national. He had come to Singapore in early 2020 to work as a construction worker under a work permit taken out by the 1st Defendant.¹

The Plaintiff alleged that he had sustained the following injuries in two separate accidents on 6 February 2020 while working at premises occupied by the 2nd Defendant: The first injury was to the Plaintiff’s left index finger. He had sustained this injury while performing steel rolling works.² The second injury was to the Plaintiff’s right leg. This injury was sustained when a heavy steel plate that the Plaintiff was carrying dropped onto his leg.³

Arising from the accidents, the Plaintiff commenced DC 190 against the 1st and 2nd Defendants for negligence and breach of duty to take reasonable care for his safety.

SUM 1661/2022

Soon after DC 190 was commenced, the 1st Defendant took out DC/SUM 1661/2022 (“SUM 1661”) to apply for an order for security for costs on the following terms: 1. That the Plaintiff do, within fourteen (14) days from the date of the order to be made hereon, furnish security in the sum of S$15,000.00 or such other sum that this Honourable Court deems fit (the "Security Sum") for the 1st Defendant's costs in the action, DC/DC 190/2022 (the "Suit") up to and including the first exchange of Affidavits of Evidence-in-Chief. 2. The Security Sum be furnished by way of payment(s) into Court. 3. All further proceedings in this Suit other than the furnishing of security be stayed until the Security Sum has been furnished by the Plaintiff and the costs of this application are fully paid by the Plaintiff to the 1st Defendant.

[emphasis added]

According to SUM 1661 and the supporting affidavit of Buvan s/o Manogaren dated 12 May 2022 (“Supporting Affidavit”), the 1st Defendant’s application was based on the following grounds: That the Plaintiff was ordinarily resident out of the jurisdiction and had no asset in Singapore: O 23 r 1(1)(a) of the Rules of Court 2014 (“ROC”); and That the Plaintiff did not have a reasonably good prospect of success.

Decision below

After hearing submissions, the Deputy Registrar allowed the 1st Defendant’s application and made the following orders: That the Plaintiff was to furnish, by 25 August 2022, security in the sum of S$5,000.00 ("Security Sum”) for the 1st Defendant's costs in DC 190 up to and including the exchange of Affidavits of Evidence-in-Chief. That all further proceedings in DC 190 be stayed until the Security Sum has been furnished by the Plaintiff. That if the Plaintiff failed to furnish the Security Sum, the Plaintiff's action against the 1st Defendant in DC 190 would be dismissed with costs without further order.

The cross-appeals

Both parties were dissatisfied with the Deputy Registrar’s decision. The Plaintiff appealed against the order for security imposed on him, while the 1st Defendant appealed against the security being fixed at $5,000 (instead of $15,000 as applied for).

Key issue for determination

The appeals raise the issue of whether the Deputy Registrar’s order for security at $5,000 was correctly made. Applicable principles

Order 23 r 1(1) and (2)

The power to make an order for security is provided for under O 23 r 1. Order 23 r 1(1) and (2) states the following: (1) Where, on the application of a defendant to an action or other proceeding in the Court, it appears to the Court— (a) that the plaintiff is ordinarily resident out of the jurisdiction; (b) that the plaintiff (not being a plaintiff who is suing in a representative capacity) is a nominal plaintiff who is suing for the benefit of some other person and that there is reason to believe that he will be unable to pay the costs of the defendant if ordered to do so; (c) subject to paragraph (2), that the plaintiff’s address is not stated in the writ or other originating process or is incorrectly stated therein; or (d) that the plaintiff has changed his address during the course of the proceedings with a view to evading the consequences of the litigation,

then, if, having regard to all the circumstances of the case, the Court thinks it just to do so, it may order the plaintiff to give such security for the defendant’s costs of the action or other proceeding as it thinks just.

(2) The Court shall not require a plaintiff to give security by reason only of paragraph (1) (c) if he satisfies the Court that the failure to state his address or the mis-statement thereof was made innocently and without intention to deceive.

[emphasis added]

Two conditions

On a plain reading, O 23 r 1(1) requires a defendant to satisfy two conditions. First, he must show that at least one of the four threshold conditions in O 23 r 1(1) is present on the facts (“First Condition”). Second, the defendant must also show that it is just for a court to order security “having regard to all the circumstances of the case” (“Second Condition”).

Consistent with the plain reading, it has been held that – A court is not obliged to order security as a matter of course merely because any of the four threshold conditions is present: Jurong Town Corp v Wishing Star Ltd [2004] 2 SLR(R) 427 at [14]; Ong Jane Rebecca v Pricewaterhousecoopers and others [2009] 2 SLR(R) 796 (“Ong Jane Rebecca”) at [21]; Fasi Paul Frank v Specialty Laboratories Asia Pte Ltd [1999] 1 SLR(R) 1138 at [33]. A court is obliged to consider all the circumstances of a case, and in the light thereof to determine whether, and to what extent, or for what amount, a plaintiff may be ordered to provide security: Singapore Civil Procedure 2020 (Sweet & Maxwell, 2020) (“Singapore Civil Procedure”) at [23/3/3] and [23/3/4] (pages 501 and 504).

Second Condition Whether just to order security – Considerations

To determine whether the Second Condition is satisfied, courts typically take into account the following considerations: Will the defendant be unable, or find it exceptionally difficult, to enforce a costs order against the plaintiff? Is the plaintiff’s claim bona fide and not a sham? Does the plaintiff have a reasonably good prospect of success? Is the application for security being used oppressively with a view to stifle a bona fide claim? See e.g., Pacific Integrated Logistics Pte Ltd v Gorman Vernel International Freight Ltd [2007] 1 SLR(R) 1017 (“Pacific Integrated Logistics”) at [7]; Tjong Very Sumito v Chan Sing En [2011] 2 SLR 360 at [10]; Ong Jane Rebecca at [22]; SIC College of Business and Technology Pte Ltd v Yeo Poh Siah [2016] 2 SLR 118 at [76].

The above considerations attempt to assess – the likelihood of injustice to a defendant if no security is ordered and the plaintiff’s claim fails at trial: the first two considerations in [13(a)] and [13(b)], and the likelihood of injustice to the plaintiff if he is prevented from pursuing a genuine claim by an order for security: the last two considerations in [13(c)] and [13(d)].

I will now discuss two of these considerations in greater detail.

Ability to enforce a costs order

The first is that of whether a defendant will be able to enforce a costs order against a plaintiff ([13(a)] above). In making this determination, courts typically consider, among others – whether the plaintiff is able to pay costs if ordered against him, whether the plaintiff has assets within jurisdiction, and if the answer to (b) is no, then whether there is a reciprocal enforcement of judgements arrangement between Singapore and the country where the plaintiff is residing.

It is important to emphasise that none of the above considerations is conclusive on whether security ought to be ordered. For instance – Security will not be ordered merely because the plaintiff is a foreigner and has no address or assets within the jurisdiction: Pandian Marimuthu v Guan Leong Construction Pte Ltd [2001] 2 SLR(R) 18 (“Pandian Marimuthu”) at [12]; Amar Hoseen Mohammed Revai v Singapore Airlines Ltd [1994] 3 SLR(R) 290 (“Amar Hoseen”) at [40] and [44]. Security will also not be ordered merely because the plaintiff is impecunious: K S Oriental Trading Pte Ltd v Defmat Aerospace Pte Ltd [1996] 1 SLR(R) 448 (“K S Oriental Trading”) at [4]. It bears noting that courts will be slow in ordering security against an impecunious plaintiff especially where – the plaintiff is a natural person – given that public policy favours encouraging access to the courts: Ong Jane Rebecca at [29] and [30], and the plaintiff’s inability to pay costs is due to the defendant’s conduct: see e.g., Fibresteel Industries Pte Ltd v Radovic Dragoslav [2007] 4 SLR(R) 719 (“Fibresteel”) at [25].

Reasonably good prospect of success

The second consideration which I wish to discuss is that of whether a plaintiff has a reasonably good prospect of success ([13(c)] above). This consideration requires a court to assess the relative strengths and weaknesses of the plaintiff’s and the defence’s case: K S Oriental Trading at [4]. It has been repeatedly emphasised that when making this assessment courts will not enter into a detailed examination of the merits of the parties’ case. This is because such an examination based on affidavit evidence alone and without the benefit of cross-examination is difficult and should thus be left to the trial judge: see e.g., The “Evpo Agsa” [1992] 1 SLR(R) 662 at [13] and [14]; Elbow Holdings Pte Ltd v Marina Bay Sands Pte Ltd [2014] SGHC 219 at [17]. It has also been held that a defendant should not go into the merits of the plaintiff’s claim unless he can clearly demonstrate that the claim will probably fail: Singapore Civil Procedure at [23/3/5] (page 503); Pandian Marimuthu at [12]. Where circumstances are evenly balanced, then the fact that...