Nikkomann Co Pte Ltd and Others v Yulean Trading Pte Ltd

• Jurisdiction: Singapore
• Judge: Karthigesu J
• Judgment Date: 30 June 1992
• Neutral Citation: [1992] SGCA 44
• Docket Number: Civil Appeal No 129 of 1990
• Date: 30 June 1992
• Year: 1992
• Published date: 19 September 2003
• Plaintiff Counsel: Raymond Chan (Chan Tan & Partners)
• Citation: [1992] SGCA 44
• Defendant Counsel: Andre Yeap (Allen & Gledhill)
• Court: Court of Appeal (Singapore)
• Subject Matter: Action for breach of contract, conspiracy to defraud etc,Whether certain facts not disclosed or misdescribed by plaintiffs at the ex parte application were material so as to justify discharge of the orders,Interlocutory injunction,Civil Procedure,Whether defendants can still raise objection that compliance with the Anton Piller orders would infringe their privilege against self-incrimination when they had already complied with the orders,Injunctions,Plaintiffs obtained ex parte Anton Piller orders and Mareva injunction against defendants,Whether plaintiffs' failure to comply with undertaking to inform defendants that the information supplied by

Cur Adv Vult

On 11 April 1990, the respondents, Yulean Trading Pte Ltd, issued a generally indorsed writ against the appellants. In summary, Yulean claimed:

(1) a declaration that the appellants were jointly and/or severally constructive trustees of three lots of timber comprised in three bills of lading identified in the indorsement;

(2) an order that the appellants deliver up to Yulean the originals of the bills of lading;

(3) further or alternatively, in the event that the goods comprised in the bills of lading had been sold, a declaration that the appellants were jointly and/or severally constructive trustees of the proceeds of sale to the extent of $171,547.05; and

(4) an injunction restraining the appellants from disposing of or otherwise dealing with the bills of lading and the goods comprised therein, and any assets of the appellants within or outside Singapore, including credit balances in any accounts, subject in all cases to the limit of $171,547.15 (sic).

On the same day, Yulean applied, ex parte, for certain interim orders before Sinnathuray J. These were granted, and they may be summarized as follows (following the paragraph numbers of the order of court):

(1) an order that the appellants, within 24 hours, deliver up the original bills of lading;

(2) an order restraining the appellants from disposing of or otherwise dealing with the bills of lading and the goods comprised therein, and, subject to the limit of $171.547.05, any assets of the appellants and credit balances in any accounts held by the appellants;

(3) an order that each of the appellants, within 24 hours, make and serve on Yulean`s solicitors an affidavit setting forth:

(a) whether the goods comprised in the bills of lading have been sold and, if so, particulars of the sale;

(b)

if the goods have been sold, the whereabouts of the proceeds;

(c)

the whereabouts of the goods;

(4) an order that the appellants, within 24 hours, give discovery of all documents relating to all transactions `comprised in and contemplated by the bills of lading` and any sale or purported sale of the goods referred to or comprised in the bills of lading;

(5) an order giving Yulean and their solicitors liberty, upon giving three hours` notice, to inspect and take copies of all such documents at addresses indicated;

(6) an order giving Yulean and their solicitors liberty, upon giving three hours` notice, to inspect and take copies of all entries in the books of the Singapore branch of the Bank of America relating to accounts held in the name of any of the appellants.

Yulean filed a notice of motion inter partes to continue the interim orders and the appellants filed a notice of motion to discharge them. Both motions were heard by Tan Teow Yeow JC [as he then was]. On 29 November 1990, the learned judicial commissioner decided that the interim injunction issued on 11 April 1990 should continue and he dismissed the appellants` application for discharge. From these decisions, the appellants appealed to this court.

Tan Teow Yeow JC also granted leave for Yulean to apply for committal on the ground that the appellants had wilfully failed to comply with the terms of the interim orders. At the outset of the hearing of the appeal, however, we were told that this matter was not before us and we need not be concerned with it. So the only question before us is whether the interim orders should have been continued or whether they should have been discharged.

The facts

In the ex parte application, the material before Sinnathuray J consisted of the generally indorsed writ of summons and the affidavit of Lean Peng Khoon, the administrative officer of Yulean and a sales executive of Lumber and Plywood Pte Ltd, an associate company of Yulean. By the time the matter went before Tan Teow Yeow JC, there were at least a dozen more affidavits filed. An amended statement of claim and a defence had also been filed. The issues and the remedies sought were thereby more clearly defined.

The facts, as they presented themselves before the learned judicial commissioner, were as follows. Yulean was a company dealing in the import and export of timber. The first appellants, Nikkomann Co Pte Ltd, were a company dealing in the manufacture of plywood and veneer. Tay, the second appellant, was a director of Nikkomann. Ong, the third appellant, was, according to him, a marketing director in the employ of Nikkomann. Tay and Ong were sued in their personal as well as representative capacity.

Tay had, for some years, had dealings with Lumber and Plywood Pte Ltd, an associate company of Yulean under the charge of Kwok Keng Fatt. These dealings ceased in early 1988 when Tay`s company, Arcadia Wood Pte Ltd, ceased trading. In late 1989, Tay made approaches to Kwok to get Lumber and Plywood to enter into a joint venture with Nikkomann for trading in timber.

On 29 December 1989, Tay sent a draft set of terms for the joint venture to Kwok. Under the proposal, Nikkomann was to be responsible for marketing and locating supplies of timber and related products, for resale, and Yulean was to provide financial assistance. Nikkomann was to be the contracting party in all transactions. For transactions by means of letters of credit from buyers, the letter of credit would be in favour of Nikkomann and Nikkomann would assign it to Lumber and Plywood. In return for the financial assistance of Yulean, Yulean would receive 30% of the profit on transactions using letters of credit. There was another form of transactions, described as `documentary proofs` transactions, in which Yulean would receive 35% of the profit.

It was decided on Lumber and Plywood`s side that Yulean, instead of Lumber and Plywood, should deal with Nikkomann in relation to the proposed joint venture, and that Kwok and Lean would be Yulean`s representatives. On 8 January 1990, a meeting was held between Tay and Ong for Nikkomann, and Kwok and Lean for Yulean. There appears to be little or no dispute that they reached an agreement substantially in terms of the draft proposal of 29 December. The only or only substantial dispute is whether the parties agreed, as Yulean alleges and as Nikkomann denies, that there were additional terms agreed, including one whereby the title to and beneficial ownership of all bills of lading and the goods comprised in them should be `in the name of Yulean`. These alleged additional terms are not embodied in any document.

On 12 January 1990, Ong informed Kwok that Nikkomann had entered into a contract with a purchaser by the name of Philippe Desmoulin & Co for the sale of 400cu m of Sabah dark red seraya sawn timber. He also told Kwok that he had obtained the supply from a company in Sabah, Seratim Sdn Bhd. He asked Kwok to open a letter of credit in favour of Seratim. Kwok requested Ong to fax a copy of Philippe Desmoulin`s letter of credit to him, but Ong was unable to do so and said it would be opened soon. Ong faxed what purported to be contracts entered into between Nikkomann and Philippe Desmoulin and between Nikkomann and Seratim.

On 15 January 1990, Yulean arranged for a letter of credit to be opened by Bangkok Bank in favour of Seratim for the sum of about M$144,500.

On 2 February 1990, in circumstances in regard to which the parties have given different accounts, Yulean arranged with Bangkok Bank for another letter of credit for the sum of M$81,250, to be opened in favour of another supplier, Quickways Sdn Bhd, for another lot of sawn timber, about 130 tons of dark red seraya, for on-sale to Philippe Desmoulin. Tay told Kwok that a letter of credit would be established by Philippe Desmoulin soon.

Thereafter, Yulean repeatedly asked Nikkomann for a copy of the letter of credit opened by Philippe Desmoulin, but to no avail. In his affidavit in reply to these allegations, Tay says that Nikkomann repeatedly asked Philippe Desmoulin`s agents in Singapore to press Philippe Desmoulin for the letter of credit, but Philippe Desmoulin failed to do so.

On 15 March 1990, Tay told Kwok that the timber market had become depressed and that Philippe Desmoulin had pulled out of the purchase. He suggested flying to France with Ong to seek alternative purchasers. As a result of discussions of which different accounts have been given by the parties, the bills of lading relating to the goods were altered to show Nikkomann as the party to be notified instead of Yulean.

At this time, Nikkomann gave a cheque for $170,000 to Yulean. It was drawn on Citibank and post-dated 31 March 1990. According to Yulean, this was as security in exchange for Yulean agreeing to the change in the bills of lading. According to Nikkomann, it had nothing to do with that. Nikkomann, however, did not say what then it was for.

Ong and Tay went to Europe on 16 March 1990. On 23 March, Ong sent a message from a hotel in Utrecht to Kwok and Lean, purportedly reporting that the market situation in France was very bad, the importers were heavily over-stocked and unable to buy. He also said that he and Tay were trying their utmost to sell the timber. On 26 March 1990, Tay and Ong sent a message that they were still visiting customers. On 27 March, they sent a message that they had found prospective buyers. Then on 28 March, Ong sent a message that a firm bid had been received, but no details of the buyer or the price were mentioned. All these messages turned out to be bogus, as we shall see in a moment.

On 2 April 1990, when Tay and Ong returned from their trip, a meeting was held at Nikkomann`s offices. Again, there are differences, none material for present purposes, in the parties` accounts of what was said. According to Lean, Tay told Kwok and Lean that the goods had been sold but the purchasers had wrongly transferred the purchase moneys into Nikkomann`s account with the Bank of America instead of Citibank and that the Bank of America had refused to release the money. According to Lean, Tay also...