Nova Management Pte Ltd v Amara Hotel Properties Pte Ltd and Another

• Jurisdiction: Singapore
• Judge: Karthigesu JA
• Judgment Date: 01 December 1993
• Neutral Citation: [1993] SGCA 92
• Docket Number: Civil Appeal No 152 of 1992
• Date: 01 December 1993
• Published date: 19 September 2003
• Year: 1993
• Plaintiff Counsel: Lim Chor Pee and John Looi Teh Sung (Chor Pee & Co)
• Citation: [1993] SGCA 92
• Defendant Counsel: James L Ponniah (Wong & Lim)
• Court: Court of Appeal (Singapore)
• Subject Matter: Appellants to manage and operate the discotheque,Musical entertainment,Agreement for the management and operation of discotheque,ss 3, 6, 11 & 18 Public Entertainments Act (Cap 257),Licence in the name of respondents' director,Whether agreement in breach of Public Entertainments Act and Rules,Scheme of the Act and the Rules,Licensing,Contract,Agreement to operate discotheque for respondents,Whether agreement breached Public Entertainments Act (Cap 257) and the Public Entertainments Rules 1969,Illegality and public policy,Public entertainment licence to be obtained by respondents,Public Entertainment,Staututory illegality,rr 3(2) & 5 Public Entertainments Rules 1969

The question before the court was the legality of an agreement between the first respondents (`Amara Hotel`) and the appellants (`Nova`) dated 8 July 1988 (`the agreement`) by the terms of which Nova agreed to operate for Amara Hotel a discotheque on the fourth level of Amara Hotel`s premises at 165 Tanjong Pagar Road, Singapore (`the discotheque`). The legality of the agreement turned on the interpretation of the Public Entertainments Act (Cap 257) (`the Act`) and the rules made thereunder, the Public Entertainment Rules 1969 (`the Rules`) in general, and s 3 of the Act and r 5 of the Rules in particular.

The learned judicial commissioner who tried this question decided `that the agreement was illegal and unenforceable as it contravened the Act and the Rules`. His judgment is reported at [1993] 2 SLR 289 . At the conclusion of the appeal we allowed it. Accordingly we set aside his judgment and ruled that the agreement was not illegal. Our reasons follow.

The relevant provisions of the agreement are the following:

preamble (c)

At the request of the operator, (Amara Hotel) the manager (Nova) will undertake the conversion of the premises (the discotheque) and the management and operations of the business in the premises subject to the terms and conditions herein contained.

clause 1.2

... the operator shall be responsible for applying for and obtaining the ... licence (to operate a discotheque) and maintaining it throughout the duration of the operating term ... Provided always the cost of such licence shall be borne by the manager.

clause 2.3(a)

The manager shall at the manager`s own cost and expense operate and manage the discotheque ...

clause 8.3

... the manager hereby agrees, covenants and undertakes to supervise, direct and, pursuant hereto, control the management and operation of the discotheque and shall render or supervise and pursuant hereto control the performance of all services and do or cause to be done all things reasonably necessary for the efficient effective and proper operation of the discotheque ...

clause 8.4

The parties hereto agree that, subject only to any express limitations which may be contained in this agreement, the manager shall have absolute discretion and control over the management and operation of the discotheque and the performance of the foregoing services ... the manager shall be acting only as agent for the operator and nothing in this agreement shall be construed as creating ... any other relationship between the parties hereto ... except that of principal and agent.

clause 16.1

The manager shall accord to the duly authorized officers, accountants, employees, agents and attorneys of the operator the right to enter upon any part of the discotheque at all reasonable times during the operating term, upon prior notice being given for the purpose of examining or inspecting the discotheque or examining or obtaining extracts from the books and records of the discotheque`s operation but the same shall be done with as little disturbance to the operation of the discotheque as possible.

In compliance with cl 1.2 of the agreement Amara Hotel did apply for and were issued with a licence to operate the discotheque under the provisions of the Act and the Rules. The application for the licence was made in the name of Teo Kwee Chuan, the second respondent (`Teo`) who, at the material time, was a director of Amara Hotel and was described as such in the application form. The licence was issued in Teo`s name without any reference to his connection with Amara Hotel or for that matter to Nova.

In this connection it is necessary to refer to rr 3(2) and 5 of the Rules which provide as follows:

Rule 3(2)

Where an application is made by a company or a firm, the application shall be countersigned by the person to whom it is desired the licence shall be issued.

Rule 5

No licensee shall transfer or lend his licence to any other person.

The relevant sections of the Act, for present purposes, are the following:

Section 3

No public entertainment shall be provided except -

(a) in an approved place; and

(b) in accordance with a licence issued by the Licensing Officer.

Section 6

If the Licensing Officer is satisfied that the responsibility for the observance of the conditions of a licence is intended to be shared between two or more persons he may require the application to be made in the names of as many such persons jointly as he thinks fit.

Section 11(1)

In respect of such classes of entertainment as the Minister may from time to time prescribe by notification in the Gazette and subject to such limits as may be thereby prescribed, the Licensing Officer, before issuing a licence, may require the applicant, or, if there are several applicants, each applicant named by him for the purpose, to give security, either in the form of a cash deposit or by entering into a bond that the provisions of this Act and of the conditions of the licence issued will be duly observed.

Section 18(1) and (2)

(1) Any person who provides or assists in providing any public entertainment not being a public entertainment exempted...