Orix Leasing Singapore Ltd v Koh Mui Hoe and Others

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 17 November 2008
• Neutral Citation: [2008] SGHC 211
• Court: High Court (Singapore)
• Published date: 18 November 2008
• Year: 2008
• Plaintiff Counsel: Prem Gurbani and Bernard Yee (Gurbani & Co)
• Defendant Counsel: Justin Phua Hoon Chong (Justin Phua Tan & Partners),Chung Ping Shen (HA & Chung Partnership)
• Subject Matter: Tort,Conversion
• Citation: [2008] SGHC 211

17 November 2008 Judgment reserved.

Judith Prakash J:

Background

1 This is the first of two actions that the plaintiff, Orix Leasing Singapore Limited, commenced in this court to recover damages for conversion. The other is Suit 740 of 2006 (“suit 740”).

2 The plaintiff carries on the business of providing leasing and hire purchase services and, in this connection, purchases heavy machines to lease out to its customers. Among these customers in 2005 was a company named Rav Graphic Pte Ltd (“RGPL”) which had two directors and shareholders, Tan Kim Seng Crispian (“Crispian Tan”) and Ms Tan Soi Ngoh. On 25 August 2005, RGPL entered into an agreement to take a printing machine on hire purchase from the plaintiff viz one Mitsubishi 4-Colour Sheetfed Offset Press (the “Mitsubishi 4C”). At that time RGPL already had hire purchase agreements with the plaintiff in respect of two other machines, namely a Heidelberg Four-Colour Press Machine (the “Heidelberg 4C”) which is the subject matter of suit 740 and a Mitsubishi 5-Colour Sheetfed Offset Press (the “Mitsubishi 5C”).

3 Sometime in September 2006, the plaintiff discovered that the Mitsubishi 4C, together with the two other machines, had been removed from RGPL’s premises without the plaintiff’s prior consent or knowledge. The plaintiff then engaged a private investigator to investigate the matter and to trace the whereabouts of the machines with a view to recovering all of them.

4 In the meantime, RGPL had defaulted in meeting its obligations under the three hire purchase agreements. The plaintiff therefore commenced Suit 645 of 2006/T against RGPL and its two directors seeking recovery against the company under the hire purchase agreements and against the two directors under the personal guarantees that the latter had provided in respect of RGPL’s obligations. The plaintiff claimed approximately $3.65 million in this suit. Judgment was obtained against the two directors on 7 November 2006. However, RGPL itself was put into liquidation before judgment was entered against it by the plaintiff. The plaintiff filed a proof of debt in RGPL’s liquidation. The two directors were subsequently made bankrupt by other creditors and the plaintiff’s judgment against them was not satisfied. The plaintiff had not recovered any amount in respect of the three machines when it started the present action.

5 The investigator reported to the plaintiff that the three machines had been unlawfully sold by RGPL and also obtained certain information regarding the transportation of the machines from RGPL’s premises and the persons who had bought them. Despite further efforts being made, including commencing legal action in Malaysia, the plaintiff was unable to recover any of the machines.

6 This action was commenced on 8 November 2006 against four defendants. The original statement of claim alleged that sometime in March 2006, the first defendant Mr Koh Mui Hoe (“Mr Koh”) acting on his own or as a director of the second defendant, Ink Trading Pte Ltd (“ITPL”), unlawfully caused the Mitsubishi 4C to be removed from RGPL’s premises by arranging with the third defendant, Kenzone Logistics Pte Ltd, and/or the fourth defendant, Kim Heng Mechanic, to do so. It was further pleaded that the third defendant and/or the fourth defendant then proceeded to remove the machines from RGPL’s premises and to deliver the same to persons unknown. In the premises, the plaintiff asserted, all four defendants had converted the Mitsubishi 4C to their own use.

7 By the time this suit came on for trial, the action against the fourth defendant had been discontinued. The claim against the third defendant was discontinued at an early stage of the trial and, thereafter, the trial proceeded only against Mr Koh and ITPL. Thus, when hereafter in this judgment I refer to “the defendants” collectively, I should be understood as referring only to the first and second defendants.

8 On the morning of the second day of the trial, the plaintiff applied for and obtained leave to amend its statement of claim to remove the allegation that Mr Koh and ITPL had made arrangements with the third and fourth defendants to remove the Mitsubishi 4C from RGPL’s premises. Instead the plaintiff averred that Mr Koh and ITPL had caused the machine to be dismantled in RGPL’s premises and sold to a Taiwanese buyer whose identity was unknown to the plaintiff.

9 This action was heard before me at the same time as I heard suit 740. The witnesses who appeared in this action also testified in suit 740 except for the witnesses for the fourth defendant in suit 740 as that party was not a party to this action. However, by an order of court made on 15 November 2007, the parties were given leave to use the evidence adduced in suit 740 for the present action and vice versa.

The issues

10 The defence filed by Mr Koh and ITPL was a total denial. They denied that they had anything to do with the removal of the Mitsubishi 4C from RGPL’s premises.

11 In its closing submissions, the plaintiff submitted that the two principal issues before the court arising from the pleadings and the evidence were as follows:

(i) Whether, as a matter of fact, the Mitsubishi 4C was sold to a Malaysian buyer named Mr Mani, as alleged by Crispian Tan, or, as alleged by the plaintiff, to the defendants, alternatively, to a Taiwanese buyer through them.

(ii) If the machine was sold to Mr Koh or to a Taiwanese buyer through the defendants, whether, as a matter of law, Mr Koh’s conduct, either by buying the Mitsubishi 4C directly from RGPL or acting as a middleman to facilitate the sale of the machine by RGPL to the Taiwanese buyer, amounted to conversion on the part of the defendants.

12 The defendants did not disagree with the formulation of the issues.

The evidence

For the plaintiff

13 There were five witnesses for the plaintiff but it is not necessary to summarise the evidence of all of them. The chief witness on the matters that had occurred at RGPL was Chua Soo Meng, a former employee of RGPL. Mr Chua testified that he was employed as a production supervisor by RGPL from 2003 to 2006. He stated that he was working for RGPL at the time the Mitsubishi 4C and the Heidelberg 4C were removed from RGPL’s premises in March 2006 and August 2006 respectively.

14 Mr Chua was the person who gave the plaintiff’s investigator information about the loss of the machines. When he was first asked to prepare an affidavit of evidence in chief in support of the plaintiff’s case, he refused because he did not want the hassle of having to give evidence in court. Subsequently, after he was served with two subpoenas, one for this action and the other for suit 740, Mr Chua decided to affirm an affidavit since he had to give evidence in any case. His affidavit therefore covered matters at issue in both actions. For the purposes of the present judgment, I will summarise his evidence in relation to the Mitsubishi 4C and will only refer to his evidence in relation to the other machines where relevant.

15 Mr Chua stated that the Mitsubishi 4C was purchased by RGPL sometime in 2005. He recalled that the Mitsubishi 4C was sold to one “Jimmy Koh” (ie the first defendant) from ITPL and was dismantled in early March 2006. He remembered that on the day the machine was dismantled, four Malaysian Chinese men went to RGPL’s premises to dismantle the machine. They started to dismantle the Mitsubishi 4C at about 7am. It should be noted here that, in court, Mr Chua corrected his statement that the Mitsubishi 4C had been sold to Mr Koh. He said that he was not sure whether Mr Koh was the purchaser or the middleman for the sale of the machine.

16 After the machine had been dismantled, about eight to ten local Chinese men loaded the components into two forty-foot containers. Mr Chua remembered that a crane had been used to lift the components into the containers but he could not remember who the crane belonged to. At that time, RGPL’s premises were located in a building called Quek Industrial Building in Toh Guan Road East. After the first container was fully loaded, it was transported out of Quek Industrial Building at night by a prime mover which also brought the other container to the premises for loading. He recalled that the second container was also transported out of RGPL's premises at night. He was not aware of who the trailers or prime movers belonged to.

17 Mr Chua clearly remembered that Mr Koh was at RGPL's premises on both days to oversee the dismantling of the machines. Mr Koh was known to Mr Chua from past dealings that the two men had had. As far as Mr Chua knew, Mr Koh was in the business of buying and selling second-hand printing and printing-related machines. Mr Koh’s Taiwanese buyer, whom Mr Chua was not formally introduced to, was also there on both days. According to the Taiwanese buyer, the machine was to be transported to Malaysia before being shipped to Taiwan.

18 Mr Chua wished to clarify that when he was interviewed by the private investigator, Henry Tay, he had told Mr Tay that the third defendant was involved in the dismantling of the machines. Mr Chua said that he had been mistaken in saying this. The third defendant, as far as he could recall, had been involved in the installation of the Mitsubishi 4C, not its dismantling.

19 Mr Chua also stated that the Mitsubishi 5C was dismantled in mid-May 2006. As far as Mr Chua was aware, it was sold to an Indian buyer through a man named S Mani from a company called Newtrend Machinery Services (M) Sdn Bhd.

For the defendants

20 Mr Koh filed an affidavit of evidence-in-chief in suit 740 in which he gave evidence for both actions. He stated that he was the managing director of ITPL which was a company in the business of trading in printing equipment and consumables. He first met Crispian Tan when the latter responded to advertising brochures that ITPL had sent out to printers in Singapore.

21 In February or March 2006, at Crispian Tan’s...