Oversea-Chinese Banking Corp Ltd v The Timekeeper Singapore Pte Ltd and Others

• Jurisdiction: Singapore
• Judge: MPH Rubin J
• Judgment Date: 28 February 1997
• Neutral Citation: [1997] SGHC 42
• Plaintiff Counsel: Tan Hin Tat (Sim Hill Tan & Wong),Alina Sim (WT Woon & Co)
• Date: 28 February 1997
• Year: 1997
• Subject Matter: Whether execution of a subsequent guarantee discharges earlier joint and several guarantees,Guarantees and indemnities,Striking out,Whether grant of conditional leave to defend bars subsequent application to strike out defence,Whether Court has inherent jurisdiction to strike out pleadings,O 18 r 19 Rules of Court 1996,Conclusive evidence clause,Credit and Security,Civil Procedure,Co-guarantors,Certificate issued under the clause conclusive as to guarantor's indebtedness
• Docket Number: Suit No 1511 of 1995 (Registrar's
• Citation: [1997] SGHC 42
• Court: High Court (Singapore)
• Published date: 19 September 2003

Introduction

The appeal herein arises from a claim by the plaintiffs against the defendants for moneys due and owing to them on account of facilities granted to the first defendants, The Timekeeper Singapore Pte Ltd (`the company`) underpinned by a joint and several guarantee executed by the second, third and fourth defendants dated 21 December 1993. The company and the second defendant had allowed claims against them to go undefended. The third and fourth defendants disputed the plaintiffs` claim. Nevertheless, after a multitude of applications and in fact after the third and the fourth defendants had, at one stage, obtained conditional leave to defend the claim, upon a further application by the plaintiffs on 2 February 1996, the deputy registrar struck out the defences of the third and fourth defendants and granted liberty to the plaintiffs to enter final judgment against them. I heard the third and fourth defendants` appeals against the decision of the deputy registrar and at the end I dismissed both the appeals. My grounds now follow.

Facts

The plaintiffs` original claim against all the defendants was for the following sums:

(1) for US$49,458.38 together with interest thereon at the rate of 9.3125% per annum commencing 25 August 1995 until payment - arising from overdue trust receipts from the company;

(2) for S$42,039.40 together with interest thereon at the rate of 4.75% per annum above the plaintiffs` prime lending rate calculated on a daily basis with monthly rests from 25 August 1995 until payment - arising from overdraft facilities granted to the company; and

(3) for legal fees, costs and disbursements.

Overdraft	$300,000	- $100,000	$200,000
Letter of credit (sight and $term 180 days), trust receipt (60 days) and shipping guarantee under the bank`s letter of credit	$100,000
$400,000 -	$100,000	$300,000

(signed)	(signed)	(signed)
[second defendant]	[third defendant]	[fourth defendant]

In formulating their claims, the plaintiffs initially relied on two documents, ie the facility letter addressed to the company dated 10 September 1993 and a joint and several guarantee in writing dated 21 December 1993 signed by the second, third and fourth defendants. Insofar as material, the relevant parts of the said documents are reproduced hereunder:

[Facility Letter]

10 September 1993

The Timekeeper Singapore Pte Ltd

We are pleased to advise you that Oversea-Chinese Banking Corporation Limited (hereinafter called `the bank`) has agreed, subject to satisfactory completion of legal documentation, and upon the following terms and conditions to restructure and to grant to your company credit facilities (hereinafter called `the facilities`) as follows:

Interest:

Overdraft: OCBC`s Prime (presently at 5% per annum) + 0.5% per annum

Trust receipt: OCBC`s Prime + 1% per annum

or at such other rate of interest as may from time to time be determined by the bank.

SECURITY:

The facilities shall be secured as follows:

(a) Set-off and cfharge over fixed deposit kept with the bank in any account and all account maintained in name of your company.

(b) Joint and several guarantee for $300,000 by Mr Ngiam Choong Kam, [fourth defendant], Mr Sebastian Wong Cheen Pong [second defendant] and Mr Low Kian Beng [third defendant].

CONDITIONS

(2) Your company`s right to utilise the facilities and the obligation of the bank to continue with the same shall be subject to the condition precedent that there shall have been previously delivered to the bank the following documents in form and substance satisfactory to the bank:

(a)

(e) Duly executed joint and several guarantee for $300,000 by Mr Ngiam Choong Kam, Mr Sebastian Wong Cheen Pong and Mr Low Kian Beng. [Emphasis added.]

(4) All expenses including stamp duty (whether as penalty or otherwise), legal, administrative, registration, execution fees and any other costs or charges (including abortive costs) whether of the bank or otherwise and incurred or expended by the bank in connection with the facilities whether the same is accepted or otherwise shall be borne by your company and all expenses including legal fees and costs as between solicitor and client and other costs and disbursements incurred by the bank in connection with any demand made or legal proceedings instituted for the recovery of any loan or facilities or any moneys due or unpaid or payable by your company or in relation to the realisation or enforcement of any security shall be borne by your company and also if the bank retains solicitors to enforce any of its rights whether by judicial proceedings or otherwise, then and in that event your company will pay to the bank all costs expenses including legal costs as between solicitor and client incurred by the bank.

This letter of offer shall supersede and cancel our previous letter of letter (sic).

Letter of guarantee (joint and several)

To: Oversea-Chinese Banking Corporation Limited

In consideration of your making or continuing to make loans or advances or otherwise giving or continuing credit or granting other credit or banking facilities or other accommodation from time to time to such extent and for so long as you may think fit to The Timekeeper Singapore Pte Ltd of 160 Orchard Road #03-17, Orchard Point, S(0923) (hereinafter called the `customer`) we Wong Cheen Pong, Low Kian Beng and Ngiam Choong Kam care of 160 Orchard Road #03-17, Orchard Point S(0923) the undersigned hereby jointly and severally unconditionally agree with you as follows that is to say:

1 We will pay to you on demand all sums of moneys or liabilities which are now or shall hereafter from time to time be due or owing or shall remain unpaid to you or be incurred from or by the customer anywhere whether as principal or as surety and whether solely or jointly with any other person or persons (in partnership or otherwise) on any account or accounts or otherwise including the ultimate balance which at the date of such demand shall be due or owing or remain unpaid to you by the customer TOGETHER WITH in all the cases aforesaid interest at such rate or rates as may from time to time be fixed or determined by you with monthly rests commission discount and other banking charges and together with also all legal and other costs charges and expenses which you may incur in enforcing or seeking to enforce any security for or obtaining or seeking to obtain payment of all or any part of the moneys and liabilities hereby guaranteed.

2(a) This guarantee shall be a continuing guarantee for the purpose of securing the whole of the moneys and liabilities or ultimate balance in paragraph 1 hereof mentioned notwithstanding any such payments receipts or dividends as are hereinafter mentioned provided always that the amount for which we shall be liable under this guarantee shall not exceed Dollars Three Hundred Thousand Only *** ($300,000).

2(b) In addition to the said limit hereinbefore mentioned we shall be liable to pay interest on the sum claimable from us on daily balance at such rate or rates as may from time to time be fixed or determined by you with monthly rests from the date of demand to the date of payment as well after as before any judgment is obtained in respect thereof.

7 This guarantee shall be in addition to and shall not in any way be prejudiced or affected by any other security whether negotiable or otherwise including any other guarantee or indemnity which you may now or at any time hereafter hold from us or any of us the customer or any other person for all or any part of the moneys hereby guaranteed nor shall such security or any other security to which you may be otherwise entitled or the liability of any person not a party hereto for all or any part of the money hereby guaranteed be in any way prejudiced or affected by this guarantee.

8 This guarantee shall not be prejudiced or diminished or affected in any way nor shall we nor any of us be released or exonerated by any of the matters following :

(a) any increase decrease extension renewal or re-structure of all or any of the loans or advances or credit or banking or credit facilities or other accommodation granted or given to the customer from time to time whether solely or jointly with any other person or persons (in partnership or otherwise) and whether beyond the said limit or otherwise or any variation of any terms and conditions thereof with or without notice to us;

(c) any variation exchange renewal release or modification of any guarantee indemnity or security or the refusal or neglect by you to complete enforce or assign any judgment specialty or other security or instrument negotiable or otherwise and whether satisfied by payment or not all of which you are at liberty to do whether with or without our consent or notice to us;

(d) any time forbearance concession or other indulgence given or extended to the customer and/or to any party to any guarantee indemnity security or other instrument in respect of any moneys hereby guaranteed all of which you are at liberty to give whether with or without our consent or notice to us;

(e) any compromise composition or arrangement made with the customer and/or any other person or persons all of which you are at liberty to make whether with or without our consent or notice to us;

9 Though as between us and the customer we are sureties only for the customer yet as between you and us each of us shall be deemed to be a principal debtor for all the moneys the payment of which is hereby guaranteed and accordingly we shall not be discharged nor shall our liability be affected in any way by any fact circumstance act omission or means whatsoever whether known to you or not whereby our liability hereunder would have been discharged if we had not been principal debtors.

14 This guarantee shall be valid binding and enforceable upon any one of us who had signed notwithstanding that this guarantee has not been signed or given by any one or more of the guarantors named in this instrument or...