P J Holdings Inc v Ariel Singapore Pte Ltd

• Jurisdiction: Singapore
• Judge: Choo Han Teck J
• Judgment Date: 26 March 2009
• Neutral Citation: [2009] SGHC 72
• Date: 26 March 2009
• Subject Matter: Contempt of Court,Whether committal proceeding measure of last resort,Civil contempt,Whether impecunious judgment debtor could be committed for contempt,Order 45 r 5 Rules of Court (Cap 322, R 5, 2006 Rev Ed)
• Docket Number: Originating Summons No 202 of 2008 (Summons No 5070 of 2008)
• Published date: 27 March 2009
• Defendant Counsel: Jeffrey Ong (JLC Advisors LLP)
• Court: High Court (Singapore)
• Plaintiff Counsel: John Thomas (David Nayar and Vardan)

26 March 2009

Choo Han Teck J:

Background

1 On 15 August 2008, the plaintiff P J Holdings Inc obtained an order of court (“the Order”), which was endorsed with a penal notice, against the defendant Ariel Singapore Pte Ltd (“Ariel Singapore”). The Order provided, inter alia, that:

Specific Performance of the Deed dated 12^th July 2007 (“the Deed”) to take place within one (1) month from 15^th August 2008 in that the Defendants complete the sale and purchase of 40,000 ordinary shares owned by the Plaintiffs in P.J. Services Pte Ltd and to pay the Plaintiff the sum of S$3,000,000.00 as per the Deed; …

On 4 September 2008, the plaintiff’s solicitors wrote to the defendant’s solicitors informing them that completion was to take place in their office before 14 September 2008 and that the plaintiff will require payment for the sum of $3m for the 40,000 ordinary shares in P J Services Pte Ltd. The defendant did not reply. By a facsimile dated 16 September 2008, the plaintiff’s solicitors informed the defendant’s solicitors that in view of the defendant’s non-compliance with the Order, “[the plaintiff] shall now proceed as they deem fit without further reference to [the defendant]”. On 13 October 2008, the plaintiff applied to the High Court for liberty to commence committal proceedings against Mr Low Shiong Jin, a director of the defendant, in respect of the latter’s failure to comply with Order. Leave was granted on 7 November 2008. A week and a half later, the plaintiff filed the present application to commit Mr Low to prison “for the contempt of Court by the Defendants for its failure to comply with the Order of Court dated 15^th August 2008”.

2 At the first hearing on 16 January 2009, the matter was adjourned as the parties were in negotiations to settle the matter out-of-court. Prior to the second hearing on 30 January 2009, the defendant filed an affidavit stating that at no time during the material period did Ariel Singapore have the financial means to pay the plaintiff. The matter was then further adjourned. At the third hearing on 24 March 2009, counsel for the plaintiff informed the court that a settlement had been reached on the following terms:

1. Leave to withdraw with liberty to restore.

2. Low Shiong Jin will make best his endeavours to make payment of $3m to the plaintiff.

3. Each party to bear his own costs.

3 Counsel for the plaintiff then requested for leave to withdraw with liberty to restore. I refused to grant leave to withdraw with liberty to restore, and instead granted leave to withdraw with no liberty to restore. My reasons for so doing are as follows.

The Statutory Provisions

4 Sections 7 and 13 of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) (“SCJA”) provide as follow:

Contempt

7. —(1) The High Court and the Court of Appeal shall have power to punish for contempt of court.

2) Wilful disposal by a garnishee, otherwise than in accordance with law or by leave of the court, of any property attached in his hands or under his control by a notice of court, shall be deemed to be contempt.

(3) Wilful disobedience by a corporation to any order punishable by attachment may be punished by attachment of the directors or other officers of the corporation who are responsible for, or are knowingly a party to, such wilful disobedience.

Writs of execution

13. A judgment of the High Court for the payment of money to any person or into court may be enforced by a writ, to be called a writ of seizure and sale, under which all the property, movable or immovable, of whatever description, of a judgment debtor may be seized, except —

(a) the wearing apparel and bedding of the judgment debtor or his family, and the tools and implements of his trade, when the value of such apparel, bedding, tools and implements does not exceed $1,000;

(b) tools of artisans, and, where the judgment debtor is an agriculturist, his implements of husbandry and such animals and seed-grain or produce as may in the opinion of the court be necessary to enable him to earn his livelihood as such;

(c) the wages or salary of the judgment debtor;

(d) any pension, gratuity or allowance granted by the Government; and

(e) the share of the judgment debtor in a partnership, as to which the judgment creditor is entitled to proceed to obtain a charge under any provision of any written law relating to partnership.

The relevant provisions in the Rules of Court (Cap 322, R5), in relation to contempt vis-à-vis a judgment or order for the payment of money or to do an act, are as follows:

Enforcement of judgment, etc., for payment of money (O. 45, r. 1)

1. —(1) Subject to these Rules and section 43 of the Subordinate Courts Act (Chapter 321) where applicable, a judgment or order for the payment of money, not being a judgment or order for the payment of money into Court, may be enforced by one or more of the following means:

(a) writ of seizure and sale;

(b) garnishee proceedings;

(c) the appointment of a receiver;

(d) in a case in which Rule 5 applies, an order of committal.

Enforcement of judgment to do or abstain from doing an act (O. 45, r. 5)

5. —(1) Where —

(a) a person required by a judgment or order to do an act within a time specified in the judgment or order refuses or neglects to do it within that time or, as the case may be, within that time as extended or abridged under Order 3, Rule 4; or

(b) a person disobeys a judgment or order requiring him to abstain from doing an act,

then, subject to these Rules, the judgment or order may be enforced by one or more of the following means:

(i) with the leave of the Court, an order of committal;

(ii) where that person is a body corporate, with the leave of the Court, an order of committal against any director or other officer of the body;

(iii) subject to the provisions of the Debtors Act (Chapter 73), an order of committal against that person or, where that person is a body corporate, against any such officer.

Measure of Last Resort

5 Committal proceeding is a measure of the last resort. This well-settled principle is set out at para 52/1/6 of the Singapore Civil Procedure 2007, which states:

Remedy of last resort/other remedies

The general principle is that if a reasonable alternative to committal proceedings exist, that should be used first. The courts commit a person to prison for contempt only after other options have been exhausted.

An...