Piong Michelle Lucia v Yuk Ming Cheung and others

• Jurisdiction: Singapore
• Judge: Quentin Loh JC
• Judgment Date: 12 April 2010
• Neutral Citation: [2010] SGHC 110
• Court: High Court (Singapore)
• Hearing Date: 04 March 2010,25 March 2010
• Docket Number: Suit No 659 of 2009 (Registrar’s Appeal No 50 of 2010)
• Plaintiff Counsel: Carolyn B.H. Tan and Tony Au Thye Chuen (Tan & Au LLP)
• Defendant Counsel: Kenneth Pereira (Advocatus Law LLP)
• Subject Matter: Civil Procedure
• Published date: 21 April 2010

Quentin Loh JC:

The Plaintiff, Vice President, Finance of Pan Sino International Holdings Ltd (“Pan Sino”), a Cayman Island Corporation listed on the Hong Kong Stock Exchange, (“HKSE”), sued the Defendants for defamation. The 1st Defendant was an auditor sent by the 2nd Defendant to audit the accounts of Pan Sino. The 2nd Defendant was a company incorporated and based in Hong Kong and were appointed by Pan Sino to be their auditor and to audit its annual accounts. The 3rd Defendant was a company incorporated in Hong Kong under the control of or closely associated to the 1st and 2nd Defendants and provided corporate secretarial services to clients of the 1st and 2nd Defendants. These facts appeared from the Statement of Claim and the Plaintiff’s Affidavit affirmed on 25 August 2009.

The Plaintiff obtained leave under O 11 r 1(c), (f), (p) and (q) of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) to serve the Writ on the Defendants in Hong Kong. Various applications were made. The appeals before me concerned two applications: (a) Summons No 5283 of 2009: the Defendants’ application for a stay of proceedings on the ground of forum non conveniens (there were other prayers in the summons, including whether there was proper service of the Writs on the Defendants, but they were not before me); and (b) Summons No 5472 of 2009: the Plaintiff’s application for interlocutory and/or final judgement against the Defendants, for damages to be assessed, for a full and complete withdrawal of all defamatory statements and a written apology on terms to be agreed to by the Plaintiff, for an apology in terms acceptable to the Plaintiff to be published in the major newspapers in Singapore, Jakarta, Makasar and Hong Kong, and for costs and interest. AR Ang Ching Ping heard these applications on 26 January 2010 and granted the stay, holding that the Defendants had discharged their burden in showing that Hong Kong was a distinctly more appropriate forum, and that there were no special circumstances requiring the trial take place in Singapore. She dismissed the Plaintiff’s application for judgment. Costs were also awarded against the Plaintiff. The Plaintiff appealed against those decisions. After hearing counsel, I dismissed the appeal with costs on 4 March 2010. The Plaintiff wrote in for further argument, I acceded to the request and after hearing further argument, I saw no reason to change my mind. The Plaintiff appealed against my decision on 31 March 2010.

The Writ of Summons, endorsed with a Statement of Claim was filed on 29 July 2009. In the Statement of Claim, the Plaintiff alleged the following defamatory acts: (a) the 1st Defendant defamed the Plaintiff by sending an email dated 29 April 2008 to one Mr Lau Kee Swan (“LKS”) in Singapore and copied to one Mr Rudi Zulfian (“Rudi”) and the 2nd Defendant, alleging that the Plaintiff was “very cunning and dishonest” and told lies to them; (b) the 1st Defendant defamed the Plaintiff by sending an email dated 30 April 2008 to LKS and Rudi alleging that the Plaintiff was doing two of them a “big dis-service” and giving the impression that they were rushing to “cover up some very bad things from the shareholders and regulators”, that the Plaintiff should be replaced, that retaining her was a “high risk” to them and Pan Sino and its shareholders and to the auditors, and that the Plaintiff was “not ethical, not truthful and not fit to be an accounting person of a listed company who should behave honestly and fairly”; (c) the 1st Defendant sent an email dated 10 June 2008 to LKS, copied to Rudi, stating that the Plaintiff was “toxic, unfair, lying, attacking, bullying, threatening and like so much to frame up people”, that was why they had to complain to LKS, and that continuing to use the Plaintiff would “keep [LKS] in an endless cycle of stressful struggle with others in the future”; (d) the 3rd Defendant sent an email to one Ms Nelcia of Portcullis Trustnet Ltd (“Portcullis”) in the British Virgin Islands, who in turn forwarded the email to Mr Mohan Abraham, an advocate and solicitor in Singapore, stating that it was unlikely that Ms Nelcia would get a reply from her “master client as she has absconded from Singapore to avoid a criminal charge and the pursuit by the Indonesian government on certain suspected fraud”; (e) the 3rd Defendant sent a letter dated 17 June 2009 to the Chairman of Platinum Securities Ltd, one Mr Lui Chee Ming (“Mr Liu”) in Hong Kong, asking that he freeze shares registered in the name of Silk Route International Ltd (“Silk Route”) (279,741,000 shares) and Flanders Fields Corporation (“Flanders Fields”) (179,659,000 shares), stating that his assistance in holding the shares and not transferring them to anyone was necessary to facilitate police investigations in Police Case No CCB 08008767 relating to a police report dated 16 June 2009 that had been lodged to report the theft of the abovementioned shares from Mr Harmiono Judianto (“Judianto”); (f) the 2nd Defendant sent a letter dated 9 July 2009 to G W Barth AG (“GWB”) of Germany referring to the purchase of a plant from them by Hesley Cocoa International Pte Ltd, (“Hesley Cocoa”), and stating that it was conducting an audit investigation of Hesley, asking for confirmation of the total purchase price at S$19,877,225 or €9,341,460 and confirmation that there was no amount due to GWB as at 31 December 2007 and 31 December 2008; and (g) the 3rd Defendant sent a letter dated 17 July 2009 to Tricor Tengis Ltd (“Tricor”) in Hong Kong, asking for some share certificates, copies of letters, notices or other correspondence sent to Judianto by Tricor or others concerning any of the shares, stating that they needed to find out the truth as they were “afraid that the loss may not be traced and recovered as the particular directors who [were] suspected to have arranged the matters including the transfer forms [had] closed Pan Sino’s head office in Jakarta and disappeared”, as a result of which the annual reports of 2007 and 2008 had not been issued on time to the shareholders as were required under the listing rules, and asking for the two transfer forms, without redaction, to ascertain the identities and addresses of the two transferees from the Standard Transfer Forms where Judianto was described as the seller or transferor although he did not know or agree to the sale or transfer. The Plaintiff also alleged that she was the CEO and substantial shareholder of Hesley Cocoa, which was intended for public listing on the Singapore Stock Exchange and that she was widely known as the founder and key person behind Hesley Cocoa; she had been involved in businesses in Singapore, Indonesia and Hong Kong for many years. The Plaintiff alleged aggravating factors in support of her claim for damages.

Numerous affidavits were filed by the parties and further facts emerged from these affidavits. The 1st Defendant filed affidavits on behalf of all the Defendants. The subparagraphs below set out some of the facts alleged in the 1st Defendant’s Affidavit of 16 October 2009. (a) The Plaintiff controlled a BVI company, Tapleys, which was a substantial shareholder of Pan Sino. (b) The 2nd Defendant was appointed auditor of Pan Sino for 2007. Prior to that, another audit firm, Li, Tang and Cheng were the auditors. That firm issued a heavily qualified or adverse audit report for Pan Sino for the year ending 31 December 2006. Prior to the 2006 audit, PKF Certified Public Accountants (“PKF”) and Andrew Ma (DFK) Ltd (“Andrew Ma”) were Pan Sino’s auditors. Both PKF and Li, Tang and Cheng resigned whilst Andrew Ma, another auditor, was removed by Pan Sino. (c) The 2nd Defendant issued an adverse report for the year ending 31 December 2007. In the exhibited report, 2 pages of reservations on various items were set out. One of those items was the inability to verify whether inventories of HK$8.33 million, accounts receivable of HK$89.07 million, deposits in respect of a factory under construction in Singapore of HK$149 million, and payment of HK$100 million for a purported joint venture had been correctly stated. Another was the insufficient information over a dispute between Pan Sino and its subsidiaries, the builder and the principal supplier over the Hesley Cocoa factory and the recovery of HK$163 million in relation to that dispute. A third related to a doubtful payment of HK$140.68 million to Vantage Unicom Holding Ltd, a BVI company with an Indonesian subsidiary. Other items concerned transactions and balances with customers on which satisfactory audit evidence could not be obtained. After setting out the above, the 2nd Defendant stated in that audit report that the directors required them to give a “good and clean report” stating that except for two items the financial statements showed a true and fair view of the company, and to give a sign off on a draft audit report adapted from the 2nd Defendant’s draft with an implicit threat that the 2nd Defendant’s fees would not be paid if they did not co-operate. The report stated that the 2nd Defendant did not agree to that. (d) Judianto, one of the shareholders of Pan Sino (and former spouse of the Plaintiff), complained to the 2nd Defendant in late 2008 that 279,174,000 of his shares in Pan Sino had been stolen or unlawfully transferred to another BVI company, Silk Route and another 177,266,000 shares had been similarly transferred to Flanders Field. (e) That alleged theft from Judianto was...