Public Prosecutor v Tan Hang Song

• Jurisdiction: Singapore
• Judge: Chay Yuen Fatt
• Judgment Date: 19 March 2019
• Neutral Citation: [2019] SGDC 52
• Citation: [2019] SGDC 52
• Docket Number: ACRA Summons No. 000138-2017 & Others
• Published date: 01 June 2019
• Hearing Date: 11 September 2018,14 November 2018,10 September 2018,21 February 2019
• Plaintiff Counsel: Kung Yong Jin Kenny (ACRA)
• Defendant Counsel: Daniel Chia and Christine Ong (Coleman Street Chambers LLC)
• Court: District Court (Singapore)

District Judge Chay Yuen Fatt: Introduction

The accused, a 48-year old Singaporean, is a local director of nine companies (‘the companies’) that were incorporated in Singapore. These companies failed to hold their annual general meetings (‘AGMs’) and also failed to lodge their annual returns (‘ARs’) over a number of years between 2011 to 2017 as required under the Companies Act (Cap. 50)(‘the Act’). The accused, in his capacity of an officer of these companies, was charged with 54 counts of knowingly and wilfully permitting the companies to default in their statutory obligations. He was represented by counsel and contested the charges. At the conclusion of the trial, he was convicted of all the charges and fined $2,100 for each charge.

He is appealing only against the order of conviction having paid the total fine of $113,400 in full.

Charges

For ease of reference, I will only set out two charges for failing to hold the AGM and to file the AR respectively for a specified year (2016) in respect of one of the companies (Faxlink Trading Pte Ltd). These are charges under s 175 and s 197 of the Act respectively. The charges against the other companies are similarly framed, save for the name of the company, its registration number and the date of the breach. The two charges for easy reference are reproduced as follows:

Failing to hold AGM

You…on or around 24 November 2016, in Singapore, being a director of Faxlink Trading Pte Ltd (198903432W) (“the Company”), a company incorporated in Singapore, did knowingly and wilfully permit the Company to default in holding an annual general meeting as required under section 175(1) of the Companies Act, to wit, you permitted the Company to not hold its annual general meeting by 24 November 2016, the Company thereby contravened section 175(4)(a) of the Companies Act (Chapter 50, 2006 Revised Edition) (“the Act”), and you have thereby committed an offence punishable under section 175(4)(a) of the Act read with section 408(3)(b) of the Act.

Failing to file AR

You…on or around 24 December 2016, in Singapore, being a director of Faxlink Trading Pte Ltd (198903432W) (“the Company”), a company incorporated in Singapore, did knowingly and wilfully permit the Company to fail to lodge an annual return as required under section 197(1) of the Companies Act, to wit, you permitted the Company to fail to lodge its annual return by 24 December 2016, the Company thereby contravened section 197(6) of the Companies Act (Chapter 50, 2006 Revised Edition) (“the Act”), and you have thereby committed an offence punishable under section 197(6) of the Act read with section 408(3)(b) of the Act.

For the charges for failing to file an AR, it is also pointed out by the prosecution¹ that the Companies (Amendment) Act 2014 amended the timeframe for filing an AR from within one month of the date of the AGM to within 30 days. Further, for offences committed before 3 January 2016, the offence section number is s 197(7) whereas for offences committed on or after that date, the offence section number is s 197(6).

For completeness, I point out that the reference in the charges to s 408(3)(b) of the Act provides for a default penalty in respect of a continuing offence. However, the issue of any continuing offence was not pursued by the prosecution in the present case.

The Prosecution’s Case

The facts are largely undisputed. The accused holds an accountancy degree and is a qualified chartered accountant in Singapore. He is also the general manager and director of Asian Corporate Service (SEA) Pte Ltd (‘ACS’), a company providing corporate secretarial services. He has been the general manager of ACS for 15 years from April 2004. At all material times, ACS is a registered filing agent (‘RFA’) and the accused is the authorised person to carry out electronic transactions with the Accounting and Corporate Regulatory Authority (‘ACRA’) on behalf of ACS.

It is not disputed that the accused is a director of some 39 companies and was first appointed as a director of a company as far back as 2001. In short, the accused has been in this business for some 20 years. In respect of the charges and at all material times, it is not in dispute that the accused was the sole local director of the nine companies. I set out the material particulars of the accused’s directorship as provided by the prosecution in a table²:

S/No.	Company Name & Registration Number	Date accused appointed as director	Status of Company
1	Faxlink Trading Pte Ltd	09 November 2004	Live
2	Oliver Wight Asia Pacific (Singapore) Pte Ltd	14 June 2004	Live
3	Rothesay Pte Ltd	11 November 2004	Live
4	SQR Solutions Pte Ltd	05 December 2006	Live
5	Hawkesbury Pte Ltd	01 October 2004	Live
6	JCF Investment Group Pte Ltd	4 June 2004	Live
7	Maro Pte Ltd	23 May 2006	Struck off on 4 June 2018
8	Solutions Center Pte Ltd	25 May 2006	Struck off on 4 June 2018
9	Gannon Power Pte Ltd	30 March 2007	Live

It is not in dispute that the companies in question did not hold an AGM or file an AR within the material dates as reflected in the charges. The deadlines that were breached span a number of years between 2011 to 2017 and are comprehensively set out in the conditioned statement³ of the representative of ACRA⁴ who gave evidence for the prosecution.

It is also undisputed that the accused did not apply to ACRA for an extension of time to comply with the statutory requirements in respect of any of the charges. Apart from two letters from the accused or his lawyers to explain the circumstances in respect of one of the companies named in the charges, he did not inform ACRA of any difficulties in holding the AGMs or filing the ARs in respect of the remaining companies. The accused also did not make any representations in respect of the charges before the summonses were issued against him to answer the charges.

The prosecution also relied on the following concessions by the accused in respect of the charges: That he did not issue a notice to call for the AGM to be held;⁵ That he did not apply for an extension of time to hold any of the AGMs;⁶ That he did not apply to dispense with holding the AGMs under s 175A of the Act;⁷ That he was aware of the avenue of⁸ but did not make any application to ACRA to file the ARs even though an AGM could not be held due to a variety of reasons including the lack of a quorum and/or where two directors signatures could not be obtained;⁹and That he did not make any applications to the High Court concerning the holding of any AGM or for an order to hold an AGM because of any difficulty.¹⁰

Finally, it is not in dispute that ACRA had sent the accused reminders to hold the AGM and file the AR before the due dates in respect of the companies.¹¹

The Defence

The accused took the stand to give evidence. He was the only witness for the defence.

The accused testified that he was only a nominee director of the companies in question, being appointed to comply with s 145(1) of the Act which mandates that every company shall have at least one director who is ordinarily resident in Singapore. He is also the sole director who is resident in Singapore.

Essentially, the accused’s defence is that he had difficulties either contacting the foreign directors and shareholders of the companies or getting them to sign or provide him with the necessary documents and accounts in order to hold an AGM and file the AR within the statutory time frame after the AGM. Therefore, despite all his efforts and due diligence, he was unable to hold the AGM or file the AR in respect of the companies within the statutory time frames. In this regard, the prosecution has summarised the steps the accused took, and the reasons or causes which led to the statutory breaches, in the form of a table.¹² As these facts are not in dispute, I will adopt and set out the summary as follows:

S/No	Company Name & Registration Number	Reasons for breaches	Date accused lost contact with Directors/Shareholders	Date of 1st breach of s. 175 CA
1	Faxlink Trading Pte Ltd	Domestic family dispute between shareholders preventing holding of AGM13	Did not lose contact14	24/11/2016
2	Oliver Wight Asia Pacific (S) Pte Ltd	“Client” had disappeared ie Mr Gly Williams15	30/04/ 200916	04/05/2015
3	Rothesay Pte Ltd	“Clients” are in Taiwan – “not very co-operative” – there were “accounting issues” 17	Did not lose contact18	31/12/2014
4	SQR Solutions Pte Ltd	“Client abandoned Us” – did not respond to correspondence and request to get the affairs of the company up to date” - was informed that the “principal” had discontinued business19	7 September 201220	31/12/2014
5	Hawkesbury Pte Ltd	Uncooperative “client” – asked for information to confirm and complete the accounts but client not co-operative21	Did not lose contact22	31/12/2016
6	JCF Investment Group Pte. Ltd.	Missing information regarding the accounts and when “client” responded they did not provide information 23 “JCF is more a issue of them not being able to provide us with information about creditors and how we should distinguish the creditors”24	Lost contact in March 2016 (but resumed contact March 2017)25	15/11/2014
7	Maro Pte. Ltd	“Clients” did not respond to accused’s correspondence26	30/05/201327	31/12/2013
8	Solutions Center Pte Ltd	Lost contact with shareholders and directors28	30/05/201329	31/12/2013
9	Gannon Power Pte Ltd	Lost contact with shareholders30 Non-cooperative regarding proposed striking off the company31	10/08/201232	09/09/2011

As emphasised by the...