Rabiah Bee bte Mohamed Ibrahim v Salem Ibrahim

JurisdictionSingapore
JudgeJudith Prakash J
Judgment Date23 February 2007
Neutral Citation[2007] SGHC 27
Citation[2007] SGHC 27
Date23 February 2007
Year2007
Plaintiff CounselEdmond Pereira and Looi Teck Kheong (Edmond Pereira & Partners)
Docket NumberSuit No 1079 of 2003
Defendant CounselJimmy Yim SC and Kelvin Tan (Drew & Napier LLC)
CourtHigh Court (Singapore)
Published date14 March 2007

23 February 2007

Judgment reserved.

Judith Prakash J:

Background

1 The plaintiff, Rabiah Bee binte Mohamed Ibrahim, who is also known by her married name of Rabiah Weiss, is the elder sister of the defendant, Salem Ibrahim. Well known as a successful businesswoman in the fashion industry in Singapore in the 1970s and 1980s, the plaintiff sold her business in 1988 and moved to London. There she went into property investment. By 1994, the plaintiff owned four houses in London. In early 1996, she bought two more. The plaintiff used the rental received from some of the houses to support herself and her children.

2 The defendant started practice as a lawyer in Singapore in 1989. Prior to that, he had been in the insurance industry. By 1996, the defendant was a partner in M/s Harry Elias & Partners (“M/s HEP”). He left that practice at the end of May 1997 to establish his own legal firm which he still heads.

3 In mid 1996, the defendant and her husband, Pierre-Alain Weiss, spent some days in Singapore as house guests of the defendant. During that stay, the siblings had discussions about jointly entering the property market in Greater London (“the venture”). The talks ended in an agreement (“the oral agreement”) to buy and refurbish residential properties (“the JV properties”) with the intention of letting or selling them at a profit. On the plaintiff’s return to London, the venture was put into effect and between October 1996 and February 1998, the plaintiff arranged for the purchase of eight properties, at least seven of which were, indisputably, intended for the venture. The ownership of the eighth property is in dispute.

4 Despite the apparent financial success of the venture, the personal and commercial relationship of the siblings broke down. In 2000, the plaintiff accused the defendant of not keeping proper accounts and of using the venture’s moneys for his own purposes. In mid 2001, another sibling, Victor Adam Ibrahim (“VAI”) brokered a truce between the two. They signed a settlement agreement by which they agreed to dissolve the venture, retain their respective capital contributions and split the remaining proceeds in equal shares. The settlement agreement did not, however, end the matter. Subsequently, there was a dispute as to the obligations imposed by the settlement agreement and each side accused the other of reneging on his/her respective promises.

The action

5 This action was started in November 2003. The plaintiff has amended her statement of claim three times with the last amendment being made in the course of the trial after the plaintiff had given her testimony and while the defendant was in the course of cross-examination. The defendant filed a defence and counterclaim and that pleading has also been amended several times in order to meet the changes in the plaintiff’s pleading.

6 Since the parties were given ample leeway to amend their pleadings, both before and during the trial of the action, and have thus had every opportunity to define and re-define their respective cases, I do not think it would be unfair in any way to hold them strictly to their respective pleadings. The last set of proposed amendments to the statement of claim was hotly contested by the defendant and I allowed some but not others. The defendant appealed against my order but subsequently this appeal was discontinued. The plaintiff did not appeal and therefore must be taken as accepting that only those amendments that I allowed were valid amendments and that the other proposed amendments had no further relevance to the case. In view of these developments, I do not propose to consider, let alone decide on, any issue that has not been raised by the pleadings. It would therefore be helpful if I set out in brief exactly what was pleaded by each side.

Statement of claim

7 The first version of the statement of claim was endorsed on the writ in November 2003. The final version of the statement of claim was filed in late October 2005.

8 The first few paragraphs set out the background of the parties and the venture. In para 5, the plaintiff set out what she alleged were the express terms of the oral agreement. These were:

(a) the capital for the venture would be provided by the parties in equal shares with an initial contribution of ₤100,000 each;

(b) legal title to the JV properties would be held by companies incorporated outside the United Kingdom (“the offshore companies” or “the JV companies”);

(c) the beneficial interest in the JV properties would be held by the JV companies on trust for the parties in equal shares as tenants-in-common;

(d) the defendant would be responsible for all financial and legal aspects of the purchases, including managing the capital jointly provided by the parties, incorporating the JV companies and handling their affairs, procuring mortgages from banks to finance the purchase of the JV properties and making the relevant payments in respect of such mortgages;

(e) the plaintiff would identify suitable properties to be purchased and would refurbish them, arrange for them to be rented out and then manage them;

(f) the rental proceeds and the profits from the resale of the JV properties would be shared equally; and

(g) the plaintiff would be entitled to reasonable compensation for the time, effort and expense incurred and expended by her in performing her obligations to the venture.

As an alternative to the claim made under para 5(g), para 6 asserted that it was an implied term of the venture that the plaintiff would be entitled to reasonable compensation for her effort and expenditure. This issue was further taken up in paras 29 and 30 wherein the plaintiff asked for “reasonable” compensation or alternatively for a quantum meruit calculated at 15% of the gross rental proceeds of the JV properties during the currency of the venture.

9 In para 6(a), it was asserted, as a further implied term of the venture, that the plaintiff and the defendant would account to each other for all their respective dealings and property and assets coming into their hands or under their control in the course of and by reason of the venture, including the JV properties and the JV companies, and that a joint venture account would be opened and operated for this purpose.

10 Paragraphs 7 to 15 set out the manner in which seven properties were purchased between October 1996 and February 1998 with each property being registered under the ownership of a different offshore company. At para 13, the plaintiff averred that to the best of her knowledge, the purchase of the JV properties was financed in part by loans obtained from Hill Samuel Merchant Bank (“Hill Samuel”) (this bank and the loans were subsequently taken over by Lloyds Bank) which loans were secured by mortgages over the respective properties to which they related. She further averred that all arrangements relating to the loans and mortgages were handled solely by the defendant pursuant to the terms of the venture and/or in his capacity as the plaintiff’s solicitor.

11 Paragraphs 27 and 28 dealt with an eighth property, 71A Glengarry Road (“Glengarry”). The plaintiff averred that Glengarry was not purchased as a JV property but that she had told the defendant that she was purchasing Glengarry as a home for her son, David Fleming (“DF”). She asserted that she had asked the defendant to pay for this property because he was holding moneys belonging to the venture which he had not disbursed to the plaintiff.

12 In paras 16 to 30, the plaintiff set out her allegations in relation to the defendant’s alleged failure to discharge his duty to account to her. She stated that in late 2000, the venture and the relationship of solicitor and client between the defendant and herself was terminated by mutual consent as a result of a breakdown in their relationship. She averred that the defendant was in receipt of funds from the venture and that he was a trustee of those funds and under fiduciary duty to render a full and proper account of the funds to the plaintiff as beneficiary, and also to account for all property and assets he controlled. This included the JV companies and the joint venture account.

13 The plaintiff said that she had asked for accounts of these matters repeatedly from late 2000 to early 2003. In March or April 2003, she received an account from the defendant which had been prepared by a company called M/s Gane Shawn & Partners (“GSP”) that had allegedly been verified by a chartered accountant, one Duncan Merrin. The plaintiff was dissatisfied with these accounts because no supporting documents accompanied them and Mr Merrin had reviewed the accounts without evidence of the manner in which the loans from Lloyds Bank (“Lloyds”) had been used or of the interest rates Lloyds had charged.

14 Paragraph 25 of the statement of claim contained particulars of the defendant’s alleged breaches of duty to the plaintiff as a joint venture partner and as the director of the JV companies. It was alleged that he had failed:

(a) to disclose to the plaintiff that there was no bank account for the venture and that he was using his own personal bank accounts instead;

(b) to disclose to the plaintiff that he had used the bank accounts that he shared with his wife to receive the plaintiff’s contribution to the venture;

(c) to disclose to the plaintiff that he had kept the moneys drawn down from the loans in a personal account that he maintained with his wife;

(d) to disclose to the plaintiff that he had used the venture’s funds for his personal expenses;

(e) to keep and maintain proper records of all the JV properties purchased and sold by the JV companies;

(f) to keep and maintain proper records of all documents pertaining to the sale and purchase and mortgage of the JV companies in particular:

(i) the sale and purchase agreements;

(ii) valuation reports;

(iii) completion statements;

(iv) letters of offer;

(v) mortgage documents;

(vi) annual and quarterly mortgage...

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