Ramesh Vangal v Indian Overseas Bank and another matter

• Jurisdiction: Singapore
• Judge: Woo Bih Li JAD
• Judgment Date: 10 July 2023
• Neutral Citation: [2023] SGHC(A) 25
• Court: High Court Appellate Division (Singapore)
• Docket Number: Civil Appeal No 8 of 2023 and Originating Application No 6 of 2023
• Hearing Date: 14 March 2023
• Citation: [2023] SGHC(A) 25
• Year: 2023
• Plaintiff Counsel: Kanapathi Pillai Nirumalan, Liew Teck Huat and Phang Cunkuang (Niru & Co LLC)
• Defendant Counsel: Chan Cong Yen Lionel and Caleb Tan Jia Chween (Oon & Bazul LLP)
• Subject Matter: Civil Procedure,Foreign judgments,Registration
• Published date: 10 July 2023

Woo Bih Li JAD (delivering the judgment of the court): Introduction

The court must undertake a balancing exercise when invoking its discretion to adjourn an application to set aside the registration of a foreign judgment. It must strive to make a just order having regard to the interests of the judgment creditor in obtaining the well-earned fruits of litigation, as well as the interests of the judgment debtor that an appeal in the foreign court is not rendered nugatory. But in that process, it should not pass judgment on the merits of the appeal pending before the foreign court. These principles assume central importance in this case.

The present case arose out of HC/OS 1054/2019 (“OS 1054”), which was an ex parte application by the respondent, Indian Overseas Bank (“IOB”), to register a judgment from the Hong Kong Special Administrative Region (“Hong Kong”) in Singapore. The registration order was successfully obtained by way of HC/ORC 5731/2019 (“ORC 5731”). Thereafter, the appellant, Mr Ramesh Vangal (“Mr Vangal”), filed an application to set aside ORC 5731 in HC/SUM 2662/2021 (“SUM 2662”). SUM 2662 was heard by an assistant registrar (“AR”) of the Singapore Supreme Court who decided to adjourn the hearing of SUM 2662 pending the disposal of an appeal in Hong Kong.

IOB appealed against the AR’s decision and a Judge of the General Division of the High Court (the “Judge”) varied the period of adjournment of SUM 2662 to sometime after an application in Hong Kong to stay execution of the Hong Kong judgment was disposed of (instead of after the appeal in Hong Kong was disposed of). When that initial stay application was dismissed by the Hong Kong court, Mr Vangal filed a renewed application in Hong Kong once more to stay the execution of the Hong Kong judgment. Thereafter, Mr Vangal filed another application in Singapore by way of HC/SUM 4456/2022 (“SUM 4456”) for a further adjournment of SUM 2662 and a stay of execution of ORC 5731.

The Judge heard SUM 4456 and SUM 2662 together, and decided to dismiss both applications. The Judge’s grounds of decision are found in Indian Overseas Bank v Seabulk Inc (formerly known as Seabulk Systems Inc) and others [2023] SGHC 42 (the “GD”) where he explained his refusal to exercise his discretion to set aside ORC 5731, or to grant a further adjournment of SUM 2662 or a stay of execution of ORC 5731. Mr Vangal then filed the present appeal in AD/CA 8/2023 (“AD 8”) against the dismissal of SUM 2662; and also filed an application for permission to appeal in AD/OA 6/2023 (“OA 6”) against the dismissal of SUM 4456. It is these two matters which concern us and which we deal with collectively in this judgment.

The factual background The Hong Kong proceedings

IOB is a nationalised bank under the ownership of the Indian Ministry of Finance and incorporated under the laws of the Republic of India. It operates branches in Hong Kong and Singapore.

The underlying case is a long-running one beginning more than a decade ago to recover loans advanced. Sometime after August 2007, IOB (through its Hong Kong branch) granted credit facilities to a company which were guaranteed by two individuals, including Mr Vangal. On 21 May 2012, IOB commenced an action in the Hong Kong Court of First Instance (“HKCFI”) against the borrower company and the two guarantors. On 29 January 2018, that court held the defendants jointly and severally liable to IOB for the sum of about CAD$9.6m and about US$137,000 with interest on those sums (the “HK Judgment”).

On 26 February 2018, the defendants filed an appeal to the Hong Kong Court of Appeal (the “HK Appeal”).

On 20 August 2019, IOB filed OS 1054 in Singapore to register the HK Judgment under the Reciprocal Enforcement of Foreign Judgments Act (Cap 265, 2001 Rev Ed) (the “REFJA”). On 21 August 2019, the HK Judgment was registered in Singapore by ORC 5731 which was granted by an AR. Thereafter, IOB attempted to serve a Notice of Registration on Mr Vangal in May 2021.

On 18 May 2021, Mr Vangal filed an application in the HKCFI to stay the execution of the HK Judgment (the “First HK Stay Application”) pending the HK Appeal being determined.

Procedural background to SUM 2662 and SUM 4456 Proceedings before the AR

On 8 June 2021, Mr Vangal filed SUM 2662 in Singapore to set aside ORC 5731. It was heard by an AR on 10 May 2022. The prayers sought in SUM 2662 were as follows: 1. The Order of Court No. HC/ORC 5731/2019 dated 21 August 2019 (as amended on 28 January 2020), ordering the registration of the Judgment dated 29 January 2018 of the High Court of the Hong Kong Special Administrative Region Court of First Instance in HCA 846/2012 and the Notice of Registration issued pursuant thereto dated 18 May 2021, be set aside. 2. The costs of this application be paid by the Applicant to the 2nd Respondent. 3. Such further and/or other Order(s) and/or Direction(s) as this Honourable Court deems fit and/or necessary.

Mr Vangal relied on procedural and substantive grounds to set aside ORC 5731. There were two procedural grounds. The first was that IOB had failed to comply with O 67 r 3(4) of the Rules of Court (2014 Rev Ed) (the “ROC 2014”). This provision required IOB to adduce evidence of the enforceability by execution of the HK Judgment in its country of origin, ie, Hong Kong, in its affidavit to support the application for registration under the REFJA in Singapore. IOB had omitted to do this at the time when ORC 5731 was obtained.

Second, Mr Vangal contended that IOB had breached its duty to make full and frank disclosure when it applied ex parte to register the HK Judgment in Singapore. IOB had not disclosed that Mr Vangal had, on 1 February 2019, successfully set aside a statutory demand dated 28 September 2018 issued by IOB in Singapore because IOB had not yet registered the HK Judgment in Singapore under the REFJA at that time.

The substantive ground of challenge was that ORC 5731 should be set aside or stayed pursuant to s 6(1) of the REFJA on the basis that the HK Appeal and also the First HK Stay Application were pending in Hong Kong. Alternatively, Mr Vangal argued that the hearing of SUM 2662 should be adjourned pending the determination of the HK Appeal.

On 31 May 2022, the AR gave his decision. The AR rejected the two procedural grounds. On the first ground, he was of the view that the omission to adduce evidence of the HK Judgment’s enforceability in Hong Kong was a curable defect. Furthermore, the experts from each side had subsequently confirmed that the HK Judgment was enforceable in Hong Kong at the time of registration.

Second, as for the omission to disclose the setting aside of the statutory demand, the AR was of the view that this was not a material non-disclosure. The statutory demand was set aside only because the HK Judgment had not yet been registered in Singapore (and not because it could not be registered). It did not affect the validity of IOB’s subsequent application to register the HK Judgment.

As for the substantive grounds, the AR considered that justice would best be achieved by invoking s 6(1)(b) of the REFJA to adjourn the hearing of SUM 2662 pending the disposal of the HK Appeal. The AR also granted a stay of execution of ORC 5731.

The extracted orders of the AR stated as follows: 1. There be no order made on Prayer 1 of HC/SUM 2662/2021 (the ‘Application’). 2. The Application be adjourned for a reasonable period. Such reasonable period shall be until after the determination of the [HK Appeal]. 3. There be a stay of execution of [ORC 5731] made on 21 August 2019 for the reasonable period described in Paragraph 2 of this Order. 4. The parties be at liberty to write to the Court to restore the Application for an earlier hearing in the event that the [HK Appeal] and/or [the First HK Stay Application] do not proceed or are not prosecuted with diligence. 5. [Mr Vangal] is to write to the Court by 31 August 2022 with an update on the status of the proceedings in Hong Kong in the [HK Appeal] and [the First HK Stay Application]. 6. The Costs of the Application be reserved. In other words, there were two parts to the AR’s decision. The first part was to reject the procedural grounds raised by Mr Vangal. The second part was to adjourn SUM 2662 pending the outcome of the HK Appeal.

Proceedings before the Judge

On 13 June 2022, IOB appealed against the decision of the AR to the Judge sitting in chambers in HC/RA 192/2022 (“RA 192”). IOB challenged the second part of the AR’s decision and argued that the court should dismiss SUM 2662 instead of granting an adjournment. Notably, Mr Vangal did not file any appeal against the first part of the AR’s decision which Mr Vangal should have done if he wanted to contest that aspect of the decision. The decision by the AR (see above at [17]) not to make an order on prayer 1 of SUM 2662 (which was the prayer seeking to set aside ORC 5731, see above at [10]) was still a decision which effectively rejected Mr Vangal’s procedural grounds of challenge.

On 29 July 2022, the Judge heard IOB’s appeal in RA 192. The Judge varied the period of adjournment of SUM 2662 so that SUM 2662 would be adjourned until after the First HK Stay Application was disposed of, rather than until the HK Appeal was disposed of. If the First HK Stay Application was allowed, then the adjournment and stay of execution of ORC 5731 would be extended until the HK Appeal was determined. If the First HK Stay Application was dismissed, then SUM 2662 would proceed for hearing. The Judge also granted Mr Vangal liberty to file a fresh application to adjourn SUM 2662 and stay ORC 5731 should the First HK Stay Application be dismissed. However, the Judge also mentioned that the outcome of any fresh application for adjournment would include the consideration of partial security for the judgment sum: Ct: … In such eventuality you [ie, Mr Vangal]...