Re Jeyaretnam Joshua Benjamin

• Jurisdiction: Singapore
• Judge: Tay Yong Kwang JC
• Judgment Date: 16 May 2000
• Neutral Citation: [2000] SGHC 87
• Docket Number: Bankruptcy Nos 3129 and 3130 of
• Date: 16 May 2000
• Year: 2000
• Published date: 19 September 2003
• Plaintiff Counsel: Lynette Sathiasingam (Leo Fernando)
• Citation: [2000] SGHC 87
• Defendant Counsel: Davinder Singh SC and Hri Kumar (Drew & Napier),Sarjit Singh and Sunari Kateni (Official Assignee)
• Court: High Court (Singapore)
• Subject Matter: Petition,Bankruptcy,s 61(1)(a) Bankruptcy Act (Cap 20, 1996 Ed),Whether presumption of inability to pay properly invoked,Whether dishonesty involved in presentation of petition,Statutory minimum debt of $10,000,Time for applying requirement,Insolvency Law,Time for assessing debtor's inability to pay

: This is an appeal by the debtor in Bankruptcy 3130/99 against the decision of the learned Assistant Registrar Dawn Tan Ly-Ru given on 5 May 2000 ordering that the debtor be adjudged a bankrupt. Both Bankruptcy 3129/99 and Bankruptcy 3130/99 were heard together and upon the bankruptcy order being made in Bankruptcy 3130/99, leave to withdraw Bankruptcy 3129/99 was granted. Both petitions were essentially the same and arose out of High Court Suit 2308/95.

Bankruptcy 3130/99

The petition filed by R Kalamohan on 1 October 1999 stated:

1 The conditions and grounds specified in ss 60 and 61 of the Bankruptcy Act (1996 Ed) have been satisfied as:

(a) the debtor is domiciled in Singapore and/or has within the period of one year immediately preceding the date of the presentation of this petition, been ordinarily resident in Singapore; and

(b) the amount of the debt is not less than $10,000, is for a liquidated sum payable to the petitioner immediately and the debtor is unable to pay the debt.

2 The debtor is justly and truly indebted to me in the aggregate sum of $31,504.10, full particulars of which are set out in the annexure to this petition.

3 The abovementioned debt is for a liquidated sum payable immediately and the debtor appears to be unable to pay it.

4 On Wednesday, the 8th day of September, 1999, at 2.30pm a statutory demand was served upon the debtor by way of substituted service, in respect of the abovementioned debt. Twenty-one days have elapsed since the service of the demand and to the best of my knowledge and belief, the demand has neither been complied with nor set aside in accordance with the Bankruptcy Rules and no application to set it aside is outstanding.

5 I do not, nor does any person on my behalf, hold any security on the debtor`s estate, or any part thereof, for the payment of the above-mentioned sum.

6 There has been no stay of execution in respect of this debt.

The petition also contained a notice to the debtor stating that if he intended to oppose the petition, he must file a notice in court specifying the grounds of objections not later than three days before the day fixed for hearing. The annexure to the petition spelt out the particulars of the debt which comprised a judgment amount of $30,000 and interest thereon amounting to $1,504.10 as at 1 October 1999 awarded to the petitioner in Suit 2308/95. The debt here was therefore $31,504.10.

On 5 October 1999, the petition and the supporting documents were served on the debtor by delivering them personally to Mr Leo Fernando, the solicitor for the debtor, who had instructions to accept service on his behalf.

Bankruptcy 3129/99

As I have indicated, the petition by Ravindran s/o Ramasamy was for all practical purposes the same as that by R Kalamohan except that the judgment amount of $30,000 and the interest of $1,504.10 thereon were reduced by the amount of 8.710.95 being the net sum of costs ordered in favour of the debtor in various applications. The debt owing in this petition was therefore $22,793.15.

The hearing of the petitions

Both petitions first came on for hearing before an assistant registrar on 12 November 1999. The debtor did not attend the hearing and neither was he represented by a solicitor. The petitioners` solicitor informed the assistant registrar of an instalment plan and tendered some letters exchanged between the parties` solicitors. The letter dated 22 September 1999 from the petitioners` solicitors to the debtor`s solicitors reads:

SUIT 2308/95

We refer to your letter of 20 September 1999.

Our clients are prepared to let your client discharge his debts to them by way of eight instalments, but on the following terms and conditions:

(1)	The debts due from your client to our clients must be paid off by eight monthly instalments as follows:
	To Mr Ravindran
	- on or by 31 October 1999	-	$	3,000.00
	- on or by 30 November 1999	-	$	3,000.00
	- on or by 31 December 1999	-	$	3,000.00
	- on or by 31 January	-	$	3,000.00
	- on or by 29 February	-	$	3,000.00
	- on or by 31 March 2000	-	$	3,000.00
	- on or by 30 April 2000	-	$	3,000.00
	- on or by 31 May 2000	-	$	1,705.18
	To Mr Kalamohan
	- on or by 31 October 1999	-	$	4,000.00
	- on or by 30 November 1999	-	$	4,000.00
	- on or by 31 December 1999	-	$	4,000.00
	- on or by 31 January 2000	-	$	4,000.00
	- on or by 29 February 2000	-	$	4,000.00
	- on or by 31 March 2000	-	$	4,000.00
	- on or by 30 April 2000	-	$	4,000.00
	- on or by 31 May 2000	-	$	3,387.75
(2)	Our clients shall file their respective bankruptcy petitions against your client, but will adjourn the hearing of the same until your client`s debts are fully discharged in accordance with the instalments referred to in (1) above.
(3)	Your client agrees that we may, on behalf of our clients, serve our clients` bankruptcy petitions on you, and that such service shall be deemed good service of the said bankruptcy petitions on your client.
(4)	In the event your client fails to make payment of any instalment on time, our clients shall be entitled, at their absolute discretion, to terminate this agreement and proceed with their respective bankruptcy petitions. Any notice of termination may be served on you by fax, post or by hand, or any one of such means at our clients` absolute discretion, and such service shall be deemed good service of the said notice on your client.
Please note that Mr M Loganthan did not make any payment pursuant to the garnishee order. In the circumstances, your client`s debt is not reduced by reason of the said order.Please let us know if your client agrees to the above terms.

The letter from the debtor`s solicitors dated 11 November 1999 to the petitioners` solicitors advised that neither the debtor nor his solicitors would be attending the hearing on 12 November 1999 and requested that the assistant registrar be informed of the abovestated agreement and that the petitions be stayed.

The petitioners` solicitors replied the same day. They reminded the debtor`s solicitors about para (2) of their letter dated 22 September 1999 and stated that they would therefore be asking for the petitions to be adjourned to a date after 30 November 1999 when the second instalment would become due. They also suggested that the debtor`s solicitors attend the hearing on 12 November 1999 should they disagree with the proposed course of action. At the first hearing, the petitions were adjourned to 3 December 1999.

On 3 December 1999, the Assistant Registrar was informed of the instalment plan and the parties` agreement to have the petitions adjourned from month to month. The petitions were adjourned accordingly to 7 January 2000 on which date the Assistant Registrar ordered that the petitions be withdrawn subject to the petitioners` right to restore them for hearing in the event of default on the instalment payments. Neither the debtor nor his solicitor attended on any of the above hearing dates. The petitioners` solicitor mentioned the matters on their behalf each time.

On 17 April 2000, the petitioners` solicitors wrote to the Registrar. The letter stated that the debtor was to have made an instalment payment of $7,000 on or by 31 March 2000 and had requested through his solicitors` letter dated 5 April 2000 an extension of time to 15 April 2000 to make the said payment. As the debtor failed to pay by 15 April 2000, the petitioners` solicitors asked that the petitions be restored for hearing. A copy of the petitioners` letter was sent to the debtor`s solicitors.

In response, the Registry restored the two petitions for hearing on 28 April 2000.

On 27 April 2000, the petitioners` solicitors filed an affidavit setting out the brief history of the proceedings and stated that five instalments had been made but not the sixth instalment due by the extended deadline of 15 April 2000. The letter dated 22 September 1999, which set out the agreement of the parties, was exhibited in this affidavit and so was the debtor`s solicitors` letter dated 5 April 2000 which referred to both petitions here and stated:

1 We refer to your letter of 3rd instant.

2 Our client regrets the delay in making payment of his sixth instalment of $7,000. We are instructed that our client will pay the said amount on or before 15 April 2000.

3 Kindly hold your hands in the interim.

On 28 April 2000, only the petitioners` solicitor attended the hearing. He informed the assistant registrar that the sixth instalment was paid the day before and that the seventh instalment would be due on 30 April 2000. He therefore requested an adjournment of one week. The Assistant Registrar acceded to the request and adjourned the hearing to 5 May 2000.

On 5 May 2000, the debtor`s solicitor turned up for the first time. The Assistant Registrar was informed by the petitioners` solicitor that the seventh instalment was not paid. The debtor`s solicitor applied for the matters to be stayed until the end of the month as the debtor`s solicitors, by their letter dated 27 April 2000, had informed the petitioners` solicitors that full payment of the balance due to both petitioners ($4,705.18 for Ravindran and $7,387.75 for R Kalamohan) would be made by 31 May 2000, the last day to settle the debts as stated in the agreement. It was also pointed out that almost 80% of both debts had already been settled. The reasons put forward to justify a stay were the following:

(1) a bankruptcy order could only be made where the amount of the debt was not less than $10,000 (see s 61 Bankruptcy Act set out later in this judgment) and the respective outstanding debts were below this amount;

(2) the court had to be satisfied that the debtor was unable to pay the debts...