Re Ritecast (S) Pte Ltd

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeG P Selvam J
Judgment Date25 January 1996
Neutral Citation[1996] SGHC 9
Citation[1996] SGHC 9
SubjectProof of debt,Winding up,Insolvency Law,Companies,Part payment on receipt of statutory demand,Whether petitioners or company had assumed credit risk of customer,Opposition,Grounds for petition,Petition by factoring company,Whether a relevant factor
Date25 January 1996
Defendant CounselS Santhiran (Santhiran & Pnrs)
Plaintiff CounselK Bala Chandran and KL Wong (Mallal & Namazie)
Docket NumberCompanies Winding Up No 197 of
Publication Date19 September 2003
Judgment:

GP SELVAM J

This was a petition to wind up Ritecast (S) Pte Ltd (the company). The petition was presented by a factoring company called Heller Factoring (Singapore) Ltd.

The ground relied on was that the company was indebted to the petitioners in the sum of $994,269.69 with interest at the rate of 2% above the prime rate of 7.25% from 5 May 1995. The company failed to pay the amount due and was insolvent. The petitioners` solicitors had on 8 May 1995 served by hand on the company, by placing at the registered office of the company, a demand in writing dated 8 May 1995 demanding payment of the sum of $994,269.69 and interest thereon. Despite having been allowed instalments the company defaulted in payment. The petition went on to cite that the petitioners had on 2 August 1995, through their solicitors, personally served by hand on the company, by placing at its registered office, a second demand in writing dated 2 August 1995 requesting the company to pay $831,602.49 and interest then due. The company had for a period of more than three weeks after service of the demand and immediately prior to the presentation of the petition failed to meet the relevant demand to the reasonable satisfaction of the petitioners. The amount due on 23 August 1995 was $775,408.18.

The above assertions of the petitioners were not refuted by the company. But it resisted the petition. To understand the company`s case it is necessary to trace the background to the problem.

The company had sold on credit and delivered engineering goods and products to another company called Hakua Co Pte Ltd (the customer). The total sale price of the goods was $1.62m. Then they factored their invoices to the petitioners under a factoring agreement between the petitioners and the company. The petitioners paid 80% of the price less the factoring commission to the company. In the factoring agreement the petitioners were called `the purchasers` and the company was called the `vendor`.

Clause 9 of the factoring agreement read as follows:

(1) The vendor may submit to the purchaser in advance the full name and address of any customer and all such information with regard to such customer and its business with the vendor as the purchaser may request. Upon receipt of such application and all such information as may be requested by the purchaser, the purchaser will assess the credit worthiness of the customer submitted and the risks (if any) in relation to the business transactions
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