Richland Logistics Services Pte Ltd v Biforst Singapore Pte Ltd
Jurisdiction | Singapore |
Judge | Lai Siu Chiu J |
Judgment Date | 31 July 2006 |
Neutral Citation | [2006] SGHC 137 |
Court | High Court (Singapore) |
Year | 2006 |
Published date | 01 August 2006 |
Plaintiff Counsel | Siraj Omar and See Chern Yang (Tan Kok Quan Partnership) |
Defendant Counsel | Wendy Leong and Angeline Soh (AsiaLegal LLC) |
Citation | [2006] SGHC 137 |
31 July 2006
Lai Siu Chiu J:
The background
1 The plaintiff, Richland Logistics Services Pte Ltd, applied by way of Originating Summons No 22 of 2006 (“the application”) for leave to serve pre-action interrogatories on the defendant, Biforst Singapore Pte Ltd. The application was heard and dismissed by the assistant registrar (“AR”).
2 The plaintiff appealed against the AR’s decision in Registrar’s Appeal No 83 of 2006 (“the Appeal”). I heard and allowed the Appeal. Being dissatisfied, the defendant has appealed against my decision in Civil Appeal No 52 of 2006. I now give my reasons for reversing the AR’s decision.
The facts
3 The facts leading to the making of the application are set out in the affidavit filed on the plaintiff’s behalf by its director, Lim Chwee Kim (“Lim”), on 3 January 2006 (“Lim’s affidavit”).
4 According to Lim’s affidavit, the plaintiff is part of the Richland group of companies and is wholly owned by a public company, Richland Group Limited, which is listed on the stock exchange of Singapore.
5 The plaintiff is a logistics provider and its business, inter alia, includes:
(a) ground-handling services at airport terminals covering import and export permit declaration, and transfer of cargo;
(b) in-bound and out-bound transportation to and from airport terminals and seaports;
(c) point-to-point distribution within Singapore;
(d) other supply chain services such as warehousing, inventory management, packing and repacking of goods as well as after-sales service centres.
6 In providing services to its customers, the plaintiff would sometimes outsource part of its activities to third parties. One such third party was a sole-proprietorship known as Ah Kwee Transport (“Ah Kwee”) which was appointed in 1999 when the plaintiff was awarded through another party a contract to provide inland transportation and international services to Seagate Technology International (“Seagate”). In 2001, Seagate awarded directly to the plaintiff the inland portion of the contract. The plaintiff in turn engaged Ah Kwee to provide transportation services to transfer cargo between Seagate’s factory, Seagate’s finished goods hub, the airport and Seagate’s clients within Singapore.
7 Ah Kwee Transport Pte Ltd (“AKTPL”) was incorporated on 23 September 2004 to take over the business of Ah Kwee. AKTPL’s two shareholders are Ang Sze Kwee (“Ang”) and his wife Tan Leh Hua (“Ang’s wife”) holding 80% and 20% respectively of the company’s shares.
8 The plaintiff appointed Ah Kwee and subsequently AKTPL (from 15 October 2004) as its service partner under a specific service order (“SSO”) in its master plan agreement dated 1 August 2002 (“the Master Agreement”), which expressly stated that Seagate was a core customer of the plaintiff to whom the services were being provided.
9 The plaintiff and Seagate had signed a logistics services provider agreement dated 28 June 2001 which was subsequently renewed on similar terms on 17 June 2004. The plaintiff subcontracted both contracts to Ah Kwee and to AKTPL subsequently.
10 On 3 May 2005, Seagate issued a request for quotation inviting the plaintiff and other logistic service providers to submit quotations for the provision of local trucking services in Singapore for Seagate. The plaintiff submitted a competitive quotation, which Seagate did not accept. The plaintiff subsequently discovered that the contract was awarded to the defendant and was preceded by Seagate’s contract for long-haul trucking service along the Singapore-Malaysia-Thailand route (collectively “Seagate’s contracts”). The long-haul contract was awarded to the defendant less than a month after its incorporation.
11 The plaintiff was puzzled by Seagate’s choice of the defendant over the plaintiff as the defendant was only incorporated on 10 September 2004, which was less than eight months prior to Seagate’s request for quotations and the defendant had no track record.
12 From his investigations and inquiries, Lim ascertained that Ang was behind the defendant and had used the defendant to secure Seagate’s contracts. The defendant’s major shareholder was Koh Han Lee (“Koh”) who had been Ah Kwee’s and then AKTPL’s general manager, since 1999. (I should point out that at the hearing of the appeal, the plaintiff’s solicitor exhibited a search he had conducted on the defendant. The results showed that Koh’s shareholding was the largest, viz 37,500 shares, followed by that of one Ng Kok Seng with 35,000 shares).
13 Lim also discovered that another company, Jetlee Logistics Pte Ltd (“Jetlee”), was incorporated on 23 June 2004 in which Ang, Koh and Ang’s wife were directors with Ang and Koh as shareholders; Ang was the majority shareholder. The business activities of Jetlee were identical to the defendant’s and its registered office was that of Ah Kwee and AKTPL. Lim learnt that the defendant had subcontracted Seagate’s contracts to AKTPL and the fleet of trucks which Ah Kwee and AKTPL previously used to perform the plaintiff’s subcontract had been deployed for Seagate’s contracts.
14 Lim believed that through Ang and/or Koh, AKTPL was instrumental in the Seagate contracts being given to the defendant. If Lim’s belief was correct, then AKTPL had breached cl 12 of the Master Agreement which states:
EXCLUSIVITY & NON-COMPETITION
[AKTPL] undertakes to provide the Services exclusively for the [plaintiff]. [AKTPL] shall not carry out any business activities that pose any competition with the [plaintiff] during the term of this Agreement and for one (01) year after the termination of this Agreement. [AKTPL] will not directly or indirectly solicit, initiate, accept or engage in any contact of any kind or enter into any transaction with the Customers, or the [plaintiff’s] suppliers, staff, distributors, officers, consultants or employees or with any other party having any actual or prospective connection therewith. The [plaintiff] reserves the rights to seek compensation from [AKTPL] for any breach of this undertaking.
15 Consequently, the plaintiff made the application as the 25 interrogatories it sought the court’s leave to serve on the defendant would be relevant to issues that were likely to arise in the plaintiff’s intended claim against AKTPL; they may show that the defendant was an extension of AKTPL. The interrogatories were necessary as, if the answers showed that the plaintiff did not have a plausible cause of action against AKTPL, the parties would have saved the time and expense involved in court proceedings.
16 Not surprisingly, the application was opposed by the defendant. In the affidavit filed on the defendant’s behalf by Koh (“Koh’s affidavit”) to oppose the application, he deposed that the plaintiff’s suspicion and belief that Ang had used the defendant as a vehicle to procure Seagate’s contracts was based on information furnished by other logistics providers. Koh stated that the reasons provided by the plaintiff to support the application were misconceived and/or had no merit.
17 Koh claimed it was Seagate who invited the defendant to tender for the Seagate contracts. By then, he was no longer working for Ah Kwee or AKTPL as he had resigned as a driver (and not general manager as the plaintiff alleged) on 1 July 2004. Koh referred to cl 3.17.1 of the SSO in the Master Agreement which, he contended, precluded the plaintiff from suing AKTPL in any event.
18 Clause 3.17.1 of the SSO states:
Any dispute arising out of or in connection with this Agreement including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration in Singapore in accordance with the Arbitration Rules of the Singapore International Arbitration Centre (the SIAC Rules) for the time being in force which rules are deemed to be incorporated be reference into this clause.
19 Koh deposed that no useful purpose would be served if the plaintiff’s interrogatories were served on the defendant as any dispute between the plaintiff and AKTPL must go for arbitration, including breach of cl 12 of the Master Agreement. Order 26A of the Rules of Court (Cap 332, R 5, 2004 Rev Ed) (“the Rules”), under which the application was made by the plaintiff, allowed a party that intended to initiate court proceedings to determine if he had good grounds for a claim. If the plaintiff felt it had...
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...or matter or for saving costs, they will not be allowed. For example, in Richland Logistics Services Pte Ltd v Biforst Singapore Pte Ltd [2006] SGHC 137, Lai Siu Chiu J observed at [38] that: In any event, whatever the outcome of the interrogatories, granting the application would amount to......
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World Sport Group Pte Ltd v Dorsey James Michael
...or matter or for saving costs, they will not be allowed. For example, in Richland Logistics Services Pte Ltd v Biforst Singapore Pte Ltd [2006] SGHC 137, Lai Siu Chiu J observed at [38] that: In any event, whatever the outcome of the interrogatories, granting the application would amount to......