Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd and Others and Other Suits

JurisdictionSingapore
CourtCourt of Three Judges (Singapore)
Judgment Date08 March 2007
Docket NumberCivil Appeals Nos 17, 18, 19 and 20 of 2006
Date08 March 2007

[2007] SGCA 9

Court of Appeal

Chan Sek Keong CJ

and

Andrew Phang Boon Leong JA

Civil Appeals Nos 17, 18, 19 and 20 of 2006

Skandinaviska Enskilda Banken AB (Publ), Singapore Branch
Plaintiff
and
Asia Pacific Breweries (Singapore) Pte Ltd and other appeals
Defendant

Steven Chong SC, Chew Ming Hsien Rebecca, Koh Mei Ping Lynette, Tay Yew Jin Lionel, Ng Wei-Chern Paul and Christopher Eng (Rajah & Tann) for the appellants in Civil Appeals Nos 17 and 18 of 2006

Alvin Yeo SC, Monica Chong, Sannie Sng and Tan Hsiang Yue (Wong Partnership) for the appellant in Civil Appeal No 19 of 2006

Tan Kok Quan SC and Siraj Omar (Tan Kok Quan Partnership) for the appellant in Civil Appeal No 20 of 2006

Davinder Singh SC, Hri Kumar, Yarni Loi, Kabir Singh and Shivani Retnam (Drew & Napier LLC) for the respondent.

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Anderson v Bank of British Columbia (1876) 2 Ch D 644 (refd)

Baker v Campbell (1983) 153 CLR 52 (refd)

Balabel v Air India [1988] 1 Ch 317 (folld)

Bayerische Hypo- und Vereinsbank AG v Asia Pacific Breweries (Singapore) Pte Ltd [2004] 4 SLR (R) 39; [2004] 4 SLR 39 (refd)

Blair v Wawanesa Mutual Insurance Co [1998] ABQB 1025 (refd)

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Criminal Procedure Code (Cap 68, 1985 Rev Ed)s 58

Evidence Act (Cap 97,1997 Rev Ed)ss 128, 131 (consd);ss 2 (2),23, 164

Evidence Act (Act Iof 1872) (India)s 126

Evidence–Documentary evidence–Private documents–Draft reports by lawyers and accountants commissioned by directors of company after discovery of fraud on company perpetuated by company's employee–Defrauded banks bringing action against company and seeking order for disclosure of draft reports–Whether draft reports protected by legal advice privilege and/or litigation privilege–Whether privileged information forming integral part of draft reports–Whether court should inspect draft reports to assess whether privileged information contained therein–Sections 128, 131 Evidence Act (Cap 97, 1997 Rev Ed)

Between 1999 and September 2003, one Chia Teck Leng (“Chia”), who was employed by Asia Pacific Breweries (Singapore) Pte Ltd (“APBS”) as its finance manager, had used APBS's name to obtain credit and loan facilities from four foreign banks (“the appellant banks”). On 2 September 2003, officers from the Commercial Affairs Department of the Singapore Police Force (“CAD”) visited the premises of Asia Pacific Breweries Limited (“APBL”), the parent company of APBS, to meet with senior officers of APBL. CAD informed them that Chia had used bank accounts fraudulently opened in the name of APBS by using forged documents and resolutions to borrow money for his own use.

After writing to the appellant banks to ascertain if there had been accounts opened in its name (by Chia of which it had no prior knowledge), APBS requested for all account-opening documents and bank statements in its name, and instructed the appellant banks to immediately suspend operation of the unauthorised accounts until further notice.

On 4 September 2003, a special committee was constituted by APBL's board of directors (“the Special Committee”). The Special Committee immediately appointed PricewaterhouseCoopers (“PWC”) and Drew and Napier LLC (“D&N”) and made an announcement on MASNET (“the first MASNET announcement”) in which the APBL announced that PWC and D&N had undertaken to identify the nature of the unauthorised transactions, quantify their financial impact, assist the company in taking the necessary action to prevent such unauthorised transactions and to conduct a review of the system of internal control and procedures to prevent the occurrence of such unauthorised transactions in the future. On 24 September 2003, APBL released a second MASNET announcement (“the second MASNET announcement”) in which it was noted, inter alia, that APBS had sought legal advice on the claims and had been advised that it had legal defences, and accordingly had instructed D&N to contest the claims by the appellant banks vigorously.

Preparation of the PWC draft reports pursuant to the first MASNET announcement ceased sometime in late 2003 and a final report was never issued. In early March 2004, the appellant banks made an unsuccessful application for pre-action discovery against APBS, seeking disclosure of documents including the PWC draft reports. In September 2004, the appellant banks commenced this action against APBS and subsequently made applications for specific discovery. The assistant registrar ordered that the PWC draft reports be produced by APBS as they were not privileged information. On appeal, the High Court reversed the assistant registrar's decision on the ground that the PWC draft reports were protected by both legal advice privilege and litigation privilege. The appellant banks appealed against the High Court's decision.

Held, dismissing the appeal:

(1) Section 128 of the Evidence Act (Cap 97, 1997 Rev Ed) (“the Act”) read with s 131 of the Act made it clear that the full effect of the legal advice privilege was that the client was protected from having to disclose to any other party any legal advice which he had obtained from his legal adviser, whether he was an advocate or a solicitor. In that connection, it was implicit that the nature of the business or enterprise involved in a client obtaining legal advice from a lawyer had to have the element or quality of confidentiality in the communication to the lawyer or the advice given to the lawyer: at [32], [33] and [35].

(2) There was no inconsistency between s 128 of the Act and the English Court of Appeal decision of Three Rivers District Council v Governor and Company of the Bank of England (No 5) [2003] QB 1556 (“Three Rivers No 5”). While Three Rivers No 5adopted an exceedingly narrow meaning of a “client” for the purposes of legal advice privilege, it did not lay down a general principle that all communications between a company and its legal advisers had to be made by a specially-appointed committee or that no communication made by an employee to the company's legal adviser was privileged. Three Rivers No 5 had to be...

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5 firm's commentaries
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    • Singapore Academy of Law Journal Nbr. 2020, December 2020
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