Sng Jing Xiang Benjamin t/a Blink! Events & Entertainment v Xie Shun Heng and others and another suit

• Judge: Tan May Tee
• Judgment Date: 22 November 2021
• Neutral Citation: [2021] SGDC 248
• Citation: [2021] SGDC 248
• Docket Number: District Court Suits No 2684 of 2017 and 2681 of 2017, District Court Appeals DCA 54 and 55 of 2021
• Published date: 02 March 2022
• Hearing Date: 31 May 2021,10 September 2020,30 March 2020,17 March 2020,13 March 2020,16 January 2020,16 March 2020,11 May 2021,09 September 2020
• Plaintiff Counsel: Daniel Chia Hsiung Wen and Jeanette Wong (Morgan Lewis Stamford LLC)
• Defendant Counsel: Mato Kotwani (PDLegal LLC)
• Court: District Court (Singapore)

District Judge Tan May Tee: Introduction

By consent orders¹, these two suits were tried together on the understanding that the evidence led in one suit was to be treated as evidence led in the other suit. It had also been ordered in each suit that the trial be bifurcated with the issue of liability being heard separately and prior to the hearing for an assessment of damages, if necessary².

DC 2684/2017

In DC 2684/2017, the plaintiff is Mr Sng Jing Xiang Benjamin (“Mr Sng”). He is the sole proprietor of an events and entertainment management business called Blink! Events & Entertainment (“Blink”). The action concerned Mr Sng’s claims against the first defendant, Mr Xie Shun Heng aka Richel Xie (“Mr Xie”), and Mr Xie’s companies, Exxigo Pte Ltd (“Exxigo”) and Otwo Inc Pte Ltd (“Otwo”), which are the fourth and fifth defendants respectively.

Mr Sng had obtained judgments against the second and third defendants in default of their appearance in the suit. They were young interns who had been engaged by Mr Xie to assist him in various projects. Both the second and third defendants, however, attended as witnesses at the trial. The second defendant, Sheryl Yeo (“Ms Yeo”), testified as Mr Xie’s witness while the third defendant, Rachel Kang (“Ms Kang”), appeared as Mr Sng’s witness.

As against Mr Xie, Mr Sng’s claims are for: breach of fiduciary and/or equitable duties, breach of confidence, trespass to land, conversion and/or detinue and trespass to chattels, passing off, and defamation.

As against Exxigo and Otwo, Mr Sng’s claims are for an injunction, damages, an account of profits and/or an order for the appointment of a receiver arising from Mr Xie’s alleged breaches of fiduciary and/or equitable duties as well as misuse of confidential information. Exxigo has a counterclaim against Mr Sng for unlawful interference and/or inducement of breach of contract in relation to its contract with a client called Dennis Wee Realty Pte Ltd which all parties have referred to as “DWG”.

DC 2681/2017

In DC 2681/2017, the plaintiff, Nova Artiste Management Pte Ltd (“Nova”), is a company which was incorporated in December 2014 with Mr Sng, Mr Xie and one Chee Kean Chin Jeremy (“Mr Chee”) as shareholders and directors. At the commencement of the suit, both Mr Xie and Mr Chee were no longer directors of Nova, although Mr Xie remains as a shareholder owning 30% of the shares of Nova with Mr Sng as the majority shareholder holding 70%.

Nova’s claims against Mr Xie are for breach of fiduciary and/or equitable duties in diverting business opportunities away from it to his business entities, Exxigo and Otwo. Besides seeking an inquiry and an account of profits against Mr Xie for his alleged breaches of fiduciary and/or equitable duties, Nova seeks a mandatory injunction to compel Mr Xie to grant access to Nova’s IT systems to its board of directors as Mr Sng claims that his requests for such access had been wilfully refused or denied by Mr Xie.

As against Exxigo and Otwo, Nova also seeks an inquiry and an account of profits as well as an order for payment of all sums due arising from the business opportunities diverted to them by virtue of Mr Xie’s alleged breaches of fiduciary and/or equitable duties.

While there is significant commonality in the parties and events leading to the proceedings in both suits, each suit has a different plaintiff with different causes of action pleaded. As the claims made in DC 2684/2017 traverse a wider compass and touch on events earlier in time, this judgment will deal with Mr Sng’s claims and Exxigo’s counterclaim in DC 2684/2017 first before dealing with Nova’s claims made in DC 2681/2017.

Background The parties’ relationship before December 2012

According to Mr Sng, since starting his business under the name of Blink in 2005, he had spent a considerable amount of time, money and resources to build up its reputation in the events and entertainment industry. He was able to run more than 100 events annually under Blink with clientele which included DWG, Nestle, Samsung, M1, Estee Lauder, Yokogawa, Singapore Swimming Club, Daimler South East Asia and Frasers Hospitality Group Pte Ltd³. As such, Blink had gained a significant reputation and goodwill over the years and enjoyed an annual turnover estimated at over $2.6 million in the five years before he started these proceedings. Blink’s business was heavily reliant on its existing client base as well as word-of-mouth and client referrals over the years⁴.

Mr Sng and Mr Xie first worked together in 2007 when Mr Xie was enagaged as a talent to perform the role of master of ceremonies (or emcee) at events which Mr Sng had run under Blink.

Mr Xie testified that he began his career in the events industry in 2006 when he trained with a company called Stagecraft. He was then assigned several emceeing gigs by Stagecraft before he started operating on a freelance basis under various business names⁵.

Between 2007 and 2012, Mr Sng had engaged Mr Xie to host many of Blink’s events as the emcee. From 2012 onwards, Mr Sng would also involve Mr Xie in client meetings for their mutual benefit whenever he engaged Mr Xie as emcee.

The parties’ relationship from December 2012

Sometime in 2012, an oral agreement was reached among Mr Sng, Mr Xie and Mr Chee for profit-sharing (“Oral Agreement”). The terms of the Oral Agreement and its effect are in dispute.

Mr Sng’s version

Mr Sng’s case⁶ is that he, Mr Xie and Mr Chee carried on a business association with respect to Blink’s affairs in the manner of an informal partnership. The material terms of this partnership based on the Oral Agreement were as follows: Mr Sng would oversee the overall management of Blink’s business, including running administrative and logistical support of Blink’s events. He was also in charge of Blink’s marketing and outreach efforts to customers, akin to the role of a chief executive officer (“CEO”). Mr Xie’s role was that of a business development director, in charge of bringing in new leads and assisting in project management and project pitches. Mr Chee’s role was that of a projects and design director, in charge of the design and creative direction of Blink’s events. Blink’s profits were to be shared in the following manner: For projects that were introduced by Mr Xie or Mr Chee, Mr Sng would receive 30% of the profits while Mr Xie or Mr Chee would receive 70% (depending on the party who introduced the project). For projects that were introduced by Mr Sng but were executed by Mr Xie or Mr Chee, Mr Sng would receive 60% of the profits while Mr Xie or Mr Chee would receive 40% (depending on the party who executed the project). For projects that were introduced and executed by Mr Sng, the profits would go solely to Mr Sng. Any intellectual property created in the course of Blink’s business would be owned by Blink; and Both Mr Xie and Mr Chee owed fiduciary and/or equitable duties to Mr Sng akin to that of a director of company, inter alia – A duty to act bona fide in the best interests of Mr Sng trading as Blink, A duty of good faith and fidelity to Mr Sng trading as Blink, A duty to act for the proper purposes of Mr Sng trading as Blink in relation to its affairs, A duty not to divert business opportunities away from Mr Sng trading as Blink, A duty so long as their “directorship” subsisted not to misuse any information confidential to Mr Sng trading as Blink or to disclose such information to a third party; and A duty to Mr Sng trading as Blink, following the termination of their “directorship”, not to use or disclose to third parties any trade secrets or other information deemed confidential by Mr Sng trading as Blink.

In the alternative, Mr Sng says that arising from their business association as informal partners, Mr Xie and Mr Chee owed to him fiduciary duties and/or equitable duties, viz duty of good faith and fidelity, duty not to place himself in a position where his interest would or may conflict with duties owed to Mr Sng, duty not to make a profit from his position, duty to disclose and render true accounts and full information of all things affecting Blink to Mr Sng, duty to account to Mr Sng for private profits, and duty not to compete with Mr Sng.

Mr Xie’s version

Mr Xie says that the oral agreement between him and Mr Sng had various iterations over the years. Initially, Mr Sng had been running Blink from his home. In 2012, he wanted to scale up and get office premises. He suggested to Mr Xie to work out an arrangement whereby Mr Xie could also benefit from running his business from the same office as there was extra space. Mr Chee was introduced as another person in a similar position. Mr Sng offered to finance their projects through Blink but they would continue running them. In return, Blink would receive 30% of the profits for their projects.

Mr Xie found Mr Sng’s offer to be a viable option for his growing business. They agreed on the following terms: Mr Xie would be given some space in Blink’s office. He could opt to run his events/projects through Blink. For these projects, he would get 70% of the profits while Mr Sng would get the remaining 30%. For projects that were brought in by Mr Sng, Blink would get 100% of the profits.

During this time, Mr Sng would also ask Mr Xie to assist him at some of Mr Sng’s events for which Mr Xie he would be paid $150 for helping to manage the event on-site. Subsequently, as Mr Sng took on larger projects, some of the smaller projects were handed to Mr Xie to execute and they agreed to split the profits 50:50.

The first office premises were rented by Mr Sng. In 2016, Mr Sng decided to purchase commercial property, namely at 3 Upper Aljunied Link #07-03 Joo Seng Warehouse Singapore 367902 (“the Registered Office”). Mr Sng had also hired staff to help run Blink’s operations. Due to the higher overhead expenses,...