Sunny Daisy Ltd v WBG Network (Singapore) Pte Ltd

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 26 July 2006
• Neutral Citation: [2006] SGHC 130
• Plaintiff Counsel: L Kuppanchetti Nadimuthu and Christopher Buay (Alban Tay Mahtani & De Silva)
• Published date: 24 May 2007
• Court: High Court (Singapore)
• Defendant Counsel: Peter Gabriel and Ismail bin Atan (Gabriel Law Corporation)
• Subject Matter: Civil Procedure,Appeals,Registrar's Appeal from defendant's conditional leave to defend to judge in chambers,Whether judge in chambers should allow further evidence,Whether strict Ladd v Marshall criteria applicable,Parties,Whether plaintiff was proper creditor,Whether plaintiff was agent of other principal(s) thus affording defence to plaintiff's claims for balance of price of goods sold,Commercial Transactions,Sale of goods,Whether non-merchantable quality of goods affords defence to plaintiff's claim on price

26 July 2006

Judith Prakash J:

Introduction

1 The plaintiff, a Taiwanese company, sued the defendant for the sum of US$1,057,164.03 being the balance of the price of goods allegedly sold and delivered to the defendant by the plaintiff. According to the statement of claim, the goods were supplied between May 2003 and September 2004. The defendant remitted moneys to the plaintiff in partial payment of the price of the goods between January and September 2004. No further payment having been received, the plaintiff started this action in July 2005.

2 The defendant, a Singapore company, filed a defence and counterclaim. Basically, three lines of defence were taken. The first related to two alleged oral agreements between the defendant and another Taiwanese company called Internation Chlorella Co, Ltd (“Internation”). One Prof Wang Shun Te who was also the president of the plaintiff company represented Internation in discussions. The defendant alleged that the plaintiff had been acting as agent for Internation and not as principal and therefore was not entitled to claim the money due in respect of the goods supplied. The second defence was that by reason of certain credit notes issued, the amount claimed by the plaintiff was excessive. Finally, the goods supplied were not of merchantable quality and/or not reasonably fit for the purpose for which they were intended. The counterclaim was based on loss and damage allegedly arising from the failure of the plaintiff to supply merchantable goods.

3 The plaintiff made an application for summary judgment in respect of part of its claim. This was resisted by the defendant and on 12 December 2005, the assistant registrar granted the defendant conditional leave to defend. The plaintiff appealed to the judge in chambers. I heard the appeal and allowed it and granted the plaintiff judgment in the sum of US$611,764.03 and interest at 6% per annum from the date of issue of the writ till date of judgment. I stayed execution on the judgment pending the trial of the counterclaim and final disposal thereof. Costs of the O 14 application (O 14 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed)) and of the appeal were ordered to be paid by the defendant to the plaintiff. The defendant is dissatisfied with my order and has appealed to the Court of Appeal.

Applications for further evidence

4 As stated, the original application for summary judgment was heard in early December 2005. On 27 February 2006, the plaintiff filed a further affidavit exhibiting some purchase orders issued by the defendant to the plaintiff. This affidavit was served on the defendant on that same day. The plaintiff asked for leave to admit the affidavit into evidence for the purposes of the appeal. When the appeal was heard on 17 March 2006, I allowed the affidavit to be used in evidence.

5 The defendant itself sought to adduce further evidence at the hearing of the appeal. What the defendant wanted to adduce was a letter dated 18 January 2005 (“the 2005 letter”) sent to the defendant’s previous solicitors, M/s Lee & Lee, by a Taiwanese law firm, the Law Offices of Tony M Chang under instructions from Prof Wang and Internation. The 2005 letter comprised not only the letter dated 18 January 2005 but also included three other documents. The 2005 letter was not adduced by way of an affidavit. Instead, the defendant’s solicitors had sent a copy of the 2005 letter to the plaintiff’s solicitors by facsimile transmission on the morning of 17 March 2006 itself. When he appeared in court, counsel for the defendant asked for leave to adduce the 2005 letter and its attachments as additional evidence. Counsel for the plaintiff objected on the basis that the 2005 letter was not written by his client, his client had not seen it and had not been able to give him instructions on it and it was too late to adduce the letter in evidence. I agreed. I did not think it was proper to simply produce the 2005 letter over the table at such a late stage. I refused the defendant’s application to adduce the 2005 letter in evidence.

6 After the hearing, the defendant’s solicitors wrote in for further arguments. This request was made only in respect of the admission of the 2005 letter and its attachments. The latter consisted of three documents: first, a document entitled “Formal & Serious Warning Issued to WBG Network (Singapore) Pte Ltd Debt Owing Exceeds One Million USD ($1,000,000)” (“the warning”), second, a document entitled “Notice to Cease Usage of Registered Trade Name “Cryptomonadales” (“the notice”) and third, a document entitled “Full Recourse Promissory Note” (“the pro-note”).

7 In the application for further arguments, it was said that it had always been the defendant’s contention that the proper plaintiff in the present proceedings was either Prof Wang and/or Internation and that the named plaintiff was simply an agent acting for Prof Wang and/or Internation. Counsel for the defendant wrote that extracts from the letter were highly indicative of the true relationship between the plaintiff on the one hand and Prof Wang and Internation on the other. Further, the sum of money stated in para 4 of the 2005 letter and para 1 of the warning was the exact amount that was claimed by the plaintiff. Since the 2005 letter was dated 18 January 2005 (ie, before this action was instituted), it was a clear admission that the proper parties to these proceedings must be Prof Wang and/or Internation. The 2005 letter was highly relevant to the issue before the court and it had been issued on the instructions of Prof Wang who had affirmed all of the affidavits filed in this action on behalf of the plaintiff. Thus, the 2005 letter should have been included in the plaintiff’s own affidavits so as to give a true and fair picture of the claim by the plaintiff against the defendant. This being so, there would be no prejudice to the plaintiff if the letter were to be admitted.

8 Counsel for the defendant ended his letter by submitting that based on the 2005 letter, it had been established that the money claimed by the plaintiff did not belong to the plaintiff and instead, was owed to either Prof Wang and/or to Internation. Thus, on the basis of the 2005 letter, there was a triable issue, namely, to whom the debt of US$1,057,164.03 was actually owed.

9 In their response to the request for further arguments, the plaintiff’s solicitors pointed out that the defendant had been in possession of the 2005 letter at the time the action was commenced and yet, for reasons best known to itself, it had not referred to or adduced the 2005 letter at the hearing before the assistant registrar on 12 December 2005. Further, the defendant had not produced the 2005 letter in the three months that elapsed between the first hearing and the hearing of the appeal. No explanation for the delay had been given. In any event, even if the letter had been admitted into evidence, it was not relevant to the present action because it involved parties other than the plaintiff. The letter was also not issued by the plaintiff or its solicitors. For the foregoing reasons, the plaintiff contended, no further arguments should be permitted.

10 In coming to my decision not to allow further arguments, I looked at the 2005 letter and all the attachments. The 2005 letter itself was apparently issued on the instructions of Prof Wang and Internation. It was a response to a letter from M/s Lee & Lee dated 4 January 2005 and referred to a document called the “Product Manufacturing Agreement” dated 14 February 2004. I noted that the 2005 letter did state that the defendant owed Internation “$1,057,1[6]4.03” and it contended that the defendant had raised issues on the quality of the goods in order to avoid paying that debt. However, it also stated that Prof Wang had consistently supplied the plaintiff with the standard Internation products that met food safety requirements pursuant to the agreement. Further, it referred to the fact that an executed copy of the pro-note had...