Surindar Singh s/o Jaswant Singh v Sita Jaswant Kaur

• Judge: Chao Hick Tin JA
• Judgment Date: 07 July 2014
• Neutral Citation: [2014] SGCA 37
• Court: Court of Three Judges (Singapore)
• Docket Number: Civil Appeal No 129 of 2013
• Year: 2014
• Hearing Date: 27 February 2014
• Citation: [2014] SGCA 37
• Subject Matter: Matrimonial assets,Division,Family Law
• Published date: 10 July 2014
• Plaintiff Counsel: Yap Teong Liang (TL Yap & Associates)
• Defendant Counsel: Suchitra Ragupathy, Yingtse Chen Ouw (Rodyk & Davidson LLP)

Judith Prakash J (delivering the judgment of the court): Introduction

The parties to this appeal, formerly husband and wife, were divorced by an interim judgment of divorce issued in November 2007 (“the Interim Judgment”). The parties then commenced the process of settling the ancillary matters. As by then the children of the marriage were adults, the process focussed on the issues of maintenance and division of matrimonial property. Each party filed substantial affidavits in support of their respective claims; the marriage having lasted some 35 years and the parties having been successful in business, there were many documents and factual allegations to be explored.

After some two years of this process, the parties decided to go for mediation. The mediation took place on 11 May 2011. It resulted in a document, signed by both husband and wife, which has in this appeal been referred to as the “Settlement Agreement”. The Settlement Agreement was intended to settle all disputes and be translated into an order of court. This did not happen, unfortunately; towards the end of 2011, the wife’s lawyers informed the husband’s lawyers that the wife did not wish to be bound by the Settlement Agreement.

In January 2012, the husband filed a summons before the Family Court for the terms of the Settlement Agreement to be recorded as an order of court. No order was made on this application as the District Judge took the view that it was for the judge hearing the ancillary matters to decide whether the Settlement Agreement was binding. The ancillary matters then came on before the High Court Judge (“the Judge”). The Judge decided not to give effect to the Settlement Agreement and, instead, carried out a division exercise pursuant to which the assets were divided differently than provided for in the Settlement Agreement. The Judge’s grounds can be found at Sita Jaswant Kaur v Surindar Singh s/o Jaswant Singh [2013] SGHC 176 (“the Judgment”).

The husband has appealed against the Judgment and the main issue before this court is what weight should be given to the Settlement Agreement.

Further background information

This was a long marriage: the husband (the appellant herein) and the wife (the respondent herein) were married in 1972 and lived together until 2001. Divorce proceedings were commenced in February 2007. By the time the ancillary matters came on for hearing, both parties were in their late sixties.

In 2010, the parties agreed to resolve the ancillary matters through mediation. Mr Amolat Singh, a senior lawyer, was appointed as the mediator. At the mediation both husband and wife were represented by counsel: Mr RS Bajwa of M/s Bajwa & Co and Mr Kelvin Lee of Sankar Ow & Partners LLP for the wife, and Mr George Lim SC for the husband.

On 11 May 2011, after the parties had gone through the mediation process for the whole day, the Settlement Agreement was drafted by the mediator in his handwriting and signed by the parties in the presence of their lawyers. The Settlement Agreement provided that: The wife was to retain the apartment located at City Towers (“the City Towers Property”). The husband was to retain the apartment unit located at Jalan Mat Jambol (“the Jalan Mat Jambol Property”). The husband was to give up his claim to the wife’s jewellery. The wife was to give up her claim to the property at Villa Aman, Malaysia (“the Villa Aman Property”). The Malaysian company, Suritas Sdn Bhd (“Suritas”), would be voluntarily wound up, and the proceeds distributed to the parties in accordance with their respective shareholdings. Liability for the overdraft account would be shared equally by the parties subject to the wife accounting for the sum of $40,000 which she had withdrawn. In the event of an en bloc sale of the City Towers Property, any proceeds above $1.25 m would be shared in the ratio of 60:40 between the husband and wife respectively. In the event of an en bloc sale of the Jalan Mat Jambol Property, any proceeds above $1.9m would be shared equally by the husband and wife. The wife agreed to maintain herself because the husband was already 68, and the wife was running her own business.

The Settlement Agreement also provided that the settlement was subject to the approval of the court. However, a consent order from the court was never obtained because the parties could not agree on the terms of a draft consent order. Both parties wanted to make amendments to the draft consent order in respect of matters not stated in the Settlement Agreement.

The Judge found, and the parties did not dispute, that the pool of matrimonial assets available for division consists of the following: Assets in joint names: The Jalan Mat Jambol Property valued at $3,500,000. The Villa Aman Property valued at $800,000. Assets in the husband’s name: 5% of shares in Suritas valued at $35,000. Bank accounts containing $132,465. AIA insurance policy with a surrender value of $37,425. CPF funds worth $137,648. Shares worth $15,144.67. Assets in the wife’s name: The City Towers Property valued at $2,500,000. 25% of shares in Suritas valued at $175,000. Bank accounts containing $7,722.88. AIA insurance policy with surrender value of $14,556.07. CPF funds worth $45,652.32.

Suritas is a Malaysian company which owns a property at Villa Bukit Tunku, Malaysia.

The decision in the court below

The Judge held that the Settlement Agreement was binding at the point at which it was signed because the terms were certain and the parties were ad idem, and the wife had no basis to claim that she was not bound because she did not fully understand the terms.

The Judge further held, however, that the Settlement Agreement was only one of the factors that the court should take into account under s 112(2) of the Women’s Charter (Cap 353, 2009 Rev Ed) (“the Charter”) in determining what division would be just and equitable. The Judge found that the division proposed in the Settlement Agreement was not just and equitable because the husband would receive 68% of the assets while the wife would only receive 32% of them, and this proportion did not include the other assets disclosed by the husband and wife, which were not provided for in the Settlement Agreement. Accordingly, the Judge declined to give the Settlement Agreement conclusive weight and, having considered the submissions, he awarded an equal share of the assets to each party.

The reasons of the Judge for this division are as follows: There was a long marriage of almost 30 years prior to the date on which the wife left the matrimonial home. The documentary and circumstantial evidence demonstrated that the wife had made significant financial contributions to the acquisition of the City Towers and the Jalan Mat Jambol properties. The involvement of both parties was not restricted to either the financial or domestic spheres.

The parties’ respective cases on appeal The husband’s case

The husband argued that agreements reached after divorce proceedings have commenced are not caught by s 112(2)(e) of the Charter because that sub-section only catches agreements “made in contemplation of divorce”. Hence, the Settlement Agreement was not merely a factor to be taken into account in the court’s exercise of its power to order a division of matrimonial assets under s 112, but should be upheld by the court in its totality.

In the alternative, the husband argued that the Singapore assets ought to be apportioned 60:40 in his favour. Regarding the Malaysian assets, the wife should retain her 25% share in Suritas but all other assets should be retained by the husband.

The wife’s case

The wife asserted that the argument that the Settlement Agreement was binding was no longer available to the husband as he had re-negotiated the terms of the Settlement Agreement and had been the first to contend that the terms agreed to at the mediation had not been correctly set out in that document.

The Judge was correct to classify the Settlement Agreement as an agreement caught by s 112(2)(e) of the Charter and therefore the court had the power to redesign it to achieve a fair and equitable division. There was no reason to interfere with the Judge’s decision. The letter dated 12 July 1999 which shows that the wife agreed with the husband that $75,000 was full and final settlement of the wife’s share in all the Malaysian assets was manufactured for the proceedings.

The issues

The issues are: whether there was a binding settlement agreement; whether the court is bound to give full effect to the Settlement Agreement; and, if not, what weight should be given to the Settlement Agreement.

Our decision Issue 1: Whether there was a binding settlement agreement

This issue arose because, although the husband did not quarrel with the Judge’s finding that the Settlement Agreement is valid and binding, the fact that he appealed against the whole of the decision below gave the wife the opportunity to resuscitate her challenge to the validity of that agreement notwithstanding she did not lodge her own appeal.

In this judgment, we use the phrase “binding agreement” (or “binding settlement agreement”) to mean a settlement contract that is validly formed in accordance with the legal requirements of the common law of contract, but it should be noted that if such a contract is caught by s 112(2) of the Charter, it will not be directly enforceable (see below at [43]). If there is a binding agreement between the parties with respect to the ownership and division of the matrimonial assets made in contemplation of divorce, that will be a relevant factor in the court’s determination of what is a just and equitable division of matrimonial assets under the Charter. In determining whether a binding agreement between husband and wife to settle their disputes over property and maintenance exists, the...