Symphony Ventures Pte Ltd v DNB Bank ASA, Singapore Branch

• Jurisdiction: Singapore
• Judge: Aedit Abdullah J
• Judgment Date: 17 June 2021
• Court: High Court (Singapore)
• Docket Number: Suit No 1204 of 2019 (Summons No 4362 of 2020)

Symphony Ventures Pte Ltd

and

DNB Bank ASA, Singapore Branch

[2021] SGHC 141

Aedit Abdullah J

Suit No 1204 of 2019 (Summons No 4362 of 2020)

General Division of the High Court

Civil Procedure — Pleadings — Amendment — Plaintiff seeking to amend its statement of claim — Defendant objecting to several of these amendments — Whether amendments objected to by defendant were permissible under O 20 r 5 Rules of Court (2014 Rev Ed) — Whether defendant's limitation defence would be prejudiced — Whether new causes of action arose out of same or substantially same facts — Whether it was just to allow amendments — Whether there were reasonable causes of action — Order 20 r 5 Rules of Court (2014 Rev Ed) — Sections 6(1)(a), 24A(3)(a), 29(1)(a) and 29(1)(b) Limitation Act (Cap 163, 1996 Rev Ed)

Held, refusing leave to amend:

(1) The critical threshold question determining whether O 20 r 5(1) or O 20 r 5(2) of the Rules of Court (2014 Rev Ed) (“ROC”) was engaged, was not whether the relevant limitation period had expired, but whether allowing the amendment would cause any prejudice to the other party's limitation defence. If no such prejudice would be caused, O 20 r 5(1) of the ROC applied even if the relevant limitation period might have expired. If prejudice would be caused, the court could only allow the amendment under O 20 r 5(2)–O 20 r 5(5) of the ROC. The upshot of O 20 r 5(2) and O 20 r 5(5) of the ROC was that an amendment was allowed, even if it were to bring a new cause of action to the prejudice of the defendant's accrued right of limitation, if such a cause of action arose out of the same or substantially the same facts and if the court considered it just to allow that amendment: at [10] to [12].

(2) The court only needed to be satisfied that there was a reasonably arguable case that the limitation period had expired. The defendant had made out a prima facie limitation defence. Applying ss 24A(3)(a) and 6(1)(a) of the Limitation Act (Cap 163, 1996 Rev Ed) (“Limitation Act”), the six-year time bar for the plaintiff's new claims in tort and unjust enrichment started running by 8 July 2014 and 24 December 2013 respectively, which meant that the limitation period would have expired by the time this court considered the proposed amendments. The burden of persuasion thus lay on the plaintiff to show that the defence of limitation was not reasonably arguable. The plaintiff did not discharge this burden. The plaintiff's new claims in negligence, negligent misrepresentation, unjust enrichment and lawful or unlawful means conspiracy could not be brought under the fraud exception in s 29(1)(b) of the Limitation Act since they did not implicate the defendant or its agent in any fraudulent concealment. The plaintiff's new allegations concerning fraudulent misrepresentations by the defendant would be governed by s 29(1)(a) of the Limitation Act, but such fraudulent misrepresentation, if any, could have been discovered by the plaintiff with reasonable diligence by July 2014: at [13] to [17], [20], [24] and [25].

(3) Not all amendments brought after the expiration of the limitation period would prejudice the defendant's limitation defence. A key consideration was whether the practical effect of allowing the amendment was to allow a claim which would otherwise have been time-barred if it were brought under a new writ. The amendments in question, if allowed, would prejudice the defendant's limitation defence, as they sought to bring in new causes of action: at [49] and [50].

(4) A cause of action referred to the essential factual material that supported a claim. The selection of material facts to define the cause of action had to be made at the highest level of abstraction, to the exclusion of further instances or better particulars. Identifying whether a new cause of action had been introduced, required the essential facts in the existing pleadings to be compared with the essential facts in the proposed amended statement of claim: at [51].

(5) If the amendment did introduce a new cause of action, that cause of action had to arise out of the same or substantially the same facts as those already pleaded in order to fall within O 20 r 5(5) of the ROC. The test was whether there was a sufficient overlap between the facts supporting the existing claim and those supporting the new claim, and the inquiry here was not just limited to the consideration of essential facts: at [52].

(6) The plaintiff's amendments introduced new causes of action which were predicated on essential facts not found in the original pleadings. Some of the words found in the plaintiff's proposed amendments were mentioned in its existing pleadings, but those words were used in wholly different contexts. It was not enough that there might have been causes of action in negligence, misrepresentation and conspiracy previously. Introducing essential facts within the “labels” originally pleaded, still amounted to the addition of new causes of action: at [54] to [57].

(7) These new causes of action did not arise out of the same or substantially the same facts. Given how drastically different the new essential facts were from those found in the original pleadings, these new causes of action had to draw much of their support from specific factual allegations which were not at all contained in the original claim: at [59].

(8) The consideration of whether it would be just to grant leave required a weighing of the applying party's need to amend and the prejudice to the opposing party's interests. The fact that a time bar was applicable would not of itself mean that an amendment should not be permitted, but it was still a relevant factor. Here, it would not be just to allow the amendments, as the plaintiff did not make out a clear reason why refusing leave to amend would cause it (ie, the plaintiff) injustice, or a clear reason why any injustice should outweigh the defendant's accrued right of limitation. The amendments objected to by the defendant therefore could not be allowed under O 20 r 5 of the ROC: at [60] and [61].

(9) Separate from the requirements in O 20 r 5(5) of the ROC, the amendments had to disclose reasonable causes of action before they could be allowed. The plaintiff's claim for lost profits which it could have earned if the defendant had not been negligent was legally unsustainable as loss could not be claimed on an expectation basis in tort. The plaintiff's new claim in unjust enrichment disclosed no reasonable cause of action as there was no jointly understood basis for the transfer of money. The “knowing dealing” averment should also be struck out: at [63] to [66].

Case(s) referred to

Antariksa Logistics Pte Ltd v Nurdian Cuaca [2018] 3 SLR 117 (refd)

Ching Mun Fong v Liu Cho Chit [2001] 1 SLR(R) 856; [2001] 3 SLR 10 (folld)

Chua Teck Chew Robert v Goh Eng Wah [2009] 4 SLR(R) 716; [2009] 4 SLR 716 (folld)

eSys Technologies Pte Ltd v nTan Corporate Advisory Pte Ltd [2013] 2 SLR 1200 (folld)

Geocon Piling & Engineering Pte Ltd v Multistar Holdings Ltd [2015] 3 SLR 1213 (folld)

Henderson v Henderson (1843) 3 Hare 100 (refd)

Horner v Allison [2014] EWCA Civ 117 (folld)

IPP Financial Advisers Pte Ltd v Saimee bin Jumaat [2020] 2 SLR 272 (folld)

Letang v Cooper [1965] 1 QB 232 (folld)

Lim Geok Lin Andy v Yap Jin Meng Bryan [2017] 2 SLR 760 (refd)

Lim Siew Bee v Lim Boh Chuan [2014] SGHC 41 (folld)

Lim Yong Swan v Lim Jee Tee [1992] 3 SLR(R) 940; [1993] 1 SLR 500 (folld)

MCST Plan No 3322 v Mer Vue Developments Pte Ltd [2016] 4 SLR 351 (folld)

Multistar Holdings Ltd v Geocon Piling & Engineering Pte Ltd [2016] 2 SLR 1 (folld)

Paragon Finance plc v D B Thakerar & Co [1999] 1 All ER 400 (folld)

Philips Pension Trustees Ltd v Aon Hewitt Ltd [2015] EWHC 1768 (Ch) (folld)

Rocky Point Lending LLC v Rocky Point International LLC (13 May 2019, State of Wisconsin, Circuit Court, Waukesha County) (US) (refd)

Savings and Investment Bank Ltd v Fincken [2001] All ER (D) 70 (folld)

Simpson Marine (SEA) Pte Ltd v Jiacipto Jiaravanon [2019] 1 SLR 696 (folld)

Smith v Henniker-Major & Co [2003] Ch 182 (folld)

Takhar v Gracefield Developments Ltd [2020] AC 450 (refd)

Traxiar Drilling Partners II Pte Ltd v Dvergsten, Dag Oivind [2019] 4 SLR 433 (refd)

Virginia Rhea, The [1983–1984] SLR(R) 639; [1984–1985] SLR 214 (folld)

Wishing Star Ltd v Jurong Town Corp [2008] 2 SLR(R) 909; [2008] 2 SLR 909 (folld)

Facts

The defendant bank acted on behalf of a number of corporate entities, including Traxiar Drilling Partners II Pte Ltd (“Traxiar”), to obtain expressions of interest from possible lenders, including the plaintiff, for a bridging loan for the purchase of an oil rig (the “Rig”). These corporate entities were under the control of one Mr Dag Dvergsten (“Mr Dvergsten”). A term loan agreement was entered into between the plaintiff and Traxiar, which subsequently defaulted on repayment.

The plaintiff filed its Statement of Claim (“SOC”) on 21 November 2019, seeking against the defendant bank damages arising out of negligence, negligent or fraudulent misrepresentations, dishonest assistance and knowing receipt in respect of a supposed breach of a Quistclose trust, and a conspiracy to injure the plaintiff involving the defendant and others, including one Mr Andreas Aamodt Kilde (“Mr Kilde”).

On 8 October 2020, the plaintiff filed this application seeking leave to amend its SOC. The defendant objected to four of these amendments. The first amendment contained an allegation that the defendant, as the arranger of the “end” or “take-out” finance, owed the plaintiff a duty of care. For context, the “end” or “take-out” finance referred to the raising of moneys through bonds on the Norwegian debt market to finance the balance purchase price of the Rig. This duty of care was breached when the defendant, inter alia, facilitated Traxiar's money laundering. The second new allegation sought to be introduced was that the defendant made negligent or fraudulent...