Tee Yok Kiat v Pang Min Seng

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 24 January 2013
• Neutral Citation: [2013] SGCA 9
• Court: Court of Appeal (Singapore)
• Docket Number: Civil Appeal No 52 of 2012 and Summons No 4377 of 2012
• Year: 2013
• Published date: 30 January 2013
• Hearing Date: 26 September 2012
• Plaintiff Counsel: Ong Pei Ching and Joseph Yeo (Drew & Napier LLC)
• Defendant Counsel: Uthayasurian Sidambaram and Ramesh s/o Varathappan (Surian & Partners)
• Subject Matter: Trusts,Express trusts,Certainties,Resulting Trusts,Tort,Harassment
• Citation: [2013] SGCA 9

Chao Hick Tin JA (delivering the grounds of decision of the court): Introduction

This appeal was brought against part of the decision made by the High Court judge (“the Judge”) in Suit No 589 of 2009 (“the Action”). The appellant, who was the first plaintiff in the Action (hereinafter referred to as “Sarah”), pleaded three heads of claim in the Action. The first head of claim was against the respondent (the first defendant in the Action and hereinafter referred to as “Andy”) and the second defendant in the Action (hereinafter referred to as “Tik”) for a sum of $608,700 allegedly given by Sarah to Andy to hold on trust for her for the purposes of investing in land and property in China (“the Trust Claim”). The second head of claim was against Andy in respect of a sum of $50,000 which was allegedly given by Sarah to Andy after being intimidated and/or harassed by the latter (“the Blackmail Claim”). The third head of claim was brought by Sarah and her elder sister, Tee Yok Lee (the second plaintiff in the Action and hereinafter referred to as “Ivy”), against Tik for breach of a distribution contract to sell the “POLICE” brand of apparel (“the POLICE Claim”). The Judge dismissed the Trust Claim and the Blackmail Claim, but allowed the POLICE Claim (see Tee Yok Kiat and another v Pang Min Seng and another [2012] SGHC 85 (“the Judgment”)). It was against the dismissal of the first two claims that the present appeal was brought by Sarah. Although Tik was also a party to the Trust Claim, she was not brought in as a party to the appeal.

At this juncture, we would pause to mention that Sarah was only represented on the first day of the trial, although she was represented before the trial commenced, and also in the making of the written closing submissions. Andy was unrepresented throughout the proceedings. So for all intents and purposes, the case was presented by a lay person and the defence was also conducted by a lay person.

At the conclusion of the hearing, we allowed Sarah’s appeal and gave judgment in her favour in respect of both the Trust Claim and the Blackmail Claim. We now give our reasons.

The factual background The parties

Sarah graduated from the National University of Singapore with a Bachelor of Science degree and worked as a tutor, financial consultant, and real estate agent at various times in her life. She first met Andy in or around December 2004, when she engaged Andy’s firm to carry out renovation works at her apartment in Balestier Road. She was then 45 years of age and was married to one Chiam Toon Muat (hereinafter referred to as “Toon Muat” where appropriate) and they had a daughter and a son who were then 13 and 9 years old respectively. Andy was then 33 years old, married but with no children. Sometime in January 2005, Andy introduced Sarah to Tik, a fortune-teller, when Sarah confided in him about her uncle’s ill health. Tik was also married at the material time.

The Trust Claim Sarah’s pleaded case

According to Sarah, when she first met Tik, Tik predicted that if Sarah’s uncle could live through the Chinese New Year, he would recover. Tik also told Sarah that her husband was probably having an affair with a female colleague. When Sarah’s uncle died on the eve of the Chinese New Year, Sarah was convinced that Tik’s predictions were accurate. Sarah also confided in Tik about her childhood background, including how she had grown up in Malaysia in poverty because her father had lost his fortune in gambling and had abandoned her family by coming to Singapore to work with his second wife. Tik therefore knew about Sarah’s insecurity about marriage and her desire to provide for her children at all costs. Tik stoked Sarah’s fears of divorce over time and advised her to liquidate her assets so that she could hide her money to prevent her husband from getting a share of her assets in the event of a divorce.

As Sarah trusted and believed in Tik, she decided to do as Tik advised. On 22 March 2005, Sarah gave an option to sell her shophouse located at Desker Road for the sum of $930,000. On or around 30 April 2005, Andy told Sarah about an opportunity to purchase a shop near Shenyang China Bus and Railway Terminal (“the Shenyang Shop”) at the price of $400,000. Sarah consulted Tik, who advised her to go ahead. On 4 May 2005, Sarah gave Andy $80,000 as part payment of the required 30% deposit for the Shenyang Shop, while a further sum of $3,700 was given for administrative expenses, currency exchange commission and legal fees. On 16 May 2005, Sarah gave the remainder of the 30% deposit (amounting to $40,000), plus $5,000 for travelling expenses, to Andy.

On or around 29 May 2005, Andy told Sarah that: (a) her application for a loan for the balance 70% of the purchase price of the Shenyang Shop was unsuccessful and she had to pay the remainder of the purchase price in cash; (b) $140,000 was required to renovate the Shenyang Shop and commence business; and (c) a piece of land near an airport (“the Airport Land”) was available for $120,000. The total sum for these three items is $540,000 and is hereinafter referred to as “the Outstanding Sum”. Andy also told Sarah that the Airport Land could be used to rear livestock and poultry for the Shenyang Shop. Sarah claimed that before making payment of the Outstanding Sum, she consulted Tik, who advised her to proceed with the transaction. On 1 June 2005, Sarah gave Andy $210,000 and $100,000 as part payment towards the Outstanding Sum. Sarah lost her passbook evidencing the withdrawal of $100,000 and thus did not include this sum in her claim. On 2 June 2005, Sarah gave Andy $230,000 as the final instalment of the Outstanding Sum. Subsequently, Andy gave Sarah copies of two remittance advice slips evidencing that the sum of $230,000 given by Sarah had been remitted to Liaoning, the capital of Shenyang. In or around late August 2005, Andy told Sarah that he was facing cash-flow problems with the Shenyang Shop and the Airport Land (collectively, “the China Properties”), and that he required about $40,000 to continue the business. On 2 September 2005, Sarah gave $40,000 to Andy to help with the cash-flow problems.

In summary, the following sums of money were given on the following dates:

Date of payment	Amount
4 May 2005	$83,700
16 May 2005	$45,000
1 June 2005	$210,000
1 June 2005	$100,000 (not included in Sarah’s claim)
2 June 2005	$230,000
2 September 2005	$40,000
Total	$708,700

The sum of $608,700 (ie, the aforesaid $708,700 less the $100,000 which was not included in Sarah’s claim) will hereinafter be referred to as “the Trust Money”.

In her closing submissions, Sarah claimed for the return of the Trust Money against Andy solely and/or against both Andy and Tik on the following bases: in breach of an express trust over the Trust Money and/or his fiduciary duty, Andy did not apply the Trust Money towards the purchase of the China Properties; in breach of an express trust in respect of the Trust Money, Andy used the Trust Money for the benefit of an entity called Conway Corporation (“Conway”); Andy held the Trust Money on a resulting trust for Sarah; both Andy and Tik conspired with the predominant intention to injure Sarah by inducing her to pay Andy the Trust Money to buy the China Properties; both Andy and Tik were constructive trustees of the Trust Money for the benefit of Sarah on two grounds, namely: (i) their knowing participation in a fraudulent and dishonest design against Sarah; and (ii) their retention of the benefit of the Trust Money; Andy was unjustly enriched from his receipt of the Trust Money because he failed to apply the Trust Money towards the purchase of the China Properties; and both Andy and Tik were unjustly enriched because they used the Trust Money for the benefit of Conway.

Andy’s pleaded case

Andy did not deny receiving the Trust Money, although he could not confirm when and how much was received by him. His sole defence was that there was no trust over the Trust Money, and that the Trust Money was given to him as a gift since he and Sarah were in an intimate relationship from the time they met until about March or April 2009. The allegation of a relationship was disputed by Sarah.

The Blackmail Claim Sarah’s pleaded case

According to Sarah, ever since Andy returned from China for good in October 2008, he had harassed her for more money to start a new business, and had threatened to tell her husband that she was having an affair with him and that she had given the Trust Money to him. He had also threatened to harass Sarah’s children, her parents-in-law and her sister (presumably Ivy). Sarah consulted Tik, who encouraged her to help Andy start his business so that he could return her the Trust Money. Sarah eventually decided to give $50,000 (“the Blackmail Money”) to Andy on 23 January 2009. Apropos the Blackmail Money, Sarah claimed that Andy was liable for the torts of intimidation and/or harassment.

Andy’s pleaded case

Andy denied that the Blackmail Money was given as a result of any intimidation or harassment on his part. His defence was that the Blackmail Money was also given to him as a gift.

The decision below

In the court below, the Judge dismissed both the Trust Claim and the Blackmail Claim.

The Judge noted that there are generally two different kinds of resulting trusts. The first arises when a person voluntarily pays money to or purchases property for another person. The recipient is presumed to hold the money or property on a resulting trust for the payer or purchaser. The second kind of resulting trust arises upon the failure of an express trust to fully exhaust the beneficial interest in the trust property. This second kind of resulting trust is commonly referred to as the Quistclose resulting trust, after the case Barclays Bank Ltd v Quistclose...