Telemedia Pacific Group Ltd v Yuanta Asset Management International Ltd

CourtHigh Court (Singapore)
JudgePatricia Bergin IJ
Judgment Date07 December 2016
Date07 December 2016
Docket NumberSuit No 2 of 2015

[2016] SGHC(I) 6

Singapore International Commercial Court

Patricia Bergin IJ

Suit No 2 of 2015

Telemedia Pacific Group Ltd and another
Yuanta Asset Management International Ltd and another

Paul Tan, Yam Wern-JhienandJosephine Chee (Rajah & Tann Singapore LLP) for the plaintiffs;

Hee Theng Fong, Toh Wei Yi, Nicklaus TanandJaclyn Leong (Harry Elias Partnership LLP) for the defendants.

Case(s) referred to

Airtrust (Hong Kong) Ltd v PH Hydraulics & Engineering Pte Ltd [2016] 1 SLR 1060 (refd)

Deutsche Bank AG v Chang Tse Wen [2013] 1 SLR 1310 (refd)

MFM Restaurants Pte Ltd v Fish & Co Restaurants Pte Ltd [2011] 1 SLR 150 (refd)

Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd [2008] 2 SLR(R) 623; [2008] 2 SLR 623 (refd)

Telemedia Pacific Group Ltd v Yuanta Asset Management International Ltd [2016] SGHC(I) 3; [2016] 5 SLR 1 (refd)

Wallersteiner v Moir (No 2)ELR [1975] QB 373 (refd)

Whiten v Pilot Insurance CoUNK [2002] 1 SCR 595 (refd)

Legislation referred to

Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 59, O 110 r 46(1), O 110 r 46(6)

Civil Procedure — Costs — Plaintiffs succeeded in majority of claims — How costs should be apportioned — Whether plaintiffs entitled to indemnity costs

Civil Procedure — Damages — Interest — Delay in bringing proceedings — Date of commencement of interest for damages awarded by court — Whether interest should run from date of breaches

Civil Procedure — Damages — Interest — Plaintiffs claiming compound interest on damages awarded for breach of fiduciary duty — Whether plaintiffs entitled to compound interest

Damages — Punitive damages — Whether defendants' conduct called for imposition of punitive damages

The plaintiffs sued the defendants for, inter alia, breach of contract, breach of fiduciary duties, conversion of shares in Next Generation Satellite Communications Limited (“NexGen”) and conspiracy to defraud. As part of their claim for damages, the plaintiffs claimed that a consequence of the defendants' conduct was a fall in the price of the plaintiffs' portfolio of NexGen shares (“the Portfolio Claim”).

In an earlier judgment delivered in these proceedings, the plaintiffs were held to have succeeded in establishing their claims in breach of contract, breach of fiduciary duties and conversion; their conspiracy claim and the Portfolio Claim were unsuccessful. The heads of damage in respect of the plaintiffs' successful claims were agreed to be a shortfall in loan proceeds as well as the unauthorised sales of shares in Next Generation Satellite Communications Limited (“NexGen shares”) between February and October 2011. The matter was fixed for further hearing as parties were unable to agree on the form of final orders in relation to the quantum of damages, interest on the award of damages and costs.

Held, making the relevant orders:

(1) The loan proceeds (less the relevant fees and commission) were destined for the joint venture vehicle for investment. Thus, the shortfall in loan proceeds was to be paid into a joint trust account held by the solicitors for the respective parties pending the finalisation of the joint venture accounting exercise between the parties: at [11] and [12].

(2) Even assuming that the court had the power to award punitive damages, this was not a case in which such damages should be awarded. The case did not involve high-handed and reprehensible conduct that required punishment; these parties were in a relationship that was fraught with difficulties and they were not candid with each other: at [35].

(3) While the Singapore International Commercial Court had the power to award compound interest in an appropriate or “deserving” case, this was not such a case. The plaintiffs did not lead evidence to establish what they would have done with the funds received from the unauthorised sales and what might have happened thereafter was left only to speculation: at [39] and [42].

(4) The plaintiffs' delay in bringing the proceedings did not warrant denial of the claims of interest from the date of the breaches. The defendants were not forthcoming in relation to the whereabouts of the NexGen shares that had been transferred to them and it took the plaintiffs' legal representatives considerable forensic skills to uncover the true position: at [44].

(5) Having regard to the outcome of the proceedings, the plaintiffs were entitled to 75% of their costs (excluding any costs incurred by them in respect of the Portfolio Claim) and the defendants were entitled to their costs of retaining their expert in respect of the Portfolio Claim and their costs incurred in defending the Portfolio Claim: at [65] and [66].

(6) The plaintiffs were entitled to 10% of their costs on an indemnity basis. They had been put to the trouble of preparing material urgently after the defendants were granted leave to call an additional witness. There was no real explanation given for the lateness of this notification and it was a very important aspect of the case with which the plaintiffs had to deal: at [75].

7 December 2016

Judgment reserved.

Patricia Bergin IJ:

1 These reasons relate to the form of final orders to be made consequent upon the judgment delivered in these proceedings on 30 June 2016: see Telemedia Pacific Group Ltd v Yuanta Asset Management International Ltd[2016] SGHC(I) 3 (“the Judgment”) (reported in part at [2016] 5 SLR 1). These reasons should be read with the Judgment. For convenience, I will adopt the abbreviations used in the Judgment.

2 The plaintiffs were successful in their claims for breach of contract, breach of fiduciary duties and conversion. The heads of damage in respect of those claims were agreed to be a shortfall in loan proceeds, the unauthorised sales of 101.5 million NexGen shares in February and March 2011, the unauthorised sales of 60 million NexGen shares in August 2011 and the unauthorised sales of 225 million NexGen shares in October 2011.

3 The plaintiffs were unsuccessful in the balance of their claims with which I will deal when I deal with the question of costs. The defendants were wholly unsuccessful in their claims in their Counterclaim.

4 The parties were directed to confer for the purpose of agreeing on the form of final orders, including the outstanding issues relating to the quantum of damages, interest and costs (see the Judgment at [545]). Although the parties communicated between July 2016 and October 2016, it became clear that agreement could not be achieved and the matter was fixed for further hearing on 7 November 2016. On that occasion, short oral submissions were made in addition to the written submissions that had been filed with the court and judgment in respect of these matters was reserved. Subsequently, the parties have made additional short submissions in correspondence to the court.

5 Before turning to the matters for determination in respect of quantum, interest and costs, I should refer to a controversy that arose from [402] of the Judgment which states:

The parties are entitled to share equally in the profits of the joint project and are burdened equally with any losses of the joint project. The only way in which that can be ascertained is by some form of an accounting exercise. However it is reasonably clear that the defendant has taken for himself the sale proceeds of secret sales of the 60 million NexGen shares in August 2011 and the 225 million NexGen shares in October 2011.

6 The defendants have retained an expert accountant to assist them in ascertaining the profits and/or losses of the joint venture that are to be equally shared. On 7 November 2016 I indicated to the parties that the finalisation of the joint venture relationship as a whole is not part of these proceedings and I did not intend to entertain submissions in relation to that accounting exercise. However I indicated that if the parties wished to include an order in these proceedings finalising their joint venture relationship they should file a Consent Order by 21 November 2016. This did not occur. As has been the habit of these parties, they each wrote to the court after this date seeking orders in respect of this process, albeit not orders that would finalise their relationship immediately. Although the defendants requested a further delay of 21 days in the delivery of these reasons, I am not satisfied that this is appropriate. However I will grant leave to the parties to relist the matter on seven days' written notice for the purpose of making any Consent Orders finalising the parties' relationship.

Quantum of damages

7 The first head of damage with which the parties have dealt, both in writing and orally, is the shortfall in the loan funds.

Shortfall in loan funds

8 The retention of the loan funds by the defendants was not in issue at trial, albeit that the entitlement to the funds was in issue. The plaintiffs claimed that an amount of S$850,475.73 had been retained while the defendants claimed that S$1,633,963.87 had been retained (see the Judgment ([1] supra) at [418]).

9 During the parties' post-Judgment communications the plaintiffs advised the defendants on 21 July 2016 that they had re-calculated the shortfall to be S$1,693,785.47. On 16 August 2016 the plaintiffs advised the defendants that “at the very least” they were entitled to S$850,475.73 for the shortfall in the loan funds. On 18 October 2016 the plaintiffs' submissions to the court explained the difference between these two figures as follows:

  • (a) Out of the sums that were transferred from Yuanta to AEM said to be loan proceeds, a sum of $1,459,710.82 was re-transferred back to Yuanta on...

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