TV Media Pte Ltd v De Cruz Andrea Heidi and Another Appeal

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 08 July 2004
• Neutral Citation: [2004] SGCA 29
• Citation: [2004] SGCA 29
• Defendant Counsel: Raj Singam, Wendell Wong and Tan Siu-Lin (Drew and Napier LLC),Simon Tan Hiang Teck (Attorneys Inc. LLC)
• Published date: 09 July 2004
• Plaintiff Counsel: N B Rao and Fazal Mohamed Bin Abdul Karim (B Rao and K S Rajah)
• Date: 08 July 2004
• Docket Number: Civil Appeals Nos 119 and 122 of 2003
• Court: Court of Appeal (Singapore)
• Subject Matter: Principles,Costs,Whether chain of causation broken by respondent's failure to buy pills from authorised retailer,Whether chain of causation broken when respondent continued consuming slimming pills after experiencing unusual physical symptoms,Whether phrase limited to single positive act,Companies,General damages for pain and suffering and loss of amenities,Liabilities,Damages,Whether distributor's reliance on importer's director's assertions regarding slimming pills adequate defence to negligence,Duty of care,Whether circumstantial evidence proved on balance of probabilities that relevant slimming pills caused liver failure,Directors,Quantum,Joint tortfeasors,Words and Phrases,Negligence,Whether multiplier of 34 years for future medical expenses too high,Whether director of company personally liable for authorising, directing, procuring torts committed by company,Whether exceptional circumstances existing to justify lifting of corporate veil to make director personally liable,Tort,Apportionment,Whether appellants entitled to full costs if appeal not wholly successful,"Authorised, directed and/or procured",Civil Procedure,Whether distributor's advertisement of slimming pills as safe justified because pills approved by Health Sciences Authority,Whether phrase includes omissions forming negligent course of conduct,Whether distributor of slimming pills owing duty to consumers to exercise reasonable care in promotion, endorsement and advertisement of pills,Whether award of $250,000 too high,Causation

8 July 2004 Judgment reserved.

Yong Pung How CJ (delivering the judgment of the court):

1 The appellants in these two appeals disputed the decision of the court below, which held them liable in negligence for the respondent’s liver failure. We heard the appeals on 26 May 2004 and reserved judgment.

The parties

2 The respondent, Andrea Heidi de Cruz (“Andrea”), was a 27-year-old artiste with MediaCorp Studios (“MediaCorp”) when she suffered liver failure. She instituted an action against five defendants in the court below for the liver damage, allegedly caused by her consumption of a slimming drug, “Slim 10”. The first defendant, a company incorporated in China, was the manufacturer of Slim 10 (the “Chinese manufacturer”). As the Chinese manufacturer could not be located for the purpose of service of the writ of summons, the trial could not proceed against it. The second defendant, Health Biz Pte Ltd (“Health Biz”), was a Singapore company which imported and sold Slim 10. The third defendant, Semon Liu (“Semon”), was the director and principal shareholder of Health Biz. He was also the appellant in the second of the two appeals before us. TV Media Pte Ltd (“TV Media”), the fourth defendant, was the sole distributor of Slim 10 in Singapore. It appealed in the first of the two appeals before us. The fifth defendant, Rayson Tan (“Rayson”), was Andrea’s colleague who supplied her with Slim 10. Andrea claimed in negligence against Health Biz, Semon and TV Media, and sued Rayson for breach of contract.

Andrea’s case

3 For conciseness, this judgment will only set out Andrea’s version of events in full. The material facts disputed by the appellants will be dealt with in conjunction with the appellants’ arguments.

4 Andrea came to know Rayson and his wife, Chen Liping (“Liping”), in December 2001 when they were cast together in the Chinese drama series No Problem. They spent a lot of time together during filming. During this period, Andrea saw TV Media’s television commercials on Slim 10 that featured Liping, who was known to be having problems with her weight. The commercials showed “before” and “after” pictures of Liping, and Andrea was very impressed by the difference. The commercials were “infomercials”, which were longer and more informative than ordinary commercials. They represented that Liping had tried the pills which were “100% herbal”. They featured TV Media’s name and stressed that TV Media was the distributor of Slim 10.

5 Andrea saw life-sized cardboard cutouts and large posters of Liping advertising Slim 10 at TV Media’s retail outlet in Beach Road. She viewed the advertisements aired over various television channels in Singapore until late March 2002 when she went to Bangkok. She knew that TV Media was a large and reputable company as her family had bought products from it before, and she had seen its advertisements in the United States. Hence, she believed that TV Media would have made the necessary tests to ensure that Slim 10 was safe for consumption before endorsing and marketing the product so aggressively. Andrea testified that the reputation, reliability and credibility of health supplements were very important to her. She would not have bought Slim 10 from Rayson had it been marketed by Health Biz or the Chinese manufacturer as she knew nothing about them and they had no reputation in Singapore.

6 In December 2001, Andrea told Rayson that she had seen the Slim 10 advertisements and commended him on how much weight his wife had lost. Rayson replied that the pills really worked and that Andrea should take Slim 10 if she was concerned about her weight. A few days later, Rayson asked Andrea whether she wanted the Slim 10 pills as he had some in his car. He offered them to her at $130 per bottle of 120 capsules, which was cheaper than each bottle’s retail price of $149.90. Andrea decided to buy two bottles and was given two clear, unmarked test tubes containing the capsules. Rayson told her that side effects might include insomnia, chills and pain in her calves. Other than that, the pills were definitely safe as they were all natural. Andrea paid him for the pills, not doubting that they were the Slim 10 pills advertised by TV Media, since Rayson’s wife was after all the poster girl for the product. The transparent test tubes and the white or off-white colour of the capsules also resembled those shown in TV Media’s advertisements.

7 As she was still filming at the time, Andrea did not start taking the pills immediately, as she did not want her performance to be affected by insomnia. She only started consuming Slim 10 when filming for No Problem was coming to an end, around late January or early February 2002. She had to take four capsules three times a day. As Andrea experienced some of the side effects mentioned by Rayson, as well as palpitations, she reduced her intake of the pills to four-four-two pills per day so as to minimise disruption to her sleep.

8 On 15 February, she sent a text message to Rayson telling him that she had “run out of skinny pills”. Some time on 18 February, Rayson handed her a second batch of 240 pills. These were packed in aluminium foil, and Rayson explained that he had asked the Slim 10 boss to pack them in this manner as Rayson always kept the pills in his car and did not want them to be affected by the heat. Again, Andrea did not doubt that these were Slim 10 pills. She started consuming this second batch sometime in early to mid-March 2002 after finishing the first batch of pills.

9 On 29 March, Andrea flew to Bangkok where she finished the second batch of Slim 10. On 11 April, she returned to Singapore and sent another text message to Rayson asking him to order more pills. On 14 April, Andrea’s sister observed that Andrea’s eyes looked very yellow and jaundiced. Andrea saw her doctor the next day, whereupon the doctor told her that her liver was inflamed and her eyes very jaundiced. Andrea went to Changi General Hospital where it was confirmed that her liver was inflamed and she had to be hospitalised. She was referred to Mount Alvernia Hospital. Sometime in the second week of her hospitalisation, Andrea underwent a liver biopsy, with inconclusive results.

10 On 3 May, Dr Dede Selamat Sutedja of the National University Hospital (“NUH”) liver team visited Andrea. He prescribed some drugs for her but she threw them up. On 4 May, she was moved to NUH. On 5 May, she was encephalopathic. She was unable to recognise anyone and was muttering incoherently. She was taken to the intensive care unit for immediate liver dialysis, which allowed her to recover her lucidity temporarily. As Andrea’s fiancé was the only suitable liver donor who could be found, the Ministry of Health granted special permission for an unrelated living donor transplant to be carried out. On 7 May, Andrea was transferred to Gleneagles Hospital because the NUH liver team had never carried out a living donor transplant. Dr Tan Kai Chah of Gleneagles Hospital successfully carried out the transplant.

11 In the meantime, the Singapore Health Sciences Authority (“HSA”) had convened an urgent meeting with Health Biz on 2 April 2002 because people who had consumed Slim 10 were complaining of medical problems. The following day, Semon and Peter Boo, the Vice President of Health Biz, wrote in to HSA appealing against the recall of Slim 10, as it would have devastating consequences for Health Biz. On 15 April, HSA ordered Health Biz to suspend all sales of Slim 10 immediately and to withdraw the product from the market by 29 April 2002.

12 Later tests found that Slim 10 contained the undeclared substances of nicotinamide, fenfluramine, thyroid gland extract and N-nitrosofenfluramine. Fenfluramine is an appetite suppressant which can damage heart valves but does not normally cause liver damage. It is banned in various countries, including the USA, Japan, Korea, Hong Kong, China and Singapore. N-nitrosofenfluramine is an adulterated version of fenfluramine, suspected of causing Andrea’s liver damage.

13 Andrea sued TV Media for negligently advertising and promoting Slim 10 as being 100% herbal and safe. She also sought to hold Semon personally liable for authorising, directing and/or procuring Health Biz’s negligent acts of importing and selling Slim 10.

The issues on appeal

14 We have categorised the issues before us in the following manner:

(a) TV Media’s appeal on liability.

(i) Whether Andrea consumed Slim 10.

(ii) When Andrea consumed Slim 10.

(iii) Whether TV Media owed Andrea a duty of care.

(iv) Whether TV Media breached this duty of care.

(v) Whether TV Media’s breach caused Andrea’s liver failure.

(vi) Whether Slim 10 caused Andrea’s liver failure.

(b) Semon’s appeal on liability.

(i) Whether Semon authorised, directed or procured Health Biz’s negligence.

(ii) Whether Health Biz’s corporate veil should be lifted.

(iii) Causation.

(c) The appellants’ appeal on quantum.

(i) Apportionment of blame.

(ii) Quantum of damages awarded.

TV Media’s appeal on liability

Whether Andrea consumed Slim 10

15 The judge found that the pills taken by Andrea “came through an unbroken chain from [Health Biz] to [Rayson] to [Andrea] … no one was in any doubt that the only slimming pills imported by [Health Biz] were those meant to be marketed as Slim 10”: See De Cruz Andrea Heidi v Guangzhou Yuzhitang Health Products Co Ltd [2003] 4 SLR 682 at [162].

16 TV Media disputed this finding on several grounds. We now deal with them in turn.

Different packaging of the pills

17 TV Media first contended that the judge had no basis for ruling that what Andrea consumed were Slim 10 capsules since they were packaged differently from the Slim 10 pills advertised and sold by TV Media.

18 The first batch of pills bought by Andrea came packaged in two clear test-tubes. The second batch was contained in two aluminium foil packets. Both the test-tubes and aluminium foil packets were unmarked. In this aspect, they differed...