United Overseas Bank Ltd v Lippo Marina Collection Pte Ltd and others

• Jurisdiction: Singapore
• Judge: Aedit Abdullah JC
• Judgment Date: 15 June 2017
• Neutral Citation: [2017] SGHC 140
• Plaintiff Counsel: Eddee Ng, Alcina Chew, Lau Qiuyu and Sherlene Goh (Tan Kok Quan Partnership)
• Date: 15 June 2017
• Docket Number: Suit No 1250 of 2014 (Registrar’s Appeal No 33 of 2017)
• Hearing Date: 14 March 2017
• Subject Matter: Litigation privilege,Privilege,Without prejudice privilege,Discovery of documents,Civil procedure
• Published date: 11 May 2018
• Defendant Counsel: See Chern Yang and Teng Po Yew (Premier Law LLC)
• Court: High Court (Singapore)
• Citation: [2017] SGHC 140
• Year: 2017

Aedit Abdullah JC: Introduction

Pursuant to settlement negotiations between the plaintiff on the one part and the second and third defendants on the other, a settlement agreement was entered into between these parties (“the Settlement Agreement”). This Settlement Agreement made reference to an affidavit affirmed by the second defendant, on behalf of himself and the third defendant, relating to the nature and extent of the first defendant’s involvement in the alleged wrongdoing which lies at the heart of the plaintiff’s suit (“the Affidavit”). The first defendant sought specific discovery of the Affidavit from the plaintiff and/or the second and third defendants. Disclosure was resisted on grounds of (a) litigation privilege, and/or (b) without prejudice privilege.

Several legal issues arose as to the subsistence and waiver of the two distinct types of privilege in the context of a multi-party litigation. In the court below, the learned Assistant Registrar Bryan Fang (“the AR”) disallowed discovery of the Affidavit on the ground of litigation privilege. The first defendant appealed. Having heard the parties, I find that litigation privilege in the Affidavit subsists and was not waived. The appeal is therefore dismissed.

Background

This matter is related to an earlier decision of this court in United Overseas Bank Ltd v Lippo Marina Collection Pte Ltd and others [2016] 2 SLR 597. That decision concerned the application of O 14 r 12 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (“ROC”) on summary determinations of issues of law. The background to this suit was set out there; only the relevant portions are reproduced here.

The parties

The plaintiff is a commercial bank licensed by the Monetary Authority of Singapore (“MAS”) to offer, inter alia, housing loans.

The first defendant is the developer of a 99-year leasehold condominium development known as the Marina Collection.

The second and third defendants were real estate agents at the material time. In these proceedings, they were initially represented by counsel, but their solicitors obtained an order to discharge themselves on 28 October 2016, immediately prior to the hearing of this discovery application before the court below on 9 November 2016. In the circumstances, the second and third defendants did not take an active role in this discovery application or on appeal – they filed no affidavits, made no arguments, and did not appear in any of the hearings.

Each of the fourth to eighth defendants is a relative of either the second or third defendant. For reasons to be explained below, the plaintiff discontinued the suit against the fourth to eighth defendants on 15 April 2016.

The context

From 2011 to 2013, the first defendant sold 38 units in the Marina Collection to 38 purchasers in separate transactions. The plaintiff granted housing loans to each of the 38 purchasers to finance their purchases.

After the loans were granted, the plaintiff discovered that the first defendant had offered significant furniture rebates to the 38 purchasers. These rebates exceeded market norms and were not reflected in the housing loan application forms. On 26 November 2014, the plaintiff commenced the present suit with claims in the tort of unlawful means conspiracy and the tort of deceit. The plaintiff contended, inter alia, that the rebates were part of the defendants’ deliberate effort to mislead the plaintiff into granting housing loans (a) based on artificially inflated purchase prices of the units, and (b) which exceeded the maximum loan amounts permissible under MAS’s regulation, vide, MAS Notice 632.

The first defendant denied involvement in any conspiracy or act of fraud. It pleaded that the financing of the purchase of the units was a matter solely between the plaintiff and the purchasers, of which it had no knowledge. The first defendant further pleaded that any loss suffered by the plaintiff was caused by the plaintiff’s own decision to grant the loans based on its independent checks and risk assessments, or its failure to properly perform the same.

The second and third defendants filed a joint defence denying any conspiracy between the defendants and any act of deceit. While the plaintiff’s case was based in part on certain allegedly suspicious transfers of money between the bank accounts of the purchasers and those of the second, fourth and fifth defendants, the second and third defendants contended that these transfers were made pursuant to suggestions by the plaintiff’s Vice-President of Home Loans, one Ann Ong. The second and third defendants argued that Ann Ong’s knowledge and acts as employee and agent of the plaintiff must be attributed to the plaintiff, or, alternatively, form the basis of an estoppel against the plaintiff.

The Settlement Agreement

On 29 March 2016, the plaintiff entered into the Settlement Agreement with the second and third defendants pursuant to settlement negotiations between them. The recitals to this Settlement Agreement state, inter alia: (I) [The second defendant] has affirmed an Affidavit… relating to the nature and extent of the involvement of [the first defendant] in the Suit. (J) The Affidavit is made on behalf of [the second defendant]… and… [the third defendant] in the Suit. (K) [The second defendant] has affirmed the Affidavit whilst being advised by his solicitors and has not been coerced and influenced in any way in the making of the Affidavit. (L) [The plaintiff] has requested that [the second defendant] file the Affidavit in the Suit and further give truthful testimony as to the nature and extent of [the first defendant’s] involvement in the allegations of fraud and conspiracy made by [the plaintiff] against the [d]efendants in the Suit at the trial of the Suit. (M) In consideration, [the plaintiff] is agreeable to regulating the future conduct of its claims against [the second and third defendants] as well as [the fourth to eighth defendants] in the Suit… in accordance with the terms of this Agreement.

As can be seen, Recital [M] refers to the plaintiff’s undertaking “to regulat[e] the future conduct of its claims” against the second to eighth defendants in accordance with the terms of the Settlement Agreement. This undertaking was given in consideration of the second defendant filing the Affidavit and giving truthful testimony at trial. The following terms of the Settlement Agreement are also material: 1.1 Upon [the second defendant] affirming the Affidavit in the Suit: (a) [The plaintiff] shall discontinue all of its claims against the [fourth to eighth defendants] in the Suit …;

…

1.2 Upon [the second defendant] giving truthful testimony at the trial of the Suit of the nature and extent of [the first defendant’s] involvement in the allegations of fraud and conspiracy made by [the plaintiff] against the [d]efendants in the Suit (as recorded in the Affidavit): (a) [The plaintiff] its heirs and assigns shall not take any action in law or in equity to enforce any judgment rendered in [the plaintiff’s] favour in the Suit against [the second and third defendants] in respect of [the plaintiff’s] claims against [the second and third defendants] in the Suit …;

In accordance with cl 1.1 of the Settlement Agreement, the plaintiff withdrew his action against the fourth to eighth defendants by way of a Notice of Discontinuance filed on 15 April 2016.

Requests for the Affidavit

On 13 June 2016, the plaintiff filed a Supplementary List of Documents which disclosed, inter alia, the existence of the Settlement Agreement. The plaintiff also provided a copy of the Settlement Agreement to the first defendant’s solicitors. However, the Affidavit itself, which was referred to in the recitals of the Settlement Agreement, was not provided to the first defendant.

On 5 August 2016, the first defendant’s solicitors wrote to the plaintiff’s solicitors requesting various documents, including the Affidavit. The plaintiff’s solicitors replied on 19 August 2016 stating that the plaintiff would not be providing discovery of the Affidavit as the plaintiff “does not have a copy of the [Affidavit] which can be extended to [the first defendant] because it is covered by litigation privilege and/or without prejudice privilege”.

On 23 August 2016, the first defendant’s solicitors wrote to the second and third defendants’ then-solicitors making a similar request for the Affidavit. This request was also denied in a reply letter dated 30 August 2016 (“the Letter”) stating the following:

Our clients are not obliged to provide discovery of the [Affidavit] at this stage of the proceedings. Further, the [Affidavit] is subject to litigation privilege.

As this is our client’s Affidavit-of-Evidence-in-Chief, we will disclose and exchange the same at the appropriate juncture.

In light of the above, the first defendant filed Summons No 4966 of 2016 on 12 October 2016 seeking specific discovery of several documents, including the Affidavit, by the plaintiff and/or the second and third defendants. This appeal concerns only the Affidavit. In that regard, the plaintiff resisted disclosure on grounds of litigation privilege and/or without prejudice privilege. The second and third defendants were absent from the hearings, but appeared to resist disclosure on the ground of litigation privilege.

The decision below

The learned AR issued written Grounds of Decision on 19 January 2017 in United Overseas Bank Ltd v Lippo Marina Collection Pte Ltd and others [2017] SGHCR 1 (“UOB v Lippo”). This appeal concerns only the part of his decision dismissing the first defendant’s application on the ground of litigation privilege. In that regard, the AR framed two issues for determination (at [19]): Can litigation privilege attach to the Affidavit even though the second and third defendants have omitted to file any affidavits claiming the privilege as...