Las Vegas Hilton Corporation trading as Las Vegas Hilton v Khoo Teng Hock Sunny

• Jurisdiction: Singapore
• Judge: Chao Hick Tin J
• Judgment Date: 03 August 1996
• Neutral Citation: [1996] SGHC 152
• Citation: [1996] SGHC 152
• Defendant Counsel: Goh Aik Chew and David Liew Tuck Yin (Goh Aik Chew & Co)
• Published date: 19 September 2003
• Plaintiff Counsel: Loh Boon Huat and Eric Siow (Godwin & Co)
• Date: 03 August 1996
• Docket Number: Originating Summons No 493 of 1991
• Court: High Court (Singapore)
• Subject Matter: Conflict of Laws,Illegality and public policy,Choice of law,Words and Phrases,Whether gaming illegal in Singapore or Nevada,Public policy,Whether contract to grant credit facilities made in Singapore or Las Vegas,Transactions abroad,Whether contract enforceable in Singapore,Whether gaming illegal at common law,Gaming and wagering,Place of conclusion,Whether proper law that of Singapore or Nevada,'Proper law of a contract',Main factors in determining proper law,Time at which to determine proper law,Definition of 'proper law of a contract',Gaming contracts,Betting, Gaming and Lotteries,s 6 Civil Law Act (Cap 43),Contract,Test for determining proper law,Enforcement of gaming contract

Cur adv Vult

The plaintiffs, Las Vegas Hilton Corporation, are a corporation formed under the laws of the State of Nevada, USA. At all material times the plaintiffs were and are licensed as a casino under the relevant laws of that State. By this action, the plaintiffs sue the defendant to recover the balance amount owing by the defendant in respect of loans granted by the plaintiffs to the defendant to enable the latter to gamble at the casino of the plaintiffs at Las Vegas. The loans were evidenced by markers signed by the defendant each time he drew on the credit facilities accorded by the plaintiffs.

Three main issues arises in this action. First, at which place was the contract to grant credit facilities made: Singapore or Las Vegas, Nevada. Second, what is the proper law of the contract, be it made in Singapore or Las Vegas. Third, whether the contract is enforceable under the laws of Singapore.

Facts

The defendant was at all material times a businessman and a seasoned international gambler having apparently gambled in various casinos in different parts of the world even before he came into contact with and gambled at the plaintiffs` casino, eg Las Vegas, London, Lake Tahoe, Reno, Macau, Seoul, Australia and Indonesia. He had established accounts at Maxim`s in London and Caesars Palace in Las Vegas. He was reputed to be a `high roller`, someone who gambled in large stakes. He was then residing in Kuala Lumpur.

The defendant`s association with the plaintiffs had its origin in a meeting on 14 December 1987 in Singapore at an office at the Pavilion Intercontinental Hotel (now Regent Hotel) between the defendant and one Mabel Lee (PW1). Mabel Lee was at that time employed by Benco Inc in the capacity of a Junket Representative. Benco is an associated or sister company of the plaintiffs and both are wholly owned subsidiaries of Hilton Hotels Corporation.

The duties of Mabel Lee as a junket representative were set out in an agreement dated 8 September 1987 between Benco and Mabel Lee and they were as follows:

(a) Promote and coordinate junket trips in accordance with instructions from Benco.

(b) Assist Benco in credit arrangement and collections.

(c) Perform such other services as may be required by Benco, such as office management and arrangements for reservations.

Junket trips are trips for clients to go to Las Vegas to gamble. In her evidence Mabel Lee said her office performed marketing and liaison functions. The defendant was introduced to her by two friends of hers. She invited him down from Kuala Lumpur. He indicated he was interested in gambling at the plaintiffs` casino and enquired of the facilities or perks which the plaintiffs would offer him. He was told that provided he qualified, the plaintiffs would probably let him have free food and accommodation and pay for his first class passage. To qualify a person would have to gamble up to a certain level. The perks which each customer could get varied. They also talked about how winnings could be taken out, how losses should be settled, and the discount on losses.

The plaintiffs were clearly interested in the defendant`s patronage as they sent Kevin Kelley, Vice-President of International Marketing, down to Singapore to assess him. Kelley did not think there should be any problem getting approval to grant him the credit. The defendant indicated to Kelley that he was a big-time gambler of the million-dollar class.

Kelley had no authority to approve and extend credit anywhere near to the tune of half or one million US dollars. For such amounts approvals of the most senior officials of the plaintiffs would be required. Whatever information conveyed by Kelley to the defendant regarding credit would only be provisional. Every customer who wanted credit must come to Las Vegas, complete a casino credit card and sign it. That was the first essential step. Next, the application for credit must be approved by the relevant senior officials depending on the amount of credit applied for. An application for credit of US$500,001 and upwards would require the highest level of approval. Before approval was given checks were carried out. Only when approval had been given could a customer draw on the credit to gamble. Each time a customer drew on his credit, he had to sign a marker for the relevant amount and the equivalent amount of gaming chips would be issued to him in exchange. Each marker was evidence of a loan given. The defendant admitted `every marker I signed represents a debt I owe to the plaintiff` (NE118). In the case of a customer who was not given any credit, he had to pay in cash for the gaming chips issued. That was and still is the standard procedure.

In the present case the defendant arrived at the plaintiffs` premises at Las Vegas on 29 January 1988. Kelley filled in the casino credit card (exh P2) with information provided by the defendant and the defendant signed it. He asked for a credit of US$1m. Checks were carried out, including one with the Central Credit, and they did not draw any adverse information concerning the defendant. The Central Credit is an independant credit reporting agency to which only the casino industry has access. The approvals of the executive credit committe members were obtained and they are all shown on the card. Among those whose approval was required was James Newman, Senior Vice-president for Gaming Operations of the plaintiffs. His signature was required for all applications for credit of over US$200,000. Newman testified for the plaintiffs.

As an incentive, before the defendant left for the first trip, he was given a first class air-ticket to Las Vegas and was also accorded the hospitality of staying in any Hilton Hotel en route to Las Vegas. He did, in fact, take a short break in Hawaii.

On that first trip, the defendant did not have to make use of the US$1m credit facilities because luck was with him and he won US$355,100.

In 1988 Kelley came to Singapore on a number of occasions on business promotion. He got in touch with the defendant and persuaded him to return to the plaintiffs` casino to gamble which he did on 27 December 1988.

A few months before he left for the second trip, the defendant came to see Mabel Lee asking her to make the arrangements. However for this second trip he was not given a free first class air ticket. Instead he was told that US$15,000 subsidy for travel would be given, which he could claim at Las Vegas. Mabel Lee made the flight reservations for him.

When the defendant arrived at the plaintiffs` casino on the second trip there was no necessity for the defendant to sign a fresh card though his earlier credit had expired. On his request for a US$1m credit, the previous credit was re-activated and granted, after the usual checks were made and the approval of the executive credit committee obtained. It was the plaintiffs` practice not to require such a customer to sign a new casino credit card.

On this second trip, the defendant was less fortunate. He used up the US$1m credit facility granted. He asked Kelley for a further facility of US$1m. Kelley sought approval from Newman who in turn consulted the other members of the executive credit committee. They decided to grant him a further US$1/2m. Still later he asked for more and was given another US$155,000. By 29 December 1988 he withdrew credit to the tune of US$1,655,000.

Between 30 December 1988 to 6 January 1989 the defendant went on a brief skiing vacation at Lake Tahoe at the hospitality of the plaintiffs. On his return from Lake Tahoe the defendant was given, again at his request, a final credit of a further $45,000, making a total of US$1.7m. The defendant does not deny that the markers bear his signature.

In June 1989 Kelley came over to Singapore to collect the amount the defendant owed the plaintiffs. The defendant told him that he needed to sell certain properties in Singapore to satisfy the debts to the plaintiffs in full. However, he issued a cheque for S$483,750 dated 5 June 1989 in part payment. In exchange Kelley handed to the defendant markers to the value of US$250,000.

In August 1989, Kelley and Newman came to Singapore. The defendant gave them another cheque for S$290,250 dated 8 August 1989. On this occasion Newman wanted the defendant to commit to a payment plan but the defendant would not do so.

In October 1989 Kelley and Newman went to Kuala Lumpur. This time the defendant handed to them a third cheque dated 2 October 1989 for a sum of S$290,250. He again declined to submit a payment programme.

In August 1990 both of them visited the defendant in Kuala Lumpur to seek payment of the remaining debt or to work out an instalment plan for payment. He promised to pay as soon as possible.

After substracting the three payments made, the defendant still owes the plaintiffs a sum of US$1,158,037 which is the subject of the present action. The details are set out in paras 30.2 and 30.3 and in exhibit `CAJ-10` of the affidavit evidence-in-chief of Charles Jacobi Jr, who was then the plaintiffs` Casino Cage Manager. Jacobi Jr is now the Director of International Finance of the plaintiffs. The defendant has not really challenged that evidence.

I accept the evidence of Kelley and Newman that at no time on those four occasions did the defendant ever suggest that he was not liable to pay the debts due.

Defendant`s case

The defendant alleged that before he left for the first trip in January 1988 an oral contract was entered into with the plaintiffs, through Mabel Lee, in the following terms:

(i) complimentary first class air ticket;

(ii) complimentary suite, including food and beverages, in Las Vegas and in any Hilton along the way;

(iii) a credit of US$500,000 to gamble at the plaintiffs` casino.

(iv) winnings would be paid in full in any currency;

(v) lossess could be settled later by instalments with no interest but a 10% discount would be given for prompt payment;

(vi) payment of losses could be...