Whang Tar Liang v Standard Chartered Bank

• Jurisdiction: Singapore
• Judge: Tan Sze Yao AR
• Judgment Date: 17 June 2011
• Neutral Citation: [2011] SGHC 154
• Court: High Court (Singapore)
• Docket Number: Originating Summons No. 228 of 2011/H)
• Published date: 20 June 2011
• Year: 2011
• Hearing Date: 16 June 2011
• Plaintiff Counsel: Josephine Chong (Pinnacle Law LLC)
• Defendant Counsel: Hri Kumar SC and James Low (Drew & Napier LLC)
• Subject Matter: Civil Procedure,Discovery of Documents,Pre-action Discovery
• Citation: [2011] SGHC 154

Tan Sze Yao AR: Introduction

This was an application for pre-action discovery pursuant to Order 24 Rule 6(1) of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“Rules of Court”) by the plaintiff, a private banking customer, against the defendant bank. The items sought for discovery were “[a]ll tape recordings of telephone conversations between the [p]laintiff and any officer(s)/representative(s) of the [d]efendant” pertaining to certain transactions and trades in equity-linked notes (“Transactions”) allegedly entered into by the defendant on behalf of the plaintiff.

Facts

The facts are simple. Between June 2010 and December 2010, the Transactions were allegedly entered into by the defendant on the plaintiff’s behalf. Subsequently, the plaintiff asserted that the Transactions were never authorised by him. The defendant responded to this assertion by saying that apart from documentary records that confirmed the plaintiff’s cognizance and approval of the Transactions, they also had in their possession tape recordings (“Tape Recordings”) of telephone conversations between the defendant’s employees and the plaintiff where the plaintiff could be heard to be authorizing or agreeing to the Transactions.

In the event, the plaintiff was granted an opportunity by the defendant to listen to one of the Tape Recordings, specifically a conversation he had had with his relationship manager, one Mavis Koh (“the Mavis recording”) on 8 November 2010. According to the defendant, the Mavis recording contained the plaintiff’s confirmation and acknowledgment of one of the Transactions. However, the plaintiff eventually refused to sign the requisite request form to listen to the Mavis recording, asserting that “[w]hat I had requested to listen to … had been the earlier pre-trade telephone conversation with Dennis Ng, not the 8 November telephone conversation with Mavis Koh”.

Subsequently, by a lawyer’s letter dated 23 March 2011, the plaintiff informed the defendant that he had commenced the present application for pre-action discovery of the Tape Recordings.

Law

Pre-action discovery exists for the plaintiff who is unable to plead a case as he does not know whether he has a viable claim and requires the discovery to ascertain the gaps in his case. Where the plaintiff has evidence sufficient to commence a claim, he is generally not entitled to discovery before action: see generally Kuah Kok Kim and others v Ernst & Young [1996] 3 SLR(R) 485 (“Kuah Kok Kim”), Bayerische Hypo- und Vereinsbank AG v Asia Pacific Breweries (Singapore) Pte Ltd and other applications [2004] 4 SLR(R) 39 (“Asia Pacific Breweries”) and Lian Teck Construction Pte Ltd v Woh Hup (Pte) Ltd and others [2005] 1 SLR(R) 266 (“Lian Teck”).

The relevant provisions relating to pre-action discovery are found under Order 24 Rule 6 of the Rules of Court:

6. Discovery against other person (O. 24, r. 6)

(1) An application for an order for the discovery of documents before the commencement of proceedings shall be made by originating summons and the person against whom the order is sought shall be made defendant to the originating summons.

…

(3) An originating summons under paragraph (1) or a summons under paragraph (2) shall be supported by an affidavit which must — (a) in the case of an originating summons under paragraph (1), state the grounds for the application, the material facts pertaining to the intended proceedings and whether the person against whom the order is sought is likely to be party to subsequent proceedings in Court; (b) in any case, specify or describe the documents in respect of which the order is sought and show, if practicable by reference to any pleading served or intended to be served in the proceedings, that the documents are relevant to an issue arising or likely to arise out of the claim made or likely to be made in the proceedings or the identity of the likely parties to the proceedings, or both, and that the person against whom the order is sought is likely to have or have had them in his possession, custody or power. …

(9) Unless the Court orders otherwise, where an application is made in accordance with this Rule for an order, the person against whom the order is sought shall be entitled to his costs of the application, and of complying with any order made thereon on an indemnity basis.

In Kuah Kok Kim, Lai Kew Chai J described the nature of pre-action discovery under Order 24 Rule 6 as follows (at [31] and [56]): 31 It can be seen from the tenor of the cases that where pre-action discovery is sought, the plaintiff has a duty to set out the substance of his claim to enable a potential defendant to know what the essence of the complaint against him is. This is because in the nature of pre-action discovery, the plaintiff does not yet know whether he has a viable claim against the defendant, and the rule is there to assist him in his search for the answer. Thus the safeguards specified in the rules are to ensure that the plaintiff is not allowed to take advantage of the rules merely to enable him to go on a fishing expedition.

…

56 In deciding whether to order discovery of [the relevant] documents, we were … concerned with … the purpose of the discovery, namely that the appellants wanted to find out if they had a good cause of action in tort or contract against the respondents.

[emphasis added in bold italics]

Subsequently in Asia Pacific Breweries, Belinda Ang J acknowledged and expounded on the authority of Kuah Kok Kim at [4]-[5]: 4 The requirements of O 24 r 6(3) as guided by the decision of Kuah Kok Kim are that the application for pre-discovery be supported by an affidavit setting out the grounds for the application, the material facts pertaining to the intended action and whether the person against whom the order is sought is likely to be a party to subsequent proceedings. The tests of “possession, custody or power” and “relevance” remain applicable for the purposes of pre-action discovery. The criterion of the rule is intended to ensure that the application for pre-action discovery is not brought frivolously or without justification. Lai Kew Chai J, in delivering the judgment of the Court of Appeal in Kuah Kok Kim, … said that the court’s duty is to ensure that the application is not frivolous or speculative and that the applicant is not on a fishing expedition. That duty was adopted and applied by Choo Han Teck JC (as he then was) in Ng Giok Oh v Sajjad Akhtar [2003] 1 SLR(R) 375. 5 Once the court is satisfied, based on an assessment of the formal evidence before the court, that the criteria of the rule are met, the next consideration is whether discovery is necessary either for disposing fairly of the cause or matter or for saving costs. …

[emphasis added]

But what, exactly, is a “viable” or “good” cause of action, as alluded to in Kuah Kok Kim? A “cause of action” is a legal term of art; one makes out a cause of action simply by fulfilling and articulating certain legal criteria based upon a set of facts. Would therefore a “viable” or “good” cause of action refer to a cause of action that possesses a healthy likelihood of success? Counsel for the plaintiff submitted that the affixation of these adjectives, prevalent in the case law, indicated that the inquiry was one that necessarily segued into the merits. This interpretation appeared to be a reasonable one, given the specific insertion of “good” and “viable” over and above the basic phrase “cause of action”.

To properly address the issue, I found it instructive to refer to Jeffrey Pinsler SC, Supreme Court Practice 2009 (LexisNexis, 2009) at p 632:

The High Court [in Asia Pacific Breweries] ruled that pre-action discovery should only be permitted if the potential plaintiff is unable to initiate a case without the desired information. … As the banks had indicated the causes of action that lay against the defendant, pre-action discovery was inappropriate. …

Ng Giok Oh and [Asia Pacific Breweries] stand for the proposition that if the claimant has sufficient evidence to mount a claim, he is not entitled to discovery before proceedings in order to complete his ‘entire picture’ of the case. He does not have the right to all the evidence before he sues simply because this is not necessary. If it were otherwise, the ordinary processes of general and particular discovery pursuant to O 24 r 1 and r 5 respectively would be rendered otiose. Therefore, he is not allowed to ‘snoop’.

[emphasis added]

From the extract above it is clear that pre-action discovery is for the plaintiff to come to a determination of its cause(s) of action. It is not an...