Woodcliff Assets Ltd v Reflexology and Holistic Health Academy and Others

• Jurisdiction: Singapore
• Judge: Yeong Zee Kin SAR
• Judgment Date: 10 July 2009
• Neutral Citation: [2009] SGHC 162
• Court: High Court (Singapore)
• Year: 2009
• Citation: [2009] SGHC 162
• Plaintiff Counsel: Melvin See Hsien Huei and Ng Hui Min (Rodyk & Davidson LLP)
• Defendant Counsel: Harish Kumar and Sheila Ng (Rajah & Tann LLP)
• Subject Matter: Civil Procedure,Production of documents,Rules of court,Companies,Winding up
• Published date: 20 July 2009

10 July 2009

Yeong Zee Kin SAR

Procedural History

1 The Plaintiff and the 2^nd, 3^rd and 4^th Defendants are shareholders in the 1^st Defendant. The present proceedings started life as a winding up application commenced on 16 June 2008 by originating summons. It is part of a broader matrix of suits involving the directors and shareholders of the My Foot group of companies, which is set out in a little more detail below in paragraph 32, et seq. For the present application, the salient facts are as follows.

2 On 21 January 2009, it was ordered that these proceedings be converted and to continue as if they had been begun by writ. Subsequent to this conversion, the Plaintiff served a notice to produce documents referred to in the affidavits filed variously on 2 December 2008 and 31 December 2008 in the present proceedings.

3 This notice to produce forms the genesis of an impasse between parties as they took opposing interpretations of O 1, r 2 and O 88, r 2(5) of the Rules of Court, which ultimately led to the present application before me. In brief, the notice to produce, served on 30 January 2009, was resisted by the Defendants on the ground that O 24 of the Rules of Court did not apply to companies winding up proceedings, even after they have been converted to writ actions. The Plaintiff took the opposing view that the Rules of Court applied to these proceedings upon conversion to a writ action.

4 In the present application, the issue before me is whether, on a proper interpretation of O 88, r 2(5), a company winding up application commenced by an originating summons and thereafter converted into a writ action benefits from all the investigative tools of a writ action offered by the Rules of Court or is the Rules of Court applicable only within the confines established by O 88, r 2(5).

Summary of Defendants’ submissions: a literal approach

5 The Defendants prefer an interpretation that gives effect to the literal meaning of the relevant provisions. Their submissions are that the effect of O 1, r 2 is that the entirety of the Rules of Court is not applicable to proceedings relating to the winding up of companies, except for specific provisions set forth in that Order. One of the provisions set forth in O 1, r 2 is O 88, r 2(5). The Defendants further argue that in the event of a conversion of a winding up application, commenced by originating summons, into a writ action, only O 25, rr 2–7 of the Rules of Court is thereby applicable by virtue of O 88, r 2(5)(c). They rest on the assurance that O 25, rr 2–7 would allow the registrar to make all directions necessary for the matter to proceed to trial.

6 Upon considering O 88, r 2(5) and O 25 further, I note that the drafters had intentionally omitted O 25, r 1(1) and part of O 25, r 7(1) such that Forms 44 and 46 are not available to a converted winding up writ action. In a typical writ action, the plaintiff files a summons for direction using Form 44. This Form contains an almost exhaustive list of directions which the Court may make to move the matter on to trial. The defendant may make applications by filing a notice under the summons for direction in Form 46. The omission of these forms suggests that, upon a literal interpretation of O 88, r 2(5), the Court may make directions as though a summons for direction had been filed but parties may not file any notice in the summons for direction.

Summary of the Plaintiff’s submissions: a purposive approach

7 The Plaintiff prefers a purposive approach in interpreting O 88, r 2(5). Their submissions are that the Rules of Court (Amendment No 4) Rule 2002, inter alia, introduced O 88, r 2(5) which provided for the conversion of a winding up petition to a writ action. They argue that the purpose of the amendment is to allow the court to apply the more investigative elements of a writ action to converted winding up proceedings. The Plaintiff refers to Jeffrey Pinsler, Singapore Court Practice 2006, at p 1718, to corroborate this intention which they seek to infer.

8 The Plaintiff further argues that the Rules of Court apply by virtue of Rule 4 of the Companies (Winding Up) Rules. Rule 4 provides that a registrar shall “have all the powers and duties assigned to him under section 62 of the Supreme Court of Judicature Act”; section 62 in turn provides that a registrar shall “have such jurisdiction, powers and duties as may be prescribed by Rules of Court”.

Case law on the operation of the Companies (Winding Up) Rules and the Rules of Court

9 Both parties cited the cases of Kuah Kok Kim v Chong Lee Leong Seng Co (Pte) Ltd [1991] SLR 122 and Tohru Motobayashi v Official Receiver & Anor [2000] 4 SLR 529.

10 In Kuah Kok Kim, the Court of Appeal held that although the Companies (Winding Up) Rules 1969 and the Rules of the Supreme Court 1970 were mutually exclusive in their operational effect, this did not prevent the operation of O 2, r 1(1) to cure a formal defect. In this case, the petitioners had commenced a section 216 Companies Act minority oppression action by way of a winding up petition under the Companies (Winding Up) Rules 1969, instead of an originating petition under the Rules of the Supreme Court 1970. An application was made under 0 18, r 19 of the Rules of Court and the courts’ inherent jurisdiction to strike out the proceedings. The Court of Appeal held that the mode of commencement of the proceedings by way of a petition was correct but that the title of the petition as a winding up petition was an irregularity which could be cured by re-titling the petition as an originating petition. There was nothing else that was wrong with the petition as a matter of form. The Court of Appeal therefore ordered that the title of the petition and all subsequent cause papers be amended accordingly.

11 Kuan Kok Kim was cited in the subsequent Court of Appeal decision of Tohrun Motobayashi as authority that the Companies (Winding Up) Rules and the Rules of Court operated in a mutually exclusive manner. The Court of Appeal observed further that, unless there was a provision for the extension of the Rules of Court in the Companies (Winding Up) Rules, the Rules of Court does not apply in areas where the Companies (Winding Up) Rules are silent.

12 The salient facts of Tohrun Motobahashi are as follows. Okura Singaporewas the local branch of Okura Japan. Okura Japan was adjudicated bankrupt and the appellant was appointed the trustee in bankruptcy of Okura Japan. Okura Singapore was in turn wound up as part of the global liquidation of Okura Japan and a liquidator of Okura Singapore was appointed. The liquidator of Okura Singapore made certain applications by way of Summons-In-Chamber 325/99 (SIC 325/99) to allow, inter alia, the remittance of assets realised in the liquidation of Okura Singapore to the appellant after preferential creditors had been paid off. This particular prayer was not granted. The appellant requested the Singapore liquidator to appeal; but the Singapore liquidator declined to do so. The appellant subsequently commenced a new action for certain declarations to compel the liquidator to pay over the net amount of all sums recovered and realised in the liquidation of Okura Singapore to the appellant, after payment of all preferential debts.

13 One of the issues which arose was whether the appellant could have been joined as a party to SIC 325/99 and, if so, whether the present originating summons was an abuse of process. In this context, the Court of Appeal held that since the Companies (Winding Up) Rules and the Rules of Court operated in a mutually exclusive manner, the Rules of Court cannot be called upon to fill in areas where the Companies (Winding Up) Rules are silent. The application of the Rules of Court can only be extended where such extension is specifically provided for. Since the Companies (Winding Up) Rules did not provide for the joinder of parties, and there was not express extension of the Rules of Court to allow for joinder of parties, the appellant could not have been joined as a party to SIC 325/99.

Rationalising the case law: limited applicability of the Rules of Court pre-conversion

14 In considering these cases, I note the following. First, both cases were decided before the 2002 amendments which introduced the power to convert a winding up petition to a writ action in O 88, r 2(5). Second, these cases seem to suggest that certain aspects of the Rules of Court, apart from those provisions which are expressly extended by virtue of O 1, r 2, apply to winding up proceedings either by implication of law or as part of the courts’ inherent jurisdiction. It would appear that at the minimum, the power of the Court under O 2, r 1 to cure procedural irregularities is thus available. On the basis of dicta in the Court of Appeal’s decision in Kuah Kok Kim, O 18, r 19 may also be available since the Court of Appeal did not dismiss the striking out application on the basis that the Rules of Court did not apply, but proceeded to cure the procedural irregularity: supra, at paragraph 24.

15 However, I am not persuaded by the Plaintiff’s argument that rule 4 of the Companies (Winding Up) Rules extends the application of the Rules of Court in its entirety via section 62 of the Supreme Court of Judicature Act to all winding up proceedings. A plain reading of Rule 4 of the Companies (Winding Up) Rules shows that this is not the effect intended by the provision:

Office of Registrar

4.—(1) All proceedings in the winding up of companies in the Court shall be attached to the Registrar, who shall, together with the necessary clerks and officers, and subject to the Act and these Rules, act under the general or special directions of the Judge.

(2) In every cause or matter within the jurisdiction of the Judge, whether by virtue of the Act or by transfer, or otherwise, the Registrar shall, in addition to his powers and duties under these Rules, have all the powers and duties assigned to him under...