Yeo Hiap Seng v Australian Food Corp Pte Ltd and Another

JurisdictionSingapore
JudgeGoh Phai Cheng JC
Judgment Date23 February 1991
Neutral Citation[1991] SGHC 30
Date23 February 1991
Subject MatterEffects of drawing a cheque,Commercial Transactions,Service of writ at last registered address on record,s 35(1) Sale of Goods Act 1979 [UK],Defendant not allowed to set up by way of set-off a counterclaim for damages for breach of the underlying contract,Cheques,Dishonour,Second defendant took no part in the 'without prejudice' negotiations,No reasonable explaination for failing to enter appearance,'Without prejudice' negotiations,Application to expunge parts of affidavit relating to 'without prejudice' negotiations between plaintiffs and first defendants,When buyer is deemed to have accepted goods from the seller,Trial,Counterclaim a separate action and not a triable issue for setting aside default judgment,Application for summary judgment on proceeds of a dishonoured cheque,Acceptance of goods,Non-appearance by defendant,No notice of change of registered address with Registry of Companies,Civil Procedure,Contents,Whether expunged parts should apply to proceedings against second defendant as well,Affidavits,Summary judgment,Banking,ss 27 & 55 Bills of Exchange Act (Cap 23),Whether cheque should be honoured in absence of a total failure of consideration,Sale of goods
Docket NumberSuit No 844 of 1990
Published date19 September 2003
Defendant CounselAng Kim Leong (Ang, Netto, Rama & Wilson)
CourtHigh Court (Singapore)
Plaintiff CounselAndre Yeap (Allen & Gledhill)

There are three appeals in this suit. The first appeal is against a decision given by the learned assistant registrar on 4 January 1991 dismissing an application made by the first defendants to set aside a judgment entered against the first defendants in default of appearance with costs fixed at $800.

The second appeal is against a decision given by the assistant registrar on 10 January 1991 ordering that:

(a) the second defendant`s application that para 25 to 30 of the affidavit of James Loke filed on 6 September 1990 and the exhibit referred thereto as `JL-4` filed in support of the application for summary judgment against the second defendant herein be expunged from the records in these proceedings be dismissed;

(b) paras 25 to 30 of the said affidavit of James Loke filed on 6 September 1990 be expunged in so far as proceedings against the first defendants are concerned and the said affidavit shall be so endorsed on the first page thereof and paras 25 to 30 thereof and exh `JL-4` thereto be sidelined in red; and

(c) the second defendant do pay the plaintiffs` costs fixed at $600 forthwith.



The third appeal is against a decision of the learned assistant registrar who granted summary judgment on 1 October 1990 against the second defendant for the sum of $54,500 to the plaintiffs with interest and costs.


The plaintiffs are manufacturers of fruit juices, soft drinks and other beverages and the first defendants are customers of the plaintiffs.
The second defendant is a director of the first defendants. The plaintiffs` claim against the first defendants is for the proceeds of a cheque no 390463 post-dated 20 August 1989 for the sum of $54,500 drawn by the first defendants on the Rochor Road Branch of the DBS Bank of Singapore, which was dishonoured on presentation for payment. The plaintiffs were requested by the bank to `refer to drawer`.

The plaintiffs` claim against the second defendants is based on a contract dated 17 July 1989 made between the plaintiffs and the second defendant which reads:

Date: 17 July 1989

To: Yeo Hiap Seng

950, Dunearn Road

Singapore 2366

Attn: Mr CT Yeow

Dear Sir

I, Amy Tan Meng Choo of I/C No 0978214A of 18, Chu Lin Road Singapore 2366, and a director of Australian Corp Pte Ltd, a company registered in the Republic of Singapore hereby guarantee that the DBS Cheque No 390463 for the sum of S$54,500 issued in favour of Yeo Hiap Seng Ltd will be honoured.

Yours faithfully,

Signed:

Amy Tan Meng Choo

Chairman.



The above `guarantee` was given by the second defendant on the letter-head of Australian Food Corp Pte Ltd.

Sometime in July 1989, a contract was entered into between the plaintiffs and the first defendants for the plaintiffs to produce and supply a kiwi fruit juice drink in cans to the first defendants` customer in Taiwan.
The said contract provided, inter alia, that the plaintiffs would produce the fruit juice from kiwi fruit juice concentrate supplied by the first defendants in accordance with certain agreed procedures and the specifications supplied by the first defendants. The kiwi fruit juice concentrate was produced by Tuara Foods Co-operative Ltd in New Zealand and shipped to the plaintiffs in Singapore on the instructions of the first defendants. A total of 10,500 cartons were produced by the plaintiffs and shipped in five container loads to the first defendants` customer in Taiwan. Each carton contained 24 cans of fruit juice drink produced by the plaintiffs. The plaintiffs had produced more than 10,500 cartons of the fruit juice drink and the excess were held in their possession pending the placement of further orders from the first defendants. The first defendants had paid the plaintiffs an initial part-payment of US$42,000, the equivalent of S$81,738.84.

The said DBS cheque for the sum of $54,500 was issued by the first defendants to the plaintiffs for the balance of moneys due and owing by the first defendants to the plaintiffs for the 10,500 cartons of fruit juice drinks produced and supplied to the first defendants` customer in Taiwan.
The 10,500 cartons of canned kiwi fruit juice were shipped to and received by the first defendants` customer in Taiwan on 29 July 1989.

The abovementioned facts are not in dispute.
At the commencement of the hearing, counsel for both defendants urged this court to deal first with the second appeal, namely, the appeal relating to the application to expunge certain parts of the affidavit of James Loke filed on 6 September 1990 and the exhibit therein referred thereto as `JL-4`, as he was of the view that the outcome of the other two appeals will depend on the outcome of this appeal. I heard this appeal on 6 February 1991 and it was adjourned to 8 February 1991 when I dismissed the appeal with costs fixed at $1,000 to be paid to the plaintiffs by both defendants. I now give my reasons.

The parts of the said James Loke`s affidavit, which the defendants have taken objection to, relate to `without prejudice` negotiations between the parties with the view to reaching an amicable settlement regarding the first defendants` complaint about the kiwi fruit juice supplied to the first defendants` customer in Taiwan.
The second defendant did not take part in nor was she represented at the negotiations.

With respect to that part of the said order of the assistant registrar of 10 January 1991 expunging parts of James Loke`s affidavit filed on 6 September 1990 in so far as proceedings against the first defendants are concerned, the defendants contend that those expunged parts should apply to proceedings against both defendants.
With respect to the remaining part of that order dismissing the second defendant`s application to expunge parts of the said affidavit of James Loke, the defendants are asking for the relevant parts of the said affidavit of James Loke to be expunged with respect to the plaintiffs` case against the second defendant.

The defendants` counsel submitted that the learned assistant registrar took the view that the second defendant cannot claim that the negotiations were privileged because she was neither present nor represented at the negotiations.
Counsel for the defendants contended that since the two defendants are parties to the same proceedings, as long as there is an order to expunge certain parts of the said affidavit of James Loke, those expunged parts cannot be used against any party to the proceedings, including the second defendant. In support of his contention, the defendants` counsel cited the following passage from Phipson on Evidence (14th Ed) at p 555 paras 20-67 which reads:

Now that it is clear that the protection given by the rule relating to without prejudice correspondence is a species of privilege, it is no surprise that the maxim `once privileged, always privileged` applies in this class of case also. That being so, such correspondence remains privileged even after a settlement has been reached (except on the question of whether or not a final settlement has been concluded). It is inadmissible in any subsequent litigation concerned with the same subject-matter. That is so whether the litigation is between the same or different parties.



Counsel for both defendants also referred this court to the case of Rush & Tompkins Ltd v Greater London Council & Anor [1988] 3 All ER 737 in support of his contention.
In that case the House of Lords held that without prejudice correspondence entered into with the object of effecting the compromise of an action remained privileged after the compromise had been reached and accordingly the correspondence was inadmissible in any subsequent litigation connected with the same subject matter whether between the same or different parties and, furthermore, was also protected from subsequent discovery by other parties to the same litigation. It followed that the second defendants were not entitled to discovery of the without prejudice correspondence which had passed between the plaintiffs and the first defendants leading up to the settlement of their action.

In my view, the rule of law in Rush & Tompkin `s case is good law.
However, the facts of that case can be distinguished...

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3 cases
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