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Lee Eng Beng SC, Kelvin Poon, Low Poh Ling and Wilson Zhu from the Business Finance & Insolvency Practice and International Arbitration, Construction & Projects Practice successfully acted for the 1st and 2nd Appellants in Re BKR [2013] SGHC 201.
Re BKR [2013] SGHC 201 is believed to be the first reported Singapore High Court case on a contested application under the Mental Capacity Act (Cap 177A, 2010 Rev Ed) (the "MCA"). The case is significant for the High Court's decision on the relevance of undue influence in the test for mental capacity under the MCA; the weight to be accorded to the performance in cross-examination of a person alleged to lack capacity; and the scope of powers for deputies.
Brief Facts
BKR's siblings (the "Respondents") applied to be appointed as BKR's deputies in relation to her property and affairs under the MCA. After a lengthy trial at the District Court involving both factual and expert witnesses, and after observing BKR's performance under cross examination, the District Court found that BKR lacked mental capacity to make decisions on her property and affairs. The District Court then appointed the Respondents as BKR's deputies, with wide-ranging powers to make decisions on her property and affairs. The District Court also found that BKR was subject to undue influence from her daughter and son-in-law (the "1st and 2nd Appellants").
BKR and the 1st and 2nd Appellants appealed against the District Court's decision. On appeal, the High Court overturned the whole of the District Court's decision.
Holding of the High Court
The High Court found that the Respondents' real concern was alleged undue influence by the 1st and 2nd Appellants. As the parties’ substantial dispute was not on mental capacity, the District Court had no jurisdiction to entertain the application under the MCA.
The High Court also rejected the submission that undue influence was relevant in the test for mental capacity. Instead, the only causal factor to be considered under the MCA was whether an individual's incapacity was caused by an impairment of, or disturbance in the functioning of, the mind or brain. Accordingly, the District Court's findings on undue influence were set aside as they were irrelevant to the issue of BKR's mental capacity.
The High Court also stressed that all practicable assistance must be given to a person before a person is found to lack capacity under the MCA. In this regard, the adversarial nature of cross-examination was not the best form of assessing a person’s mental capacity. On a review of all the evidence, BKR could understand and make decisions on her property and affairs if given the appropriate assistance.
Finally, the High Court held that the District Court's declarations of incapacity, and consequently the powers granted to the deputies, were too wide. The Court should strive to be as specific as reasonably practicable in declaring the mental incapacity of a person.
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In Re International Formwork & Scaffolding Pte Ltd [2013] SGHC 225, the High Court was faced with competing claims between provisional liquidators and the subsequent liquidators of a company over the provisional liquidators' fees and expenses. The questions to be decided were the extent of the provisional liquidators' lien over the company's assets, and the priority of the provisional liquidators' lien in the statutory scheme set out in s328 of the Companies Act.
The High Court held in favour of the provisional liquidators, and affirmed that provisional liquidators of a company have an equitable lien over the assets of the company, out of which they are entitled to be paid their fees and expenses. The High Court further clarified that the equitable lien extends over all the assets of the company, including physical assets and things-in-action, regardless of whether such assets were realised into funds by the provisional liquidators during their appointment. There was also no requirement for a provisional liquidator to demonstrate exactly how he had preserved, protected or enhanced the value of each asset before the asset would fall within the equitable lien. In any event, on the facts, it was not disputed that the provisional liquidators took control of all the assets of the company, including things-in-action, and had in fact preserved and protected such assets.
The High Court also held that the provisional liquidators' equitable lien arises at general law and stands outside of the statutory scheme of priorities in s328 of the Companies Act. The result is that a provisional liquidator's entitlement to his fees and expenses takes priority over a liquidator's s328(1)(a) Companies Act entitlement to his fees and expenses. In the circumstances, the High Court ordered that the provisional liquidators' agreed fees and expenses be paid in full to the provisional liquidators from the assets of the Company.
The extent and priority of a provisional liquidators' equitable lien were novel issues of law that had not previously been decided in the Singapore Court. Sim Kwan Kiat, Mark Cheng and Wilson Zhu from the Business Finance & Insolvency Practice successfully represented the provisional liquidators in this matter.Back to Top Print
In Pacific Harbor Advisors Pte Ltd and Credit Suisse AG, Singapore Branch v Tiny Tantono (sued as representative of the estate of Susanto Lim, deceased) (SUM NO. 589 of 2013 / RA 157 of 2013), Gregory Vijayendran, Benjamin Smith and Ronald Wong from the Commercial Litigation Practice successfully represented the Plaintiffs (Pacific Harbor Advisors Pte Ltd and Credit Suisse AG, Singapore Branch) in resisting an application by the Defendant for a stay of proceedings on the ground of forum non conveniens. The Assistant Registrar at first instance granted the stay and the Plaintiffs subsequently appealed.
The Plaintiffs had commenced a claim against the Defendant (as representative of the estate of her deceased husband) for the repayment of approximately US$50.5 million due under a loan provided to her husband's company and guaranteed by her husband personally. The Defendant applied for a stay of proceedings, arguing that England or Indonesia were clearly more appropriate forums than Singapore. The Defendant also alleged that her husband's capacity to furnish the guarantee was governed by Indonesian law, under which the Defendant's consent was required. The Defendant alleged that her previously provided consent was invalid and that her husband thus had no capacity to furnish the guarantee. The Defendant also relied on pending proceedings she had commenced in Indonesia after the Singapore action began to invalidate her husband's guarantee.
On appeal, the High Court held that the dispute had no real connection with England. Further, as all parties took the position that any forum hearing the case would have to choose between various possible laws governing the husband's capacity, this issue did not point in favour of Indonesia as a more appropriate forum. The Court also observed that as the relevant contractual documents are in English, these would have legal concepts inbuilt into them. Singapore would therefore be a more appropriate forum than Indonesia to interpret them.
Considering these and other appropriate connecting factors, the Court dismissed the Defendant's application and held that the Defendant had not discharged her burden of showing that there was a forum clearly more appropriate than Singapore.Back to Top Print
The case of Goh Lian Yong Jonah and another v Heng Kuek Hoy and another [2013] SGHC 203 revolved around an intended sale of property ("the Property"), as well as caveats that had been lodged over the Property.
Lynette Koh and Ginny Cheong from the Business Finance & Insolvency Practice acted for Oversea-Chinese Banking Corporation Limited ("OCBC") in this matter. OCBC had financed the Purchaser's intended purchase of the Property, and successfully obtained costs from the Purchaser for these proceedings and for the removal of their caveat over the Property.
Brief Facts
The Purchaser had entered into an agreement ("the Agreement") to purchase the Property from the Vendor. After the contract was signed, the Purchaser lodged a caveat over the Property. OCBC, as the financier of the purchase, lodged a Caveat over the property as well.
However, the sale did not complete, and the Vendor claimed against the Purchaser for breach of contract and for vacant possession of the Property.
Holding of the High Court
The Court declared that the Purchaser had rescinded the Agreement by failing to complete the sale of the Property. Accordingly, the Court ordered the caveats over the Property to be withdrawn.
OCBC was able to successfully obtain costs and reasonable disbursements against the Purchaser. Such costs included OCBC's cost of withdrawing the caveat, which followed on from the Purchaser's failure to complete the sale.Back to Top Print
Teo Yi Jing, Koh Tien Gui, Alison Foo, Hui Shan Kung from the Corporate & Capital Markets Practice and Linda Qiao and Wang Chen from Rajah & Tann LLP Shanghai Representative Office acted for OUE Limited ("OUE") which is listed on the Mainboard of the Singapore Exchange Securities Trading Limited with market capitalization of approximately S$2.5 billion, in the following transactions with a total value of approximately S$120 million:
- the disposal by OUE and Wah Hin and Company Private Limited ("Wah Hin") of OUE's 80% shareholding and Wah Hin's 20% shareholding in Hotel Investment (Shantou) Limited ("Shantou Target Company") and the novation of certain shareholders' loans (owing from the Shantou Target Company to OUE and Wah Hin respectively) from each of OUE and Wah Hin to Gold Pot Developments Limited (the "Purchaser"); and
- the disposal by OUE of its 100% shareholding in Hotel Investment (Hainan) Private Limited ("Hainan Target Company") and the novation of certain promissory notes (owing from the Hainan Target Company to OUE) from OUE to the Purchaser.
OUE is a real estate owner, developer and operator with prime assets in Singapore, and hotels in Malaysia and the People's Republic of China ("PRC").
The Shantou Target Company owns the entire issued and paid-up share capital of Meritus Shantou Co., Ltd which in turn owns the Meritus Shantou China, a hotel situated in Shantou, Guangdong province of the PRC. The Hainan Target Company owns the entire issued and paid-up share capital of Hainan Mandarin Hotels Pte Ltd which in turn owns the Meritus Mandarin Haikou, a hotel situated in Haikou, Hainan province of the PRC.
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Ng Sey Ming, Lee Weilin and Ho Mei Shi from the Banking & Finance Practice acted for China Minzhong Food Corporation Limited ("China Minzhong") in respect of a secured term loan facility of up to the aggregate principal amount of US$150,000,000, the amount of which may be increased to an amount not exceeding US$200,000,000 if the syndication is oversubscribed.
China Minzhong was established in 1971 and is a leading integrated vegetable processor in the PRC. It is listed on the Singapore Exchange Securities Trading Limited and was named a 'National Leading Dragon Head Enterprise' by the PRC government in 2002, in recognition of its status as a leading agricultural enterprise. Its products are distributed across four continents, spanning 26 different countries and regions including the Americas, Asia and Europe.Back to Top Print
Chia Kim Huat, Lorena Pang, Kalyn Liang and Koh Choon Yee from the Capital Markets and Mergers & Acquisitions Practice acted for SGX Mainboard-listed Grand Banks Yachts Limited ("Grand Banks"), in its proposed 2 for 1 renounceable non-underwritten rights issue of shares to raise up to S$12.3 million.
Grand Banks is engaged in manufacturing and selling of luxury yachts worldwide. Back to Top Print
Chia Kim Huat, Danny Lim, Chia Lee Fong and Caitlin Huang from the Capital Markets Practice and Mergers & Acquisitions Practice acted for Federal International (2000) Ltd, which is listed on the Main Board of the Singapore Exchange Securities Trading Limited, in its S$12.96 million acquisition of a 1,000 HP Brewster N-85 land drilling rig.
The Federal Group's core businesses in oil and gas include, inter alia, supply, assembly and distribution of flowline control products and distribution of oilfield drilling equipment for use on onshore and offshore rigs and drilling platforms.Back to Top Print
Chia Kim Huat, Teo Yi Jing and Bernia Tan from the Capital Markets and Mergers & Acquisitions Practice are acting as counsel to Sugih Energy Pte. Ltd. ("Offeror"), a direct wholly-owned subsidiary of PT Sugih Energy Tbk (a company listed on the Indonesia Stock Exchange) in the voluntary conditional cash partial offer ("Offer") by PrimePartners Corporate Finance Pte. Ltd., for and on behalf of the Offeror, to acquire 51% of the issued ordinary shares in the capital of Ramba Energy Limited ("Ramba"). The Offer will not be made unless and until certain pre-conditions are satisfied or waived (as the case may be).
The main businesses of Ramba and its subsidiaries are (i) oil and gas exploration and production in Indonesia and (ii) supply chain related logistic services in the region (including transportation activities, distribution management, seaport and airport cargo handling services, etc).
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Chia Kim Huat, Danny Lim and Bernia Tan from the Corporate & Capital Markets Practice are acting as Singapore counsel to Sound (HK) Limited ("Offeror") in the proposed conditional cash exit offer by CIMB Bank Berhad, Singapore Branch and CIMB Securities Limited (HK), for and on behalf of the Offeror, to acquire all the issued shares in and all the outstanding convertible bonds of Sound Global Ltd. ("Sound Global") listed on the Main Board of the Singapore Exchange Securities Trading Limited ("SGX-ST"), other than those already owned, controlled or agreed to be acquired by the Offeror and its consortium group, the undertaking shares and the undertaking bonds (collectively, the "Offers"). Sound Global is listed both on the SGX-ST and The Stock Exchange of Hong Kong Limited ("SEHK"). The Offers are being made in connection with the proposed voluntary delisting of Sound Global from the SGX-ST, whilst retaining its listing on the SEHK.
Based on the offer price of S$0.70 per share, the group is valued at approximately S$1.07 billion. The group is engaged in providing turnkey water and wastewater treatment solutions, management of water treatment plants and investments in build, operate and transfer projects, mainly in the PRC.
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