Ang Boon Chye and another v Ang Tin Yong

Kan Ting Chiu J:

[1] The matter under consideration is an application for leave to commence committal proceedings under O 52 of the Rules of Court (Cap 322, R5, 2006 Rev Ed).

[2] The two plaintiffs and the defendant were partners operating a business named “All Family Food Court” (“the business”). Disputes between them led to the filing of an action by the plaintiffs for the defendant to indemnify them against additional income tax imposed upon them in respect of their shares in the business and an account and inquiry of transactions between them and the defendant, and the payment to them of their rightful share of the profits of the business. The defendant, on the other hand, counter-claimed for the dissolution of the partnership.

[3] The action came on for hearing before Justice Tan Lee Meng. In his judgment dated 21 October 2008, Tan J ordered that an account be taken of all transactions of the partnership for the period 1999 to 2004, and he dismissed the counterclaim.

[4] Subsequent to the judgment, the plaintiffs applied for an order that the defendant, in particular, was to lodge the accounts for the partnership for the period 1999 to 2004. The defendant was not prepared to do that. He opposed the application, but an Assistant Registrar (“AR”) made an order on 1 December 2008 that he was to lodge the accounts by 2 April 2009. The defendant took his objection further and appealed against the AR’s order, but his appeal was dismissed by Justice Judith Prakash on 5 January 2009. Although the Order of Court of 1 December 2008 was affirmed, the defendant did not lodge the accounts.

[5] The plaintiffs decided to take committal proceedings against the defendant. On 23 September 2010, the plaintiffs took the first step to apply for leave to apply for an order of committal. The statement filed in compliance with O 52 r 2(2) referred to Tan J’s judgment, the Order of Court of 1 December 2008, Prakash J’s order of 5 January 2009 and stated that the defendant had not complied with the Order of Court of 1 December 2008. In the plaintiffs’ joint affidavit filed in support of the application, they affirmed that the defendant did not lodge the accounts by 2 April 2009 as ordered. Going by that assertion, the defendant was prima face in contempt of court.

[6] Although r 2(2) prescribed that an application for leave was to be made ex parte, the plaintiffs notified the defendant of the application. The defendant had filed an affidavit on 20 October 2010 to oppose the application and his counsel was heard on the application.

[7] The defendant devoted a good part of his affidavit to the judgment and the application, but inexplicably, he did not address the Order of Court of 1 December 2008, or explain his failure to comply with it. Instead, he deposed:

[8] In the deed the plaintiffs were described as “the Outgoing Partners” and the defendant and two other persons as “the Continuing Partners”. The clauses relevant to the present application are:

The deed made no reference to the judgment of 21 October 2008 and the Order of Court of 1 December 2008.

[9] The defendant’s assertion that “all the Partners are/were furnished with the Partnership’s Profits and Loss Account as well as the Balance Sheet” fell short of saying that he had complied with the Order of Court of 1 December 2008 and had lodged the accounts of the partnership for the period 1999 to 2004 by 2 April 2009.

[10] If the Order of Court had been complied with, that would be the first thing for the defendant to assert, and all that he needed to do was to state that clearly and simply and to substantiate that with proof. The defendant knew that the plaintiffs’ case was that he had not complied with the Order of Court. When he did not dispute that in his affidavit, he is deemed to admit it.

[11] I should add that even if the defendant had provided the accounts after 2 April 2009 (he had not said that), he would not have complied fully with the Order of Court of 1 December 2008, and he is liable to be found guilty of contempt. Likewise, the plaintiffs’ retirement from the partnership on 31 July 2009 per se did not release the defendant from his liability to provide the accounts by 2 April 2009, and did not extinguish their right to take action against him on his failure to comply.

[12] The defendant should intervene and object to the plaintiffs’ application at this preliminary stage only in exceptional circumstances such as:

(a) the Order of Court had been complied with;

(b) the plaintiffs waived their rights to the accounts;

(c) the plaintiffs had undertaken not to take out committal proceedings,

or on other grounds which go to the plaintiffs’ entitlement to apply for leave to commence committal proceedings.

[13] If the defendant’s position is that although he had not complied with the Order of Court, his failure did not tantamount to contempt of court, then he should hold back, and put forward his case at the second stage of the proceedings when the plaintiffs apply for an order of committal against him.

[14] In the circumstances, I found that the conditions for leave to institute committal proceedings against the defendant had been satisfied, and the defendant had not presented any grounds to withhold leave. I granted the plaintiffs’ application but the defendant is not satisfied with my decision, and has appealed against it.