Chiam Heng Hsien (on his own behalf and as partner of Mitre Hotel Proprietors) v Chiam Heng Chow (executor of the estate of Chiam Toh Say, deceased) and others

1. Sundaresh Menon CJ (delivering the judgment of the court):

2. [1]

   [1] This is an appeal against the decision of the High Court judge (“the Judge”) dismissing the Appellant’s claim in Suit No 1 of 2012 (“the Suit”). The Appellant had sought a declaration that the Respondents were not partners of Mitre Hotel Proprietors (“MHP”) and thus had no interest in or entitlement to any part of the one-tenth share of the proceeds from the sale of the Mitre Hotel at No 145 Killiney Road, Singapore (“the Property”). The share in question amounted to $11,500,000 (“the Sale Proceeds”). The Property had been sold on 1 March 2010 pursuant to an Order of Court made in Originating Summons No 830 of 2006 (“OS 830/2006”).

3. [2]

   [2] The Judge dismissed the Appellant’s claim and held that the Respondents were partners of MHP (see Chiam Heng Hsien (on his own behalf and as partner of Mitre Hotel Proprietors) v Chiam Heng Chow (executor of the estate of Chiam Toh Say, deceased) and others [2014] SGHC 119 (“the GD”)). The Appellant appealed against the Judge’s finding that the Respondents were partners of MHP.

4. The background facts

5. The parties to the dispute

6. [3]

   [3] The Appellant was admitted as a partner of MHP on 19 November 1974 in respect of a 21/88 share of the partnership by those who at that time were the partners of MHP and who signed the relevant Form B as stipulated in the Business Registration Act 1973 (Act 36 of 1973).

7. [4]

   [4] The Respondents defend the action in their capacity as the respective personal representatives of three of the original partners of MHP :

8. (a) the 1st and 2nd Respondents are the executors of the estate of Chiam Toh Say (“Toh Say”);

9. (b) the 3rd Respondent is the executrix of the estate of Chiam Toh Tong (“Toh Tong”); and

10. (c) the 4th Respondent is the executor of the estate of Chiam Toh Kai (“Toh Kai”).

11. Background to the dispute

12. The formation of MHP

13. [5]

    [5] Prior to the formation of MHP, another partnership (comprising the five original partners of MHP and five others) had run a hotel business on the Property. On 28 November 1951, it was decided that the earlier partnership be dissolved and the hotel business be sold as a going concern to Toh Say for the sum of $260,000. This was subsequently documented in a deed of dissolution dated 26 February 1952, pursuant to which, among other things, the earlier partnership was deemed dissolved as from 30 November 1951 and the outgoing partners assigned to Toh Say absolutely their respective shares, title and interest in the hotel business which included a one-tenth undivided share in the Property.

14. [6]

    [6] MHP was then constituted to take over the running of the hotel business. The original partners of MHP entered into a partnership deed on 28 February 1952 (“the Partnership Deed”) setting out their respective shares in MHP as follows:

15. [7]

    [7] The one-tenth undivided share in the Property was only conveyed to Toh Say on 29 September 1952. The parties do not dispute that this was partnership property of MHP. Subsequently, on 21 October 1952, Toh Say executed a declaration of trust (“the Trust Deed”) in these terms:

16. Toh Moo’s death and the Appellant’s admission into the partnership

17. [8]

    [8] Toh Moo passed away in February 1961 and was survived by his widow and the Appellant, who was his only child. They were also the only beneficiaries of his estate. On 22 July 1968, Toh Moo’s widow executed a Deed of Gift and transferred the 21/88 share in MHP that she had inherited from the late Toh Moo to the Appellant. Subsequently, the Appellant was admitted into the partnership of MHP in respect of that 21/88 share (see [3] above).

18. Toh Tong’s death and the alleged Loan Agreement

19. [9]

    [9] Toh Tong passed away on 17 May 1969. As provided in his will, Toh Kai was appointed the executor of his estate.

20. [10]

    [10] The Appellant alleged that sometime in 1974, Toh Tong’s widow, purporting to act on behalf of all the beneficiaries of Toh Tong’s estate, requested that Toh Kai take over the estate’s share in MHP in Toh Kai’s personal capacity as the beneficiaries were not prepared to bear responsibility for the substantial accumulated losses of MHP. According to the Appellant, Toh Kai acceded to her request and this arrangement was reflected in the omission of Toh Tong’s estate from the list of partners of MHP that was submitted to the Registry of Companies and Businesses in 1974 and further in the minutes of a partners’ meeting dated 6 April 1975.

21. [11]

    [11] Subsequently in the mid-1980s, Chiam Heng Pout (“Heng Pout”), Toh Tong’s son and a beneficiary of his estate, encountered some financial difficulties and requested a loan of $50,000 from the Appellant. The Appellant claims that he agreed with Toh Kai (as the personal representative of Toh Tong’s estate (see above at [9])) to extend such a loan to Heng Pout on the basis that the entirety of Toh Tong’s original 21/88 share in MHP to the Appellant, save for a nominal interest (the amount of which would be determined by the Appellant) that Toh Kai would hold on trust for the estate of Toh Tong, would be transferred to the Appellant with effect from the date of the loan, if:

22. (a) Heng Pout failed to repay the $50,000 loan to the Appellant within six months of the date of the loan; or

23. (b) Heng Pout was declared a bankrupt.

24. (“the alleged Loan Agreement”)

25. [12]

    [12] According to the Appellant, Heng Pout knew of this arrangement and had signed a note stating that he was fully aware of the terms of the alleged Loan Agreement (“the alleged Loan Agreement Note”). Heng Pout did not dispute that he had obtained a $50,000 loan from the Appellant but claimed that it was an unconditional loan and that there was no such thing as the alleged Loan Agreement. He also denied ever having signed the alleged Loan Agreement Note.

26. [13]

    [13] Heng Pout did not repay the $50,000 loan to the Appellant within six months and was later adjudged a bankrupt in 1988. The Appellant claimed that he became aware of Heng Pout’s bankruptcy in the early 1990s, and he then asked Toh Kai to transfer Toh Tong’s 21/88 share in MHP to him, save for a nominal share which Toh Kai would hold for Toh Tong’s estate. The Appellant alleged that a letter evidencing this transfer was prepared (“the alleged Transfer Letter”). However, the Appellant was unable to produce either the alleged Transfer Letter or the alleged Loan Agreement Note. According to him, Toh Kai’s daughter, Chiam Siew Juat, and a relative had broken into the Property sometime in September or October 2008 and stolen these documents.

27. [14]

    [14] By way of a deed of appointment dated 27 February 1986 (“the First Deed of Appointment”), Toh Kai relinquished his position as the sole trustee of Toh Tong’s estate and appointed the 3rd Respondent and Heng Pout in his place. Subsequently, by another deed of appointment dated 23 October 1996 (“the Second Deed of Appointment”), Heng Pout discharged himself as executor and appointed the 3rd Respondent the sole executrix of Toh Tong’s estate.

28. The consent judgment with Toh Lew’s estate

29. [15]

    [15] Toh Lew passed away in 1975. In District Court Summons No 6648 of 1984 (“DC 6648/1984”), a consent judgment was entered in which his estate agreed to withdraw his name as a partner of MHP and relinquish all claims that it had in respect of any share in MHP in consideration for Toh Kai, Toh Say and the Appellant paying the estate $7,000 and reimbursing the estate for “all payments made by [Toh Lew’s estate] to the Inland Revenue Department for the years 1983-1988”.

30. Toh Say’s death and the proceedings brought by his estate

31. [16]

    [16] Toh Say’s status as a partner was the subject of court proceedings that took place more than two decades ago and which culminated in Civil Appeal No 150 of 1991 (“CA 150/1991”). It began in 1968 when the Appellant, having received Toh Moo’s share of the partnership, began to take an interest in the running of the hotel business. Toh Say had been running the hotel business with Toh Moo, but had become the sole managing partner upon Toh Moo’s death. The Appellant questioned Toh Say over the accounts for 1973 and was alleged to have physically assaulted Toh Say. Their relationship soured. On 20 March 1975, Toh Say, through his solicitors, wrote to the Appellant, Toh Kai and Toh Lew proposing that MHP be dissolved on 31 March 1975 or that he retire from MHP on that date. The proposals were not accepted. A few days later, on 31 March 1975, Toh Say issued a notice of dissolution to the Appellant, Toh Kai and Toh Lew. Again, the notice of dissolution was not accepted.

32. [17]

    [17] In 1984, Toh Say commenced an action against the MHP among other things, for his share of the profits of the partnership from 1976 to 1983. Toh Say passed away on 16 February 1990 in the midst of those proceedings and the 1st and 2nd Respondents, being the executors of Toh Say’s estate, took over the conduct of the proceedings. The statement of claim was then amended to reflect the claim for Toh Say’s share of the profits of the partnership from 1976 to 1986 (instead of 1983). It appears that this amendment was triggered by the decision of the Income Tax Department (the predecessor of the Inland Revenue Authority of Singapore) in 1986 to adjust Toh Say’s previous tax liabilities upwards.

33. [18]

    [18] Lai Siu Chiu JC (as she then was) held that Toh Say ceased to be a partner of MHP as at 31 March 1975 and was therefore not entitled to any share of the profits thereafter. The Court of Appeal disagreed and held that, while Toh Say had given notice to dissolve MHP on 31 March 1975, this was ineffective because not all the partners had given effect to it and he therefore remained a partner of MHP and was entitled to a share of the profits for the period between 1976 and 1986 (see Chiam Heng Chow and another (executors of the estate of Chiam Toh Say, deceased) v Mitre Hotel (Proprietors) (a firm) and others [1993] 2 SLR(R) 894).

34. [19]

    [19] On 30 December 1993, the 1st and 2nd Respondents commenced Suit No 2439 of 1993 (“S 2439/1993”) against MHP and the Appellant seeking, among other things, an account of the value of Toh Say’s share at the date of his death and the payment of such sum found to be due on the taking of this account.

35. [20]

    [20] On 5 October 1994, the Appellant was ordered to produce all the accounts of MHP and to file an affidavit verifying the said accounts within 21 days from the date of the order (“the 5 October Order”). The Appellant produced some documents alleging that these were MHP’s accounts, but did not verify this by affidavit. On 24 November 1994, the Appellant was ordered to make an affidavit in compliance with the 5 October Order within 28 days, failing which parts of his defence in S 2439/1993 would be struck out without further order; and in that event, the Appellant’s entire defence would be struck out and the 1st and 2nd Respondents would be at liberty to enter judgment against him (“the Unless Order”). The Unless Order was appealed against unsuccessfully and in the event it was upheld by Kan Ting Chiu J in Chiam Heng Chow and another (executors of the estate of Chiam Toh Say, deceased) v Mitre Hotel (Proprietors) (a firm) and another [1996] 1 SLR(R) 899.

36. Toh Kai’s death and the proceedings brought against his estate

37. [22]

    [22] Toh Kai passed away on 20 June 1993.

38. [24]

    [24] The Appellant’s account was disputed by the 4th Respondent, who claimed that he had been admitted into the partnership shortly after his father’s death and remained a partner since then.

39. [25]

    [25] On 25 January 2002, the 3rd Respondent commenced Originating Summons No 136 of 2002 (“OS 136/2002”), in her capacity as trustee of Toh Tong’s estate, against the 4th Respondent (in his capacity as trustee of Toh Kai’s estate) seeking a transfer of the share of MHP belonging to Toh Tong’s estate from the estate of Toh Kai, who it will be recalled had been the executor of Toh Tong’s estate after his death (see [9] above); and for the 4th Respondent to render an account of and pay over all business profits due to Toh Tong’s estate. Neither MHP nor the Appellant were joined as a party to the action. It was eventually decided in that case that the estate of Toh Kai held a 19/88 share of MHP on its own behalf and a 21/88 share of MHP on trust for the estate of Toh Tong and the 4th Respondent was ordered to rectify the particulars of the partnership business that were maintained with the Registry of Companies and Businesses (now known as the Accounting and Corporate Regulatory Authority (“ACRA”)) to reflect this.

40. Sale of the Property and subsequent events

41. [26]

    [26] On 25 April 2006, the co-owners of the Property commenced OS 830/2006 seeking, among other things, an order that the Property be sold with vacant possession. The judge who heard that matter ordered that the Property be sold with the proceeds of sale to be paid into court pending the final disposal of all issues in the action. That decision was affirmed by the Court of Appeal.

42. [27]

    [27] The Property was sold on 1 March 2010 and the sum of $115,000,000 was paid into court to be distributed to the owners of the Property.

43. [28]

    [28] According to a search with ACRA conducted by Mr Moey on 15 October 2012, MHP’s registration with ACRA was cancelled on or about 3 May 2011. In the same search, the partners of the MHP were listed as being:

44. (a) the Appellant;

45. (b) Toh Kai’s estate;

46. (c) Toh Tong’s estate; and

47. (d) Toh Say’s estate.

48. [29]

    [29] On 29 October 2010, the 1st and 2nd Respondents (in their capacity as the executors of Toh Say’s estate) applied in Originating Summons No 1123 of 2010 (“OS 1123/2010”) for a declaration that MHP be dissolved and an order that the Sale Proceeds be paid out to the Appellant and the other Respondents (as the representatives of the respective estates) in their respective shares. On 30 November 2011, Philip Pillai J adjourned the application sine die as he considered that there were numerous issues in dispute.

49. [30]

    [30] The Appellant then commenced the Suit, from which the present appeal arises, on 3 January 2012.

50. The parties’ pleadings

51. The claim below

52. [31]

    [31] The Appellant claimed that he was the sole remaining partner of MHP at the time the Property was sold and sought a declaration that the Respondents had no interest in the Sale Proceeds and consequently no right to claim any interest accruing from this. He therefore sought an order for the Sale Proceeds to be paid to him, save for a nominal sum (as determined by the Appellant) to be paid to the 3rd Respondent (as to which see [10] to [13] above).

53. [32]

    [32] The Appellant pleaded that the 1st and 2nd Respondents, as personal representatives of Toh Say’s estate, were not entitled to a share of the Sale Proceeds because:

54. (a) Neither Toh Say’s estate nor the 1st and 2nd Respondents had been admitted as partners of MHP.

55. (b) Any amount due to Toh Say’s estate in respect of his share was a debt that accrued at the time of Toh Say’s death and any claim that the 1st and 2nd Respondents might have in this regard had become time-barred by operation of s 6 of the Limitation Act (Cap 163, 1985 Rev Ed) (“the Limitation Act”) and/or defeated by laches.

56. [33]

    [33] The Appellant pleaded that except for a nominal share to be determined by him, he had taken over the 21/88 share in MHP belonging to Toh Tong’s estate from the date of the alleged Loan Agreement. As such, neither the 3rd Respondent nor Toh Tong’s estate was entitled to the Sale Proceeds, save for the nominal share which had not yet been determined by the Appellant.

57. [34]

    [34] The Appellant pleaded that the 4th Respondent, as the personal representative of Toh Kai’s estate, was not entitled to a share of the Sale Proceeds because:

58. (a) Neither Toh Kai’s estate nor the 4th Respondent had been admitted as a partner of MHP. Alternatively, and in any event, Toh Kai’s estate and/or the 4th Respondent had served a purported notice of its withdrawal from MHP after 8 September 1993. However, Toh Kai’s estate remained a partner holding a nominal share (to be determined by the Appellant) on behalf of Toh Tong’s estate.

59. (b) Any amount due to Toh Kai’s estate in respect of his share was a debt that accrued at the time of Toh Kai’s death, or at the time the 4th Respondent served notice of his/the estate’s withdrawal from MHP. Any such claim would now be time-barred and/or defeated by laches.

60. The defences below

61. [35]

    [35] In response, the 1st and 2nd Respondents said as follows:

62. (a) That by agreement, Toh Say’s estate continued to be a partner of MHP until its registration was cancelled.

63. (b) Further or in the alternative, Toh Say’s share of the partnership assets became payable to his estate as a debt once a final account had been rendered to his estate. As no final account was ever provided, the surviving partners of MHP held and continue to hold Toh Say’s share of the Sale Proceeds as trustees for his estate.

64. (c) Further or in the alternative, s 6 of the Limitation Act does not apply as MHP was in possession of the Property at all material times; instead, s 22 of the Limitation Act applies and there is no applicable time bar as the claim is against a trustee holding trust property. Nor does the doctrine of laches apply as the Appellant had not come to court with clean hands.

65. [36]

    [36] The 3rd Respondent’s case was that on Toh Tong’s death, his estate was admitted as a partner of MHP in respect of a 21/88 share in the partnership and it remained a partner and owner of the said share until the date of the action. In this regard, she denied that:

66. (a) Toh Kai had personally ever taken over the share of MHP belonging to Toh Tong’s estate; and

67. (b) the Appellant in turn had acquired the said share from Toh Kai in the mid-1980s.

68. [37]

    [37] The 4th Respondent’s case was as follows:

69. (a) Shortly after Toh Kai’s death, he had been admitted into MHP to represent Toh Kai’s estate in respect of a 19/88 share in MHP. Toh Kai’s estate never served a notice of withdrawal from MHP; and

70. (b) He further denied that any claim by Toh Kai’s estate to the Sale Proceeds was time barred by s 6 of the Limitation Act and/or defeated by laches. Instead, s 22 of the Limitation Act was applicable and therefore no time bar could be raised against the 4th Respondent as his claim to the share of the partnership assets was against the Appellant as a trustee holding trust property (or the proceeds thereof).

71. The decision of the court below

72. [38]

    [38] The Judge held that the Trust Deed did not confer a beneficial interest in the Property on the original partners; and therefore no such interest devolved to the respective estates upon the deaths of the original partners. The Judge also held that on a true construction of the Trust Deed, the Property was held on trust for whoever was a partner of MHP at the “relevant future period” and therefore only those who were partners of MHP when the Property was sold would be entitled to a share of the Sale Proceeds: [70]–[73] of the GD.

73. [39]

    [39] The Judge also held that pursuant to cl 3 of the Partnership Deed, there was a technical dissolution of MHP upon the death of a partner; and that there was no agreement that the personal representatives of the estate of the deceased partners would be automatically admitted as partners: [74]–[76] of the GD.

74. [40]

    [40] The Judge also found that in the absence of an express provision in the partnership agreement, the surviving partners did not hold a deceased partner’s share in partnership land on trust for his estate. Rather, the estate’s entitlement was to the proportionate share of the net proceeds from the liquidation of the partnership assets. Pursuant to s 43 of the Partnership Act (Cap 391, 1994 Rev Ed) (“Partnership Act”), this accrues as a debt owed to the personal representatives of a deceased partner on the date of the death of the partner and this in turn was subject to the six-year limitation period prescribed by s 6(1)(a) of the Limitation Act: [78]–[88] of the GD.

75. [41]

    [41] However, the Judge found that all the Respondents were nevertheless entitled to a share of the Sale Proceeds because they had each in fact been admitted to the partnership.

76. [42]

    [42] For the 1st and 2nd Respondents, the Judge found that they had been impliedly accepted as partners. He based this on the Appellant’s failure to rectify the ACRA records despite being repeatedly advised to do so, as well as his failure to object to the payment by the 1st and 2nd Respondents of a 25/88 share of the property tax assessed on the one-tenth share of the Property, in their capacity as partners of MHP: [98]–[99] of the GD.

77. [43]

    [43] As regards the 3rd Respondent, the Judge held that Toh Tong’s 21/88 share in MHP was not extinguished upon his death but was held on trust by Toh Kai for Toh Tong’s estate. He found that Toh Kai did not subsequently acquire the estate’s share in MHP in his personal capacity and further that there was no alleged Loan Agreement; hence, the entire 21/88 share in MHP vested in the 3rd Respondent and Heng Pout upon the execution of the First Deed of Appointment: [104]–[122] of the GD. Relying on certain statements made by the Appellant in affidavits filed in different proceedings as admissions, the Judge found that following their appointment as trustees of Toh Tong’s estate, the 3rd Respondent and Heng Pout were admitted as partners holding a 21/88 share in MHP. The 3rd Respondent became the sole executrix of the estate and the entirety of the 21/88 share vested in her following the Second Deed of Appointment: [124]-[129] of the GD.

78. [44]

    [44] The Judge also relied on certain statements made by the Appellant in various affidavits filed in other proceedings, which he found amounted to admissions, and on this basis found that the 4th Respondent had been admitted as a partner of MHP representing Toh Kai’s estate in respect of its 19/88 share in MHP. On the evidence, the Judge also rejected the Appellant’s contention that Toh Kai’s estate had given notice to withdraw from the partnership subsequent to the decision in CA 150/1991: [130]–[136] of the GD.

79. The parties’ cases on appeal

80. The Appellant’s case

81. [46]

    [46] The Appellant submits that the Judge was wrong to find that he had consented to the admission of the Respondents as partners. In this regard, he argues that:

82. (a) the 1st and 2nd Respondents did not plead implied consent and further that any inaction on his part was not sufficiently unequivocal to constitute consent by him to the admission of the 1st and 2nd Respondents as partners; and

83. (b) the Appellant’s statements in affidavits filed in previous proceedings could not be relied upon as admissions that he had consented to the 3rd and 4th Respondents being admitted as partners.

84. [47]

    [47] The Appellant further contends that the Judge erred in finding that the Respondents had been admitted as partners into MHP as he failed to consider whether the others who were then partners at the various material times, had consented to the Respondents’ admission as partners.

85. The Respondents’ respective cases

86. [48]

    [48] The 1st and 2nd Respondents submit that the Judge was correct to find that the Appellant had consented to their admission as partners. In the alternative, they contend that the Judge’s decision to dismiss the claim should be affirmed on the following grounds:

87. (a) They continued to be partners of MHP following the death of Toh Say either because there had been no technical dissolution of the partnership or because they were automatically admitted into the partnership.

88. (b) The Judge erred in finding that the original partners’ beneficial interest in the Property did not devolve to their respective estates upon their deaths.

89. (c) Section 6 of the Limitation Act does not apply because the 1st and 2nd Respondents were not trying to enforce a contract or bring an action for an account against the Appellant. Moreover, the Appellant has not come to court with clean hands and their claim would therefore not be defeated by laches.

90. [49]

    [49] The 3rd and 4th Respondents submit that the Judge was correct in finding that the Appellant’s statements in other proceedings amounted to admissions that he had consented to their being admitted as partners of MHP. They also contend that the allegation that the others who were partners at the relevant times did not give their consent was not pleaded below and that the Appellant should not be allowed to raise the argument now. In any event, they argue that there is ample evidence that those who were partners at the relevant times did consent to their admission as partners of MHP.

91. [50]

    [50] The 4th Respondent also submitted in the alternative that the decision of the Judge should be affirmed on the basis that the 4th Respondent does have a beneficial interest in the trust of the sale proceeds of the Property regardless of his status as a partner. In this regard, he argues (in some respects, in common with the 1st and 2nd Respondents) that:

92. (a) The Judge erred in interpreting the relevant term of the Trust Deed; and that in fact on a true construction of the Trust Deed, the partners at the time the trust was created were also beneficiaries of the said trust.

93. (b) Irrespective of the Trust Deed, the beneficial interest of a partner in partnership land devolves to his estate on his death. As such, no limitation period was applicable pursuant to s 22(1) of the Limitation Act.

94. (c) Alternatively, the Limitation Act has no application because no account was ever rendered to Toh Kai’s estate by the surviving partners and the new partnership was carried on after his death.

95. Issues before this Court

96. [51]

    [51] Two main issues arise for our decision. The first is whether the evidence bears out the finding that each of the Respondents had been admitted as partners of MHP. The second is whether, in the event the evidence does not bear this out, the original partners each had a beneficial interest in the partnership land, namely the one-tenth undivided share in the Property, which devolved upon their deaths to their respective estates. Related to the second issue is the sub-issue of whether the Limitation Act applies to whatever rights or interests the Respondents might have and if so, what the applicable limitation period is.

97. Our decision

98. [52]

    [52] Before turning to these issues, we touch on one point which was not raised by the parties. The Judge’s finding at [89] of the GD was expressed in terms that the Respondents had been admitted into the partnership “in their personal capacities”. This was never pleaded by any of the Respondents who were defending the Suit in their capacities as personal representatives of the respective deceased partners.

99. [53]

    [53] We raised this at the hearing before us. Counsel for the Appellant, Mr Edwin Lee (“Mr Lee”), in all fairness did not feel able to pursue the point, observing that the Judge’s finding had to be read in the context of the rest of the GD; it was apparent from the rest of his grounds that the Judge had found that the respective Respondents had been admitted not in their personal capacity but rather as personal representatives of the respective deceased partners. We agree. Indeed, all the evidence that was adduced to support the 3rd and 4th Respondents’ pleaded cases had been directed towards showing that they had been admitted in their capacity as the personal representatives of Toh Tong and Toh Kai respectively.

100. [54]

     [54] Before proceeding further, we should clarify one point. As Toh Say passed away in 1990, it should have been the Partnership Act 1890 (53 & 54 Vict, c 39) (UK) (“the 1890 Act”), made applicable in Singapore by virtue of s 5 of the Civil Law Act (Cap 43, 1988 Rev Ed), that would apply. However, the parties have proceeded by reference to the Partnership Act, and given that the 1890 Act and the Partnership Act are identical save for a number of provisions which are not relevant for the present proceedings, we refer to the provisions in the Partnership Act instead of the 1890 Act.

101. Did the Judge err in finding that the Respondents are partners of MHP?

102. The 1st and 2nd Respondents

103. [55]

     [55] We first deal with the 1st and 2nd Respondents’ contention that they continue to be partners of MHP because (a) there has allegedly been no technical dissolution of MHP given that no proper accounts have been rendered to Toh Say’s estate, and alternatively (b) the partners had agreed that the legal representatives of the deceased partner’s estate would step into the shoes of the deceased partner in the partnership and be automatically admitted into the partnership. We deal with these two points in turn.

104. (1) Did a technical dissolution of MHP occur?

105. [56]

     [56] Unlike a company, which is a distinct legal entity with its own legal personality, a partnership, in essence, is a contractual relationship between two or more persons carrying on a business with a view to profit. It has thus been observed that the essence of a partnership contract is that each partner must be alive in order to contribute his individual personal qualities; therefore, the death of any partner and the ensuing loss of his personal attributes will, in and of itself, extinguish the very spirit of the contract and terminate not only the relationship between the deceased and the surviving partners but also as between the surviving partners: see Yeo Hwee Ying, Partnership Law in Singapore (Butterworths Asia, 2000) (“Yeo”) at p 243 and Roderick I’Anson Banks, Lindley & Banks on Partnership (Sweet & Maxwell, 19th Ed, 2010) (“Lindley”) at para 3-04.

106. [57]

     [57] Reflecting this principle, s 33(1) of the Partnership Act provides that a partnership is dissolved by the death of a partner, subject to any agreement to the contrary. In the present case, cl 3 of the Partnership Deed provides that “[t]he death or retirement of any partner shall not dissolve the partnership as to the other partners”. We note first that cl 3 in effect provides for the continuance of the partnership “as to the other partners” [emphasis added]. It does not in terms contemplate that the estate of a deceased partner remains a partner. But does this mean that in a setting where a contrary arrangement has been agreed to that no technical dissolution occurs? In our judgment that does not follow. A technical dissolution of the original partnership occurs, as a matter of law, due to the change in the composition of the firm. It is therefore observed in Lindley as follows (at para 24-02):

107. [58]

     [58] This basic proposition was reiterated in Hadlee v Commissioner of Inland Revenue [1989] 2 NZLR 447 at 455 (per Eichelbaum CJ): see also Inland Revenue v Graham’s Trustees [1971] SC (HL) 1 at 5 and Khoo Yoke Wah v Lee Choo Yam Holdings [1991] 1 MLJ 414 at 416 (per Gunn Chit Tuan SCJ, in obiter) where the courts found that the surviving partners who continue to run the business of the partnership, carry on as a “different and distinct legal persona”. Put simply, therefore, a technical dissolution occurs because the composition of the partnership has changed. The rendering of accounts is not a pre-requisite for the technical dissolution of a partnership to occur; rather it would be a consequence of it.

108. [59]

     [59] Mr Moey, counsel for the 1st and 2nd Respondents, sought to rely on s 27(2) of the Partnership Act to support his proposition that there will not be a technical dissolution of the partnership until the accounts have been rendered. That section provides as follows:

109. [60]

     [60] With respect to Mr Moey, his reliance on this provision is misplaced. Section 27 of the Partnership Act is concerned with the continuation of a partnership for a term (that is a partnership that has been entered into for a fixed term and that will automatically be dissolved upon the expiration of that term). Such a partnership continues as a partnership at the will of the partners after the expiration of the stipulated term. In other words, s 27(2) of the Partnership Act essentially creates a presumption that a partnership for a term continues as a partnership at will where the partners or such of them have continued the business, “without any settlement or liquidation of the partnership affairs”. The provision has no application in the present case which was not a partnership for a term and which had been technically dissolved not by the effluxion of time but by the death of one of the partners.

110. [61]

     [61] In light of the foregoing, we find that there was a technical dissolution of MHP upon the death of Toh Say.

111. (2) Were the 1st and 2nd Respondents automatically admitted as partners?

112. [62]

     [62] We turn to the second point. It is clear that unless the parties to the partnership contract have agreed to the contrary, the personal representatives of a deceased partner have no automatic right to become a partner. This is so even if the business of the partnership continues with the remaining partners: see Lindley at para 26-02 and Yeo at p 244. In this regard, the 1st and 2nd Respondents repeat their arguments raised in the trial below that it can be inferred from the practice of the partners and from cll 23 and 25 of the Partnership Deed that the intention was that the personal representatives of a deceased partner’s estate would automatically be admitted to the partnership.

113. [63]

     [63] We first consider the clauses of the Partnership Deed. Clause 23 provides that the “[i]f any partner should die during the continuance of the partnership[,] his share of the nett [sic] profits shall be paid to his legal personal representatives.” The Judge observed that nothing in the wording of cl 23 suggests that the personal representatives of the deceased’s estate are to be admitted as partners and we agree. Notably, cl 23 expressly provides that the payments would be received by the personal representatives of the deceased’s estate in that capacity and not as partners. Moreover, the clause will clearly cease to operate once the deceased partner’s share in the partnership has been extinguished.

114. [64]

     [64] As regards cl 25 of the Partnership Deed, which is the dispute resolution clause, Mr Moey sought to contend that the fact that it contemplates disputes between the personal representatives of a partner and any other partner suggests that the personal representatives were themselves to be admitted as partners. We disagree and instead concur with the Judge that nothing in its wording limits the operation of cl 25 to partners of MHP. Indeed, the clause expressly states that:

115. Clause 25 thus contemplates that even disputes arising after the partnership ceases to exist shall be referred to arbitration, where these are between the partners or their personal representatives in the case of a deceased partner. This does not assist Mr Moey’s argument or support his contention that it was contemplated that the personal representatives would automatically become partners. Indeed, the fact that cl 25 refers to “partners or their respective representatives” would suggest that the personal representatives of the partners are not automatically admitted into the partnership. If Mr Moey was right, then the words “or their respective representatives” would have been redundant. In this regard, it appears to us that cl 25 actually contradicts Mr Moey’s contention.

116. [65]

     [65] As to the alleged practice of admitting the personal representatives of a deceased partner to the partnership, we are satisfied that there was no such consistent practice. Indeed, the true position was quite to the contrary. First, the Appellant had been admitted into MHP with the express consent of the other surviving partners and this was done in his own right (ie, not in his capacity as personal representative of Toh Moo’s estate). That this is so is reflected in the fact that although Toh Moo passed away in February 1961, the Appellant was only admitted as a partner on 19 November 1974. Second, the 1st and 2nd Respondents’ reliance on the consent judgment in DC 6648/1984 as evidence that Toh Lew’s estate had been admitted as a partner of MHP is tenuous. Disputes are settled for an infinite variety of reasons and the entry of a consent judgment generally says nothing about the merits of either side’s case. Moreover, the consent judgment in that case entailed the estate giving up its claims in return for certain payments. This says nothing about the nature of those claims. Finally, and most importantly, the 1st and 2nd Respondents did not take the position in S 2439/1993 (see above at [19]-[21]) that they had been automatically admitted as partners in their capacity as personal representatives of Toh Say following Toh Say’s demise. On the contrary, the 1st and 2nd Respondents claimed that the Appellant was the sole surviving partner of MHP and sought various reliefs in their capacity as personal representatives of Toh Say, which was consistent with an intention to liquidate and extract the value of Toh Say’s share from the partnership (see below at [136]-[137] and [153]).

117. [66]

     [66] In the premises, we find that there was no agreement that the personal representatives of the deceased partners’ estates would be automatically admitted as partners. Therefore, s 24(7) of the Partnership Act applies and the consent of all remaining partners had to be obtained for a person to be admitted into the partnership. It is to this question of consent that we now turn.

118. (3) Did the Appellant consent to the admission of the 1st and 2nd Respondents as partners?

119. [67]

     [67] The Judge primarily relied on the Appellant’s failure to rectify the particulars in ACRA and his failure to object to the 1st and 2nd Respondents’ payment of property tax in respect of the property to find that the Appellant had impliedly consented to the admission of the 1st and 2nd Respondents as partners of MHP. The Appellant submits that the Judge erred and makes three contentions in respect of his submission. First, he contends that his alleged “silent inactivity” was not sufficiently unequivocal to signify his implied consent to the admission of the 1st and 2nd Respondents into MHP. Second, and in any event, he submits that there was no “silent inactivity” on his part. Finally, he contends that implied consent was not even pleaded by the 1st and 2nd Respondents.

120. [68]

     [68] In our judgment, the last contention can be dismissed quickly. The 1st and 2nd Respondents had pleaded the facts on which they intended to rely to make good their contention that the Appellant considered them to be partners. Further and in any event, there has been no prejudice to the Appellant as this issue had been fully ventilated and the necessary evidence was adduced at the court below. Mr Lee quite properly did not pursue this point at the hearing before us.

121. [69]

     [69] In relation to the first two contentions, before we turn to the relevant facts, we think it useful to briefly set out the relevant legal principles. In accordance with contract law principles, the fact of consent must be ascertained objectively and it may be express, implied or inferred from the surrounding circumstances including the conduct of the parties at the time the agreement was reached: Lindley at para 10-256 and Yeo at pp 29 and 79. The Judge relied on the decision in Giuffrida Luigi v Julius Baer (Singapore) Ltd (in members’ voluntary liquidation) and another [2010] SGHC 96 (“Julius Baer”) (at [20]) for the proposition that silent inactivity may be sufficient to signify a party’s implied consent to an arrangement if the circumstances are such that the silent party ought to have spoken up or objected. It is important to emphasise that this inquiry is invariably fact-sensitive. As observed by V K Rajah JC (as he then was) in Midlink Development Pte Ltd v The Stansfield Group Pte Ltd [2004] 4 SLR(R) 258 at [52]:

122. In Julius Baer for example, the circumstances which were thought to warrant finding a duty on the silent party to object included the fact that the complainant customer was deemed to have received a letter which specifically stated that bank customers were to respond if they did not agree to the transfer of their accounts.

123. [70]

     [70] Returning to the case at hand, it is true that the present proceedings are the first commenced by the Appellant to clarify just who the partners of MHP are. Furthermore, although the Appellant had claimed under cross-examination that he had requested that the 1st and 2nd Respondents sign and file the prescribed Form D to rectify ACRA’s records and reflect that they were no longer partners, he was unable to produce any documentary evidence in support of this claim.

124. [71]

     [71] Nonetheless, we consider that the Appellant’s failure to rectify the register must be seen in context. Such a failure can only be held against the Appellant if he owed a duty to the 1st and 2nd Respondents to take steps to rectify the register. As was recognised by the Judge, the registration of a deceased partner’s estate as a partner of MHP cannot affect the rights and status of the partners inter se. Indeed, ACRA had consistently accepted that the inclusion of the deceased partners’ estates on its register was merely for administrative purposes and did not mean that the estates in question had in fact been admitted into the partnership. In its letter dated 30 March 2000, the Registry of Companies and Businesses (ACRA’s predecessor) explained that the addition of the words “Estate of” in respect of Toh Kai and Toh Say had been done only “to denote that these two persons…have passed away. It does not denote that the estate has been admitted into the partnership” [emphasis added]. Similar statements to the Appellant were made in ACRA’s letter dated 27 November 2006 and ACRA’s email dated 18 January 2011.

125. [72]

     [72] This is entirely consistent with the fact that the Business Registration Act (Cap 32, 2004 Rev Ed) imposes a statutory duty on persons carrying on a business to ensure the accuracy of the particulars of the business registered with ACRA (see ss 5 and 14), for a particular purpose, which is to protect third parties dealing with these persons from fraud (see Singapore Parliamentary Debates, Official Report (26 July 1973) vol 32 at col 1229 (Hon Sui Sen, Minister for Finance)). In our judgment, the 1st and 2nd Respondents can hardly be said to be in the same position as a third party dealing with MHP. On the contrary, there is ample evidence that the 1st and 2nd Respondents were put on notice of the Appellant’s consistent and vehement objection to their claim to be partners of MHP. The Appellant had denied that they were partners in his 5 March 1998 affidavit filed in Originating Summons No 31 of 1998 and subsequently also in his affidavit dated 31 August 2006 filed in OS 830/2006 (“the OS 830 affidavit”). The 1st and 2nd Respondents were parties to both of these proceedings and would therefore have known of the Appellant’s objections. Further, on 2 October 2006, subsequent to the filing of the OS 830 affidavit, the 1st and 2nd Respondents’ solicitor had sent a letter, purporting to give notice of a partnership meeting of MHP, to the Appellant as well as the 3rd and 4th Respondents. In his reply, the Appellant objected to the purported notice on the basis that the 1st and 2nd Respondents had not been admitted as partners into MHP.

126. [73]

     [73] In the circumstances, we are satisfied that the Judge erred in finding that the circumstances were such as to justify imposing a duty on the Appellant, as against the 1st and 2nd Respondents, to take steps to rectify ACRA’s records by removing Toh Say’s estate from the register. Moreover, in our judgment, the Appellant’s consistent objections to the 1st and 2nd Respondents and/or Toh Say’s estate being named as partners of MHP ran counter to a finding of implied consent on his part to their admission as partners.

127. [74]

     [74] We next consider the Judge’s finding in relation to the payment of property tax. It is important to emphasise from the outset that as Toh Say’s estate was the legal owner of the one-tenth share of the Property, the 1st and 2nd Respondents (being the executors of his estate) were legally obliged to pay the property tax assessed on it, although they would then have been entitled to be reimbursed out of the trust funds for this expense. Indeed, this was the Appellant’s understanding as he testified under cross-examination:

128. [75]

     [75] The 1st and 2nd Respondents relied on the letter from their counsel dated 9 March 2009 to the other parties in relation to the property tax payable to suggest that this indicated that the Appellant accepted that they were partners. We do not agree. First, the letter has to be read in light of the legal position stated above at [69] which is that it must be construed objectively in the light of all the circumstances. Paragraph 2 of the letter states as follows:

129. [76]

     [76] In our judgment, the language of this extract, read in light of the 1st and 2nd Respondents’ legal obligation (as the registered legal owners) to pay property tax, suggests that the payment of property tax in accordance with the parties’ claimed partnership shares was merely a suggestion. Unlike in Julius Baer, where the letter from the bank expressly stated that the bank customers were obliged to respond if they disagreed to the transfer, there was no duty on the Appellant to respond, such that his silence would constitute acquiescence. On the contrary, it was the 1st and 2nd Respondents who requested the Appellant to respond precisely because he was not obliged to do so. Thus paragraph 4 of the letter stated:

130. [77]

     [77] In the circumstances, we do not agree that the Appellant’s failure to respond to the letter from the 1st and 2nd Respondents could be deemed sufficiently unequivocal to connote consent.

131. [78]

     [78] It is also irrelevant whether the Appellant offered to reimburse the 1st and 2nd Respondents for the property tax that they had paid because as trustees, the 1st and 2nd Respondents would in any event be entitled to be reimbursed from the proceeds of sale of the trust property for any expenses they had incurred.

132. [79]

     [79] We therefore find that the Judge erred in relying on the Appellant’s failure to object to the 1st and 2nd Respondents’ payment of property tax as constituting implied consent to their admission as partners.

133. [80]

     [80] Finally, for completeness, we address two further points raised by Mr Moey at the hearing before us. First, he sought to rely on a letter dated 29 April 2006 from the Appellant to the 1st and 2nd Respondents in respect of OS 830/2006 as evidence that the Appellant had consented to the admission of the 1st and 2nd Respondents as partners. Second, he argued that the implied consent of the Appellant could also be inferred from his failure to take action to displace the 1st and 2nd Respondents as trustees of the one-tenth undivided share in the Property.

134. [81]

     [81] As to the first point, we begin by setting out the contents of the letter dated 29 April 2006 in full:

135. Mr Moey argued that it was clear from the Appellant’s reference to “our interest” that he thought that the 1st and 2nd Respondents were also partners of MHP. We disagree. As we observed at the hearing, the reference to “our interest” was consistent with the 1st and 2nd Respondents being trustees of the one-tenth share of the Property for MHP because as trustee their interest in relation to the trust property would have been aligned with the interest of the beneficiary. This reading of the words “our interest” is further supported when read in the context of the rest of the letter as it is clear that the Appellant was addressing the 1st and 2nd Respondents in their capacity as trustees. The question of whether the 1st and 2nd Respondents were also partners is a separate one that was neither raised nor put in issue by this letter.

136. [82]

     [82] As for Mr Moey’s second contention that the Appellant should have removed the 1st and 2nd Respondents as trustees, we do not see any force in this. First, as noted in the letter that Mr Moey referred to and which is set out in the preceding paragraph, the Appellant had sought a transfer of legal title to him as precedent partner (for him to hold on trust for MHP). Second, the fact that no action was taken to remove the 1st and 2nd Respondents as trustees sheds no light at all on whether they had in fact been admitted to the partnership in the first place.

137. (4) Conclusion on Issue 1 in relation to the 1st and 2nd Respondents

138. [83]

     [83] For these reasons, we find that the Appellant did not consent to the 1st and 2nd Respondents being admitted as partners of MHP following the demise of Toh Say. In the premises, it is unnecessary for us to consider whether the others who were partners of MHP at the time had consented to their admission.

139. The 3rd and 4th Respondents

140. [84]

     [84] The Judge primarily relied on statements made by the Appellant both in these and in other legal proceedings (primarily in OS 830/2006) as admissions (in the evidentiary sense) that the 3rd and 4th Respondents had been admitted as partners of MHP. In this regard, the case advanced by the Appellant has two main prongs. First, he submitted that the Judge had erred in finding that the statements made by the Appellant were admissions that the 3rd and 4th Respondents had become partners of MHP. Second, he submitted that even if these were admissions, the Appellant could not have acted unilaterally; consent also had to be obtained from the others who were partners of MHP at the time and this, allegedly, was never done.

141. [85]

     [85] We begin by stating that we affirm the Judge’s finding that neither Toh Kai nor the Appellant had acquired Toh Tong’s 21/88 share in the partnership, as set out at [10]–[13] above. We agree with the Judge’s finding on this and his reasons as set out at [107]-[122] of the GD.

142. (1) The Appellant’s statements

143. [86]

     [86] The Appellant makes two arguments in respect of the Judge’s reliance on the statements made in the OS 830 affidavit. First, he argues that the OS 830 affidavit essentially dealt with the issue of whether MHP continued to be in existence and not whether the 3rd or 4th Respondents were substantive partners of MHP at the relevant time and that his statements should be read in that context. Second, he argues that his statements were not inconsistent with the position that the 4th Respondent had been admitted as a partner only in respect of the nominal share that he says belongs to Toh Tong’s estate.

144. [87]

     [87] We set out the relevant extract of the OS 830 affidavit:

145. [88]

     [88] It is clear from this that the Appellant had stated in definite terms and on oath that the 3rd and 4th Respondents as the personal representatives of the estates of the deceased partners (namely, Toh Tong and Toh Kai) had been admitted as partners. In our judgment, these statements were clearly admissions that could be and were properly relied on against the Appellant as they were statements that he had made and were contrary to the position he was taking in the present proceedings. We are also satisfied that the context in which the statements were made does nothing to alter their clear and unequivocal meaning. In fact, the statements had been made in the context of the Appellant giving an account of the changes in the composition of MHP and its partners as at the date of the affidavit in order to show that the partnership still existed. We note that the Appellant appeared to reserve his position on who the partners of MHP were and what their respective shares were at paragraph 27 of the said affidavit. In our judgment, however, this does not displace the weight of the assertions that he was making. Significantly, the Appellant had himself relied on these statements in the later parts of his affidavit to support his claim that he did have standing to represent MHP in those proceedings (see paras 32 and 33 of the OS 830 affidavit).

146. [89]

     [89] Turning to the Appellant’s second contention, we have already stated (at [85] above) that we agree with the Judge’s rejection of the Appellant’s contentions on the nominal share issue. But there is a further point. In his affidavit filed on 6 June 2011 in OS 1123/2010 (“the OS 1123 affidavit”), which was an application taken out by the 1st and 2nd Respondents as trustees of the one-tenth share of the Property, the Appellant had said as follows:

147. This was an express statement contrary to the Appellant’s position before us that the 4th Respondent had been admitted only in respect of the nominal share belonging to Toh Tong’s estate.

148. [90]

     [90] For completeness, we also affirm the Judge’s finding that the 4th Respondent did not withdraw from the partnership. In addition to the Judge’s reasons at [133]-[135] of the GD, which we accept, we also observe that there was no mention of the 4th Respondent’s purported withdrawal in the OS 830 affidavit that the Appellant filed in August 2006, long after the alleged withdrawal of the 4th Respondent from the partnership. Moreover the Appellant had confirmed, under cross-examination in those proceedings, that the 4th Respondent was still a partner of MHP as at 17 April 2007.

149. (2) The consent of the other then-partners

150. [91]

     [91] The Appellant’s alternative position is that the 3rd and 4th Respondents were not effectively admitted as partners because the consent of the others who were partners at the time of their alleged admission had not been obtained. This was a point taken only at the appeal. Is the Appellant entitled to raise this now? The 3rd and 4th Respondents submit that this had not been pleaded by the Appellant and was never put forward as a basis for the Appellant’s claim that he was the sole surviving partner of MHP. In response, the Appellant contends that it was incumbent on the 3rd and 4th Respondents (and not on him) to plead and prove the facts that support their claim that the administrators of the respective estates have been admitted as partners of MHP, and this would include proving the fact that all the partners at that time had consented to their admission: see s 24(7) of the Partnership Act.

151. [92]

     [92] It is trite that every pleading must contain the material facts on which the party relies for his claim or defence and that both the parties and the court are bound by the parties’ pleadings. In this regard, the Appellant’s claim in respect of the non-admission of the 3rd and 4th Respondents was based on particular factual allegations as summarised at [33]-[34] above and expressly pleaded in his Statement of Claim (Amendment No 4) at paras 32-49 and 50-55. It was never the Appellant’s position below that the 3rd and 4th Respondents had not been admitted into the partnership on the basis that no consent had been obtained from the other partners at that time. In turn, the 3rd and 4th Respondents denied that the Appellant’s pleaded factual allegations were true in their respective defences. Having squarely met the Appellant’s pleaded case, the lack of consent of the other partners was a matter which, if raised, would have taken the 3rd and 4th Respondents by surprise and should therefore have been specifically pleaded in any subsequent pleadings: O 18 r 8(1)(b) Rules of Court (Cap 322, R5, 2014 Rev Ed) (“ROC”). However, the contention that the consent of the other partners had not been obtained was conspicuously absent from the Appellant’s subsequent pleadings. Moreover, the Appellant never contended that the 3rd and 4th Respondents had failed to obtain the consent of the other partners, even in his closing submissions.

152. [93]

     [93] Aside from the pleadings, the issue of the alleged failure to obtain the consent of the other partners was not a live issue between the parties at the trial. Neither the 3rd nor the 4th Respondent took the position as against one another that they had not been admitted into the partnership. Moreover, at the hearing before us, counsel for the 3rd and 4th Respondents respectively confirmed that the position of their clients was that although there was no express consent, there was implied consent which could be inferred from their conduct inter se and from the way in which the partnership was run.

153. [94]

     [94] We are satisfied that the Appellant’s attempt to raise this contention now is plainly an afterthought and to allow him to do so will prejudice the 3rd and 4th Respondents. We therefore disallow the attempt to raise the point at this late stage.

154. [95]

     [95] In any case, there is no substance in the Appellant’s contention having regard to the available evidence. First, as we noted above at [88], his statements, which we regard as admissions (in an evidentiary sense), were in definite terms that the 3rd and 4th Respondents had been admitted as partners in their capacity as the personal representatives of the estates of the deceased partners (namely, Toh Tong and Toh Kai). This was in no way qualified or limited by any suggestion that he alone had consented to their admission or that they were partners only so far as he was concerned. Moreover any such qualification would have rendered untrue the Appellant’s assertion (on oath) that they were partners.

155. [96]

     [96] Finally, as regards the 4th Respondent, the Appellant sought to rely on the 3rd Respondent’s evidence under cross-examination to show that she had not consented to the 4th Respondent’s admission as a partner. The 3rd Respondent’s evidence was as follows:

156. [97]

     [97] With respect, this exchange does not support the Appellant’s contention. At best, the essence of the 3rd Respondent’s evidence was that her formal consent in respect of the 4th Respondent’s admission as a partner was never sought in a partnership meeting. Indeed, she had earlier said under cross-examination that no meetings of the partners of MHP were held. In no way does this evidence negate the 3rd Respondent’s implied consent to the 4th Respondent’s admission as a partner as manifested in their conduct inter se. Pertinently, the 3rd Respondent never took the position that the 4th Respondent was not a partner, even when it would clearly have been advantageous for her to do so.

157. (3) Conclusion on Issue 1 in relation to 3rd and 4th Respondents

158. [98]

     [98] For these reasons, we find that the Appellant did consent to the admission of the 3rd and 4th Respondents as partners of MHP in their capacity as the personal representatives Toh Tong and Toh Kai respectively. They were therefore partners of MHP at the time of the sale of the Property. We accordingly affirm the Judge’s findings in this respect. This is sufficient to dispose of the appeal insofar as the 3rd and 4th Respondents are concerned. However, there remains an issue as far as the 1st and 2nd Respondents are concerned and it is to this that we now turn.

159. Did the Respondents acquire a beneficial interest in the trust of Sale Proceeds even if they are not partners of MHP?

160. [99]

     [99] In the alternative, the 1st and 2nd Respondents argue that the Judge’s decision to dismiss the Appellant’s claim ought to be affirmed on the ground that the original partners had a beneficial interest in the one-tenth share of the Property that was held on trust for MHP and that this devolved to their respective estates upon their death. In response, the Appellant raises first, a technical objection that, not having filed a cross-appeal, the 1st and 2nd Respondents are not entitled to rely on O 57 r 9A(5) of the ROC to canvass this argument in this appeal. The Appellant also argues that the Judge did not err in finding that the original partners had no beneficial interest in the one-tenth share of the Property being held on trust and that, in any event, no such beneficial interest devolved to the estates of the deceased partners.

161. [100]

     [100] The operation of O 57 r 9A(5) was considered in Lim Eng Hock Peter v Lin Jian Wei and another and another appeal [2010] 4 SLR 331 (“Peter Lim”) at [26]. Order 57 r 9A(5) provides that:

162. In Peter Lim, the trial judge had dismissed the plaintiff’s claim in defamation as he found that – (1) although the relevant extracts were defamatory, (2) they were published on an occasion of qualified privilege, and (3) there was no malice defeating the qualified privilege. The respondents who had not filed a cross-appeal against the first finding that the extracts were defamatory, sought to argue that, contrary to the trial judge’s decision, the relevant extracts were not defamatory of the appellant. The respondents argued that they could do so by virtue of O 57 r 9A(5) as this was a new or additional ground on which they contended that the trial judge’s dismissal of the appellant’s claim should be affirmed. The Court of Appeal rejected this, observing that the purpose of O 57 r 9A(5) was to allow a successful respondent to support a decision of the court below that is in his favour by affirming it on a ground that the court had not relied on. The Court of Appeal further held that a “decision of the court” as contemplated by the rule included a “finding of law or fact that can be varied or affirmed”. On the facts before it, the Court of Appeal held that the respondents were not entitled to rely on O 57 r 9A(5) because in effect, they were asking the Court of Appeal to reverse the trial judge’s decision on this point insofar as it had been held that the relevant extracts were defamatory.

163. [101]

     [101] In the case before us, the Judge held that the deceased partners’ estates have no beneficial interest in the one-tenth share of the Property. In this appeal, the 1st and 2nd Respondents are seeking by their alternative argument to reverse this decision. This would seem impermissible based on the approach taken in Peter Lim. In such circumstances, they ought to have filed a cross-appeal and not having done so, they are not entitled to pursue this.

164. [102]

     [102] Nevertheless, as this is a question of law, and as the point was fully argued by both parties both in their written submissions and in oral arguments, we make some observations on this.

165. The applicable law

166. [103]

     [103] The parties do not dispute that the one-tenth undivided share in the Property was partnership property as defined in s 20 of the Partnership Act. The arguments revolved mostly around the interpretation of various provisions of that Act.

167. [104]

     [104] The 1st and 2nd Respondent contend that, based on the proviso to s 20(1) of the Partnership Act, Toh Say had a beneficial interest in the one-tenth undivided share in the Property, which devolved to his estate upon his death.

168. [105]

     [105] Section 20(1) of the Partnership Act provides as follows:

169. [106]

     [106] Particular reliance was place on the following words of the proviso: “but in trust, so far as necessary, for the persons beneficially interested in the land under this section”. The 1st and 2nd Respondents contend on this basis that Toh Say (and, for that matter, each of the partners) had a discrete equitable interest in the land which was capable of passing and did pass to Toh Say’s estate when he died; they also argue that s 22(1)(b) of the Limitation Act applies, since the 1st and 2nd Respondents’ claims are for trust property (or the proceeds thereof), and therefore no period of limitation applies in such circumstances.

170. [107]

     [107] On the other hand, the Appellant submits that no beneficial interest in the one-tenth undivided share in the Property devolved to Toh Say’s estate or to the 1st and 2nd Respondents upon Toh Say’s death and that the 1st and 2nd Respondents never had any right to an in specie division of the land. According to the Appellant, all the 1st and 2nd Respondents had upon Toh Say’s death was a right to be paid the value of his share and this was a debt pursuant to s 43 of the Partnership Act, which in turn was subject to a 6-year limitation period under s 6(a) of the Limitation Act.

171. (1) Background to the Partnership Act

172. [108]

     [108] It is helpful first to set out the legislative background to the Partnership Act, which provides the backdrop against which we consider the meaning and operation of its provisions. As mentioned earlier, our Partnership Act, save for a few minor amendments, is similar to the 1890 Act. The 1890 Act became part of our law through the reception of English law by virtue of s 6 of the Civil Law Ordinance (No IV of 1878), later replaced with s 5 of the Civil Law Act (Cap 24, 1955 Ed), and subsequently confirmed by the enactment of s 4(1)(a) of the Application of English Law Act (Act 35 of 1993). The Partnership Act was then updated and re-enacted in its current form in 1994.

173. [109]

     [109] The 1890 Act was not a complete code of partnership law or a precise legislative enactment of the existing case law that had developed the applicable legal and equitable principles. As Lord Lindley observed, it was “not a perfect measure, nor even so good as Parliament might have made it”: see Lindley at para 1-05. The 1890 Act itself provided, by s 46, that the existing rules of equity and of common law would continue in force except so far as they were inconsistent with the express provisions of the 1890 Act. This saving provision was retained in our Partnership Act. The English Court of Appeal in Robert John Hopper and another v June Lilian Hopper [2008] EWCA Civ 1417 (“Hopper”) recognised at [45] that much of the statute broadly reflects the pre-existing case law. We note that this is particularly the case for the provisions that deal with partnership property and the interest of each partner in such property: see Lindley & Banks on Partnership (Ernest H Scamell and R C I’Anson Banks eds) (Sweet & Maxwell, 15th Ed, 1984) at p 6.

174. [110]

     [110] It follows that in construing the provisions of the Partnership Act, it may be relevant to have regard to the principles articulated in cases that predate the 1890 Act.

175. (2) The nature of a partner’s interest in partnership property

176. [111]

     [111] The nature of a partner’s interest in partnership property has been elucidated in various decisions. Prior to the enactment of the 1890 Act, Kindersley VC made several key observations in relation to the nature of a partner’s interest in partnership property in Darby v Darby (1856) 3 Drewry 495 (“Darby”), and we reproduce the relevant parts below (at 503-506):

177. [112]

     [112] Two salient points can be discerned from the above passage. First, it is implied in all partnership agreements that, upon dissolution, partnership property will be sold and the net proceeds, after having satisfied the debts and liabilities of the partnership, will be divided amongst the partners in their proportionate share. Second, as a result of the equitable doctrine of conversion (which is based on the maxim that equity looks upon that as done which ought to be done), partnership property which was supposed to be sold at the dissolution of the partnership will be deemed as sold (see Snell’s Equity (John McGhee QC gen ed) (Sweet & Maxwell Asia, 31st Ed, 2005) at paras 6-01, 6-02 and 6-03). The effect is that a partner’s interest (as well as persons claiming through him in respect of his interest as a partner) in the partnership property as against the other partners is no more than a proportionate share of the net proceeds.

178. [113]

     [113] Kindersley VC’s observations in Darby were made with regard to the nature of the partner’s interest in partnership property as against the other partners. There is a subtle distinction in the position among the partners on the one hand and between the partnership and the outside world on the other hand. This was noted for instance by Hoffmann LJ (as he then was) in Inland Revenue Commissioners v Gray [1994] STC 360 at 377 where he said:

179. [114]

     [114] The same distinction was drawn by Luxmoore J in the earlier case of In re Fuller’s Contract [1933] 1 Ch 652 at 656, where he explained as follows:

180. [115]

     [115] In the same vein, Nourse LJ in Popat v Shonchhatra [1997] 1 WLR 1367 at 1372 considered that:

181. [116]

     [116] It is apparent from these cases that there are two periods in the life of the partnership – first, while it is continuing, and second, after a general dissolution; and there is both an internal and an external perspective of the nature of a partner’s interest in partnership property. During the continuation of the partnership, and as against the outside world, the partners are collectively entitled to each and every asset of the partnership in which each of them has an undivided share. However, as between themselves, none of the partners are entitled individually to assert proprietary rights over any specific part of the partnership property to the exclusion of the other partners. This follows from their having subjected their proprietary interests to the terms of the partnership agreement. Therefore, each partner’s interest in the partnership property is in the nature of an interest in their use and application for the benefit of the partnership until the time of its determination. At such time, each partner’s beneficial interest in the partnership property will, unless the partners have agreed otherwise, take effect by the division of any surplus (after the settlement of the debts and liabilities) amongst the partners in their proportionate share.

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