Haribo Asia Pacific Pte Ltd v Aquarius Corp [2021] SGHC 291

The error to be corrected

Following the release of my decision in Haribo Asia Pte Ltd v Aquarius Corporation [2021] SGHC 278 (the “Judgment”), counsel for the Defendant wrote to the court, clarifying that an incorrect contractual interest rate had been applied in the Judgment in respect of the judgment debt I determined they were to pay the Plaintiff. At [12]–[13] of the Judgment, I wrote:

Thereafter, at [228] and [236]–[237] of the Judgment, I proceeded to apply the rate of 8% over 7.12%, ie, 15.12%, which I observed was a “rather high” rate of interest. The Defendant now highlights, and the Plaintiff confirms, that this was erroneous, and that the correct rate of interest which should have been applied was 7.12%, not 15.12%. The applicable base interest rate should have been -0.88%, not 7.12%. Thus, 8% over -0.88% is 7.12%, which is the rate which should have been used.

The Defendant suggests that this error stems from inconsistent usage, by the Plaintiff in its key documents, of the phrases “applicable base interest rate” and “applicable interest rate”. However, my incorrect usage of the figures in the Judgment in fact stems from the lack of clear distinction between these two phrases in the first place. At no point in the Plaintiff’s statement of claim, its written closing submissions, or its sole factual witness’s affidavit was the figure -0.88% stated, and if it had been, the character of the 7.12% figure would have been immediately apparent.

The Statement of Claim provided:

The Plaintiff’s written closing submissions then stated:

The Plaintiff’s sole factual witness, Mr Nikolay Karpuzov, stated in his affidavit of evidence-in-chief:

On the face of these averments and submissions, it is not clear whether the figure 7.12% was meant to represent the derived figure (ie, base rate + 8%), or whether it referred to the base interest rate indicated in the German Civil Code without the additional 8%. The Defendant now highlights that it addressed the Plaintiff’s error – particularly, the Plaintiff’s written closing submissions – in its own written reply submissions. I have re-examined the materials, and I accept that the Defendant did so, but the point was confined to a mere footnote.

Having said the foregoing, I will not attribute any blame for the ultimate error. I will only note that roundabout ways of expressing simple positions are generally undesirable, especially in cases such as this, with written submissions running into two to three hundred pages per side. The applicable rate of interest was not a disputed issue, and references to the “base” and “applicable” rates were unnecessarily oblique. It could simply have been stated that the rate of interest being claimed was “8% over -0.88% (the base rate provided by the German Civil Code), ie, 7.12%”. This would have avoided further, unnecessary ambiguity amongst a whole host of other contentious issues. I leave this point with the following admonishment: the role of counsel is to assist the court and this is best carried out by the use of plain and simple language that clarify rather than obfuscate the issues.

A consequential point raised by the Plaintiff

As stated at [2] above, I observed in the Judgment that the initially-applied interest rate of 15.12% was “rather high”. On this basis, I ordered that the Plaintiff’s contractual interest be terminated on the date of the Defence and Counterclaim, 30 August 2018, and thereafter, that they would only be entitled to the court-ordered rate of 5.33%, same as the Defendant.

At [236] of the Judgment, I said:

In light of the error and the correction of the rate of interest down to 7.12%, the Plaintiff submits that there is basis for me to reconsider not terminating the applicable contractual interest on 30 August 2018. Having considered the submission, I agree that difference between the Plaintiff’s contractual rate of 7.12% and the court-ordered rate of 5.33% is not as to engage the same considerations set out above. Indeed, apart from being almost three times the usual rate of 5.33%, 15.12% was, in my view, in and of itself bordering on usurious. The same cannot be said of 7.12% and the reason for not awarding the contractual rate no longer applies. I therefore change this aspect of my orders.

Consequential changes to the Judgment

Using the correct interest rate of 7.12%, and with the change stated in the paragraph above in mind, I set out the amendments to the following paragraphs of the Judgment:

For the avoidance of doubt, my amended orders as set out above shall take effect from 2 December 2021, the date of the Judgment. As I explained at [240]–[253] of the Judgment, there are issues of set off and currency conversion arising in this matter, and there is a principled basis on which I decided to order the necessary conversion and set off to be effected on that date. This subsequent correction of the precise sums which form the subject of my orders does not justify a departure from the basis on which I made that decision.

With these clarifications, the parties may proceed to effect the set off of their respective judgment debts using the relevant exchange rate on 2 December 2021, and the Plaintiff may then proceed to enforce payment of the balance owing thereafter.