TG Master Pte Ltd v Tung Kee Development (Singapore) Pte Ltd and another

[1] Following the release of my decision in TG Master Pte Ltd v Tung Kee Development (Singapore) Pte Ltd and another [2022] SGHC 316 (“the Judgment”) on 19 December 2022, counsel for the plaintiff wrote in on 30 December 2022 requesting for further arguments to be heard after the trial. I agreed to this request on 10 January 2023. However, in addition to further arguments pertaining to aspects of my decision, I directed the parties to address me on whether I, sitting as a judge in the General Division of the High Court (“High Court”), even have the jurisdiction to hear further arguments after a trial due to s 29B of the Supreme Court of Judicature Act 1969 (2020 Rev Ed) (“SCJA”).

[2] Having considered the parties’ further arguments, I concluded that the High Court does not have jurisdiction to hear further arguments after a trial. On this basis, I cannot consider further arguments made to me after the trial. The result is that I, in effect, affirm my decision contained in the Judgment. I provide my reasons for coming to this conclusion. On the assumption that I am wrong on whether I have the jurisdiction to hear further arguments after a trial, I also deal briefly with the plaintiff’s further arguments and explain why I nonetheless would not have varied my decision.

[3] The plaintiff’s argument in favour of the High Court’s jurisdiction to hear further arguments on the merits of a decision given after trial is founded on three main grounds. First, the plaintiff submits that the Court of Appeal decision of Thomson Plaza (Pte) Ltd v Liquidators of Yaohan Department Store Singapore Pte Ltd (in liquidation) [2001] 2 SLR(R) 246 (“Thomson Plaza”) and the High Court decision of Long Well Group Ltd and others v Commerzbank AG and others [2018] SGHC 164 (“Long Well”) both endorsed the view that “[t]he power for a court to hear further arguments after trial is contained within the inherent jurisdiction of the court”, such inherent jurisdiction being preserved by O 92 r 4 of the Rules of Court (2014 Rev Ed) (“ROC 2014”).

[5] Third, the plaintiff submits that s 29B of the SCJA is an “enabling provision” that provides for the High Court’s ability to hear further arguments in respect of a decision made after a hearing that is not a trial, but which does not otherwise affect the High Court’s ability to hear further arguments after a trial.

[6] Before considering the plaintiff’s arguments, it is useful to situate the High Court’s supposed jurisdiction to hear further arguments within its broader jurisdiction and power to amend its orders. It is well established under Singapore law that a court can recall and vary its decision before it is perfected. However, it is important to bear in mind the distinction between the courts’ jurisdiction and power to make (a) substantive amendments and (b) non-substantive amendments to their orders. The need for finality, which gives effect to fairness and certainty, means that there is a more limited scope for courts to make substantive amendments that go towards the merits of the matter in their orders once they have been made. Thus, as the High Court put it in Godfrey Gerald QC v UBS AG and others [2004] 4 SLR(R) 411 (“Godfrey Gerald”) (at [18]), “[a] final decision, once made, cannot be revisited”.

[7] That said, there remains limited avenues for a court to reconsider the substantive merits of its decision. For example, pursuant to O 3 r 2(8) of the Rules of Court 2021 (“ROC 2021”), a court can, among others, “revoke any judgment” on any of the four grounds listed in O 3 r 2(8)(a) to O 3 r 2(8)(d) if it is “in the interests of justice”. This arguably includes the making of substantive amendments to its orders. Another example is the opportunity for parties to make further arguments pursuant to s 29B of the SCJA to convince the court to reconsider and change its decision, even though it has already been pronounced. In this regard, the Court of Appeal had elaborated on the purpose of further arguments in Singapore Press Holdings Ltd v Brown Noel Trading Pte Ltd and others [1994] 3 SLR(R) 114 (“Singapore Press Holdings”) (at [40]):

[8] The scope of the courts’ jurisdiction and power to make non-substantive amendments to their orders is much wider. In Godfrey Gerald, the High Court clarified (at [18]) that the principle of finality cannot be applied “as a sterile and mechanical rule in matters where there are minor oversights, inchoateness in expression and/or consequential matters that remain to be fleshed out”. This explains why courts have employed devices such as the “slip rule” and the implied “liberty to apply” proviso to redress or clarify such problems (see Godfrey Gerald at [18]). Accordingly, in the Court of Appeal decision of Retrospect Investment (S) Pte Ltd v Lateral Solutions Pte Ltd and another [2020] 1 SLR 763 (“Retrospect Investment”), Steven Chong JA held (at [12]) that it is clear that “the court possesses the inherent jurisdiction and power to clarify the terms of its orders and to give consequential directions”. The learned judge further noted that the exercise of this jurisdiction or power is not uncommon (see Retrospect Investment at [15]). Parenthetically, it should be noted that the learned judge did not determinatively decide whether the court’s ability to make non-substantive amendments to its orders should be considered a matter of its jurisdiction or its power. As such, I have deliberately used the expression “jurisdiction and power” to describe a court’s ability to make non-substantive amendments to its orders. Similarly, in the High Court decision of Thu Aung Zaw v Ku Swee Boon (trading as Norb Creative Studio) [2018] 4 SLR 1260 (“Thu Aung Zaw”), in the context of summary judgments, Tan Siong Thye J concluded (at [23]) that a court can make non-substantive amendments to its orders so long as “the amendment only corrects an irregularity and does not substantively vary the decision” [emphasis added].

[9] The courts’ jurisdiction and power to make non-substantive amendments to their orders can be grounded either in their statutory or inherent jurisdiction/power. In regard to the former, O 20 r 11 of the ROC 2014 had expressly provided as such:

While this provision does not appear in an equivalent form in the ROC 2021, it is arguable that the courts’ statutory jurisdiction and power is preserved through the general power provided in O 3 r 2(2). This rule provides that the court may do whatever it considers necessary on the facts of the case before it to ensure that justice is done or to prevent an abuse of the process of the court, so long as it is not prohibited by law and is consistent with the Ideals set out in O 3 r 1 of the ROC 2021. However, given the lack of a more specific provision in the ROC 2021 on the courts’ jurisdiction and power to make such non-substantive amendments to their orders, such jurisdiction or power might be more properly located within their inherent jurisdiction or power (see Retrospect Investment at [12]).

[10] Turning now to other jurisdictions, the distinction between substantive and non-substantive amendments is also well established. However, it would appear that there is less scope for the courts elsewhere to make substantive amendments to their orders as compared to Singapore.

[12] While phrased quite broadly, this rule does not allow the courts to make substantive amendments to their orders. Thus, as has been observed in The White Book Service 2022 vol 1 (Peter Coulson et al eds) (Sweet & Maxwell, 2022) (at para 40.9.3):

[21] With the above background in mind, I disagree with the plaintiff’s argument in favour of the High Court’s jurisdiction to hear further arguments for the reasons founded on principle, precedent, and policy that I will develop below. Before I do so, I will from this point on deliberately use the word “jurisdiction” to describe my conclusion that the High Court does not have the jurisdiction to hear further arguments after a trial. I have done this to avoid any confusion caused by the conflating or inconsistent use of terminology such as “jurisdiction” and “power” in relation to the specific instance of a court’s jurisdiction to hear further arguments.

[22] In this regard, as V K Rajah JA observed in the Court of Appeal decision of Re Nalpon Zero Geraldo Mario [2013] 3 SLR 258 (“Re Nalpon Zero”) (at [13]), the jurisdiction of a court is “its authority, however derived, to hear and determine a dispute that is brought before it” (citing Chan Sek Keong J (as he then was) in Muhd Munir v Noor Hidah [1990] 2 SLR(R) 348 (“Muhd Munir”)). In contrast, as Rajah JA also observed in Re Nalpon Zero (at [31]), again citing Chan J in Muhd Munir (at [19]), the powers of a court constitute “its capacity to give effect to its determination by making or granting the orders or reliefs sought by the successful party to the dispute”. These are necessarily distinct concepts, and the court’s jurisdiction must be established before the court can consider what powers it possesses and may exercise (see the decision of the Court of Appeal in Pradeepto Kumar Biswas v Sabyasachi Mukherjee and another and another matter [2022] 2 SLR 340 at [28]).

[23] In the context where the High Court is asked to hear further arguments after a hearing, it is better to regard this as an instance of whether the court has the authority to consider the further arguments, as opposed to whether it has the capacity to give effect to any prior determination. This is because the High Court is functus officio after it has rendered its final decision (see Thu Aung Zaw at [19]). As such, it no longer possesses the authority to hear further arguments on the merits of the case unless such authority is provided for statutorily or by the common law. Given this, it would not be accurate to ask if the High Court has the “power” to hear further arguments when its authority to do so is in question.

[24] With this in mind, I turn to my reasons for my decision why the High Court does not have the jurisdiction to hear further arguments after a trial.

Principle: Parliament has curtailed the High Court’s inherent jurisdiction to hear further arguments after a trial under the SCJA

[25] I begin with a point of principle. Since the High Court is a creature of statute, the starting point for locating its jurisdiction must necessarily be found in statute. In this regard, the key statute is the SCJA. Prior to 2010, the SCJA did not contain a specific provision dealing with the jurisdiction of the High Court to hear further arguments. The SCJA 1999 did, however, contain s 34(1)(c), which provided as follows:

[27] However, in light of the subsequent amendments to s 34(1)(c), I find that Parliament has curtailed the High Court’s inherent jurisdiction to hear further arguments after a trial. In this regard, it is pertinent that on 15 November 2010, the SCJA 1999 was amended by the Supreme Court of Judicature (Amendment) Act 2010 (Act 30 of 2010) to insert a new s 28B (“the 2010 Amendment”), which is the predecessor provision of the present s 29B. Section 28B first appeared in the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) (“SCJA 2007”), as amended. It provides, as relevant, the following:

[28] For completeness, s 29B of the SCJA provides for substantively the same but breaks up s 28B(1) of the SCJA 2007 into two subsections, as follows:

Section 29B also refers to the General Division of the High Court, being a newly created division at the time. In this context, I have, for convenience, used the term “High Court” to refer both to the General Division of the High Court, as well as the High Court prior to the creation of the General Division. As there is no indication from the relevant parliamentary debates as to why s 29B is framed differently from s 28B (see Singapore Parliamentary Debates, Official Report (5 November 2019) vol 94 (Mr Edwin Tong Chun Fai SC, Senior Minister of State for Law)), and that the two sections are materially similar, I will concern my discussion primarily with s 28B and regard the points made as being equally applicable to s 29B.

[29] I begin with the text of s 28B of the SCJA 2007. It is crucial that s 28B expressly provides that a High Court judge “may” hear further arguments after any hearing other than a trial. This is a marked departure from the terms of s 34(1)(c) of the SCJA 1999, which does not provide for whether the judge may or may not hear further arguments; it simply recognises his or her jurisdiction to do so. This is crucial because this shows that Parliament had, by the 2010 Amendment, moved from merely recognising to conferring the jurisdiction on the High Court to hear further arguments.

[30] Equally crucially, it would appear that Parliament has confined this conferral of jurisdiction to hear further arguments in the 2010 Amendment to “after any hearing other than a trial” [emphasis added]. While there is, strictly speaking, no express prohibition of hearing further arguments after a trial, this prohibition can be inferred given that s 28B of the SCJA 2007 is the only provision within the statute referring to the authority to hear further arguments and expressly confines such authority to after any hearing other than a trial of an action. Therefore, from a textual comparison of s 28B of the SCJA 2007 (and now s 29B of the SCJA) with s 34(1)(c) of the SCJA 1999, it can be reasonably inferred that Parliament intended to curtail the High Court’s inherent jurisdiction to hear further arguments after a trial. Parliament has done this by excluding the hearing of further arguments after a trial from its conferral of statutory jurisdiction to hear further arguments in other matters.

[31] That Parliament intended to do this can also be seen from the relevant parliamentary debates and relevant materials. During the Second Reading of the Supreme Court of Judicature (Amendment) Bill in October 2010, the Senior Minister of State for Law, Assoc Prof Ho Peng Kee, explained that the purpose behind s 28B of the SCJA 2007 was to remove the then prevailing technical requirement of a party needing to make further arguments before it could file an appeal to the Court of Appeal (see Singapore Parliamentary Debates, Official Report, (18 October 2010) vol 87 at col 1373). While this does not explain why s 28B expressly included the proviso “after any hearing other than a trial”, Assoc Prof Ho did say (at col 1368) that the amendments, including those in relation to further arguments, “arose out of two Reports helmed by the Judiciary”, including the report by the Law Reform Committee (see Law Reform Committee, Singapore Academy of Law, Report of the Sub-Committee on the Rationalisation of Legislation Relating to Leave to Appeal (October 2008) (Chairman: Cavinder Bull) (“LRC Report”)). Indeed, as noted by the Court of Appeal in ARW v Comptroller of Income Tax and another and another appeal [2019] 1 SLR 499 (“ARW v Comptroller of Income Tax”) (at [80]), the recommendation to retain the right to request for further arguments in Singapore stemmed from the LRC Report.

[32] As such, the reason for why further arguments can only be heard after “other than a trial of an action” becomes clear when we look at the legislative impetus as can be gleaned from the LRC Report. In summary, the possibility of further arguments being heard was only ever intended to apply for interlocutory applications and not a full trial. It is relevant to scrutinise the relevant paragraphs of this report which I reproduce here for convenience:

[34] The key thread that ties these concerns together is the significant time pressure that can arise in interlocutory applications. It seems highly unlikely that such time pressure would exist in the context of a civil trial. In this regard, a civil trial spans months, and even years, of preparation starting from the pleadings all the way to the actual trial. During this whole process, counsel would have had sufficient opportunity to think about their case theory. Similarly, a judge would usually also have ample time to consider counsel’s arguments carefully after the trial. Thus, if any argument went unaddressed, it is highly unlikely that it was due to the time pressure that may exist for interlocutory applications. This provides a clear reason as to why Parliament enacted s 28B of the SCJA 2007 (and s 29B of the SCJA) in its present form so as to exclude the High Court’s inherent jurisdiction to hear further arguments after a trial.

[35] At this point, I should address the plaintiff’s argument that s 29B of the SCJA is an “enabling provision” that sets certain deadlines governing when further arguments may be heard in respect of a decision made after any hearing other than a trial of an action, but which does not disturb the High Court’s inherent jurisdiction to hear further arguments in respect of a decision made after a trial. I disagree with this argument because it implies that Parliament has deemed it unnecessary to provide any deadlines that restrict when further arguments may be heard after a trial. This would go against the stated policy aims of such deadlines. In this regard, the LRC Report had noted that the specific reason for the imposition of a deadline is, among others, “to ensure that the appeal process is not unduly delayed” (at para 111). Therefore, if Parliament had intended to retain the court’s jurisdiction to hear further arguments after a trial, it would not make sense for Parliament not to have set any deadline at all for such situations. As such, the better view is that s 28B simply does not contemplate the High Court having the jurisdiction to hear further arguments after a trial.

[36] Accordingly, in my view, s 28B of the SCJA 2007 (and now s 29B of the SCJA) has superseded the previous position that the High Court had the inherent jurisdiction to hear further arguments in respect of all hearings, which might have been justified by the framing of s 34(1)(c) of the SCJA 1999. Section 28B did this by specifically excluding trials from the hearings following which the High Court can hear further arguments. As such, I conclude that Parliament intended to curtail the High Court’s inherent jurisdiction to hear further arguments after a trial. The result is that the High Court has no jurisdiction, whether statutory or inherent, to hear further arguments pertaining to the merits of the decision after a trial.

[40] From the above passage, the court in Long Well appears to have suggested that the High Court still possessed the inherent jurisdiction to hear further arguments after a trial despite s 28B of the SCJA 2007 on the authority of Thomson Plaza. To the extent that this is a correct reading of Long Well, I respectfully disagree with the court’s suggestion. First, as I have explained above, Thomson Plaza should not be taken to have ruled on the effect of s 28B on a court’s inherent jurisdiction to hear further arguments after a trial given that it was decided before the 2010 Amendment. Second, as I have also explained above, the better view in light of s 28B (and now s 29B of the SCJA) is to regard Parliament as having curtailed the High Court’s inherent jurisdiction to hear further arguments after a trial.

[41] I now turn to other precedent cases which touch upon the issue at hand. Starting with the decision of the Court of Appeal in ARW v Comptroller of Income Tax, the relevant facts were that the Comptroller of Income Tax filed an application seeking an extension of time to file a request for further arguments in relation to the appellant’s application for specific discovery pursuant to s 28B(1) of the SCJA 2007. The Court of Appeal had to answer the question of whether the High Court below had the jurisdiction to extend the 14-day timeline prescribed under s 28B(1)(b). In answering that question, the Court of Appeal made this observation (at [58]):

[43] Further, the outcome in ARW v Comptroller of Income Tax is better explained on the basis that the court’s power to extend time was already statutorily provided for in para 7 of the First Schedule to the SCJA 2007 read with s 18(2) of the SCJA 2007. Paragraph 7 of the First Schedule to the SCJA 2007 stated as follows:

Indeed, the Court of Appeal in that case observed that the time limit in s 28B of the SCJA 2007 was not immutable and did not affect the general power accorded to the court under s 18(2) of the SCJA 2007 to extend time (at [58]).

[45] The second case is Muhammad Adam bin Muhammad Lee (suing by his litigation representatives Noraini bte Tabiin and Nurul Ashikin bte Muhammad Lee) v Tay Jia Rong Sean [2022] 4 SLR 1045. In that case, after the judgment was released (which quantified the damages to be assessed), counsel for the defendant had written to court requesting for further arguments on the question of pre-judgment interest (at [308]). The court acceded to the defendant’s request for further arguments as both the plaintiff and defendant counsel agreed that the court possessed the “inherent power” to recall its earlier decision and hear further arguments, once again citing Thomson Plaza (at [310]).

[46] In my respectful view, these decisions are inconclusive on the question of whether the High Court can exercise its inherent jurisdiction to hear further arguments after a trial. First, as already explained above, there are various reasons why Thomson Plaza is not a direct authority for the proposition being argued for (see above at [37]–[38]). Second, it does not appear that the implied prohibition against further arguments after a trial in s 28B of the SCJA 2007, and now s 29B of the SCJA, was brought to the court’s attention. As such, there was no proper consideration of the issue.

[47] Therefore, from this survey of the precedent cases, there does not appear to be any prior decisions which have analysed the issue at hand such that it represented binding or relevant authority.

[48] Finally, as a matter of policy, there would be practical concerns if further arguments were ordinarily heard and considered as a matter of course after a full trial. These are well illustrated by this very case. For instance, in support of its argument that the forfeiture of the Further Sum (as the term is defined in the Judgment) does not offend the penalty rule because such forfeiture is a genuine pre-estimate of its loss, the plaintiff’s counsel now argues that they were “instructed” that the losses was a certain amount. The plaintiff has even now provided a detailed breakdown of these losses.

[50] As such, having considered the above, the appropriate course of action is for the plaintiff, if it so wishes, to file an appeal against my decision. If necessary, the appellate court can decide whether to hear what are, in effect, new arguments on appeal and admit the further evidence if that is needed. In that context, the appellate court may affirm or reverse my decision. But for present purposes, I find that, in my capacity as a judge in the High Court, I simply do not possess the jurisdiction, statutory or inherent, to hear further arguments after a trial on the merits of the case, with a view to making substantive amendments to my decision that has already been pronounced in the Judgment.

Even if the High Court has the jurisdiction to hear further arguments after a trial, whether the plaintiff’s further arguments would have warranted a variation of my decision

[51] Even if I am wrong that the High Court does not have the jurisdiction to hear further arguments after a trial, I would still have affirmed my decision in the Judgment because I did not think that the plaintiff’s further arguments merit, without the potential admission of further evidence, a variation of my decision. Because the plaintiff may well appeal against my original decision, I will only provide brief reasons as to why.

[52] The plaintiff’s first argument is that, based on the terms of the eight Options to Purchase dated 3 January 2018 (“the OTPs”), the sum of $500,000 paid for each of them (“the Further Sum”) was the agreed consideration for their rental for two and a half years. As such, the plaintiff argues that this makes the payment of the Further Sum a primary obligation, to which the penalty rule does not apply. Among others, the plaintiff cites the recent Court of Appeal decision of Ethoz Capital Ltd v Im8ex Pte Ltd and others [2023] SGCA 3 (“Ethoz”) in support.

[53] I disagree with this argument. Ethoz was a case concerning the potential payment of accelerated interests and default interests after the borrower defaulted on the repayment of the loan given by the finance company. It was through that lens that the Court of Appeal had to answer the question of whether the acceleration of interest payments upon breach amounted to a primary or secondary obligation that was subject to the penalty rule. It held that the primary obligation was to pay the interests over 180 instalment payments and the secondary obligation was the accelerated payment of all the interests upon default (see [54], [55] and [57]).

[54] In contrast, the present situation is different as it concerned the forfeiture of the sums already paid over in the form of the Further Sum. The governing case is therefore the High Court decision of Hon Chin Kong v Yip Fook Mun and another [2018] 3 SLR 534 (“Hon Chin Kong”), which dealt squarely with the issue on the law relating to deposits and presented a context-specific framework to be applied to the traditional penalty doctrine in Ethoz. In particular (at [143]), Hon Chin Kong laid down the framework for determining whether the Further Sum should be characterised as a true deposit or as a part payment (and in the latter scenario, with the right to forfeit being tested against the penalty rule).

[55] Indeed, it would be wrong to classify the Further Sum as a form of payment to be made “only when there was a breach of contract” under the general traditional test in Ethoz, since it has already been paid over. In other words, by the plaintiff’s argument, the payment of the Further Sum will never amount to a secondary obligation to be tested against the penalty rule under the traditional test since it has already been paid over. Further, by this argument, no forfeiture will ever attract the application of the penalty rule since they are predicated on a primary obligation to pay money over. This surely is not an accurate reflection of the law.

[56] The plaintiff’s second argument is that, even if I am not with it on the primary obligation argument, the relevant clauses of the OTPs are not penal in nature. To this, the plaintiff makes two sub-points, namely: (a) the payment of the Further Sum was a payment of a deposit pursuant to a property transaction, and (b) the forfeiture provisions were commensurate with the nature of the breach and the loss suffered.

[57] On the first sub-point, I would simply refer to my reasons in the Judgment as I do not think that the plaintiff has raised any new point for my consideration. For completeness, I do note that the plaintiff has argued that the defendants had not discharged its burden of proving what the customary rate of a deposit is in the present context. I disagree. The defendants raised the case of Hon Chin Kong which mentions the customary 10% rate, and in any event, this is a well-established position in Singapore that the court is entitled to take judicial notice of.

[58] On the second sub-point, while I understand the plaintiff’s point about the losses that it has had to bear over the two years, the problem is that the plaintiff did not adduce evidence of those losses during trial. While the plaintiff’s counsel now says that they are “instructed” as to the nature and quantum of these losses, I do not think that it is satisfactory for the court to receive evidence of these figures outside of trial without the opportunity for the defendants to test this evidence (see above at [49]). As such, without admitting this evidence as to the plaintiff’s losses, it is not possible for me to assess whether the forfeiture of the Further Sum was commensurate with the nature of the breach and the losses the plaintiff allegedly suffered.

[59] In any event, even without admitting new evidence, the provisions pertaining to the Further Sums, in particular the forfeiture mechanism, are likely incommensurate with the losses that the plaintiff might suffer as a result of a potential breach. Indeed, a helpful indicator for determining whether a clause is a penalty is whether “a single lump sum is made payable by way of compensation, on the occurrence of one or more or all of several events, some of which may occasion serious and others but trifling damage” (see Ethoz at [67(c)]). Here, as the defendants rightly point out, the forfeiture of the Further Sums could occur on a number of different events, some of which may occur early on within the two-year period. Despite this, the entirety of the Further Sums would still have to be forfeited in any event. It is unclear whether such forfeiture would not be commensurate with the extent of the losses suffered by the plaintiff in each of those different events, especially in relation to events well within the two-year period. Therefore, I am of the view that the provisions pertaining to the Further Sums are, in totality, penal in nature.

[60] For all of these reasons, I affirm my decision in the Judgment. The main ground is that I do not think the High Court has the jurisdiction to consider the plaintiff’s further arguments after the trial. But even if I were wrong on this point, I would still have affirmed my decision because I am not convinced of the merits of the further arguments.