Goh Eileen née Chia and another v Goh Mei Ling Yvonne and another

Quentin Loh J:

[5] The issues before me were as follows:

(a) whether the Non-Parties and/or the Plaintiffs’ solicitors and/or the Plaintiffs should be ordered to pay costs;

(b) whether costs should be ordered on an indemnity basis; and

(c) what is the quantum of costs payable.

(a) a close connection between the non-party and the proceedings: DB Trustees at [29]–[34], citing Dymocks Franchise System (NSW) Pty Ltd v Todd and others (Associated Industrial Finance Pty Ltd, Third Party) [2004] 1 WLR 2807 (“Dymocks”);

(b) a causal link between the non-party and the incurring of the costs: DB Trustees at [29]–[30] and [35], citing Dymocks;

(c) the ability of the party through whom the proceedings are brought or defended to meet any order for costs: DB Trustees at [42]; Raffles Town Club Pte Ltd v Lim Eng Hock Peter and others (Tung Yu-Lien Margaret and others, third parties) [2011] 1 SLR 582 (“RTC”) at [28]; and

(d) the fact that due process ought to be accorded to the non-party before an order of costs is made against it: DB Trustees at [36] and [47].

[10] All four of the factors identified above have been addressed by the parties to varying degrees. As such, I will consider each factor in turn, starting with the close connection between the non-party and the proceedings.

[12] The Defendants contend that the Non-Parties have a close connection to the proceedings because they have not only funded but also controlled the proceedings. The Defendants further assert that the Non-Parties were the true litigants in S 732/2012 and that the 1st Plaintiff was merely a “pawn”. The Defendants also argue that Eric, as one of the Non-Parties, would benefit from the proceedings if the Plaintiffs succeeded. On the other hand, the Non-Parties argue that there is “no credible evidence” to show that the Non-Parties had controlled or funded the proceedings with the intention of deriving a benefit from it.

[13] I find that, in the present case, the Non-Parties have a close connection to the proceedings because they have not only funded but also controlled the proceedings. Based on the factual findings in S 732/2012, the logical inference is that the Non-Parties had funded and controlled the proceedings with the intention of ultimately deriving a benefit from it. The pertinent findings of fact are as follows:

(a) the Plaintiffs had not signed any warrant to act; the terms of the warrant to act, which was signed by Eric on 26 January 2012, made it “very clear” that he was the client (GD at [4] and [70]);

(b) the Non-Parties displayed an unusually high level of interest and involvement in the proceedings (GD at [62], [65]–[66] and [68]);

(c) the proceedings were brought “for the benefit and at the behest of Eric and Evan”, and the Non-Parties and to a considerably lesser extent, Evan, were the “main driving forces” behind the proceedings (GD at [46]–[47], [51] and [60]);

(d) the Non-Parties paid the deposit and the legal fees for the proceedings (GD at [69]–[70]); and

(e) Eric and Evan stood to gain from the proceedings (GD at [36]).

[14] The Non-Parties argue that there is no credible evidence to conclude that there is a close connection between the Non-Parties and the proceedings. I do not agree with the Non-Parties.

[15] First, the Non-Parties argue that they had not funded the proceedings as the 1st Plaintiff was supposed to repay them later. I do not agree for two reasons:

(a) The definition of “funding”, for the purpose of establishing close connection, is sufficiently wide to encompass loans. For instance, the non-party in Dymocks funded the litigation by providing loans (see Dymocks at [3]–[6]). This was acknowledged in DB Trustees (at [31]). Thus, this argument is of no weight and fails.

(b) In any event, the fact that the 1st Plaintiff is neither aware nor concerned about the legal fees incurred for the litigation suggests that she would not be the one ultimately paying for it. The Non-Parties say that it would be unusual for a person of the 1st Plaintiff’s age to “have the finer details of finances at the fingertips”, especially when Eric and Evan were managing the 1st Plaintiff’s finances. Even if I accept this, it would not have explained why the 1st Plaintiff knows nothing about the legal fees. The 1st Plaintiff admits that she had never asked how much the legal fees were and does not know how much had been incurred so far (GD at [69]). While the 1st Plaintiff is not impecunious, I do not think that she would have been comfortable incurring legal fees personally without regard for whether she could have afforded it. Indeed, there is some evidence to suggest that the 1st Plaintiff could not afford a lawyer back in 2013 (GD at [69]). In light of the above, I cannot accept the bare assertion that there is some form of arrangement between the 1st Plaintiff and the Non-Parties for the repayment of the legal fees. It necessarily follows that the Non-Parties would, in all likelihood, have been the ones who were actually paying for the legal fees.

[16] Secondly, the Non-Parties contend that there is no credible evidence to say that they had controlled the proceedings. This argument consists of several limbs and I will explore them in turn.

[17] The Non-Parties argue that the Plaintiffs were advised and represented by solicitors acting on their behalf even though there was no warrant to act signed by the Plaintiffs because the lead counsel for the Plaintiffs confirmed that they took instructions directly from the Plaintiffs, and the 1st Plaintiff had referred to the Plaintiffs’ solicitors as her lawyers (as opposed to the Non-Parties’ lawyers). I find this explanation incredible. The Plaintiffs’ solicitors must have known that it was necessary for them to obtain a warrant to act from the Plaintiffs, and that would have been evidence that they were authorised to act on behalf of the Plaintiffs (see O 64 r 7). It was never done.

[18] This was not a case of inadvertence or mistake. In fact, the Plaintiffs’ solicitors had obtained a warrant to act from Eric instead. If it was true that the Plaintiffs’ solicitors had always, in their minds, been sure that they were acting solely on behalf of the Plaintiffs, then I do not understand how they could have been satisfied with the warrant to act from Eric. More importantly, the very fact that Eric had signed the warrant to act and received advice in relation to it would constitute “weighty evidence of Eric’s links” to the proceedings (GD at [70]), regardless of whether the Plaintiffs’ solicitors were in fact authorised to act on behalf of the Plaintiffs or not. The Non-Parties suggest that Eric was merely the “initial contact point” but this is inconsistent with his unusually high level of interest and involvement throughout the entire proceedings (GD at [62], [65]–[66] and [68]).

[19] The Non-Parties further contend that even if the Plaintiffs were pressured into commencing S 732/2012 (which the Non-Parties deny), the Plaintiffs remained in control of the proceedings, and that they were merely assisting the Plaintiffs in the proceedings in light of her age. I do not think that this is consistent with the evidence. Indeed, Eric had admitted during trial that the 2nd Plaintiff was “in bed most of the time” and had not given instructions to the Plaintiffs’ solicitors. The evidence also suggests that the 1st Plaintiff was also not in control of the proceedings. In fact, it became apparent during the trial that the 1st Plaintiff was not even familiar with the key documents in the proceedings, including her own affidavit. When the lack of involvement and familiarity displayed by the Plaintiffs is viewed together with the unusually high level of interest and involvement by the Non-Parties and the warrant to act signed by Eric, it would appear that the Non-Parties were the ones in control of the proceedings.

[20] Thirdly, the Non-Parties argue that there is no evidence that they acted with an intention of deriving a benefit from the proceedings. The Non-Parties say that the reliefs sought in S 732/2012 were for the Plaintiffs’ own benefit, even though a benefit could “potentially accrue” to Eric and Evan if the transfer was invalidated. While superficially attractive, I find that the argument is, with respect, fundamentally flawed. In my view, there is no need for a non-party to benefit directly from the proceedings; it is sufficient if they acted with the “intention of ultimately deriving a benefit” (see DB Trustees at [30]). It does not matter whether he eventually benefits from the proceedings. As I have found earlier, the proceedings appear to have been commenced “for the benefit of and at the behest of Eric and Evan” (GD at [46]). This is clear from the circumstances, and in particular, the sequence of events leading up to the action (GD at [34]–[38]). Eric’s wife, Penny, who is legally trained, also played an active role supporting her husband in this litigation. She sought the services from Rodyk & Davidson LLP, and she was the one who prepared Post-it Notes on documents she had organized to help Eric with his cross-examination, and these were documents that she had gathered from elsewhere as they were clearly were not copied from the Agreed Bundles. Furthermore, I do not think that much weight should be accorded to Eric’s self-serving evidence that he has “nothing to gain” from the proceedings and that he was “not really interested” in the Clementi flat.

[21] Accordingly, I find that the Non-Parties had funded and controlled the proceedings in S 732/2012 with the intention of ultimately deriving a benefit from it.

[36] The scope of this jurisdiction was comprehensively considered by the English Court of Appeal in Ridehalgh v Horsefield and another [1994] Ch 205 (“Ridehalgh”) which dealt with a similar provision under English procedural law. Sir Thomas Bingham MR (as he then was), delivering the judgment of the court, laid down the three-stage test as follows (at 231):

The three-stage test has been endorsed by the Court of Appeal (see Ho Kon Kim v Lim Gek Kim Betsy and others and another appeal [2001] 3 SLR(R) 220 at [58]).

(a) Goodwood Recoveries Ltd v Breen; Breen v Slater [2006] 1 WLR 2723 (“Breen”), where there was dishonesty, impropriety and exceptional conduct on the part of a non-party (ie, the director of the plaintiff company); and

(b) DB Trustees, where the non-party (ie, the sole director of the plaintiff company) had, among other things, “plainly abused the judicial process”.

(a) Heng Holdings SEA (Pte) Ltd v Tomongo Shipping Co Ltd [1997] 2 SLR(R) 813, where there was material non-disclosure of facts; and

(b) Ng Eng Ghee v Mamata Kapildev Dave [2009] 4 SLR(R) 155, where there were allegations that the party had suppressed information and conducted strata titles board proceedings in an unjustifiably adversarial manner.

[51] This leaves me with the issue of quantum.

(a) $387,730.00 for legal work;

(b) $10,000.00 for work done in respect of their submissions and reply submissions on costs; and

(c) $47,455.78 for disbursements.

(a) the hearing was originally scheduled to be heard over 6 days (including 2 days for submissions);

(b) the hearing lasted, in terms of time taken, for about 10 full days (by the Plaintiffs’ calculation) to 13.5 full days (by the Defendants’ calculation), and the counsel for the Defendants, Mr Alfred Dodwell, was sick on one of the days;

(c) the time and labour expended by the Defendants’ counsel;

(d) this was not a complex case, despite the numerous allegations against the Defendants and there are no difficult or novel points of law;

(e) the essential disputed facts are neither complex nor over a long period of time;

(f) this is not a case where there are voluminous bundles of documents that had to be perused or prepared;

(g) the urgency of the matter (if any) was not such that it led to an increase in the stress levels and workload of the Defendants’ counsel;

(h) the proceedings had been unnecessarily prolonged by counsel;

(i) the difficulties faced by counsel during cross-examination, eg, the age of the 1st Plaintiff and the evasiveness of Eric on the stand (GD at [63]); and

(j) the Clementi flat, which is the subject-matter of S 732/2012, is worth only about $700,000 (GD at [1]).

[56] I do not agree with the Plaintiffs’ suggestion that the evidence of Lucy Theodas, Dr Lim Yun Chin and Prof Tan Yew Lee Kevin were irrelevant. As I have found earlier, the evidence given by all three witnesses provided the backdrop, explained the relationships within the Goh family, and the 1st Plaintiff’s motivation for being involved in S 732/2012 (GD at [31]–[33], [39], [43]–[44], [46]–[48], [52], [57]–[58]). In this regard, they certainly fall within the definition of relevant facts under the Evidence Act (Cap 97, 1997 Rev Ed).

[57] However, I do agree that the Defendants’ counsel had unnecessarily prolonged the proceedings. For a start, I note that the Plaintiffs’ counsel had stayed close to their estimate whereas the Defendants’ counsel took longer than expected. I am aware that there were several half days throughout the 17-day hearing such that, at the end of the day, the hearing lasted for only about 10 full days (by the Plaintiffs’ calculation) to 13.5 full days (by the Defendants’ calculation). I also acknowledge that the counsel for the Defendants, Mr Dodwell, was sick on one of the days and I do not blame him for that. I further take into account the fact that Eric had been evasive on the stand (GD at [63]). Even so, they do not adequately explain for the total amount of time taken by the Defendants. I notice that the Defendants’ counsel had expected to finish the cross-examination of the 1st Plaintiff by the morning of the third day of trial, but as it turns out, the 1st Plaintiff was kept on the witness stand for another 5 days (albeit only for several hours in the morning each day). While I appreciate that the 1st Plaintiff is very old, I am of the view that the Defendants’ counsel could have been much more efficient. I also note that, to a large extent, the same criticism can be made of the Plaintiffs’ counsel, and particularly in relation to her cross-examination of Prof Kevin Tan and Lucy Theodas. I should also note that many of the applications which took place during the trial, including the leave to call further witnesses and leave to dispense with AEIC for certain witnesses, could have been avoided in the first place.

(a) Bank of China v First National Bank of Boston [1992] 1 SLR(R) 72 at [34], where the Court of Appeal allowed only costs for one day attendance even though the hearing took two days because it was, among other things, “unnecessarily prolonged by the lengthy and elaborate submissions”;

(b) Maratz Ltd v New India Assurance Co Ltd [1998] 2 SLR(R) 134 at [33], where Warren Khoo J allowed only half the costs because the defendants had “unnecessarily prolonged the proceedings”; and

(c) Anne Joseph Aaron (m w) and others v Cheong Yip Seng and others [1995] SGHC 131, where Lai Siu Chiu J deducted 2 days of attendance in court out of the 5 days of cross-examination because the counsel had unnecessarily prolonged the proceedings by taking the witnesses “through the special report sentence by sentence”.

As such, I award costs on the basis of a 9-day trial and taking into consideration all the facts and circumstances of this case, I allow costs at $126,000.

[59] I now deal with disbursements. At the hearing, the Plaintiffs’ counsel confirmed that they are only challenging the Defendant’s claim for food and lodging between January and August 2013 which was $16,000. Specifically, they contend that the Defendants did not have to stay in Singapore for the entire proceedings but only when they were giving evidence. In the present case, I disallow the Defendants’ claims of $8,000 each for food and lodging ($1,000 per month for each Defendant), as they were not able to substantiate the same. Hence, I would only allow the disbursements of $31,455.78.

(a) $126,000 for legal work;

(b) $7,500.00 for work done in respect of their submissions and reply submissions on the application for and taxation of costs; and

(c) $31,455.78 for disbursements.