Lee Shieh-Peen Clement and another v Ho Chin Nguang and others

Philip Pillai JC:

[1] This is a summons filed by the Plaintiffs, having obtained leave of the Honourable Justice Judith Prakash on 17 November 2009, for a committal of the first and second Defendants, Ho Chin Nguang and Ng Sow Moi, for their contempt of the orders of this Honourable Court dated 7 April 2009 and 31 July 2009 (the “Order”), by failing to inform the Plaintiffs’ solicitors in writing, within the requisite time limit or at all of:

(a) the value and details of all their assets whether in or outside Singapore by way of an affidavit, which was to have been served on the Plaintiffs’ solicitors within seven (7) days after the respective Orders had been served on the First and Second Defendants; and

(b) the source of the money used before spending the same in the amount specifically limited by this Honourable Court for their expenditure on ordinary living and legal expenses.

[2] The interim Mareva injunction was granted on 7 April 2009 against all three Defendants. It was replaced by a final Mareva injunction granted on 31 July 2009 against only the first and second Defendants.

[3] The materially relevant terms of the final Mareva injunction are as follows:

[4] The relevant considerations in relation to this application for committal are the first principles of Mareva injunctions and the scope and purpose of the exceptions contained in such injunctions. In Polly Peck International plc v Nadir (No 2) [1992] 4 All ER 769 (“Polly Peck (No 2)”), Lord Donaldson of Lymington MR stated (at 785):

[5] The relevant considerations relating to committal proceedings bear restatement. J Pinsler, Singapore Court Practice 2009 (LexisNexis, 2009) states at para 52/1/2 and para 52/2/1:

[6] In P J Holdings Inc v Ariel Singapore Pte Ltd [2009] 3 SLR 582 at [7], Choo Han Teck J stated:

[7] The Plaintiffs claim in their application that:

The substance of the failure complained of relates to the expenditure from undeclared source(s) of funds. The undeclared source(s) of fund, it is claimed is evidenced by a number of events including the minimal withdrawals from their disclosed bank accounts from 4 May to 9 September 2009, their solicitor’s requesting an increase in combined limit of S$6,000 for ordinary living expenses and the subsequent deposit of S$67,097 into their disclosed POSB bank account.

[8] The first Defendant admits in his affidavit that between June and November 2009 he spent about S$16,115.27 to S$19,615.27 a month. However, he also explained in his affidavit that he had subsequently received IDR 134,819,900 by way of a monthly cash allowance from PT Mega Fortune for his role as an advisor and Vice Chairman.

[9] As the Defendants’ disclosed assets are insufficient to cover the Plaintiffs’ claim, the Plaintiffs counter-argued that the Order extends to assets to be acquired in the future.

[10] Clause 2 of this Mareva injunction by its own terms requires a one-off disclosure by an affidavit a list of assets and this has been done. By its express terms it does not stand as a primary or a continuing order to regularly update after acquired assets. In any event, the subsequent receipt of monthly allowance in cash after the due submission of the affidavit of assets as required by the Mareva injunction, does not by its very nature constitute an undisclosed asset that was required to be disclosed by the terms of this Mareva injunction, in particular Clause 2.

[11] I am of the view that Clause 1(4) of this Mareva injunction by its terms operates only to restrict the disposal or dealing of disclosed assets. It contemplates a diminution of the disclosed assets. Even if a liberal construction of this Mareva injunction were warranted, such that there is construed to be a continuing obligation to update and disclose after acquired assets, this monthly cash allowance does not by its nature constitute an asset. I therefore find that there was no breach arising from such receipt of a monthly allowance.

[12] The Plaintiffs further claim that the first and second Defendants had failed to provide the Plaintiffs’ solicitors with the value and details of the assets comprising of their disclosed shareholdings in a number of private companies.

[13] It was conceded that the Defendants had provided the latest available financial statements relating to the Singapore, BVI, Indonesian and Chinese private and unlisted companies in which they have an interest and which were already disclosed in the affidavit of assets. The Plaintiffs submit that this was not sufficient compliance as the Defendants are, additionally, obliged to provide either their own estimate of the value or an independent valuation of the same.

[14] Bearing in mind that the shares are of private companies in multiple jurisdictions, no additional commercial purpose can be served by requiring the Defendants to provide their estimate of the value when the Plaintiffs have been given the relevant financial statements and were able to arrive at their own conclusion as to the valuation of those assets. To require the Defendants to take the further step of procuring independent valuations of unlisted companies would be unduly onerous considering the interlocutory nature and the purpose of granting a Mareva injunction. I accordingly find no breach as claimed by the Plaintiffs.

[15] The Plaintiffs’ application further claims that the Defendants have failed to inform the Plaintiffs’ solicitors in writing, within the requisite time limit or at all of the source of the money used before spending the same in the amount specifically limited by this Honourable Court for their expenditure on ordinary living and legal expenses to wit that they have breached the spending limits by reason of their admitted monthly expenditure of S$16,115.27 to S$19,615.27.

[16] As the first Defendant had already explained in his affidavit, these amounts were monthly cash allowances received subsequently to the filing of his affidavit of assets due to his role as advisor and Vice Chairman of PY Mega Fortune. Given that his interest in PY Mega Fortune has been duly disclosed in his affidavit of assets, and also he has not drawn on or dissipated the bank accounts and assets disclosed in his affidavit of assets, it would be a stretch to conclude that he is to be subject to committal proceedings by virtue of receiving subsequent advances or gifts which, I have already determined, do not constitute assets for the purposes of this Mareva injunction.

[17] As I do not find there to have been a contumelious breach of the Orders in the circumstances, the application is denied.