General Division of the High Court · Decided 1 October 2026

Shenning Heritage Capital VCC v Hiah David and others

[2026] SGHC 205Case no. Originating Claim No 821 of 2023

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Grounds of decision

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Sushil Nair JCA:
Introduction
[1] The Claimant, Shenning Heritage Capital VCC (“Shenning Heritage”), invested US$2.55 million with the fourth defendant, Ark Capital Holdings Ltd (“Ark Capital”), for the stated purpose of pursuing a foreign-exchange trading strategy. The investment was not deployed as represented, and fabricated statements were later provided to the Claimant. The principal wrongdoers are no longer before the court, judgments having been entered against them. The question which remains for my determination is whether the second and third defendants, Mr Hiah Moh Watt (“Mr Hiah”) and Ms Li Ee Yan (“Ms Li”), are legally implicated in any wrongdoing. In this regard, the Claimant mounts claims in dishonest assistance and knowing receipt against Mr Hiah and Ms Li, as well as a claim in unlawful means conspiracy against all the defendants save for Ark Capital.
[2] Having considered the parties’ submissions, I dismiss these claims in their entirety. First, the Claimant has not established its pleaded case that Ark Capital held the moneys sent by the Claimant on trust. Second, even if the requisite trust or fiduciary duty had existed, the evidence does not establish dishonesty or the necessary knowledge on the part of either Mr Hiah or Ms Li. Third, the evidence also does not establish any agreement or combination involving them for the purposes of the conspiracy claim. I elaborate on my reasons below.
Facts
The parties
[3] The Claimant is a Variable Capital Company incorporated in Singapore. The Claimant operates a number of sub-funds under it, one of which is Kingdom Fund. The Claimant is in turn managed by Shenning Investments Pte Ltd (“Shenning Investments”).
[4] The Claimant, through Kingdom Fund, invested with Ark Capital, a company incorporated in the British Virgin Islands. The first defendant, Mr David Hiah (“David”), is a director and 40% shareholder of Ark Capital. The second defendant, Mr Hiah, is David’s father. He was registered as a director and 60% shareholder of Ark Capital at all material times, although how he came to be reflected as such is a matter of dispute. Mr Hiah had worked in the insurance industry for more than 18 years.
[5] The third defendant, Ms Li, is David’s former wife. She had filed for divorce on 3 November 2023. Interim judgment was granted on 19 December 2023 by consent, and final judgment was obtained on 22 March 2024. She works at a global investment banking and asset management firm.
[6] The fifth defendant, BWCG Pte Ltd (“BWCG”), is a company incorporated in Singapore. Based on David’s evidence, BWCG represented itself as being involved in the trading of commodities.
Shenning Heritage’s investment with Ark Capital
Initial investment and execution of Term Sheet
[7] David first got to know Mr Ng Chee Yuen (“Mr Ng”), a director of Shenning Heritage and the Chief Executive Officer of Shenning Investments, in 2018. David and Ms Li met Mr Ng and his wife, Ms Stephanie Kwee-Ng (“Ms Kwee-Ng”), in December 2018. Ms Kwee-Ng is also an employee of Shenning Investments.
[8] Sometime in 2019, David sought Mr Ng’s involvement in an event through which Shenning Heritage could raise funds for one of its projects from potential investors. Mr Ng hosted a dinner on or around 6 November 2019, which David and Ms Li both attended. There is some dispute as to how David was introduced to guests at the dinner and David’s association with the Claimant at this point.
[9] Between the end of 2019 and February 2020, David exchanged correspondence with Mr Ng and the Claimant on a foreign exchange trading fund, and provided details of Ark Capital and his foreign exchange trading strategy (“FX Strategy”). In one set of slides, Mr Hiah and David’s mother were identified as the “Founding Partners” of Ark Capital, which was designated as a “Multi-Family Office”. David explained that Ark Capital is only an intermediary fund manager. The management of the fund was delegated to JP Fund Services SA (“JPFS”). JPFS in turn used a broker in Australia, Charterprime Pty Ltd (“Charterprime”), for the purposes of executing the FX Strategy. The Claimant agreed to invest with Ark Capital sometime towards the end of 2021.
[10] Part of the communication at that time revolved around the identity of the counterparty with whom Kingdom Fund would make the investment. A difficulty arose because David had been issued a prohibition order by the Monetary Authority of Singapore (“MAS”). This meant that David could not act as a director or become a substantial shareholder of any financial advisory firm for a period of seven years from 14 May 2018. As a result of this complication, on 21 November 2021, David proposed to Mr Lee Yong Wei (“Mr Lee”), another employee of Shenning Investments and one of Shenning Heritage’s directors at the material time, that the investment be made “through a SG-registered company with [Mr Hiah] as the sole director & shareholder”. However, Mr Lee replied that Mr Hiah could be added as a director and shareholder of Ark Capital instead. Mr Lee confirmed subsequently on 22 November 2021, after conferring with Mr Ng, that the Claimant would “prefer to invest via [Mr Hiah] in the BVI company [ie, Ark Capital]”.
[11] The initial subscription for US$750,000 was transferred to Ark Capital’s LEN24 account on 24 December 2021. Ark Capital sent Shenning Heritage a Term Sheet outlining the terms and conditions of the investment proposals dated 27 December 2021 (“Term Sheet”). This draft Term Sheet purported to bear Mr Hiah’s signature in his capacity as a director of Ark Capital. The Term Sheet was executed by Mr Lee on behalf of Kingdom Fund.
[12] Under clause 1 of the Term Sheet, Kingdom Fund invested a total sum of US$2.55 million with Ark Capital. The material sections of clause 1 are reproduced as follows:
[13] Additionally, the Term Sheet also contained other clauses concerning the standard of care and the operating arrangements:
Transfer of investment funds
[14] Pursuant to the Term Sheet, the Claimant was instructed to transfer the subscription funds to Ark Capital’s settlement agent, ie, LEN24 Bank (“LEN24”), via a bank account with Revolut Ltd (London) (“LEN24 Account”).
[15] Kingdom Fund’s investment with Ark Capital was carried out between December 2021 and April 2022 for an aggregate of US$2.55 million in six tranches. The funds were transferred to Ark Capital’s LEN24 Account on the following dates:
[16] The additional subscriptions were also accompanied by contracts which incorporated the same terms and conditions as the Term Sheet, and appeared to bear Mr Hiah and Mr Lee’s signatures for Ark Capital and Kingdom Fund respectively (“Additional Subscription Agreements”). The Claimant understood that Ark Capital would forward these funds received to its broker, Charterprime, to be traded by JPFS under a power of attorney to be executed by Ark Capital.
[17] Ark Capital, through David, would issue email confirmations acknowledging receipt of Kingdom Fund’s funds after each transfer. These emails included supporting documents purportedly from LEN24 Bank and Charterprime. David also forwarded what appeared to be performance statements and fact sheets bearing the logos of Charterprime and its custodian bank, National Australia Bank Ltd (Sydney) (“NAB”), as evidence of trading activity using the Investment Moneys. These statements also reflected certain “sub-accounts” with Charterprime, which David explained belonged to the Claimant under the main account that Ark Capital had with Charterprime (“Charterprime Sub-Accounts”). From 3 February 2022 to 13 September 2022, David provided Shenning Heritage with these monthly statements via email, together with commentary on the investments undertaken, their performance and prevailing market conditions.
[18] On 19 August 2022, Ms Elaine Tan of Shenning Investments wrote to David to query the delay in distribution of the Investment Moneys and returns thereon from Ark Capital to Kingdom Fund, and asked for supporting documents from the bank or third parties. David provided his correspondence with LEN24’s compliance department, which indicated that LEN24 had issues as to account ownership and had suspended Ark Capital’s account with LEN24. The correspondence further indicated that David had been attempting to liaise with LEN24’s compliance department since May 2022 to restore access. In the same email in reply to the Claimant, David sought the Claimant’s assistance to explain how it and Kingdom Fund were related, but remained separate legal entities. To resolve this issue, the Claimant produced a letter dated 24 August 2022 which sought to explain the relationship between Shenning Heritage, Kingdom Fund and Ark Capital, and their knowledge of the change in shareholding and directorship of Ark Capital. This letter was forwarded by David to LEN24 on 25 August 2022.
[19] As LEN24 appeared unresponsive, David then proposed to open accounts at other banks to link to Charterprime, eg, with UOB or NAB, so as to resolve the issue with the suspended bank account and resume distribution of the Investment Moneys and returns. The Claimant agreed with this proposal by email on 11 September 2022. David also proposed other alternatives, including for Ark Capital to set up an Indonesian subsidiary and open an account denominated in US$ for the subsidiary.
[20] On 15 September 2022, Mr Andy McIntyre (“Mr McIntyre”) of LEN24 replied to Shenning Heritage’s letter to inform that Ark Capital’s account with LEN24 was cancelled, and David’s application for a new account with LEN24 was received but subject to LEN24’s custodial partners’ approval. Mr McIntyre also explained that as Kingdom Fund was not the owner of the cancelled account, it was unable to influence the outcome of the process.
[21] On 4 October 2022, Kingdom Fund wrote to David attaching a letter dated 30 September 2022 (“30 September 2022 Letter”), in which Kingdom Fund requested Ark Capital to send documentary evidence of the suspension of the Ark Capital account with LEN24, and to return the Investment Moneys together with the returns of US$140,091.74. Kingdom Fund further stated that a monthly rate of 0.91% would be levied on all the outstanding unpaid dues to compensate it for the missed trading returns since 1 September 2022 (“Default Fee”), together with a late payment fee of 1.5% per month on all outstanding amounts if full payment was not received by 30 November 2022 (“Late Payment Fee”). David was asked to sign an acknowledgement page annexed to the 30 September 2022 Letter. However, David enquired if it should be “[his] dad to sign this letter since his name is on the subscription agreement”, and a revised execution page was sent with Mr Hiah’s name, which was subsequently returned with Mr Hiah’s signature apparently affixed.
[22] At a meeting on 11 October 2022, the parties negotiated an arrangement under which the amounts owed by Ark Capital, including the Default Fee and Late Payment Fee, which Ark Capital accepted liability for, would be repaid in three tranches between November 2022 and March 2023. David suggested that “[Mr Hiah] will draft a letter sent over to Kingdom Fund to say that as the shareholder of Ark Capital, he will be buying our Ark Investments”. This arrangement was subsequently captured in a buyout letter dated 26 October 2022 from Ark Capital (“Buyout Letter”), which was sent to Kingdom Fund from David’s email on 7 November 2022.
[23] Notwithstanding the Buyout Letter, David informed Kingdom Fund that his various attempts to secure funds to repay Kingdom Fund were unsuccessful. In or around January or February 2023, David informed the Claimant that he had signed a deal from which he might be able to obtain a significant commission and would use the commission received (in Indonesian rupiah) to repay Kingdom Fund. This did not come to fruition, and David claimed that there were various issues which prevented him from making repayment to Kingdom Fund.
[24] On 3 May 2023, David wrote to LEN24 warning that he would be lodging official complaints to the relevant authorities. Despite this, there was ostensibly no response from LEN24.
[25] This impasse lasted until June 2023, when Kingdom Fund requested evidence from Ark Capital that its funds were still safe in Charterprime. David reverted with various statements for the Charterprime Sub-Accounts, including a “client’s summary” for each Sub-Account which reflected, amongst others, the purported balance and profits of each Sub-Account from January 2022 to December 2022. This was followed by a similar email from David attaching statements and a client’s summary for the Charterprime Sub-Accounts for January 2022 to June 2023, together with a letter from Ark Capital titled “Monthly Returns” showing the purported monthly net return and account balance for all six Charterprime Sub-Accounts (“Ark Capital Monthly Returns Letter”). The Ark Capital Monthly Returns Letter purported to contain Mr Hiah’s signature. Similar Ark Capital Monthly Returns Letters continued to be sent until October 2023.
Discovery of irregularities
[26] At around the same time, in April 2023, Shenning Investments started another fund, and it sought to make further investments in the FX Strategy with JPFS due to its reported good performance. David introduced JPFS directly to Shenning Investments, and Shenning Investments established direct contact with JPFS for the first time.
[27] From September to October 2023, Kingdom Fund repeatedly chased David for updates on its funds and investments. David gave the explanation that although Kingdom Fund’s funds were with Charterprime, access to Ark Capital’s account with Charterprime was restricted due to “AML issues” relating to LEN24. Kingdom Fund also urged David to go to Australia directly to meet with representatives from Charterprime and arrange for the return of funds, but David continued to demur and gave various reasons against making the trip. He also claimed that his contact at Charterprime had left and he had no other point of contact. Shenning Heritage then filed a police report against LEN24 on 26 September 2023.
[28] Finally, in October 2023, Kingdom Fund decided to explore options to recover the funds itself. On 17 October 2023, Mr Ng from Shenning Heritage spoke to Mr Mikkel Thorup (“Mr Thorup”), an investment professional with JPFS, without David’s presence. Mr Ng was shocked to learn that Mr Thorup had never dealt with any of the funds from Kingdom Fund and had no knowledge of any of the alleged Charterprime Sub-Accounts. When Mr Thorup was shown the statements sent by Ark Capital to Kingdom Fund, he commented that they did not resemble official Charterprime statements, and that it was odd for any official statement from Charterprime to refer to NAB at the top of their statement. Finally, Mr Thorup also explained that he only ever traded two accounts involving Ark Capital with Charterprime, and those account numbers did not match the account numbers for the purported Charterprime Sub-Accounts as reflected in the statements provided by David.
The 31 October 2023 Meeting
[29] Prompted by this discovery, Mr Ng arranged for a meeting with David in the Claimant’s office. On 31 October 2023 at around 1.30pm, David attended a meeting with Mr Ng, Mr Lee and Shenning Heritage’s solicitor, Mr Nawaz Kamil (“Mr Kamil”) (the “31 October 2023 Meeting”).
[30] At the 31 October 2023 Meeting, David was asked about Kingdom Fund’s moneys, and he was informed that Kingdom Fund was aware that the purported Charterprime Sub-Accounts did not exist. David confessed that he created the Charterprime Statements himself and then emailed these false documents to Kingdom Fund in the form of the Ark Capital Monthly Returns Letters. He also admitted that the Investment Moneys were not with Charterprime. While David claimed that he had other assets worth close to US$6 million, he said that he believed that the moneys were with LEN24, but that LEN24 had locked his account and so he was unable to access them. David also indicated that he was willing to put up his personal assets with Kingdom Fund to make up for the missing funds.
[31] Following these admissions, David promised that he would assist Kingdom Fund in recovering its funds, and that he would be personally responsible for such losses. Kingdom Fund then prepared the following documents for David to execute:
(a) a deed of personal undertaking and personal guarantee dated 31 October 2023, where David agreed to provide Kingdom Fund with “a personal undertaking and guarantee as to all obligations, liabilities, debts, whether presently owing or in the future, which arise under” the Term Sheet and the Additional Subscription Agreements (“David Personal Undertaking”);
(b) a power of attorney from David dated 31 October 2023 in general terms (“David POA”);
(c) a power of attorney from Ark Capital dated 31 October 2023 granting powers in similarly general terms, save for an express reference to the Term Sheet and the Additional Subscription Agreements (“Ark Capital POA”); and
(d) a statutory declaration dated 31 October 2023 setting out various statements David had made during the 31 October 2023 Meeting (“31 October SD”), including that:
(i) the statements sent to Kingdom Fund were not created by Charterprime, but by David, and that the trades were copied from some other account and pasted into the statements;
(ii) the Investment Moneys totalling US$2.55 million were never transferred to Charterprime; and
(iii) David had never previously informed Kingdom Fund of this until 31 October 2023 and believed that LEN24 had stolen the Investment Moneys.
[32] David was also informed that his father, Mr Hiah, would need to execute similar documents as a director of Ark Capital. David initially offered to take the documents home for Mr Hiah to sign them, but this proposal was rejected by Mr Kamil. Instead, another meeting was arranged for the next day during which Mr Hiah would attend at Shenning Heritage’s office and execute the documents.
Events subsequent to the 31 October 2023 Meeting
[33] On the night of 31 October 2023, David visited Mr Hiah at Mr Hiah’s home to request that he visit Shenning Heritage’s office the next day. David confessed to Mr Hiah that Mr Hiah was listed as Ark Capital’s director and shareholder without Mr Hiah’s knowledge or consent. After returning home, David also informed Ms Li about his issue with the Claimant and that he had signed the David Personal Undertaking and the David POA. Ms Li was upset with David and had complained earlier in the evening that David had missed picking up their daughter at the last minute. David also admitted to Ms Li that Mr Hiah was asked to attend at Shenning Heritage’s office as he had used Mr Hiah’s electronic signature to execute Ark Capital’s agreements.
[34] On 1 November 2023, Mr Hiah attended at Shenning Heritage’s office together with David, and met with Mr Lee and Ms Kwee-Ng (“1 November 2023 Meeting”). At this meeting, Mr Hiah signed a power of attorney in the presence of a Commissioner for Oaths granting similar powers to Kingdom Fund and the Claimant as the David POA (“Mr Hiah POA”). However, Mr Hiah did not sign the prepared undertaking and personal guarantee, as he expressed concerns about the potential impact of signing such documents on his work in the insurance industry, and indicated that he wished to seek further advice. These other documents were never signed by Mr Hiah.
[35] On 2 November 2023, David volunteered certain personal items, including his Rolex Daytona watch and two Hermes leather bags that he had bought for his wife.
[36] On 3 November 2023, David met again with Ms Kwee-Ng and Mr Lee in Shenning Heritage’s office (“3 November 2023 Meeting”). During this meeting, parties dialled Charterprime’s main line, and Mr Ng and Ms Kwee-Ng spoke to Charterprime’s operations manager, Mr Jackson Toal (“Mr Toal”). Ms Kwee-Ng and Mr Lee explained that they were physically present with David, and that David was unable to access his Charterprime accounts online. Mr Toal then sent new passwords for the Charterprime accounts under David’s name to David’s email account. David forwarded these passwords to Mr Lee on 4 November 2023.
[37] Ms Kwee-Ng and Mr Lee accessed David’s Charterprime accounts under Ark Capital using the passwords, and discovered that there were no such accounts of Kingdom Fund which David claimed that the Investment Moneys were in. Further, on or around 6 March 2023, David had transferred US$238,835.38 from two Charterprime accounts into a LEN24 account hitherto unknown to Kingdom Fund. It was also discovered that David’s Charterprime accounts under Ark Capital had almost no funds in them.
[38] On 4 November 2023, David met with Ms Kwee-Ng and Mr Lee at a consignment shop. David brought his Rolex Daytona watch and two Hermes bags. David claimed that the two Hermes bags were gifts to Ms Li and she volunteered to allow for them to be sold to assist David. Ms Li’s messages to David on 4 November 2023 in this regard were in the following terms:
[39] These items were valued and handed over to Ms Kwee-Ng with the intention of selling them to recover funds. An email with photos of the two Hermes bags attached was sent by David to Mr Lee and Mr Ng to record this arrangement. The Rolex Daytona watch was subsequently sold for S$20,000, and the two Hermes bags for S$9,000 and S$4,800 respectively. The proceeds were deposited into Kingdom Fund’s account.
The 6 November 2023 Meeting
[40] On 6 November 2023, David attended another meeting at Shenning Heritage’s office with Mr Lee and Ms Kwee-Ng (the “6 November 2023 Meeting”). At this meeting, David signed agreements to allow Kingdom Fund to access his personal account with Interactive Brokers (“IBKR Account”), his personal POSB account (“David POSB Account”) and his personal Maybank account. The login details to these accounts were provided to Kingdom Fund (“Access Agreement”). David also granted consent for Kingdom Fund to access his mobile phone and laptop, including his email account, Dropbox and Ark Capital’s email accounts, and for forensic imaging of his devices to be done. A statutory declaration to this effect was executed by David “for the purposes of recovering [David’s] personal assets towards the liabilities which [he] owe[s] to Kingdom Fund”. Mr Lee and Ms Kwee-Ng reviewed the information on David’s laptop and mobile phone, and extracted certain pieces of information.
[41] During Mr Lee and Ms Kwee-Ng’s review of David’s accounts, they were unable to locate any email between David, Ark Capital and BWCG. From the examination of the information contained in David’s devices, as well as from logging into his accounts, the Claimant surmised that the following transfers took place from Ark Capital’s LEN24 Account:
[42] It was subsequently discovered, after Mr Hiah had provided his bank statements, that although the bank statement from LEN24 reflected a transfer to Mr Hiah’s bank account on 26 April 2022, no money was received by him.
[43] Based on screenshots of WhatsApp conversations between David and Mr Wong, it appeared that David had been actively arranging for payments out of the Charterprime accounts to his mother’s account.
[44] During the 6 November 2023 Meeting, David informed Ms Li that he had surrendered control of the IBKR Account and bank accounts, together with his devices. Ms Li then requested to go to Shenning Heritage’s office to explain that the stocks in the IBKR Account in fact belonged to her. However, David replied that “[Mr Ng] says not today.”
[45] After the 6 November 2023 Meeting, Kingdom Fund effected a transfer of S$110,605 from the IBKR Account to the David POSB Account. However, David later changed the password to the David POSB Account and prevented Kingdom Fund from transferring this sum to itself.
[46] On or around 7 November 2023, David handed over his phone and laptop to the forensic imaging professional engaged by Shenning Heritage, but the forensic imaging was not successfully completed. David then agreed on the following day to allow Ms Kwee-Ng to take photos of relevant WhatsApp messages from his phone. Ms Kwee-Ng took photos of David’s communications with his wife, and any messages containing references to Ark Capital and LEN24. After about 30 to 45 minutes, David’s phone was returned to him, and Shenning Heritage’s IT manager also performed a backup of David’s laptop which included his email accounts, and the contents of his Dropbox.
[47] On 9 November 2023, the Claimant wrote to David to demand the S$110,605 which was transferred from the IBKR Account to the David POSB Account. On 13 November 2023, David replied via email to say that he had signed the Access Agreement “under unfair circumstances”, and that the money in the IBKR Account belonged to Ms Li.
[48] Finally, on 15 November 2023, the Claimant sent another letter of demand to David to reject the allegations made by David in his email and demand that David immediately contact the Claimant to arrange for a meeting.
Procedural history
[49] The present proceedings have been protracted. Numerous summons and applications were made, and judgments have been granted against some of the defendants. I thus briefly set out the procedural history and highlight some of the procedural steps in so far as I deem them relevant to these proceedings.
Filing and eventual service of OC 821
[50] HC/OC 821/2023 (“OC 821”) was first filed on 28 November 2023 with an Endorsement of Claim, together with a summons for a freezing injunction against David, Mr Hiah, Ark Capital and BWCG, and for service out of jurisdiction against Ark Capital. The application for a freezing injunction was heard and dismissed by a Judge on 30 November 2023. The Claimant applied for and obtained leave for substituted service against David and Mr Hiah, together with leave for service out of jurisdiction against Ark Capital.
[51] Shenning Heritage effected service of OC 821 with no corresponding statement of claim on Ms Li on 8 December 2023 via her solicitors, and parties engaged in without prejudice negotiations with a view to settling the claim against Ms Li. After a round of cross-applications by the Claimant and Ms Li, OC 821 was renewed for service and the time for service of the Claimant’s statement of claim on David, Mr Hiah and Ms Li was extended until 19 April 2024 vide HC/ORC 1809/2024. The Statement of Claim (“SOC”) was filed on 19 April 2024. Mr Hiah and Ms Li filed their respective Defences on 9 May 2024, and David filed his Defence on 15 May 2024.
Default judgments and enforcement proceedings against Ark Capital and BWCG
[52] An application was taken out against Ark Capital on 14 May 2024 for judgment for failing to file a notice of intention to contest or not contest, and judgment in default was entered on 14 May 2024 vide HC/JUD 173/2024. A similar application was taken out against BWCG for its failure to file its defence, and judgment in default for US$1,500,000 was entered on 7 June 2024 vide HC/JUD 211/2024.
[53] After the default judgments were entered, Shenning Heritage commenced examination of enforcement respondent proceedings against David, as the sole director of Ark Capital in HC/SUM 1930/2024, and against Mr Wong Yuen Soon (“Mr Wong”) as the sole director of BWCG in HC/SUM 2201/2024.
[54] Subsequently, on 29 October 2024, BWCG applied in HC/SUM 3173/2024 for the default judgment against it to be set aside, together with a stay of enforcement of the default judgment in HC/SUM 3107/2024. These applications were dismissed on 28 January 2025. It transpired over the course of proceedings that Mr Wong had been disqualified from acting as a director since 20 November 2024, and court directions were repeatedly disregarded. The learned AR found that the explanations proffered by Mr Wong as to why BWCG received funds from Ark Capital were unsatisfactory, and his evidence supporting the assertion that BWCG had returned the funds received to Ark Capital was similarly suspect. The AR also observed that during the more than four months between the default judgment and the setting aside application, Mr Wong had continually assured Mr Ng that BWCG would pay the judgment debt.
Summary judgment against David
[55] On 14 September 2024, the Claimant applied for summary judgment in HC/SUM 2659/2024 against David for US$3,304,929.63 and an order that David declare and surrender all his assets, including any cash held in David’s IBKR Account and all shares he holds in Ark Capital (“Summary Judgment Application”).
[56] In David’s affidavit dated 19 October 2024 resisting the Summary Judgment Application, he made several factual assertions:
(a) First, he said that he was pressured by the Claimant and Mr Kamil into signing various documents, including the 31 October SD, and that there were representations made by Mr Ng that the Claimant would not seek to enforce the David Personal Undertaking.
(b) Second, he contested the accuracy of the transcript produced by the Claimant for the 31 October 2023 Meeting.
(c) Third, he said that the Claimant was actually or constructively aware that the funds transferred to Ark Capital’s LEN24 Account were in that account and had not been transferred to Charterprime, as he “had not communicated to the Claimant that the funds had been transferred”.
(d) Fourth, he claimed that he did not tell the Claimant that continued the attempts by Ark Capital to get funds were unsuccessful, and neither did he request for a 12-month extension to raise the funds. On his account, it was the Claimant who wanted David to open an account for Ark Capital in Indonesia so that the commission from the deal (at [23] above) could eventually be transferred to the Claimant.
(e) Fifth, while he admitted to transferring US$238,835.38 from the account of Ark Global Holding Pte Ltd (another entity controlled by David) with Charterprime to two LEN24 accounts controlled by BWCG, David claimed that this was at the suggestion of BWCG, which represented that they would be able to procure the onward transfer of these funds to the Claimant’s DBS account. Further, David claimed that because BWCG had failed to do this, he believed that the sum had been converted by BWCG, and he stated that he had made police reports against BWCG.
(f) Sixth, he claimed that while the IBKR Account bore his name, the moneys in the IBKR Account belonged to Ms Li.
[57] After a further round of affidavits that, among other things, addressed issues arising out of the meeting on 11 October 2022 (see [22] above), the learned AR granted the Summary Judgment Application on 10 January 2025. The AR was satisfied that the Claimant had established a prima facie claim in contract in respect of the David Personal Undertaking and the David POA, and that David had failed to raise triable issues. In particular, the AR found that:
(a) David’s assertion that the recording did not capture a representation from the Claimant’s representative, to the effect that the Claimant would not seek to enforce the David Personal Undertaking, was an “incredible” one.
(b) David’s case was not clearly particularised, and the alleged representation appeared to have been a “mere afterthought”.
(c) As to the alleged pressure asserted by the Claimant’s representatives or Mr Kamil, this was not borne out by the transcript, nor were the means by which such undue influence or duress was allegedly exerted particularised in David’s pleadings.
Calling David as a witness
[59] As the matter progressed, a further issue arose as to David giving evidence at the trial of this action. The Claimant had initially indicated that it would be calling David as a witness and seeking dispensation of the filing of an affidavit of evidence-in-chief (“AEIC”). However, this was not pursued, and none of the parties indicated that they would be calling David as a witness prior to the commencement of trial. Notwithstanding this, Mr Hiah, who was then unrepresented, made an application for leave to call David as his witness at the start of trial. I directed that Mr Hiah was to produce a written statement of the matters to be dealt with by David, should I allow David to be called as a witness, and this was produced on the morning of the second day of trial (“Statement”). I allowed the application as there would be no significant prejudice to the Claimant for David to deal with the issues specified in the Statement, since the issues substantially followed the position taken in Mr Hiah’s AEIC. I also allowed the Claimant and Ms Li the opportunity to cross-examine David in relation to the case against Ms Li. Directions were given for David to file an AEIC limited to the issues set out in the Statement.
[60] The foregoing procedural history leads to the result that only the Claimant’s claims against Mr Hiah and Ms Li arose for my determination after trial, although I shall go on to address the effect of the summary and default judgments obtained against the other defendants.
The parties’ cases
[61] As the Claimant relies on multiple different causes of action against each of the defendants, it would be helpful to set out in some detail the Claimant’s case against each of the defendants, as well as the defences raised by Mr Hiah and Ms Li.
The Claimant’s case
As against David, Ark Capital and BWCG
[62] The Claimant mounts a myriad of claims against David, Ark Capital and BWCG in its SOC. These include:
(a) that fraudulent misrepresentations were made by David and Ark Capital in the form of performance statements and fact sheets reflecting trades being done using Kingdom Fund’s Investment Moneys between 6 April 2022 and 13 September 2022, to the effect that (i) the funds which Kingdom Fund had transferred to Ark Capital were invested using the FX Strategy in accordance with the terms of the Term Sheet and the Additional Subscription Agreements, (ii) the investments were profitable, and (iii) the Investment Moneys were safe and being held by Charterprime;
(b) that Ark Capital was contractually obliged to pay a sum of US$3,304,929.63 pursuant to the Term Sheet, the Additional Subscription Agreements and the Buyout Letter; and
(c) that David was liable for the same sum pursuant to the David Personal Undertaking executed by him.
[63] Additionally, the Claimant also submits that Ark Capital held Kingdom Fund’s moneys on trust for the benefit of Kingdom Fund, and that its transfers to the other defendants were in breach of this trust.
As against Mr Hiah
[64] The Claimant initially pursued a claim in knowing receipt for a sum of US$22,000 against Mr Hiah, which was a purported transfer from Ark Capital’s LEN24 Account to Mr Hiah’s DBS account on 26 April 2022, but this claim was later abandoned during trial. As such, at the conclusion of trial, the Claimant’s case against Mr Hiah was for dishonest assistance in Ark Capital’s breach of trust.
[65] The Claimant says that Mr Hiah, as a director of Ark Capital, knew or ought to have known that Kingdom Fund’s moneys were to be invested under the Term Sheet and Additional Subscription Agreements. By providing his personal bank account to receive Kingdom Fund’s moneys, the Claimant claims that Mr Hiah had dishonestly assisted in the disposal of the moneys into his personal bank account.
As against Ms Li
[66] The Claimant similarly pursued a claim for US$12,000 against Ms Li, being another purported transfer from Ark Capital’s LEN24 Account to Ms Li’s DBS account on 1 March 2022. The Claimant mounted claims in dishonest assistance and knowing receipt against Ms Li for providing her personal bank account to receive Kingdom Fund’s moneys. The argument was similar to that against Mr Hiah, save that she was not a director of Ark Capital and therefore there was no basis for her to receive funds from Ark Capital. The pleaded dishonesty is that as David’s wife, Ms Li had knowledge of David and Ark Capital’s dealings with the Claimant and therefore knew or ought to have known that Kingdom Fund’s moneys were meant for investment purposes under the Term Sheet and the Additional Subscription Agreements.
The unlawful conspiracy claim
[67] Finally, the Claimant also mounted a claim in unlawful means conspiracy. The Claimant averred that there was an agreement between David, Mr Hiah, Ms Li and BWCG to (a) forge documents to give the Claimant the impression that moneys were being invested according to the FX Strategy; (b) channel the moneys to their respective bank accounts; and (c) assist with the receipt and dissipation of the funds from the Claimant, which were unlawful acts done with the intent of causing loss to the Claimant. The Claimant relied on David and Mr Hiah’s alleged breaches of custodial and non-custodial fiduciary duties, breaches of other duties of a fiduciary nature, and breaches of their duty of skill, care and diligence, by virtue of their positions as directors of Ark Capital, together with the alleged dishonest assistance, knowing receipt and unjust enrichment on the part of each of David, Mr Hiah, Ms Li and BWCG, as being the unlawful means in question.
[68] However, as I had pointed out and as was accepted by counsel for the Claimant, the conspiracy claim could not be pursued against Ms Li in so far as it related to an existing agreement “since the time of the investment”. This is because there was clearly no evidence of any involvement by Ms Li in 2021. In the words of counsel for the Claimant, there was “[n]othing to tie her to the beginning.” Counsel for the Claimant had also accepted that even if there was a conspiracy, Mr Hiah and Ms Li were not a part of that conspiracy “from the start”.
Mr Hiah’s defence
[69] Mr Hiah’s defence is a simple one. He argues that he was not a knowing participant in the affairs of Ark Capital, nor did he know about his purported appointment as director and majority shareholder of Ark Capital until right before the 1 November 2023 Meeting. David has confessed that Mr Hiah’s signatures on the Ark Capital documents, save for the Mr Hiah POA executed during the 1 November 2023 Meeting itself, were all forged or printed by David without his knowledge. Therefore, Mr Hiah remained in complete ignorance of the affairs of Ark Capital, or David’s dealings with LEN24, Charterprime, Kingdom Fund or Shenning Heritage until the night of 31 October 2023 when David spoke to him in his home. Further, his case is that he understood the execution of the Mr Hiah POA in Shenning Heritage’s office during the 1 November 2023 Meeting as granting authority to deal with LEN24 in order to recover moneys, and not as an acknowledgement of personal financial liability. As such, he could not be involved in any alleged conspiracy, nor did he possess the requisite knowledge and intention for dishonest assistance. Finally, if he did not know about his appointment as director of Ark Capital, then no fiduciary duty can arise between him and Ark Capital.
Ms Li’s defence
[70] Ms Li’s defence is founded on a similar basis in that she had minimal knowledge of the arrangement between David, Ark Capital and the Claimant beyond what little was shared with her by David. While she admits that a sum of US$12,000 was transferred to her account on or around 1 March 2022, she says that this transfer was pursuant to an arrangement between her and David to conduct swaps of foreign currency between themselves so as to save on bank foreign exchange charges (“Forex-Swap Arrangement”). Pursuant to this Forex-Swap Arrangement, she had correspondingly transferred S$16,000 to David on 4 March 2022. Ms Li also argued that the Claimant could not prove that this sum was beneficially owned or traceable to property beneficially owned by it.
[71] Further, in relation to the IBKR account in David’s name, Ms Li’s account is that (a) both she and David had contributed to the account on the understanding that the funds therein would be used for their daughter’s education; (b) there was an understanding between parties as to who owns which stock position; and (c) David had liquidated all his stock positions by February 2023, with the result that the remaining stock positions in David’s IBKR account belonged to her exclusively.
Issues to be determined
[72] As can be surmised from [62]–[68] above, the Claimant’s causes of action against the remaining defendants, ie, Mr Hiah and Ms Li (who, for convenience, I shall refer to collectively as the “Defendants”), lie essentially in knowing receipt, dishonest assistance and the tort of unlawful means conspiracy.
[73] Thus, following from the parties’ respective cases, the following issues arose for my determination:
Preliminary issue: Effect of judgments obtained
[74] The Claimant raises as a preliminary point that any allegations made or evidence given by David which relate to matters which have already been determined by the court against him should not be treated as issues requiring determination from trial as a result of the judgment against him, together with Ark Capital and BWCG. It says, on this basis, that “there was no evidence from the other Defendants […] to challenge the pleaded facts on the conspiracy claim against these other Defendants.” Mr Hiah, however, takes the position that any effect of res judicata or estoppel can only operate between the parties to a default judgment and their privies. He relies on Neptune Capital Group v Sunmax Global Capital Fund 1 Pte Ltd [2016] 4 SLR 1177 (“Neptune Capital”) for the proposition that a default judgment is not evidence of the facts pleaded against a co-defendant who actively defends the claim, still less as conclusive proof of them.
[75] It is generally true that cause of action estoppel, issue estoppel and the “extended” doctrine of res judicata all require an identity of parties: The Royal Bank of Scotland NV v TT International Ltd [2015] 5 SLR 1104 at [101]–[102]. This requirement is the necessary corollary to the rule that judgments in personam only determine the rights and liabilities of parties inter se such that only parties or privies to such judgments in personam can benefit from their preclusionary effect: Gonzalo Gil White v Oro Negro Drilling Pte Ltd [2024] 1 SLR 307 at [101].
[76] This is the first hurdle for any claim for res judicata, and the Claimant fails to surmount it. The Claimant did not argue that the Defendants were privies of David, Ark Capital or BWCG. Even if it was assumed that Mr Hiah was a director of Ark Capital at the relevant time, the company is a separate legal entity from the director and any attempt at shedding this distinction ought to have been pleaded: Nagase Singapore Pte Ltd v Ching Kai Huat [2008] 1 SLR(R) 80 at [13]. In any event, for reasons which I shall elaborate on below, I do not think an attempt at identifying Mr Hiah with Ark Capital can succeed on the evidence. Therefore, I agree with Mr Hiah that no res judicata can apply as against the Defendants, in so far as the default judgments were only entered as against Ark Capital and BWCG, summary judgment was entered against David personally, and the Defendants did not participate in those proceedings.
[77] Further, issue estoppel arises only when the following requirements are met (Turf Club Auto Emporium Pte Ltd v Yeo Boong Hua [2017] 2 SLR 12 at [87]):
[78] Although a default judgment can give rise to both res judicata and issue estoppel, it is necessary to determine with complete precision what has been decided, and to do so having regard to the history of the litigation: Hii Yii Ann v Tiong Thai King [2024] SGHC(I) 21 (“Hii Yii Ann”) at [61]. A judgment given due to the default of parties could create a situation of res judicata if it “determined an issue which, when formulated, necessarily and with complete precision determined the rights of the parties”: Neptune Capital at [50]. The question in Neptune Capital was whether a default judgment obtained due to a breach of an unless order was capable of giving rise to res judicata, and specifically whether a default judgment could amount to a judgment on the merits. The Court considered the statement of claim as well as the defence and counterclaim filed, and determined that the language of the default judgment obtained dealt with and settled the claim, thus giving rise to res judicata: Neptune Capital at [51]–[55]. It is hence necessary to scrutinise the default judgment carefully in order to see precisely what was decided, having regard to the history of the litigation in some detail: Syed Ahmad Jamal Alsagoff v Harun bin Syed Hussain Aljunied [2011] 2 SLR 661 at [38] and [44].
[79] It is apposite to note that the default judgments against both Ark Capital and BWCG were obtained prior to the filing of any defence. As such, unlike the situation in Neptune Capital, there was no pleading filed by the respective defendants before default judgments were obtained. Further, in the present case, the wording of the default judgments themselves is broad and refers only to the fact that “[n]o Defence having been filed” by BWCG, and “[n]o notice of intention to contest or not contest having been filed” by Ark Capital. It is thus unclear, on the face of the judgments, whether any issue on the merits had been decided.
[80] I proceed to more closely examine the history of the litigation and the pleadings. In so far as the claim was against Ark Capital, the causes of action are breach of contract, fraudulent misrepresentation and breach of trust. Ark Capital’s liability under these causes of action would not necessarily implicate either Ms Li or Mr Hiah. As for BWCG, the pleaded claim as against it was in dishonest assistance, knowing receipt and conspiracy. I note that an attempt to set aside the default judgment was rejected after arguments and evidence was presented by BWCG. However, BWCG’s liability does not automatically establish liability against the Defendants either, whether in conspiracy or otherwise. Although once a conspiracy is proven, each co-conspirator is jointly and severally liable (National Bank of Oman SAOG Dubai Branch v Bikash Dhamala [2021] 3 SLR 943 at [50]), a successful claim in conspiracy does not mean that liability of each of the alleged co-conspirators is automatically established: The “Dolphina” [2012] 1 SLR 992 at [282]. In any event, I do not read the default judgment entered against BWCG to necessarily establish its liability in conspiracy, since the claims for dishonest assistance and knowing receipt would render it liable for US$1,500,000, whereas if liability for conspiracy is established, the quantum of damages awarded may well be a different sum. Thus, upon closer examination, even beyond the fact that there is no identity of parties, the default judgments also do not determine “an issue which, when formulated, necessarily and with complete precision determined the rights of” the Defendants so as to give rise to issue estoppel: Neptune Capital at [50].
[81] Turning to consider the summary judgment entered against David personally, I similarly find that it cannot have the effect of foreclosing any evidence from David as to the Defendants’ liability for the alleged conspiracy. The AR, in entering summary judgment, had made clear the remit of the summary judgment:
[82] The above makes clear that there was no finding on any of the other causes of action against David in the summary judgment, including any alleged breach of trust. The summary judgment does not preclude David from giving evidence in relation to the claims in dishonest assistance, knowing receipt or conspiracy. To the extent that the Claimant seeks to weaponise the summary and default judgments and forestall any arguments on the facts, it bears highlighting the caution extolled by Megarry VC in Gleeson v J Wippell & Co Ltd [1977] 1 WLR 510 at 516 (cited in Hii Yii Ann at [46]):
[83] Thus, the judgments against David, Ark Capital and BWCG granted in the Claimant’s favour, in light of the Defendants’ respective cases, have little impact on my present determination. Neither do they preclude any challenge by the Defendants to the Claimant’s case in relation to the claim in conspiracy.
Dishonest assistance and knowing receipt
[84] I turn next to the claims in dishonest assistance and/or knowing receipt against the Defendants. The requisite elements for a claim in dishonest assistance have been set out comprehensively in Esben Finance Ltd v Wong Hou-Lianq Neil [2022] 1 SLR 136 (“Esben Finance (CA)”) at [255]:
[85] The requisite elements of a claim in knowing receipt are also set out in Esben Finance (CA) at [256]:
[86] Having set out the elements of the two causes of action, it is apparent that they share some common elements. Both dishonest assistance and knowing receipt would require the existence of some fiduciary duty, as well as an enquiry into the defendant’s state of mind, ie, whether he knows that the assets received are traceable or whether he possessed the requisite element of dishonesty. It is to these two common questions that I now turn.
Existence of trust or fiduciary duty
[87] The existence of a trust or some other basis for a fiduciary duty is a fundamental requirement for claims in both dishonest assistance as well as knowing receipt: Aljunied-Hougang Town Council v Lim Swee Lian Sylvia [2019] SGHC 241 at [450]–[451] and [631]. The Claimant’s claims in dishonest assistance and knowing receipt are both premised upon the alleged breach of trust by Ark Capital in relation to the Investment Moneys, which it says were held on trust by Ark Capital. As Mr Lee rightly conceded during cross-examination, there is no express mention of a trust in the Term Sheet or the Additional Subscription Agreements. The Claimant argues that the Investment Moneys were held by Ark Capital on a Quistclose trust, as the Term Sheet provided for the specific use of the Investment Moneys and the specific and limited role of Ark Capital as an intermediary between the Claimant and Charterprime.
Quistclose trust
[88] For a Quistclose trust to arise, there must be the twin certainties of subject matter and object, and the object must be stated with sufficient clarity for a court to determine if it is still capable of being carried out or if the money has been misapplied: Envy Asset Management Pte Ltd v CH Biovest Pte Ltd [2024] SGHC 46 (“Envy Asset Management”) at [46(b)]. Additionally, for an express Quistclose trust, the settlor-donor must intend to constitute the recipient as a trustee, and confer a power or duty on the recipient-trustee to apply the money exclusively in accordance with the stated purpose: Envy Asset Management at [46(c)]. Alternatively, for a resulting Quistclose trust, the donor must have a lack of intention to part with the entire beneficial interest in the transferred money. The recipient must not have free disposal of the money and must be under a power or duty to apply the money exclusively in accordance with the stated purpose: Envy Asset Management at [46(d)]. The key ingredient of a Quistclose trust is that a donor “transfers money to a recipient for a specified purpose” (Envy Asset Management at [46]), but a Quistclose trust does not arise simply because money is paid for a particular purpose: Attorney-General v Aljunied-Hougang-Punggol East Town Council [2015] 4 SLR 474 at [120]. Even though the purpose need not be precisely defined, it must be expressed “sufficiently clearly for a court to be able to say of any application of the money that it does or does not fall within the terms of the power given”: Underhill and Hayton: Law of Trusts and Trustees (Charles Mitchell et al eds) (LexisNexis, 20th Ed, 2022) at para 27.6. Further, while there is no strict need for segregation to infer the necessary intention for a Quistclose trust to arise, there exists a relatively high evidential burden to prove that segregation was at least contemplated: Wei Ho-Hung v Lyu Jun [2022] 2 SLR 1066 at [43].
[89] Mr Hiah argues that the requisite features of a Quistclose trust are absent on the present facts. Beyond the absence of an express reference to the existence of a trust anywhere in the contractual documents, the Term Sheet, in providing for a promised fixed band of return, is more emblematic of a debtor-creditor relationship than of one where the investor retains the beneficial interest in the very moneys advanced. There was no requirement of segregation of the Claimant’s moneys, no requirement of a separate client account and no restriction on Ark Capital’s free disposal of the funds pending deployment. He goes on to argue that an obligation to invest the assets or to act honestly, in good faith and with reasonable care, also does not evince a mutual intention for the Claimant to retain beneficial ownership. Finally, that the Charterprime Sub-Accounts were purportedly created cannot retrospectively constitute the mutual intention of the parties at the time of transfer.
[90] For reasons which I elaborate on below, I agree with Mr Hiah’s argument and find that there is no trust, whether Quistclose or otherwise, over the Investment Moneys held by Ark Capital as trustee.
[91] In determining whether there was a Quistclose trust over the Investment Moneys, the natural first port of call would be the wording of the Term Sheet pursuant to which the Investment Moneys were transferred to Ark Capital. As conceded by the Claimant, there is no express reference to a trust, and neither is there any reference to a trust being created in the Additional Subscription Agreements, the exhibited contemporaneous correspondence between Kingdom Fund and David, or the subsequent documents and correspondence exchanged concerning the purported investment. At clause 3 of the Term Sheet, the objective of Ark Capital is stated to be “achiev[ing] Capital Appreciation of the Investment Capital in the Account through active trading of G10-Currencies through their related Financial Securities and Obligations”. Clause 3 of the Term Sheet also states that Ark Capital “employs various strategies which include long-term and short-term trading strategies among G10-Currencies Markets and using ‘short’ positions in an attempt to profit from price declines of assets.”
[92] At first blush, these provisions appear to be “particular purposes” from which a Quistclose trust may arise. Nevertheless, a closer examination reveals the opposite. Even as the Term Sheet seeks to define the “trading strategy” to be adopted, Ark Capital also has the additional discretion under clause 3 of the Term Sheet to deviate from the stated methodology of investment by “keeping all, or a portion of, [Kingdom Fund’s] holdings in less volatile cash equivalents from time to time.” There is no accompanying definition as to what may constitute “related Financial Securities and Obligations” or “long-term and short-term trading strategies”. The purpose so formulated is not sufficiently clear to serve as a yardstick by which the court can measure compliance. There is thus little basis for the court to determine whether a particular application of the Investment Moneys by Ark Capital would have fallen outside of the stated purpose. This is unlike where the money was stipulated to be only for paying a dividend to the recipient’s shareholders (Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567 at 569), or to be applied solely for the acquisition of property and no other purpose (Twinsectra Ltd v Yardley [2002] 2 AC 164 at [16]). The Court in Envy Asset Management found that a restriction similar to the present instance, ie, for amounts provided by an investor to be applied “solely for investment in LME Nickel Grade Metal”, was “much too vague to have constituted the basis of a specific and exclusive purpose behind the payment”: Envy Asset Management at [51].
[93] The Claimant’s case appears to go slightly further in its closing submissions in arguing for a narrower purpose, ie, for Ark Capital to “receive the funds from the Claimant and then immediately transfer the moneys to Charterprime.” I accept that David had likely represented that the Investment Moneys may be sent on to Charterprime to be managed by JPFS as part of the FX Strategy, including through the execution of a Limited Power of Attorney by Ark Capital in favour of JPFS for Charterprime dated 15 December 2021. However, even as parties may have contemplated that Ark Capital was to transfer the Investment Moneys onwards to Charterprime to be managed by JPFS, it must also be appreciated that the express wording of clause 3 only obliges Ark Capital to “invest the assets of the Account”. If it had been intended from the beginning that Ark Capital could only send the Investment Moneys to Charterprime to be managed by JPFS, it is curious why this understanding was not captured in the Term Sheet or the subsequent Additional Subscription Agreements. Further, the communications before the execution of the Term Sheet do not indicate that parties contemplated such a restriction. The introductory material sent by David to Mr Ng on 31 January 2020 only introduced Ark Capital in broad terms, including a reference to the use of a “Global Multi-Asset Day-Trading Strategy”. Likewise, in the WhatsApp chatgroup titled “ARK Cap-Chee Yuen” between David and Mr Ng, wherein David shared information about the returns achieved by Ark Capital from April 2018 to April 2020, David made no mention of either Charterprime or JPFS. There is little to suggest that there was such a restriction on Ark Capital’s disposition of the Investment Moneys, which would be a crucial factor in the finding of a Quistclose trust: Toh Eng Tiah v Jiang Angelina [2020] SGHC 65 at [142]–[145]. Taking into consideration the language used in the contractual documents, any representation by David that the Investment Moneys would be moved to Charterprime could equally have been understood merely as an indication of how Ark Capital intended to invest the Investment Moneys, and not an agreement to narrow Ark Capital’s broad discretion provided for under the Term Sheet. Therefore, I do not think this argument can remedy the uncertainty as to the purpose of any alleged Quistclose trust.
[94] A further difficulty is that there is nothing to suggest that Kingdom Fund and Ark Capital intended for the Investment Moneys to be segregated. Although the Term Sheet refers to a “capital account” or an “Account” being maintained for Kingdom Fund, there is no further explanation as to what these accounts were and whether they would be separate either from other accounts presumably held by other investors with Ark Capital, or from Ark Capital’s own assets. The description of a “capital account” at clause 4 of the Term Sheet also does not necessarily entail segregation of the accounts from one another. Such an arrangement could be akin to accounts maintained by a bank for its depositors, where there is no necessary obligation to keep the assets represented by the account balances distinct. In such a situation, the bank is not a trustee of the depositor but a debtor: Damayanti Kantilal Doshi v Indian Bank [1998] 3 SLR(R) 851 at [12]. Although the Term Sheet and the Additional Subscription Agreements reference the account numbers of the Charterprime Sub-Accounts, their significance was not explained in the contractual documents themselves. These account numbers may well have been intended or understood by parties at the time of transfer to be for Ark Capital’s own record-keeping. The reference to a “Custodian Bank” and “Settlement Agent”, without any accompanying definition or explanation of these terms, similarly sheds little light on parties’ intentions. Again, following Envy Asset Management at [52], I find that there was no clear mutual intention for the Investment Moneys to be segregated from Ark Capital’s general fund.
[95] The Claimant points to the existence of contractual duties of good faith, to exercise reasonable care, diligence and skill, and to act in the best interests of the Claimant, as evidence that parties had intended there to be a trust. While an express trustee owes a fiduciary duty to perform the trust honestly and in good faith for the benefit of the beneficiaries of the trust (Credit Suisse Trust Limited v Bidzina Ivanishvili [2024] 2 SLR 164 at [39]), a duty of good faith can also be expressly created in contract (HSBC Institutional Trust Services (Singapore) Ltd v Toshin Development Singapore Pte Ltd [2012] 4 SLR 738 at [37]–[45]). A duty to exercise reasonable care, diligence and skill can equally be provided for contractually without implying the existence of a trust: Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric [2007] 1 SLR(R) 853 at [31]–[32]. Thus, the fact that these duties were provided for under the Term Sheet is at best neutral in evidencing parties’ intentions as to whether to part with the whole of the Claimant’s beneficial interest in the Investment Moneys, and as to whether there was a trust.
[96] I would finally observe that the existence of a Quistclose trust would make little commercial sense on the Claimant’s own case. The Claimant first takes the position that Ark Capital had given an undertaking as to investment returns via the Term Sheet. In its own letter imposing the steep Default Fee of 0.91% per month, the Claimant stated that the Default Fee was to “compensate for the missed trading returns for the period”. If this was indeed the arrangement between parties, Ark Capital would have been guaranteeing something which it had little control over, ie, the returns on assets supposedly held on trust to be invested in a specific manner. Having said this, I note that the Claimant’s position that there was such an undertaking may not be correct in view of the disclaimer at clause 5 of the Term Sheet that “there are neither assurances nor guarantees of any profits to the Investors”. As this aspect of the Claimant’s case does not arise for my determination, I make no finding on whether there was a contractually guaranteed rate of return, nor do I place much weight on this point.
[97] For all these reasons, I conclude that the Investment Moneys are not subject to a trust of which Ark Capital was a trustee, whether Quistclose or otherwise. As such, this cannot form the basis of a breach of trust or any fiduciary duty owed by Ark Capital (Acute Result Holdings Ltd v CGS-CIMB Securities (Singapore) Pte Ltd [2023] 5 SLR 406 at [119]), and the Claimant’s claims in dishonest assistance and knowing receipt as pleaded fail to meet this threshold requirement.
Ad hoc fiduciary duties
[98] For completeness, I am cognisant that there are other possible bases of fiduciary duty, including an ad hoc fiduciary duty. Nevertheless, the general rule is that parties are bound by their pleadings and that the court is precluded from deciding on a matter that the parties have not put into issue: V Nithia v Buthmanaban s/o Vaithilingam [2015] 5 SLR 1422 (“V Nithia”) at [39]. The Claimant does not plead or argue the existence of an ad hoc fiduciary duty but only relies on the existence of a trust. I am therefore left without the benefit of counsel’s submissions on this point. I find that, while there may be some overlap, the factors pointing to the existence of an ad hoc fiduciary duty as adopted in Celeste Yeo Xueli v Sin David [2025] SGHC 166 (“Celeste Yeo”) at [30] remain yet distinct from those relevant to the existence of a Quistclose trust (see [88] above). Going on to decide this point, when the material facts pointing to the existence of ad hoc fiduciary duties were not fully pleaded, may cause the defendant undue prejudice: How Weng Fan v Sengkang Town Council [2023] 2 SLR 235 at [29(b)]. Consequently, I go no further than the pleaded case, save to make the following general observations.
[99] First, I begin with the precept that the court should proceed with special caution when urged to make a finding that ad hoc fiduciary duties have arisen in commercial contexts, where parties deal at arm’s length and choose to govern their legal relationship by contract: Celeste Yeo at [32]. Where parties have entered into a contract, the terms of the contract have primacy in assessing the putative fiduciary’s power to affect the putative beneficiary’s legal interests, and any ad hoc fiduciary duty which may be superimposed on their relationship will have to conform to the terms of their contract: Ok Tedi Fly River Development Foundation Ltd v Ok Tedi Mining Ltd [2023] 3 SLR 155 at [87]. There remains a fundamental distinction between a contractual duty of fidelity and a fiduciary duty: Re Medora Xerxes Jamshid [2024] 5 SLR 1006 at [64]–[69]. The fact that a person has assumed responsibility giving rise to duties in contract or tort to act to protect the interests of another is not sufficient in itself to give rise to a fiduciary duty: Hopcraft v Close Brothers Ltd [2026] AC 877 at [106]. Without taking a definitive view, I express my doubts as to whether a contractual obligation of good faith and best interests so broadly phrased can have the effect of subjugating the interests of the obligor to the interests of the obligee: Tahnoon Pasha v Hill, Avere Mark [2026] SGHC 36 at [61]–[64]. This would be unlike the situation of a fiduciary duty, where the fiduciary is obliged to subjugate all other interests, including his own, in the discharge of the fiduciary duty: Celeste Yeo at [31]. Of course, there are situations, albeit unusual, where two commercial parties using similar contractual language, in light of the facts and context of the particular case, intended for the existence of fiduciary duties (see eg, CNA v CNB [2023] 5 SLR 1 at [142]–[146]), but this must fall to be considered within the specific facts and context.
[100] Further, in so far as Ark Capital would have a share of the profits generated under the Term Sheet, it did not equally share in any losses which may be incurred. This is another indicium that it was unlikely that an ad hoc fiduciary duty arose: Kelly, Patrick Michael v Clicks2customers Pte Ltd [2023] 3 SLR 431 at [39].
[101] Finally, the Claimant alluded to David’s breach of fiduciary duty as an (unpleaded) basis for the claim in dishonest assistance in its reply closing submissions. However, the relevant breach relied on cannot be any breach of fiduciary duties owed to Ark Capital by David or Mr Hiah as directors, since a claim in dishonest assistance is a type of accessorial liability and there must be “a breach of duty by a person in a fiduciary relationship with the plaintiff” [emphasis added]: Foo Jee Boo v Foo Jhee Tuang [2016] SGHC 260 at [195]. The Claimant has made no case as to how David or Mr Hiah owed fiduciary duties directly to the Claimant.
Knowledge and/or dishonesty
[102] The conclusion at [97] above is sufficient to dispose of the claims in dishonest assistance and knowing receipt. Nevertheless, the parties had, in cross-examination and submissions, extensively addressed whether the Defendants had acted dishonestly or had any knowledge of the alleged breach of trust. It is to this issue that I now turn. For clarity, I proceed to consider Mr Hiah and Ms Li’s respective positions separately.
As against Mr Hiah
[103] To recapitulate, only the claim in dishonest assistance is being pursued against Mr Hiah, and the question is thus whether the requisite element of dishonesty is made out.
[104] In order to establish such dishonesty, Mr Hiah must be shown to have had “knowledge of the irregular shortcomings of the transaction that ordinary honest people would consider it to be a breach of standards of honest conduct if he failed to adequately query them”: George Raymond Zage III v Ho Chi Kwong [2010] 2 SLR 589 (“George Raymond Zage”) at [22]. This can be either actual knowledge, or the wilful ignorance of knowledge, and the alleged assistor does not need to know exactly what is going on so long as he suspects that something dishonest might be going on: Yong Kheng Leong v Panweld Trading Pte Ltd [2013] 1 SLR 173 at [81].
[105] Mr Hiah’s defence is a simple and complete one: he knew nothing about the dealings between David, Ark Capital and the Claimant. His signatures on all the documents were forged or printed by David without his knowledge. The Claimant disputes this by relying on the signatures themselves, together with the factual assertion that Mr Hiah did not raise the point about the forged signature at any time before or during the 1 November 2023 Meeting. It says that this, coupled with Mr Hiah’s execution of the Mr Hiah POA during the meeting and the failure to exhibit any communications between Mr Hiah and David after the 1 November 2023 Meeting, leads to the inference that Mr Hiah’s pleaded defence is not genuine.
[106] To be fair to the Claimant, an assertion of this sort involving corroborative evidence between a father and son should naturally be viewed with scepticism. I also found the evidence given by the Claimant’s witnesses, ie, Mr Lee, Mr Ng and Ms Kwee-Ng, to be perfectly candid. The Claimant had reasons to be concerned. However, the difficulty with the Claimant’s case is that it can go no further than scepticism. Apart from the signatures, there was no evidence of any correspondence or interaction between the Claimant’s representatives and Mr Hiah. In fact, the evidence of both Mr Lee and Ms Kwee-Ng was that the 1 November 2023 Meeting was the first time the Claimant’s representatives had met or communicated directly with Mr Hiah. Throughout the period from 2018 up until after the Claimant discovered the irregularities, the Claimant dealt only with David.

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Shenning Heritage Capital VCC v Hiah David and others

Grounds of decision

Introduction

Facts

The parties

Shenning Heritage’s investment with Ark Capital

Initial investment and execution of Term Sheet

Transfer of investment funds

Discovery of irregularities

The 31 October 2023 Meeting

Events subsequent to the 31 October 2023 Meeting

The 6 November 2023 Meeting

Procedural history

Filing and eventual service of OC 821

Default judgments and enforcement proceedings against Ark Capital and BWCG

Summary judgment against David

Calling David as a witness

The parties’ cases

The Claimant’s case

As against David, Ark Capital and BWCG

As against Mr Hiah

As against Ms Li

The unlawful conspiracy claim

Mr Hiah’s defence

Ms Li’s defence

Issues to be determined

Preliminary issue: Effect of judgments obtained

Dishonest assistance and knowing receipt

Existence of trust or fiduciary duty

Quistclose trust

Ad hoc fiduciary duties

Knowledge and/or dishonesty

As against Mr Hiah