Sun Jin Engineering Pte Ltd v Hwang Jae Woo

Chao Hick Tin JA (delivering the judgment of the court):

[1] This is an appeal against the decision of the High Court judge (“the Judge”), who upheld the decision of the assistant registrar (“the AR”) to grant a stay of proceedings in Suit No 379 of 2009 (“the Singapore Action”), an action commenced in Singapore by the appellant, Sun Jin Engineering Pte Ltd (“the Appellant”), against the respondent, Hwang Jae Woo (“the Respondent”). The grounds of decision of the Judge may be found at Sun Jin Engineering Pte Ltd v Hwang Jae Woo [2010] 3 SLR 684 (“the GD”).

[2] To better appreciate the circumstances giving rise to the Singapore Action, we will first set out the facts of the case. The Appellant is a company incorporated in Singapore. Its majority shareholder and director is one Seung Yong Chung (“Seung”), who is also a substantial shareholder and director of a Malaysian company known as Sun Jin Engineering (M) Sdn Bhd (“SJM”). The Respondent is a South Korean citizen who was the acting project director for projects undertaken by SJM in the Republic of Maldives (“the Maldives”). The exact legal relationship between the Appellant and the Respondent is in dispute, although the Judge was tentatively of the view that the Respondent was in fact employed by the Appellant at the material time, albeit seconded to work for SJM in the Maldives (see the GD at [31]; see also [12] below). On the factual matrix of the present case, we do not see how we can disagree with this finding.

[3] The Respondent worked in the Maldives from 27 August 2006 to 1 February 2008. When the Respondent arrived in the Maldives on 27 August 2006, he was given a letter of employment dated 15 August 2006 from SJM. The authenticity of this letter is disputed by the Appellant. During the period while the Respondent was working in the Maldives, he was the country representative, project director and project manager of SJM. It is undisputed that the directors of SJM passed a resolution on 3 May 2007 appointing the Respondent as its country representative in the Maldives. The work permit issued by the Maldivian authorities showed the Respondent as an employee of SJM.

[4] The Appellant brought the Singapore Action against the Respondent, claiming that the latter had (inter alia) acted in breach of his duty to the Appellant by effecting certain unauthorised payments to third parties, thereby causing the Appellant to suffer loss. In accordance with the Rules of Court (Cap 322, R 5, 2006 Rev Ed), the Respondent should have filed his defence to the Singapore Action by 27 May 2009. Pursuant to an oral understanding between the parties’ solicitors, the time for filing the Respondent’s defence was extended to 5 June 2009. The Respondent filed his defence on that date, but the document filed was rejected as the wrong suit number was stated in it. The Respondent subsequently re-filed his defence (this time, successfully) on 8 June 2009. Thereafter, it was only on 31 July 2009 – approximately one month and three weeks after the extended deadline for filing the defence – that the Respondent applied (via Summons No 4061 of 2009 (“the Stay Application”)) for a stay of the Singapore Action in favour of proceedings to be instituted in the Maldives as well as for an extension of time to file the application. The Respondent also sought, as an alternative to a stay of the Singapore Action, an order striking out paras 3–23 of the Appellant’s statement of claim (“the Statement of Claim”), which constitute substantially the whole of the Statement of Claim, under O 18 r 19 of the Rules of Court.

[5] The main unauthorised payments alluded to at [4] above, which form the bases of the Singapore Action, are the following:

(a) a payment of US$175,000 as alleged commission to one Ahmed Shahid (“Shahid”); and

(b) a payment of US$101,982.37 to one Son Chang Ju (“Son”), a former employee of the Appellant.

[6] We should add that legal proceedings in connection with the above two payments were earlier commenced in the Maldives, and judgments have already been given by the courts there. The judgments in those proceedings (which are different from the contemplated Maldivian proceedings mentioned at [4] above) include:

(a) a judgment obtained by Shahid against SJM for payment of US$175,000; and

(b) a judgment obtained by Son against SJM for payment of US$101,982.37.

[7] At this juncture, we should further add that the Respondent has successfully sued SJM in the Maldives (in Case No 733/MC/2008 (“the Maldivian profit suit”)) for wrongful termination of employment and compensation. In that action, the Civil Court of the Maldives found that the Respondent was an employee of SJM (see [30] of the GD, and cf the Judge’s tentative view (at [31] of the GD) that the Respondent was an employee of the Appellant). Although SJM is a separate legal entity from the Appellant, Seung is a substantial shareholder and director of both companies (see [2] above). In the circumstances, this begs the question: if the Respondent had indeed made unauthorised payments to Shahid and Son, why did SJM not raise that as a counterclaim in the Maldivian profit suit?

[8] Before the Judge, broadly, two main issues were raised:

(a) first, whether the Respondent, given that he had taken steps in the Singapore Action and, further, had filed the Stay Application long after the deadline prescribed by O 12 r 7(2) of the Rules of Court, was precluded from applying for a stay of the Singapore Action (“the First Issue”); and

(b) second, if the Respondent were not so precluded, whether a stay of the Singapore Action should be granted on the ground of forum non conveniens (“the Second Issue”).

The Judge answered the First Issue in the negative and the Second Issue in the affirmative.

(a) this court’s decision in Chan was open to question because it was based on case law which involved factual circumstances that were significantly dissimilar to those found in Chan (see the GD at [12]–[13]); and

(b) the test of prejudice adopted in Chan for determining whether a defendant who had taken steps in the proceedings and who was also late in applying for a stay should be precluded from making a stay application – namely, the test of “whether there was any prejudice to the [plaintiff] which could not be compensated by costs” (see the GD at [10]), which test the Judge found to be applicable to the case before him (see the GD at [11]) – was unsatisfactory because it could lead to unsatisfactory results in the context of stay applications (see the GD at [15] and [19]).

[10] In expressing his reservations about Chan, the Judge suggested that the test of prejudice should not be the sole or primary factor for determining whether a defendant should be granted an extension of time to file a stay application as such a test “place[d] an unfair burden on the plaintiff to show good reasons why a defendant should not be allowed to make his application for a stay late”. Instead, the Judge opined, “[t]he burden should be on the party who [was] making the late application [for a stay of proceedings] to adduce good reasons to show why he should be allowed to make his application although he [was] out of time” (see, likewise, [16] of the GD).

[11] Turning to the Second Issue, the Judge applied what is commonly called “the Spiliada test” – ie, the test laid down by the House of Lords (now known as the Supreme Court of the UK) in Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460 (“Spiliada”) – to determine whether a stay of the Singapore Action should be granted on the ground of forum non conveniens. Under the first stage of that test, the question which the court has to consider is whether there is prima facie some other available forum having competent jurisdiction that is more appropriate for the trial of the dispute in question. In this regard, the connecting factors raised in the present case by counsel for the respective parties and considered by the Judge were the following:

(a) the governing law of the dispute between the Appellant and the Respondent (“the Dispute”);

(b) the identity of the employer of the Respondent under his employment contract at the material time (“the Employment Contract”);

(c) the place where the Respondent carried out his work under the Employment Contract;

(d) the place where the Respondent’s alleged breaches of the Employment Contract took place; and

(e) the availability of key witnesses in the Maldives.

[12] After considering the evidence, the Judge came to the tentative view that (as mentioned earlier at [2] above) the Respondent was employed by the Appellant at the material time but was seconded to work for SJM in the Maldives, and that since the alleged breaches of the Employment Contract occurred in the Maldives, Maldivian law was probably the governing law relating to those alleged breaches. Further, and more importantly, as all the relevant witnesses were in the Maldives and were not willing to come to Singapore to testify, on balance, the Judge held, the relevant factors favoured the Maldives as the more appropriate place for the trial of the Dispute.

[13] Moving on to the second stage of the Spiliada test (which entails a consideration of whether, although there is prima facie another forum which is the more appropriate forum for trial based on the first stage of the test, there are circumstances by reason of which justice requires that a stay of proceedings should nevertheless be refused), the Judge considered the following factors raised by the Appellant:

(a) the alleged non-availability of the Maldivian courts as a forum for hearing the Dispute;

(b) the alleged unfair prejudice to the Appellant due to the prior ruling of the Civil Court of the Maldives in the Maldivian profit suit; and

(c) the alleged disparity between Maldivian law and Singapore law in terms of their respective states of development and the number of causes of action which each of these systems of law could independently offer to the Appellant.

The Judge came to the conclusion that the above factors were really without much substance and should not preclude a stay of the Singapore Action from being ordered. He thus affirmed the AR’s decision to stay that action on the ground of forum non conveniens.

[14] In the present appeal, the First Issue and the Second Issue are being revisited, with the Appellant arguing that this court should overturn the Judge’s decision on both of these issues.

[15] We will begin by considering the First Issue, specifically, the significance of the fact that the Respondent filed the Stay Application only after taking steps in the Singapore Action. In Yeoh Poh San and another v Won Siok Wan [2002] 2 SLR(R) 233 at [14], the High Court held that “[t]he very reason why a defendant [was] required to apply for a stay of proceedings before taking any step other than filing an appearance [was] because such … other step [might] be construed as a submission to the court’s jurisdiction”. The Appellant contends that the Respondent has taken steps in the Singapore Action by including in the Stay Application (inter alia) a prayer to strike out substantially the whole of the Statement of Claim as an alternative to a stay of proceedings. In support of this contention, the Appellant cites the case of Republic of the Philippines v Maler Foundation and others [2008] 2 SLR(R) 857, where the expression “step in the proceedings” in s 4(3)(b) of the State Immunity Act (Cap 313, 1985 Rev Ed) was interpreted and explained. In response, the Respondent argues that for the purposes of O 12 r 7(2) of the Rules of Court, the fact that he has taken a step in the proceedings or has submitted to the jurisdiction of the Singapore courts does not per se disentitle him from applying for a stay. The Respondent submits that such conduct would be “fatal only to a challenge to the [c]ourt’s jurisdiction under Order 12 Rule 7(1)”.

[16] In this connection, it must be borne in mind that an application under O 12 r 7(2) for a stay of proceedings on the ground of forum non conveniens is not the same as an application under O 12 r 7(1) disputing the jurisdiction of the Singapore courts. A stay application under O 12 r 7(2) accepts that the Singapore courts have jurisdiction over the dispute in question, but asserts that another jurisdiction is the more appropriate forum to try the dispute. This difference between O 12 r 7(1) and O 12 r 7(2) was explained by this court in Chan at [22] as follows:

[17] In the present case, the Respondent is applying for a stay of proceedings under O 12 r 7(2); he is not disputing the jurisdiction of the Singapore courts pursuant to O 12 r 7(1). Indeed, the fact that the Respondent has submitted to the jurisdiction of the Singapore courts cannot be challenged as he has already filed his defence to the Singapore Action (and has also since amended his original defence). As can be seen from the passage from [22] of Chan just quoted above, the filing of the defence by the Respondent does not in itself disentitle him from applying for a stay of the Singapore Action.

[18] In our view, the more pertinent question which we must address vis-à-vis the First Issue concerns the fact that the Respondent filed the Stay Application out of time. Order 12 r 7(2) of the Rules of Court states that an application for a stay of proceedings on the ground of forum non conveniens must be filed “within the time limited for serving a defence”. The Respondent should thus have filed the Stay Application either by 27 May 2009 (the original deadline for filing his defence) or, at the latest, by 5 June 2009 (the mutually-agreed extended deadline for filing the defence). This in turn raises the question of what considerations the court should take into account in deciding whether to exercise its discretion to extend the time for filing a stay application.

[19] Under the Rules of Court, the substantive effect of a procedural default or irregularity is provided for in O 2 r 1(2), which reads:

Order 2 r 1(2) clearly confers a wide discretion on the court to deal with procedural defaults as it does not specify the considerations which the court should take into account in exercising that discretion. That said, how this discretion should be exercised raises important questions as to the relationship between procedural justice and substantive justice in our civil litigation system.

[20] Apropos these questions, our courts have in several cases consistently advocated one principle, namely, the need to strike a balance between, on the one hand, instilling procedural discipline in civil litigation and, on the other, permitting parties to present the substantive merits of their respective cases to the court notwithstanding some procedural irregularities (see, eg, United Overseas Bank Ltd v Ng Huat Foundations Pte Ltd [2005] 2 SLR(R) 425 (“UOB v Ng Huat Foundations”) at [4]–[9], Lee Hsien Loong v Singapore Democratic Party and others and another suit [2008] 1 SLR(R) 757 (“Lee Hsien Loong”) at [36] and Lee Chee Wei v Tan Hor Peow Victor and others and another appeal [2007] 3 SLR(R) 537 at [82]). In a similar vein, Singapore Court Practice 2009 (Jeffrey Pinsler SC gen ed) (LexisNexis, 2009) (“Pinsler 2009”) states at para 2/1/1:

[21] While this principle of striking a balance between the competing interests of procedural justice and substantive justice is simple to state, it is by no means easy to apply in practice. In UOB v Ng Huat Foundations, it was held by the High Court that:

[22] A general test which is often employed to address this tension between ensuring compliance with procedural requirements and ensuring that substantive justice is done is the test of prejudice. Thus, in The “Tokai Maru” [1998] 2 SLR(R) 646 (“The Tokai Maru”), this court held at [23]:

[23] Similarly, in Chan at [25], this court, citing the decision in The Tokai Maru, held:

[24] At this juncture, we ought to refer to another provision in the Rules of Court which is pertinent to the issue of whether the timeline for filing the Stay Application should be extended. This is O 3 r 4, which reads:

Order 3 r 4 is relevant in this appeal because, as mentioned at [4] above, in the Stay Application, the Respondent, apart from seeking a stay of the Singapore Action, also asked for an extension of time to file that application. We should also add that under para 7 of the First Schedule to the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed), the High Court is conferred “[p]ower to enlarge or abridge the time prescribed by any written law for doing any act or taking any proceeding, whether the application therefor [sic] is made before or after the expiration of the time prescribed”.

[25] Like O 2 r 1(2) of the Rules of Court, O 3 rr 4(1) and 4(2) do not spell out how the court’s discretion to extend or abridge time should be exercised, although O 3 r 4(1) does state that the discretion should be exercised “on such terms as [the court] thinks just”. As is to be expected, case law also does not provide definitive guidance as to how this discretionary power ought to be exercised, although broad considerations can be gleaned from the authorities. Much would depend on the circumstances of each case. Obviously, a consideration which is materially significant in one set of circumstances may not necessarily have the same significant effect in a different set of circumstances. In some cases, the courts have made judicial pronouncements which appear to be relatively liberal, such as the statement by Mustill LJ in Erskine Communications Ltd and Another v Worthington and Others [1991] TLR 330 (at 330 itself) that:

In other cases, the courts appear to have taken a stricter approach. For instance, in Thamboo Ratnam v Thamboo Cumarasamy and Cumarasamy Ariamany d/o Kumarasa [1965] 1 WLR 8, the Privy Council stated at 12:

[27] Another instructive case is Mortgage Corporation Ltd v Sandoes and Others [1996] TLR 751 (“Mortgage Corporation”), where the plaintiff sought, but was denied, an extension of time for the exchange of witness statements and expert reports. On appeal, the English Court of Appeal said that the correct approach to take was that once a party was in default in complying with a prescribed timeline, it was for that party to satisfy the court that despite its default, the court’s discretion to extend time should nevertheless be exercised in its favour; in this connection, the party in default could rely on any relevant circumstances. Millett LJ, in delivering the judgment of the English Court of Appeal, said at 752:

[28] Our local cases appear to draw a distinction between an application (made after a trial) for an extension of time to file a notice of appeal and an application for an extension of time for other purposes, with the courts taking a stricter view vis-à-vis the former type of application. This distinction seems to have been recognised in Lee Hsien Loong, where this court said at [33]:

[29] The factors which our courts have regard to in determining whether an extension of time to file a notice of appeal should be granted are fourfold, namely: (a) the length of the delay; (b) the reasons for the delay; (c) the chances of the defaulting party (ie, the would-be appellant) succeeding on appeal if the time for appealing were extended; and (d) the degree of prejudice to the would-be respondent if the extension of time were granted (see, inter alia, Hau Khee Wee and another v Chua Kian Tong and another [1985–1986] SLR(R) 1075 at [14], Pearson Judith Rosemary v Chen Chien Wen Edwin [1991] 2 SLR(R) 260 at [15], AD v AE [2004] 2 SLR(R) 505 at [10], Lee Hsien Loong at [18] and Anwar Siraj and another v Ting Kang Chung John [2010] 1 SLR 1026 at [29]). It should, however, be noted that these factors have also been applied in some cases which did not concern an application for leave to file an appeal out of time (see, eg, The Oriental Insurance Co Ltd v Reliance National Asia Re Pte Ltd [2008] 3 SLR(R) 121, which pertained to the late filing of a proof of debt under a scheme of arrangement for a company).

[30] In our view, what the aforesaid authorities show is that in each case, the court, in deciding whether to extend the prescribed timeline for an act to be done, has to balance the competing interests of the parties concerned. As the statement of Millett LJ in Mortgage Corporation (quoted above at [27]) shows, the factual matrix of the particular case at hand will be paramount. In balancing the parties’ competing interests, the court inevitably needs to consider the question of prejudice. Copious citation of case law will not be necessary (and also will not be helpful) as previous decisions will be no more than guides. In determining how the balance of interests should be struck and in applying the four factors mentioned at [29] above, it is the overall picture that emerges to the court as to where the justice of the case lies which will ultimately be decisive.

[31] Before we go on to apply the principles outlined above to the facts of the present case, we wish to address the Judge’s reservations about this court’s decision in Chan. In Chan, the defendants – like the Respondent – applied late for a stay of proceedings and did so only after they had filed their defence. Because of this factual similarity between the instant case and Chan, the Judge felt constrained to apply the test of prejudice in Chan to the Respondent’s benefit (see the GD at [11]; see also [9] above).

[32] However, as alluded to at [9] above, the Judge also expressed reservations about the decision in Chan (see the GD at [12]–[19]). In particular, the Judge seemed to be of the view that:

(a) the decision in Chan was open to question because this court had referred to The Tokai Maru, which involved factual circumstances that were significantly dissimilar to those found in Chan (referred to hereafter as “the Judge’s first reservation about Chan”) (see the GD at [12]–[13]); and

(b) the test of prejudice adopted in Chan was unsatisfactory because it might lead to unsatisfactory results in the context of stay applications (referred to hereafter as “the Judge’s second reservation about Chan”) (see the GD at [15] and [19]).

[33] On the face of it, it seems to us that the Judge expressed reservations about the decision in Chan because there appeared (in his view) to be some incongruence between where the equities of the present case lay and the legal result that would follow by applying Chan. It appears that the Judge would not have exercised his discretion to extend time to enable the Respondent to make the Stay Application but for the principle enunciated in Chan.

[34] Vis-à-vis the Judge’s first reservation about Chan, the Judge appeared to have understood the rationale of the test of prejudice as being only to prevent a defaulting party from being deprived of the opportunity to present its case to the court on the merits. Accordingly, the Judge found it appropriate to draw a distinction between the instant case and The Tokai Maru by stating in the GD that:

[35] With respect, we do not think that the test of prejudice adopted in Chan should be so narrowly confined, ie, as being applicable only to a situation where a defaulting party would be prevented from presenting its case to the court on the merits if an extension of time were not granted. There is no reason why the test of prejudice cannot apply in other circumstances (eg, where the court is confronted with the question of whether it should exercise its discretion to extend time to enable an act to be carried out under the Rules of Court). The need for a party to present its case to the court on the merits is not the sole sort of circumstance which the test of prejudice can usefully address. In Mortgage Corporation (see [27] above), for instance, the English Court of Appeal held that the question of prejudice was a relevant consideration in determining whether an extension of time for the exchange of witness statements and expert reports should be granted. We should also underscore that in the passage from Millett LJ’s judgment in Mortgage Corporation at 752 (quoted at [27] above), it was expressly stated that the guidelines set out therein were intended to be of general application and were not limited to the specific situation which arose in that case.

[36] It is true that in Chan, this court stated at [25] that:

[37] On a plain reading of the above quotation, it seems clear that in Chan, this court was doing no more than merely citing The Tokai Maru as one instance where the test of prejudice was applied, and was not intending in any way to limit the remit of the application of this test. From the above quotation, it is also clear that in Chan, this court was well aware that the circumstances in The Tokai Maru (which concerned an application to file an affidavit of evidence-in-chief – a document that “touch[es] upon the substantive merits of a party’s case” (per [25] of Chan) – out of time) were different from those in Chan (which concerned a late attempt by the defendants, via a stay application filed out of time, to contend that Malaysia, and not Singapore, was the appropriate forum to try the plaintiff’s defamation action against them).

[38] We now turn to the Judge’s second reservation about Chan, which centred on the Judge’s concern that the test of prejudice could lead to unsatisfactory results in the context of stay applications. In particular, the Judge was of the view that under the test of prejudice, a defendant could effectively make a plaintiff endure copious interlocutory applications after the defence was filed and yet still escape the fate of being precluded from applying for a stay of proceedings out of time as the test of prejudice “place[d] an unfair burden on the plaintiff to show good reasons why [the] defendant should not be allowed to make his application for a stay late” (see the GD at [16]; see also [15] and [19] of the GD).

[39] While we understand these concerns of the Judge, it is, with respect, not entirely correct to say that the test of prejudice has the effect of enabling a defendant to make copious interlocutory applications after filing its defence whilst still remaining at liberty to make a stay application out of time. The law certainly would not grant a defendant carte blanche to make copious interlocutory applications with impunity (a fortiori, as we note at [40] below, where such applications are made in bad faith). In this regard, we note the following observations of Bowen LJ in Cropper v Smith (1884) 26 Ch D 700 at 710 (referred to in The Tokai Maru at [22]):

[42] In this connection, we ought to clarify that in Chan, the position taken by the plaintiff vis-à-vis the defendants’ application for a stay of proceedings was that the timeline prescribed in O 12 r 7(2) of the Rules of Court for filing a stay application was absolute and the court had no discretion whatsoever to extend that timeline. In the absence of any other ground advanced by the plaintiff, this court quite naturally considered, in the main, only the question of prejudice in deciding whether to grant the defendants an extension of time to file their stay application. This court did not state in Chan that prejudice was the only matter which the court needed to take into account when considering an application for an extension of time. The court’s consideration of prejudice in Chan must be viewed in the context of the grounds raised by the parties there. In any event, this court in Chan clearly also took into account other circumstances, such as the close link between the plaintiff’s action in Singapore against the defendants for defamation (“the Singapore defamation action”) and the plaintiff’s actions in Malaysia against the defendants as trustees of an estate (“the Malaysian trusteeship actions”) as well as the desirability of avoiding inconsistent findings in those two sets of proceedings (see Chan at [26]). Lastly, there is one other circumstance in Chan which warrants highlighting. This relates to the fact that the stay granted in Chan was a limited one, ie, the Singapore defamation action was stayed only to the limited extent that it was to be heard in Singapore after the conclusion of the Malaysian trusteeship actions (see Chan at [47]). The stay order in Chan was not the normal forum non conveniens stay order, which would have been an order staying the Singapore defamation action so that a fresh defamation suit could be commenced in Malaysia and be heard together with the Malaysian trusteeship actions, which were then pending.

[43] We now turn to consider whether, applying the principles discussed at [20]–[30] above to the circumstances of this case, this court should grant the Respondent an extension of time to file the Stay Application notwithstanding that, besides being late in filing that application, the Respondent has also filed his defence to the Singapore Action. The Judge thought that the whole state of affairs was brought about by the mistake of the Respondent’s solicitors. This was what he stated at [18] of the GD:

[45] Without going into the question of whether these reasons were adequate to justify the Respondent’s decision not to file the Stay Application within the prescribed timeline, the fact is that the Stay Application was not an afterthought. Admittedly, the apparent difficulty encountered by the Respondent in complying with the timeline for applying for a stay of the Singapore Action could have been easily overcome by his making an express reservation when filing his defence to that action. This was not done (due, perhaps, to an insufficient understanding of the Rules of Court on the part of the Respondent’s solicitors). On 23 June 2009, the Respondent’s solicitors again wrote to the Appellant’s solicitors, reiterating (among other things) the Respondent’s intention to apply for a stay of the Singapore Action and the fact that they (the Respondent’s solicitors) were waiting for certain documents (see [44] above). While the delay here involved a period of approximately one month and three weeks, it bears emphasis that the Stay Application is an interlocutory matter which does not involve the filing of a notice of appeal out of time. Moreover, the Stay Application cannot be regarded as without merit (see the GD at [25]–[52] and the discussion below at [53]–[64]). In the circumstances, we do not think that the Judge’s decision to grant the Respondent an extension of time to file the Stay Application can be regarded as plainly without any basis and plainly wrong.

[46] Before we move on to consider the Second Issue, we note, in passing, that the question of whether the Respondent could be taken, by virtue of his lateness in applying for a stay of the Singapore Action, to have waived his right to make such an application was not dealt with in the court below, nor was it raised by the parties in their submissions in this appeal. All that we wish to say in this regard is that in the commentary on O 12 r 7 of the Rules of Court in Pinsler 2009 at para 12/7/6, it is stated that “[a] lengthy delay in making [a stay] application (ie beyond the time limit for serving a defence) may be treated as a waiver of any objections which might have been raised”. As no submission was made by the parties as to whether the principle of waiver was applicable in the present case and, if so, how that principle should be applied, we will make no further comment on this issue.

[47] We now turn to the Second Issue, namely, whether a stay of the Singapore Action on the ground of forum non conveniens is justified. To determine which is the most appropriate forum for trial as between two or more available fora, the court has to decide which forum the dispute has the most real and substantial connection with. On this issue, the leading authority is Spiliada. The Spiliada test, which (as can be seen from [11] and [13] above) is a two-stage test, has become the established test in Singapore, having been accepted in numerous previous cases in our courts, the more recent ones being PT Hutan Domas Raya v Yue Xiu Enterprises (Holdings) Ltd and another [2001] 1 SLR(R) 104, Rickshaw Investments Ltd and another v Nicolai Baron von Uexkull [2007] 1 SLR(R) 377, CIMB Bank Bhd v Dresdner Kleinwort Ltd [2008] 4 SLR(R) 543 (“CIMB Bank”), Goh Suan Hee v Teo Cher Teck [2010] 1 SLR 367 and JIO Minerals FZC and others v Mineral Enterprises Ltd [2010] SGCA 41.

[48] In the court below, the Judge quite rightly applied the Spiliada test in deciding the Second Issue. Having weighed the various relevant connecting factors, he came to the conclusion that the Maldives would be the more appropriate forum for the trial of the Dispute. The connecting factors which he considered are tabulated below:

[49] On the basis of the above table, it is easy to see why the Judge held that the preponderance of the relevant connecting factors in the instant case favoured the Maldives as the more appropriate forum under the first stage of the Spiliada test, and also went on to hold that the Appellant had failed to show, under the second stage of the Spiliada test, why a stay of the Singapore Action should not be granted despite the Maldives being the more appropriate forum. We now examine whether the Judge was right to come to this conclusion.

[50] It is settled law that in deciding whether or not to stay an action on the ground of forum non conveniens, a judge is exercising his discretion, and this court, in hearing an appeal against such a decision, should only review that decision and should not exercise an independent discretion. As this court stated in Chan at [28]:

[51] Similarly, in the earlier case of CIMB Bank, this court held at [84]:

[52] In his submissions, counsel for the Respondent cited the decision of the House of Lords in Shiloh Spinners Ltd v Harding [1973] AC 691 and the local case of QBE Insurance Ltd v Sim Lim Finance Ltd [1987] SLR(R) 23 (“QBE Insurance”). These two cases set out substantially the same proposition of law as that enunciated at [28] of Chan and [84] of CIMB Bank, save that QBE Insurance laid down (at [36]) an additional ground for an appellate court to interfere with a lower court’s exercise of discretion as follows:

As the Respondent is not saying that there are “in closely comparable circumstances, … two conflicting schools of judicial opinion as to the relative weight to be given to particular considerations” (per [36] of QBE Insurance) in the present case, nothing in this appeal turns on this additional ground for interfering with a lower court’s exercise of discretion and we need make no further comment on it.

[53] In respect of the Judge’s exercise of discretion under the first stage of the Spiliada test, the Appellant’s strongest point, in our view, is the argument (based on the decision in Mineral Enterprises Ltd v JIO Minerals FZC and others [2010] SGHC 109) that in deciding a stay application, the court “[can]not simply weigh the connecting factors without reference to the likely issues”. Two connecting factors have been singled out by the Appellant in this regard, namely, the availability of allegedly material witnesses in the Maldives and the governing law of the Dispute.

[54] Vis-à-vis the first of the aforesaid connecting factors, the Appellant argues that “[t]he crux of [its] case concerns the authority of the Respondent and that is a matter between the [Appellant] and the Respondent alone”. According to the Appellant, the question of what authority the Respondent actually possessed at the material time is solely “a matter within the knowledge of the parties [ie, the Appellant and the Respondent]” [emphasis in bold in original omitted]. Thus, the Appellant claims, the Judge should not have taken into account the fact that there are witnesses in the Maldives (ie, Shahid and Gahir) who are allegedly material witnesses. Indeed, the Appellant asserts that these Maldivian witnesses are wholly unnecessary for the purposes of resolving the Dispute. Accordingly, it submits that the availability of allegedly material witnesses in the Maldives should carry little weight.

[55] As we see it, this argument is valid only if it is viewed solely from the viewpoint of the Appellant’s pleaded case. That, of course, would be too narrow a perspective. The Respondent’s defence to the Appellant’s claim for US$175,000 (see sub-para (a) of [5] above) is that following a negotiation between Seung and Shahid, where the Respondent was present, Seung agreed to pay US$175,000 to Shahid for the latter’s services. As for the Appellant’s claim for US$101,982.37 (see sub-para (b) of [5] above), the Respondent’s position is that the payment of this sum to Son was agreed on at a discussion between Seung and the Respondent, where Shahid and Gahir were present. In the light of this defence, the evidence of Shahid and Gahir becomes very important. The issue of the scope of the Respondent’s authority cannot be regarded as just an internal matter between the Appellant and the Respondent. Shahid can provide evidence on the services that he rendered to SJM, which evidence might show that the payment of US$175,000 to him was justified. Shahid can also testify on how the letter of 27 August 2007 from the Respondent (written on behalf of SJM) to him confirming payment of US$175,000 for “services … received” came into being. Further, Shahid and Gahir can provide evidence on Seung’s alleged agreement with the Respondent to pay Son the sum of US$101,982.37. We also note that although Gahir is apparently the brother-in-law of Shahid, the Judge found no reason to suspect that these two Maldivian witnesses were contrived by the Respondent to support the Stay Application (see the GD at [38]).

[56] The fact that an important witness is only available and compellable in a particular jurisdiction is a significant consideration which can tilt the balance in favour of that jurisdiction (see Peters Roger May v Pinder Lillian Gek Lian [2006] 2 SLR(R) 381). In this regard, the Respondent’s Maldivian law expert said that witnesses in the Maldives were compellable to testify in a civil action there, whereas the Appellant’s Maldivian law expert appeared to take the view that witnesses in the Maldives were not thus compellable. The Appellant’s Maldivian law expert added, however, that the Maldivian courts could assist in the taking of evidence (via video link) of willing witnesses in the Maldives for use in foreign proceedings (see the GD at [39]). It is unclear whether a witness in the Maldives who is unwilling to testify in a foreign action can be compelled to give evidence by video link for the purposes of the foreign action. Even assuming that there are no legal provisions in the Maldives to that effect and also no legal provisions to compel an unwilling witness to testify in a civil matter instituted in the Maldivian courts, presumably, greater pressure can be brought to bear on such a witness to testify if his evidence is required in relation to an action in the Maldives as opposed to a foreign action. To that extent, the availability of allegedly material witnesses in the Maldives favours that jurisdiction as the more appropriate forum for the trial of the Dispute.

[57] We now turn to the second connecting factor singled out by the Appellant before this court, viz, the governing law of the Dispute. That the governing law of a dispute is a relevant factor in determining which jurisdiction the dispute has the closest connection with was reiterated and explained by this court in CIMB Bank at [63] as follows:

[58] The Appellant submits that the governing law of the Dispute (which basically centres on the issue of the Respondent’s authority and the issue of whether the Respondent committed the tort of conspiracy against the Appellant) is a neutral connecting factor because, in so far as these two issues are concerned, there is no difference between the content of Singapore law and that of Maldivian law. Specifically, the Appellant contends that:

[59] In Dicey, Morris and Collins on The Conflict of Laws (Lawrence Collins gen ed) (Sweet & Maxwell, 14th Ed, 2006) (“Dicey”) at vol 1, para 12-029, the following proposition is stated:

This proposition was cited with approval by this court in CIMB Bank at [61].

[60] In the present case, there is no doubt that the Respondent’s alleged breaches of the Employment Contract occurred in the Maldives. Also, the alleged tort of conspiracy was committed there. Clearly, the alleged breaches of contract as well as the alleged tort of conspiracy would be governed by the law of the Maldives. In our view, the Appellant has failed to show that Maldivian law on breach of contract and the tort of conspiracy is the same as the corresponding areas of Singapore law. The Applicant has consequently failed to show that the circumstances of the present case warrant the application of the proposition expounded at vol 1, para 12-029 of Dicey. It must be borne in mind that in CIMB Bank, this court held that the governing law was not a factor of much significance because the court accepted that the Singapore courts would be able to apply the competing forum’s law (if it were indeed the relevant governing law) “without the aid of foreign experts” (at [63]) since that law was English law. In contrast, it is highly questionable whether the same can be said in the present case, given that there already seems to be a sharp divergence of opinion between the respective parties’ expert witnesses on several aspects of Maldivian law and the Maldivian legal system even at this interlocutory stage (see the GD at [39] and [44]). Hence, it cannot be said that the Singapore courts would be able (if the Singapore Action were allowed to proceed here) to apply Maldivian law without the aid of any experts on that system of law. On this factor, we agree with the Judge that the governing law of the Dispute also favours the Maldives as the more appropriate forum.

[61] In the result, under the first stage of the Spiliada test, we affirm the Judge’s finding that the connecting factors show that the Maldives would be the more appropriate forum for the trial of the Dispute. The one single link which the Dispute has with Singapore, as far as we can see, is the fact that the Respondent was apparently employed by the Appellant – a Singapore company – and seconded by it to work for SJM in the Maldives.

[62] Turning to the second stage of the Spiliada test, the Appellant alludes to the fact that in the Maldivian profit suit mentioned at [7] above, which has already been concluded, the Civil Court of the Maldives, in holding that the Respondent’s employer was SJM and not the Appellant, considered documents issued in the Maldives to the exclusion of documents issued in Singapore (see the GD at [31]). In view of this, the Appellant argues that substantial justice cannot be done if it is compelled to initiate proceedings against the Respondent in the Maldives because the Maldivian courts are likely to adopt the same approach as that taken in the Maldivian profit suit.

[63] With respect, the Appellant, in raising this argument, is traversing old grounds which have already been sufficiently dealt with by the Judge. Suffice it to restate that the Judge held that there would be no unfair prejudice to the Appellant if it were to litigate the Dispute in the Maldives since “[the Appellant] was not yet a party to proceedings in the Maldives and it would be open to another Maldivian court to take a different view [on the identity of the Respondent’s employer]” (see the GD at [48]). Both of the Maldivian law experts called by the Appellant have not expressed any views to the contrary. Furthermore, there is nothing to suggest that the Appellant cannot tender the documents issued in Singapore in proceedings before the Maldivian courts.

[64] In the circumstances, we hold that the Judge is correct in concluding, vis-à-vis the second stage of the Spiliada test, that the Appellant has not shown that there are circumstances by reason of which justice requires that a stay of the Singapore Action be denied even though the application of the first stage of the Spiliada test points to the Maldives as the more appropriate forum for the trial of the Dispute.