Supermix Concrete Pte Ltd v Econ Corp Ltd (Public Utilities Board, garnishees)

[2] The background was briefly as follows. On 3 April 2003 the judgement creditors obtained part judgment against the judgment debtors in the sum of $1,468,845.24, interest thereon at 6% per annum from the date of the writ (19 December 2002) to date of Judgment (3 April 2003). On 17 April 2003, the judgment creditors obtained a Garnishee Order to Show Cause. The adjourned hearing for the Garnishee to show cause was fixed for 9 May 2003. The solicitors for the judgment creditors were expressly directed by the Assistant registrar to inform the judgment debtors of the hearing date. To all intents and purposes, it was understood by the judgment debtors, quite properly and at any rate, that the hearing would be on 9 May 2003.

[3] On 6 May 2003, the judgment creditors appeared before the Assistant Registrar on duty and unilaterally moved forward the hearing date of the Garnishee Order to Show Cause from 9 May 2003 to 6 May 2003. They also sought and obtained a Garnishee Order Absolute in the sum of $1,505,000.00. At the hearing, the judgment creditors’ solicitors failed to disclose to the Assistant Registrar the following facts:-

[5] The judgment creditors’ solicitors wrote in for further arguments on 10 July 2003. They also required that in lieu of payment into Court, they provide a banker’s guarantee with “the wording to be agreed or determined by (the High Court)”. My attention was drawn to section 260 read with section 255(2) and section 334(2)(b) of the Companies Act, Cap. 50. They govern the attachment of assets of a company placed in liquidation such that attachments that are incomplete at the time of presentation of a winding up petition are void. It was noted, and I agreed, that attachment in terms of the section 334(2)(b) of the Companies Act, Cap. 50 is deemed to be complete only when the attached or garnished funds are received.

[6] The judgment creditors were concerned, in my view rightly, to avoid the situation where upon lifting of the stay of proceedings, there might be some time (in the light of the first orders I made in the appeal, which I shall come to presently) before payment out of the funds from court was effected such that if, in the intervening period, winding-up proceedings were commenced against the judgment debtors, the judgment creditors might be prevented from receiving the said funds.

[8] I made those first set of orders, having taken into account the material disclosures but I also thought that setting aside the order absolute without conditions was too disproportionate as a consequence and I sought to protect and preserve the ‘fruits of vigilance’ on the part of the judgment creditors.

[9] When the issue of the completion of attachment of the garnished debt was further raised, as to what might happen during the lag in time when payment out by the court after payment in, I amended my earlier orders and made the orders I did.