Ching Mun Fong v Liu Cho Chit: Res Judicata, Constructive Trusts & Amending Pleadings

In Ching Mun Fong (executrix of the estate of Tan Geok Tee, deceased) v Liu Cho Chit and Another Appeal, the Court of Appeal of Singapore heard two appeals by Ching Mun Fong against decisions striking out her statement of claim and disallowing amendments. The case concerned the recovery of funds paid under a mistake of law and the applicability of res judicata. The Court of Appeal allowed both appeals, finding that the claim was not time-barred and that the doctrine of res judicata did not preclude the action.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeals allowed.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding striking out a statement of claim. The Court of Appeal considered res judicata, constructive trusts, and amending pleadings.

1.7 Decision Date

11 January 2000

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Ching Mun Fong	Appellant	Individual	Appeal Allowed	Won	Jimmy Yap of Donaldson & Burkinshaw Josephine Low of Donaldson & Burkinshaw Michael Khoo, SC of Donaldson & Burkinshaw
Liu Cho Chit	Respondent	Individual	Appeal Dismissed	Lost	Harpal Singh of Harpal Wong & M Seow Teh Ee-Von of Harpal Wong & M Seow

3. Judges

Judge Name	Title	Delivered Judgment
Chao Hick Tin	Justice of Appeal	Yes
L P Thean	Justice of Appeal	No
Yong Pung How	Chief Justice	No

4. Counsels

Counsel Name	Organization
Jimmy Yap	Donaldson & Burkinshaw
Josephine Low	Donaldson & Burkinshaw
Michael Khoo, SC	Donaldson & Burkinshaw
Harpal Singh	Harpal Wong & M Seow
Teh Ee-Von	Harpal Wong & M Seow

4. Facts

Tan paid US$642,451.04 to Liu in April 1981.
Liu claimed the payment was part of a purchase price for Lim's share in Lot 1606.
Lim sued Lee Tat, Tan, Lee Kai, and Collin, claiming an interest in Lot 1606.
The Court of Appeal found that Lim had not established an interest in Lot 1606.
Ching Mun Fong, as executrix of Tan's estate, sued Liu to recover the US$642,451.04.
The assistant registrar struck out the statement of claim, but the Court of Appeal reversed this decision.
The payment was allegedly made under the mistaken belief that Lim had an interest in Lot 1606.

5. Formal Citations

Ching Mun Fong (executrix of the estate of Tan Geok Tee, deceased) v Liu Cho Chit and Another Appeal, CA 111/1999, 112/1999, [2000] SGCA 1

6. Timeline

Date	Event
1972-07-18	Agreement for sale and purchase of land made between Peng Ann Realty Pte Ltd and the vendor.
1972-07-20	Two lots of land gazetted by the Government for acquisition.
1973-01-23	Sale and purchase agreement made between Peng Ann and Lee Kai for three lots of land.
1973-01-23	Oral agreement between Liu and Tan to jointly develop a portion of land.
1973-01-23	Joint venture agreements signed.
1973-03-14	Sale under the main agreement completed.
1976-07-23	Three lots of land acquired by the Government.
1980-01-01	Liu's and Tan's interests in developing Lot 1606 revived.
1981-04-01	Tan invited Liu to Hong Kong to negotiate the sale of Lim's share in the land.
1981-04-23	Tan handed Liu two cashier's orders amounting to US$642,451.04.
1981-04-28	Tan asked Liu to sign a letter authorizing payment of US$293,555.99.
1983-04-25	Fook Gee instituted an action against Liu claiming US$642,451.04.
1984-01-01	Lim instituted Suit 4149/84 against Lee Tat, Tan, Lee Kai and Collin.
1998-02-06	Court of Appeal delivered judgment in CA 93 and 94/97.
1998-06-04	Appellant instituted proceedings in Suit 862/98 against Liu.

7. Legal Issues

Res Judicata
- Outcome: The court held that the doctrine of res judicata in the wider sense did not preclude the appellant from bringing the action against Liu.
- Category: Procedural
- Sub-Issues:
  - Abuse of process
  - Failure to raise claim in earlier suit
Constructive Trust
- Outcome: The court found that the appellant had a good arguable case that a constructive trust as a remedy is available to her as Tan`s executrix to recover the money from Liu.
- Category: Substantive
- Sub-Issues:
  - Retention of money paid under mistake
  - Unjust enrichment
Limitation
- Outcome: The court held that the claim was not time-barred because the cause of action accrued only when the mistake was discovered, and the relevant provision was s 29(1)(c) of the Limitation Act.
- Category: Procedural
- Sub-Issues:
  - Mistake of law
  - Discovery of mistake
Amendment of Pleadings
- Outcome: The court allowed the amendments to the statement of claim, finding no reason to disallow them.
- Category: Procedural

8. Remedies Sought

Recovery of money
Restitution

9. Cause of Actions

Restitution
Constructive Trust
Money had and received
Money paid under a mistake of law

10. Practice Areas

Civil Litigation
Trust Litigation

11. Industries

No industries specified

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Fook Gee Finance Co Ltd v Liu Cho Chit and another action	Court of Appeal	Yes	[1998] 2 SLR 121	Singapore	The decision in this case led to the current proceedings. The court refers to the findings in this case regarding Lim's lack of interest in Lot 1606 and the source of funds paid to Liu.
Yat Tung Investment Co Ltd v Dao Heng Bank & Anor	Privy Council	Yes	[1975] AC 581	Hong Kong	Cited for the doctrine of res judicata in the wider sense, specifically regarding abuse of process in raising matters that could have been litigated earlier.
Tan Soo Leng David v Wee, Satku & Kumar Pte Ltd & Anor	Court of Appeal	Yes	[1994] 3 SLR 481	Singapore	Cited for the principle that the court's discretion for striking out under Order 18 Rule 19 should be exercised sparingly and that amendments should be allowed where possible.
Ko Teck Siang v Low Fong Mei	Unknown	Yes	[1992] 1 SLR 454	Singapore	Cited for the principle that the discretion for striking out under Order 18 Rule 19 should be exercised sparingly.
Manuel Misa v Raikes Currie, G Grenfell Gly	House of Lords	Yes	[1876] 1 App Cas 554	United Kingdom	Cited for the principle that a new argument can be taken if it does not require new material to be introduced into the case.
Kleinwort Benson Ltd v Lincoln City Council	House of Lords	Yes	[1998] 4 All ER 513	United Kingdom	Cited for abrogating the rule that money paid under a mistake of law is not recoverable in restitution.
Hazell v Hammersmith and Fulham London Borough Council	House of Lords	Yes	[1992] 2 AC 1	United Kingdom	Cited as the case that led to the finding that certain swap agreements were ultra vires and void in Kleinwort Benson Ltd v Lincoln City Council.
Bingham v Bingham	Unknown	Yes	1 Ves Sen 126; 27 ER 934	England	Cited for the principle that a mistake relating to the ownership of property is a mistake of law.
Chase Manhattan Bank NA v Israel-British Bank (London) Ltd	Chancery Division	Yes	[1981] Ch 105	England	Cited for the principle that a person who pays money under a factual mistake retains an equitable property in it and the recipient has a fiduciary duty to respect that right.
Sinclair v Brougham	House of Lords	Yes	[1914] AC 398	United Kingdom	Cited in relation to the fiduciary relationship between payer and recipient in cases of payment under mistake, although the House of Lords later departed from its decision in this case.
Westdeutsche Landesbank Girozentrale v Islington Borough Council	House of Lords	Yes	[1996] AC 669	United Kingdom	Cited for the discussion on constructive trusts and the knowing retention of property unjustly deprived from the plaintiff.
Metall und Rohstoff AG v Donaldson Lufkin & Jenrette Inc	Unknown	Yes	[1990] 1 QB 391	England	Cited in relation to the principle that retention of money after the recipient bank learned of the mistake may give rise to a constructive trust.
Greenhalgh v Mallard	Unknown	Yes	[1947] 2 All ER 255	England	Cited for the principle that res judicata covers issues or facts which are so clearly part of the subject matter of the litigation and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be started in respect of them.
Brisbane City Council v A-G for Queensland	Privy Council	Yes	[1979] AC 419	Australia	Cited for the principle that abuse of process is the true basis for the doctrine of res judicata in the wider sense.
C (A Minor) v Hackney London Borough Council	Unknown	Yes	[1996] 1 WLR 789	England	Cited to show that the principle that an unlitigated monetary claim was barred if it could have been advanced and established in earlier proceedings could not be extended to bar claims by those who had not themselves been parties to the earlier proceedings.
Bradford & Bingley Building Society v Seddon, Hancock & Ors	Court of Appeal	Yes	[1999] 1 WLR 1482	England	Cited for the distinction between res judicata and abuse of process not qualifying as res judicata.
Gleeson v J Wippell & Co	Unknown	Yes	[1977] 1 WLR 510	England	Cited for the principle that the failure of the plaintiff to join the defendants as a third party in the first action was not an abuse of process and she was therefore entitled to bring a second action against them.

13. Applicable Rules

Rule Name
Rules of Court O 18 r 19
RSC O 15 r 6(2)(b)(ii)

14. Applicable Statutes

Statute Name	Jurisdiction
Limitation Act (Cap 163, 1996 Ed) s 6	Singapore
Limitation Act (Cap 163, 1996 Ed) s 29(1)(c)	Singapore
Limitation Act s 22(1)(b)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Res judicata
Constructive trust
Mistake of law
Abuse of process
Limitation Act
Statement of claim
Amendment of pleadings
Executrix
Lot 1606

15.2 Keywords

res judicata
constructive trust
limitation
mistake of law
amendment of pleadings
Singapore
Court of Appeal

17. Areas of Law

Area Name	Relevance Score
Trust Law	80
Civil Practice	75
Res Judicata	70
Abuse of Process	60
Estoppel	60
Equity and limitation of actions	60
Unjust Enrichment	50
Contract Law	40
Mistake of fact	40
Failure of consideration	40
Change of position	30
Commercial Disputes	30

16. Subjects

Civil Procedure
Trust Law
Restitution
Res Judicata
Limitation Law