Itochu Steel v CV Wira: Bills of Exchange Dishonor & Misrepresentation

Itochu Steel Asia Pte Ltd sued CV Wira Mustika Indah and Tan Peng Boen in the High Court of Singapore on November 30, 2000, for US$5,459,312.18 relating to 35 dishonored bills of exchange. Itochu claimed against the third defendant, Tan Peng Boen, as the acceptor of the bills and as an accommodation party, and also for misrepresentation. Justice Kan Ting Chiu dismissed Itochu's claim, finding that Itochu had not proven payment on the bills as required by the Bills of Exchange Act, and that the misrepresentation claim failed because Itochu was not prejudiced by it.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Plaintiffs' claim dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Itochu Steel sues CV Wira for dishonored bills of exchange. The court dismisses the claim, finding no proof of payment by Itochu or reliance on misrepresentation.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Itochu Steel Asia Pte LtdPlaintiffCorporationClaim DismissedLost
CV Wira Mustika IndahDefendantPartnershipClaim DismissedWon
Tan Peng BoenDefendantIndividualClaim StayedNeutral
Tan Peng Boen @ Tansri S BenuiDefendantIndividualClaim DismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Kan Ting ChiuJudgeYes

4. Counsels

Counsel NameOrganization
Low Chai ChongRodyk & Davidson
Raistlina KwekRodyk & Davidson
George LimWee Tay & Lim
Jinny TanWee Tay & Lim
Valerie YangWee Tay & Lim

4. Facts

  1. Itochu Steel sold cold rolled steel sheets to CV Wira between September 1996 and October 1997.
  2. Itochu Steel drew bills of exchange for the price of the goods, and the third defendant accepted the bills.
  3. The total sum payable on the 35 bills was US$5,992,375.18.
  4. The bills were dishonored when presented for payment.
  5. Itochu Steel received US$533,063.00, leaving a balance of US$5,459,312.18 claimed.
  6. The third defendant admitted to being an accommodation party.
  7. Itochu Steel instructed IBJ to close accounts and seek payment themselves.

5. Formal Citations

  1. Itochu Steel Asia Pte Ltd v CV Wira Mustika Indah and Others, Suit 526/1999, [2000] SGHC 259

6. Timeline

DateEvent
Sales contracts entered into between Itochu Steel and CV Wira.
First bill of exchange drawn by Itochu Steel.
Sales contracts entered into between Itochu Steel and CV Wira.
Original invoices issued by ISA to Tri Niaga Enterprise.
Last bill of exchange drawn by Itochu Steel.
Agreement signed between Itochu Steel, CV Wira, and Tri Niaga Enterprise.
ING Bank sent letters to IBJ regarding unpaid bills.
ING Bank sent letter to IBJ regarding unpaid bills.
Itochu Steel instructed IBJ to close accounts.
IBJ confirmed closure of accounts and returned bills of exchange to Itochu Steel.
Tri Niaga Enterprise issued debit note to Itochu Steel.
Judgment issued.

7. Legal Issues

  1. Dishonor of Bills of Exchange
    • Outcome: The court held that the plaintiffs failed to prove payment on the bills, and therefore could not claim against the acceptor.
    • Category: Substantive
    • Sub-Issues:
      • Failure to pay on bills
      • Liability as accommodation party
  2. Misrepresentation
    • Outcome: The court held that the plaintiffs were not prejudiced by the misrepresentation, and therefore the claim failed.
    • Category: Substantive
  3. Release and Waiver
    • Outcome: The court held that there was no release or waiver agreed to by the parties.
    • Category: Substantive

8. Remedies Sought

  1. Payment of US$5,459,312.18

9. Cause of Actions

  • Claim by drawer of bills against acceptor
  • Claim against accommodation party
  • Misrepresentation

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Steel Industry
  • Banking

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Halsbury`s Laws of EnglandN/AYes4(1) Halsbury`s Laws of England (4th Ed) para 481EnglandCited regarding the duty to provide funds or indemnity for accommodation bills.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Bills of Exchange Act (Cap 23)Singapore
s 59(4) Bills of Exchange Act (Cap 23)Singapore
s 28(2) Bills of Exchange Act Cap 23)Singapore
s 30(1) Bills of Exchange ActSingapore
s 2 Bills of Exchange ActSingapore

15. Key Terms and Keywords

15.1 Key Terms

  • Bills of exchange
  • Dishonor
  • Accommodation party
  • Holder for value
  • Release
  • Waiver
  • Misrepresentation
  • Sales contracts

15.2 Keywords

  • bills of exchange
  • dishonor
  • misrepresentation
  • Singapore
  • Itochu Steel
  • CV Wira
  • negotiable instruments

17. Areas of Law

Area NameRelevance Score
Bills of Exchange80
Contract Law70
Misrepresentation60
Commercial Law50
Estoppel30

16. Subjects

  • Bills of Exchange
  • Commercial Law
  • International Trade