Sia Leng Yuen v HKR Properties Ltd: Appeal Against Statutory Demand for Guarantor's Debt

Sia Leng Yuen appealed against the decision to dismiss his application to set aside a statutory demand issued by HKR Properties Ltd. The statutory demand was related to a guarantee Sia provided for a loan HKR Properties made to Murex Co Ltd. The High Court dismissed the appeal, finding the statutory demand to be regular. The court held that the creditor did not have to state in the statutory demand that he holds security for debt.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Appeal dismissed.

1.3 Case Type

Insolvency

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding a statutory demand against Sia Leng Yuen, a guarantor, for Murex's debt to HKR Properties. The court dismissed the appeal, finding the statutory demand regular.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Sia Leng YuenAppellantIndividualAppeal dismissedLost
HKR Properties LtdRespondentCorporationAppeal dismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Lee Seiu KinJudicial CommissionerYes

4. Counsels

Counsel NameOrganization
Intekhab KhanJ Koh & Co
Liew Yik WeeWong Partnership

4. Facts

  1. HKR lent US$3m to Murex, a Thai company.
  2. Sia unconditionally guaranteed payment of all the indebtedness of Murex to HKR.
  3. Murex was unable to pay HKR, and HKR commenced Suit 2239/98 against Sia to recover the debt.
  4. The parties entered a consent order where Sia would make payments to HKR.
  5. HKR would release club memberships to Sia based on the amount repaid.
  6. Sia defaulted on the consent order.
  7. HKR issued a statutory demand to Sia for the remaining sum.

5. Formal Citations

  1. Sia Leng Yuen v HKR Properties Ltd, OS 600073/2001 - (RA 600158/2001), [2001] SGHC 331

6. Timeline

DateEvent
Loan agreement signed between HKR and Murex for US$3m.
Murex requested HKR for an extension of time.
Murex was unable to make payment.
Sia confirmed in writing that the guarantee remained good and valid.
Consent order entered in Suit 2239/98.
HKR issued a statutory demand to Sia.
Appeal dismissed.
Decision Date

7. Legal Issues

  1. Setting aside statutory demand
    • Outcome: The court held that the statutory demand was regular and refused to set it aside.
    • Category: Procedural
  2. Whether statutory demand regular
    • Outcome: The court held that the statutory demand was regular.
    • Category: Substantive
  3. Whether creditor has to state in statutory demand that he holds security for debt
    • Outcome: The court held that it was not necessary to state in the statutory demand the fact that HKR held the club memberships as security as they were not Sia`s property.
    • Category: Substantive

8. Remedies Sought

  1. Setting aside of statutory demand

9. Cause of Actions

  • Breach of Guarantee

10. Practice Areas

  • Commercial Litigation
  • Insolvency Litigation

11. Industries

  • No industries specified

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
In Re Loh Lee Keow, ex p Keppel TatLee BankHigh CourtYes[2001] 2 SLR 503SingaporeCited for the interpretation of 'security' in rr 94(5) and 98(2) of the Bankruptcy Rules, holding that it means security on the property of the debtor.

13. Applicable Rules

Rule Name
Bankruptcy Rules (Cap 20, R 1, 1996 Ed)
r 94(5) Bankruptcy Rules (Cap 20, R 1, 1996 Ed)
r 98(2)(c) Bankruptcy Rules (Cap 20, R 1, 1996 Ed)

14. Applicable Statutes

Statute NameJurisdiction
Bankruptcy Act (Cap 20, 2000 Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Statutory demand
  • Guarantor
  • Guarantee
  • Consent order
  • Security
  • Bankruptcy Rules
  • Club memberships

15.2 Keywords

  • statutory demand
  • bankruptcy
  • guarantee
  • insolvency
  • Singapore

17. Areas of Law

Area NameRelevance Score
Statutory Demand80
Bankruptcy75
Guarantee65
Contract Law50

16. Subjects

  • Insolvency
  • Bankruptcy
  • Guarantees