Tam Tak Chuen v Khairul: Duress, Illegitimate Pressure & Contract Rescission

In Tam Tak Chuen v Khairul bin Abdul Rahman, the Singapore High Court addressed a claim by Dr. Tam Tak Chuen against Dr. Khairul bin Abdul Rahman and related corporate entities, alleging duress in the sale of his shares in several companies. Dr. Tam claimed that Dr. Khairul coerced him into selling his shares at an undervalue by threatening to disclose video footage of Dr. Tam's affair. The court, presided over by Judith Prakash J, found in favor of Dr. Tam, concluding that Dr. Khairul had exerted illegitimate pressure, vitiating Dr. Tam's consent. The court ordered the rescission of the share transfer documents and the restoration of Dr. Tam's shareholdings.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Judgment for the Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

High Court case involving duress in a contract. Dr. Tam forced to sell shares; court addresses illegitimate pressure and rescission.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Tam Tak ChuenPlaintiffIndividualJudgment for the PlaintiffWon
Eden Healthcare Pte LtdDefendantCorporationDocuments set asideLost
Khairul Bin Abdul RahmanDefendantIndividualDocuments set asideLost
Ashraff Shamsuddin EilyaasDefendantIndividualSettledSettled
Eden Family Clinic Pte LtdDefendantCorporationDocuments set asideLost
Eden Aesthetics Pte LtdDefendantCorporationSettledSettled
Eden Medical Aesthetics Pte LtdDefendantCorporationDocuments set asideLost

3. Judges

Judge NameTitleDelivered Judgment
Judith PrakashJudgeYes

4. Counsels

Counsel NameOrganization
Ang Cheng HockAllen & Gledhill LLP
Tham Wei ChernAllen & Gledhill LLP
Harish KumarRajah & Tann LLP
Goh Seow HuiRajah & Tann LLP

4. Facts

  1. Dr. Tam and Dr. Khairul were partners in Eden Family Clinic.
  2. Dr. Khairul suspected Dr. Tam of having an affair with Ms. Joanne Chew.
  3. Dr. Khairul installed a hidden camera and obtained video footage of Dr. Tam and Ms. Chew.
  4. Dr. Khairul confronted Dr. Tam with the video footage and demanded he sell his shares for $50,000.
  5. Dr. Khairul threatened to make the video public if Dr. Tam did not comply.
  6. Dr. Tam agreed to sell his shares and signed transfer documents.
  7. Dr. Tam's wife was shown the video footage by Dr. Khairul's wife.
  8. Dr. Tam lodged a police report and subsequently commenced legal action.

5. Formal Citations

  1. Tam Tak Chuen v Khairul bin Abdul Rahman and Others, Suit 706/2007, [2008] SGHC 242

6. Timeline

DateEvent
Dr. Tam and Dr. Khairul started practicing in partnership as Eden Family Clinic.
Eden Healthcare Pte Ltd incorporated.
Dr. Khairul questioned Dr. Tam about affair rumors.
Eden Family Clinic Pte Ltd incorporated.
Dr. Khairul installed a closed circuit camera in the Jurong Clinic.
Dr. Khairul obtained video footage of Dr. Tam's affair.
Meeting held where Dr. Tam agreed to sell his shares under duress.
Transfer documents electronically filed with ACRA.
Dr. Tam lodged a police report against Dr. Khairul.
Dr. Tam sent facsimile messages to the company secretary instructing him not to file the transfer documents.
Dr. Khairul arrested by police.
Dr. Khairul released on bail.
Dr. Tam's lawyers demanded rescission of documents.
Police informed Dr. Khairul that no action would be taken against him.
Dr. Tam commenced legal action.
Judgment reserved.

7. Legal Issues

  1. Duress
    • Outcome: The court found that duress was exercised on the plaintiff by the first defendant.
    • Category: Substantive
    • Sub-Issues:
      • Illegitimate pressure
      • Compulsion of will
      • Vitiation of consent
    • Related Cases:
      • [1983] 1 AC 366
      • (1838) 4 Bing (NC) 212
      • [1976] AC 104
      • [1980] AC 614
  2. Illegitimate Pressure
    • Outcome: The court found that the threat to wind up the companies was an abuse of legal process and made to support an unreasonable demand.
    • Category: Substantive
    • Sub-Issues:
      • Abuse of legal process
      • Unreasonable demand
      • Unconscionable conduct
  3. Vitiation of Consent
    • Outcome: The court concluded that the element of vitiation of consent had been established.
    • Category: Substantive
    • Sub-Issues:
      • Lack of protest
      • Absence of alternative course
      • Lack of independent advice
      • Failure to take steps to avoid
    • Related Cases:
      • [1980] AC 614

8. Remedies Sought

  1. Rescission of contract
  2. Damages

9. Cause of Actions

  • Duress
  • Breach of Fiduciary Duty

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Healthcare

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Universe Tankships Inc of Morovia v International Transport Workers FederationN/AYes[1983] 1 AC 366N/ACited for the two elements of duress: compulsion of will and illegitimacy of pressure.
Grainger v HillN/AYes(1838) 4 Bing (NC) 212N/ACited for the principle that a threat to enforce a legal right for a collateral purpose can amount to duress.
Barton v ArmstrongN/AYes[1976] AC 104N/ACited for the principle that the burden lies on the defendant to show that the illegitimate pressure exerted on the plaintiff did not induce the plaintiff to transfer his shares.
Pao On v Lau Yiu LongN/AYes[1980] AC 614N/ACited for the factors to consider when deciding whether consent has been vitiated: protest, alternative course, independent advice, and steps to avoid the contract.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Duress
  • Illegitimate pressure
  • Vitiation of consent
  • Share transfer
  • Winding-up
  • Collateral motive
  • Manifest disadvantage
  • Goodwill
  • Medical practice
  • Video footage

15.2 Keywords

  • Duress
  • Contract
  • Rescission
  • Share transfer
  • Singapore
  • High Court
  • Medical practice

17. Areas of Law

Area NameRelevance Score
Duress85
Contract Law75
Illegitimate pressure70
Undue Influence60
Rescission50
Mistake40
Commercial Disputes30
Company Law25

16. Subjects

  • Contract Law
  • Equity
  • Business Law