Dresdner Kleinwort v CIMB Bank: Stay of Proceedings & Forum Non Conveniens

In Dresdner Kleinwort Ltd v CIMB Bank Bhd, the High Court of Singapore addressed applications for a temporary stay by Dresdner Kleinwort pending German proceedings and a permanent stay by CIMB Bank based on forum non conveniens. Dresdner sought to recover USD8,199,869.50 from CIMB related to a sale and purchase agreement of promissory notes. Chan Seng Onn J dismissed CIMB's application for a permanent stay, finding Singapore to be the more appropriate forum, and varied the temporary stay to allow CIMB to pursue third-party actions while the main action is stayed pending the outcome of the German proceedings.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Permanent stay application dismissed; temporary stay varied to allow third-party actions.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Dresdner Kleinwort sued CIMB Bank for restitution. The court addressed stay of proceedings and forum non conveniens, dismissing CIMB's permanent stay.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
CIMB Bank BhdDefendantCorporationPermanent stay application dismissedLost
Dresdner Kleinwort LtdPlaintiffCorporationTemporary stay granted with variationPartial

3. Judges

Judge NameTitleDelivered Judgment
Chan Seng OnnJudgeYes

4. Counsels

Counsel NameOrganization
Alvin YeoWongPartnership LLP
Nish ShettyWongPartnership LLP
Tan Hsiang YueWongPartnership LLP
Hri KumarDrew & Napier LLC
Bhavish AdvaniDrew & Napier LLC
Tan Su-LinDrew & Napier LLC

4. Facts

  1. Dresdner Kleinwort sought to recover USD8,199,869.50 from CIMB Bank under a sale and purchase agreement.
  2. The agreement involved the purchase of eight promissory notes with a total nominal value of USD10,000,000.
  3. The notes were issued by Innaria Sdn. Bhd. and allegedly guaranteed by Jabatan Kerja Raya, Sabah, Malaysia.
  4. Dresdner Kleinwort made the payment to CIMB Bank's Singapore branch.
  5. CIMB Bank's Singapore branch transferred the payment to a third-party account in HSBC Hong Kong.
  6. The promissory notes were dishonoured when presented for payment.
  7. Siemens Financial Service GmbH sued Dresdner Kleinwort in German proceedings for breach of warranty.

5. Formal Citations

  1. Dresdner Kleinwort Ltd v CIMB Bank Bhd, Suit 661/2007, RA 20/2008, [2008] SGHC 59

6. Timeline

DateEvent
Promissory notes issued by Innaria Sdn. Bhd.
Sale and purchase agreement entered into between Dresdner Kleinwort Wasserstein Limited and Bumiputra – Commerce Bank Berhad.
Fax sent by Bumiputra – Commerce Bank Berhad stating that two authorised signatures were required for endorsement of promissory notes above USD10,000.
Alleged instructions given by Bumiputra – Commerce Bank Berhad to Dresdner Kleinwort Ltd to remit payment to the Singapore branch.
Dresdner Kleinwort Ltd sent payment to CIMB Bank Bhd's Singapore branch.
CIMB Bank Bhd's Singapore branch received payment and transferred it to HSBC Hong Kong.
Promissory notes matured and were dishonoured.
Siemens Financial Service GmbH sued Dresdner Kleinwort Ltd in German proceedings.
Siemens Financial Service GmbH obtained judgment against Dresdner Kleinwort Ltd.
Dresdner Kleinwort Ltd filed an appeal to the Superior Regional Court of Munich.
Dresdner Kleinwort Ltd commenced suit against CIMB Bank Bhd.
Judgment reserved.

7. Legal Issues

  1. Stay of Proceedings
    • Outcome: The court varied the temporary stay order to allow the defendant to proceed with third-party actions.
    • Category: Procedural
    • Sub-Issues:
      • Risk of third-party claims becoming time-barred
      • Order of hearing applications
  2. Forum Non Conveniens
    • Outcome: The court dismissed the defendant's application for a permanent stay, finding Singapore to be the more appropriate forum.
    • Category: Jurisdictional
  3. Choice of Law
    • Outcome: The court held that Singapore law governs the restitutionary obligation.
    • Category: Substantive

8. Remedies Sought

  1. Declaration
  2. Order for payment of USD8,199,869.50 plus interest

9. Cause of Actions

  • Restitution
  • Unjust Enrichment
  • Money Had and Received

10. Practice Areas

  • Commercial Litigation
  • Banking Law

11. Industries

  • Banking
  • Finance

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Rickshaw Investments Ltd and Another v Nicolai Baron von UexkullCourt of AppealYes[2007] 1 SLR 377SingaporeCited for the governing principle in natural forum cases.
Spiliada Maritime Corporation v Cansulex LtdHouse of LordsYes[1987] AC 460EnglandCited for the principle of forum non conveniens.
Brinkerhoff Maritime Drilling Corp v PT Airfast Services IndonesiaSingapore Court of AppealYes[1992] 2 SLR 776SingaporeCited for the restatement of the law regarding forum non conveniens.
PT Hutan Domas Raya v Yue Xiu Enterprises (Holdings) LimitedSingapore Court of AppealYes[2001] 2 SLR 49SingaporeCited as an example of the Singapore Court of Appeal approving the Spiliada case.
Peters Roger May v Pinder Lillian Gek LianHigh CourtYes[2006] 2 SLR 381SingaporeCited for the principle that the real issue is appropriateness, not convenience, in evaluating competing interests.
Q&M Enterprises Sdn Bhd v Poh KiatHigh CourtYes[2005] 4 SLR 494SingaporeCited for the principle that the ultimate question in a stay application is where the case should be tried having regard to the interest of the parties and the ends of justice.
Yeoh Poh San & Anor v Won Siok WanHigh CourtYes[2002] SGHC 196SingaporeCited for the principle that the court must have regard to the likely issues in dispute when considering connecting factors.
Kartika Ratna Thahir v PT Pertambangan Minyak dan Gas Bumi Negara (Pertamina)Court of AppealYes[1994] 3 SLR 257SingaporeCited for the choice of law rules governing restitutionary claims.
Luiz Vicente Barros Mattos Junior v Macdaniels LimitedEnglish High CourtYes[2005] EWHC 1323EnglandCited to show that the law of the place of enrichment will not necessarily give an answer which corresponds to the law which has the closest connection with the claim or with the issue.
Nam Kwong Medicines & Health Products Co Limited v China Insurance Company LimitedHong Kong High CourtYes[1999] HKCU 1216Hong KongCited regarding the consideration of third-party proceedings in forum non conveniens applications.
The Standard Steamship Owners’ Protection and Indemnity Association (Bermuda) Ltd v Gann and anotherEnglish High CourtYes[1992] 2 Lloyd's Rep 528EnglandCited regarding the consideration of third-party proceedings in forum non conveniens applications.
Baring Futures (Singapore) Pte Ltd (in liquidation) v Deloitte & Touche (a firm) & AnorHigh CourtYes[1997] 3 SLR 312SingaporeCited for the principle that all principal players should be brought together before one forum for adjudication.
IPCO International Construction Limited v S T Kay & Co & AnorHigh CourtYes[1998] SGHC 198SingaporeCited for the principle that the entire proceedings involving all parties should properly be before the same court.
Deaville and Others v Aeroloft Russian International AirlinesEnglish High CourtYes[1997] 2 Lloyd’s Rep 67EnglandCited for the principle that the court has power to grant a plaintiff an order staying an action brought by him if such an order is appropriate in the interest of justice.
The Al DhabiyyahHong Kong Admiralty CourtYes[1999] 4 HKC 414Hong KongCited for the principle that a temporary stay may be granted pending the result of a foreign jurisdiction dispute.
Management Corporation Strata Title No 473 v De Beers Jewellery Pte LtdCourt of AppealYes[2002] 2 SLR 1SingaporeCited for the principle that a claim for unjust enrichment which was neither grounded in contract nor tort, and in which equitable relief was not sought, did not fall within the scope of the Limitation Act.

13. Applicable Rules

Rule Name
Rules of Court (Cap 322, R 5, 2007 Rev Ed)

14. Applicable Statutes

Statute NameJurisdiction
Limitation Act (Cap 163, 1996 Rev Ed)Singapore
Civil Law Act (Cap. 43)Singapore
Evidence Act (Cap 97, 1997 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Stay of proceedings
  • Forum non conveniens
  • Restitution
  • Unjust enrichment
  • Promissory notes
  • Time bar
  • Third-party actions
  • Mistake
  • Failure of consideration

15.2 Keywords

  • Stay of proceedings
  • Forum non conveniens
  • Restitution
  • Banking
  • Singapore High Court

17. Areas of Law

Area NameRelevance Score
Civil Procedure90
Conflict of Laws90
Unjust Enrichment70
Fraud and Deceit60
Limitation40
Mistake40
Contract Law30
Breach of Contract30
Rescission20
Misrepresentation20
Costs20
Estoppel20
Evidence20
Duress10
Property Law10
Arbitration10

16. Subjects

  • Civil Procedure
  • Conflict of Laws
  • Banking
  • Restitution