Thio Keng Poon v Thio Syn Pyn: Breach of Fiduciary Duty & Removal from Company Directorship
In Thio Keng Poon v Thio Syn Pyn, the High Court of Singapore heard a case brought by Thio Keng Poon against his family and family companies, challenging his removal from the offices of Director, Chairman, and Managing-Director. Thio Keng Poon claimed oppression, breach of contract, and breach of an understanding. The court, after the Plaintiff closed his case and the defendants elected to not give evidence, dismissed the Plaintiff's claims in both suits and granted interlocutory judgment to Malaysia Dairy Industries Private Limited on its counterclaim against the Plaintiff.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Plaintiff's claims dismissed; Interlocutory judgment for the Ninth Defendant on its counterclaim.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Thio Keng Poon sued his family over his removal from company directorships. The court dismissed his claims, finding no oppression or breach of contract.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Thio Keng Poon | Plaintiff | Individual | Claims Dismissed | Lost | Vinodh Coomaraswamy, Arvind Daas Naaidu |
| Thio Syn Pyn | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Thio Syn Wee | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Thio Syn Kym Wendy | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Thio Syn Ghee | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Thio Syn San Serene | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Vicki Thio Syn Luan | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Kwik Poh Leng | Defendant | Individual | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Thio Holdings (Private) Limited | Defendant | Corporation | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| Malaysia Dairy Industries Private Limited | Defendant | Corporation | Judgment for Defendant, Interlocutory judgment for the Ninth Defendant against the Plaintiff for an inquiry to be taken for the sum of S$45,529.64 and/or all sums claimed by the Ninth Defendant from the Plaintiff in breach of the Plaintiff’s fiduciary duties with the costs of the inquiry to be reserved to the Registrar having conduct of the inquiry. | Won, Partial | Davinder Singh, Adrian Tan |
| Modern Dairy International Pte Ltd | Defendant | Corporation | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
| United Realty (Singapore) Private Limited | Defendant | Corporation | Judgment for Defendant | Won | Davinder Singh, Adrian Tan |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Vinodh Coomaraswamy | Shook Lin & Bok LLP |
| Arvind Daas Naaidu | Shook Lin & Bok LLP |
| Davinder Singh | Drew & Napier LLC |
| Adrian Tan | Drew & Napier LLC |
4. Facts
- The Plaintiff sued his six children, his wife, and four family companies over his removal from the offices of Director, Chairman and Managing-Director.
- The Plaintiff was removed from his positions in Malaysia Dairy Industries Pte Ltd and Modern Dairy International Pte Ltd.
- The Plaintiff claimed oppression, breach of contract, and breach of an understanding and assurance.
- The Plaintiff transferred shares in the Thio Group companies to his family members over the years.
- The Plaintiff made improper double claims on his travel expenses from MDI and Cotra.
- The Plaintiff failed to produce hotel invoices relating to the double claims.
- The Plaintiff was removed as an authorised bank signatory, a Director, Managing Director and Chairman of Modern Dairy with immediate effect from 21 November 2007.
5. Formal Citations
- Thio Keng Poon v Thio Syn Pyn and Others and Another Suit, Suit 734/2008, 10/2008, [2009] SGHC 135
6. Timeline
| Date | Event |
|---|---|
| Plaintiff removed as Director, Managing-Director and Chairman of Malaysia Dairy Industries Pte Ltd. | |
| Plaintiff removed as an authorised bank signatory, a Director, Managing Director and Chairman of Modern Dairy. | |
| Plaintiff removed from his offices as Director of Thio Holdings and United Realty. | |
| Plaintiff’s privileges which attached to his three offices were removed. | |
| Plaintiff barred from the premises of Malaysia Dairy Industries Pte Ltd. | |
| Trial started. | |
| Judgment issued. |
7. Legal Issues
- Breach of Fiduciary Duty
- Outcome: The court found that the Plaintiff had breached his fiduciary duties to MDI by double claiming travel expenses.
- Category: Substantive
- Sub-Issues:
- Double claiming of travel expenses
- Oppression
- Outcome: The court held that the Plaintiff had no standing to invoke s 216 of the Act to object to his removal as a Director, Managing Director and Chairman of MDI and Modern Dairy because the acts complained of in this case affected the Plaintiff in his capacity as a member of the board, not as a member of the company.
- Category: Substantive
- Breach of Contract
- Outcome: The court found no implied contract as to matters covered by an express contract.
- Category: Substantive
- Procedural Irregularities
- Outcome: The court concluded that there was no substantial injustice to the Plaintiff since there was nothing to stop the defendants from removing the Plaintiff from his positions in MDI and Modern Dairy by complying with the requisite procedural requirements even if he was reinstated.
- Category: Procedural
8. Remedies Sought
- Declaration that the resolution of the directors of MDI passed on 20 November 2007 deeming him to have vacated his office as Director, Managing Director and Chairman of MDI with effect from 20 November 2007 was null and void and not binding on the Plaintiff
- Declaration that the resolution of the members of MDI passed at the 44th AGM of MDI on 21 November 2007 purporting to confirm and ratify his removal as a director of MDI was null and void and not binding on the Plaintiff
- Declaration that nothing which occurred at the AGM of Modern Dairy deemed to have taken place on 21 November 2007 affected the Plaintiff’s position as a Director, the Managing Director and Chairman of Modern Dairy
- Declaration that the Plaintiff was still a Director, the Managing Director and Chairman of MDI
- Declaration that the Understanding bound the defendants
- Order that he be reinstated as Director, Managing-Director and Chairman of MDI and Modern Dairy
- Injunction to restrain the defendants, whether by themselves or their servants and agents howsoever, from removing him from his offices and positions as Director, Chairman and Managing-Director of Thio Holdings, MDI and their subsidiaries
- That MDI pay his arrears of salary to be assessed
9. Cause of Actions
- Breach of Fiduciary Duty
- Oppression
- Breach of Contract
10. Practice Areas
- Commercial Litigation
11. Industries
- Dairy Industry
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Lim Swee Khiang v Borden Co (Pte) Ltd | High Court | Yes | [2006] 4 SLR 745 | Singapore | Cited for the principle that he who asserts must prove and therefore a defendant is entitled to put the plaintiff to strict proof of everything he is alleging, without having to respond in any way to the allegations. |
| Relfo Ltd (in liquidation) v Bhimji Velji Jadva Varsani | High Court | Yes | [2008] 4 SLR 657 | Singapore | Cited for the test of no case to answer is whether the plaintiff’s evidence at face value establishes a case in law or whether the evidence led by the plaintiff was so unsatisfactory or unreliable that its burden of proof had not been discharged. |
| Bansal Hermant Govindprasad v Central Bank of India | High Court | Yes | [2003] 2 SLR 33 | Singapore | Cited for the test of whether there is no case to answer. |
| Re Tri-Circle Investment Pte Ltd | High Court | Yes | [1993] 2 SLR 523 | Singapore | Cited as an example of courts being slow to intervene in the management of the affairs of companies. |
| Re Kong Thai Sawmill (Miri) Sdn Bhd | Federal Court of Malaysia | Yes | [1978] 2 MLJ 227 | Malaysia | Cited for the principle that the court must examine the conduct of majority shareholders to determine whether they have departed from the proper standard of commercial fairness. |
| In re Five Minute Car Wash Service Ltd | Chancery Division | Yes | [1966] 1 WLR 745 | England and Wales | Cited for the principle that the director had to have acted unscrupulously, unfairly or with any lack of probity. |
| Re HR Harmer Ltd | Court of Appeal | Yes | [1958] 3 All ER 689 | England and Wales | Cited for the principle that the acts complained of must affect the member in his capacity as a member. |
| Re A Co (No 000477 of 1986) | High Court | Yes | [1986] BCLC 376 | England and Wales | Cited for the principle that a member’s interest as a member who invested his capital in the company’s business may include a legitimate expectation that he would continue to be employed as a director. |
| Kumagai Gumi Co Ltd v Zenecon Pte Ltd | Court of Appeal | Yes | [1995] 2 SLR 297 | Singapore | Cited for the principle that a breach of the pre-emptive provisions of the company’s articles of association did not amount to oppressive conduct. |
| Rabiah Bee Bte Mohamed Ibrahim v Salem Ibrahim | High Court | Yes | [2007] 2 SLR 655 | Singapore | Cited for the principle that there can be no implied contract as to matters covered by an express contract. |
| Steven v Bromley & Son | Court of Appeal | Yes | [1919] 2 KB 722 | England and Wales | Cited for the principle that there can be no implied contract as to matters covered by an express contract until the express contract is displaced. |
| Bentley –Stevens v Jones | High Court | Yes | [1974] 1 DPP 638 | England and Wales | Cited for the principle that a claim for reinstatement should not be granted where it would be futile. |
| Browne v. La Trinidad | Court of Appeal | Yes | (1887) 37 Ch.D. 1 | England and Wales | Cited for the principle that the court should not interfere for the purpose of forcing companies to conduct their business according to the strictest rules, where the irregularity complained of can be set right at any moment. |
| Golden Harvest Films Distribution (Pte) Ltd v Golden Village Multiplex Pte Ltd | High Court | Yes | [2007] 1 SLR 940 | Singapore | Cited for the principle that a meeting of the board of directors was a proceeding under s 392(2) of the Act. |
| Re Caysand No 64 Pty Ltd | Supreme Court of Queensland | Yes | [1994] 2 Qd R 467 | Australia | Cited for the principle that the onus lay upon the party attacking the validity of a proceeding to satisfy the court of substantial injustice that cannot be remedied by the court. |
| The Oriental Insurance Co Ltd v Reliance National Asia Re Pte Ltd | Court of Appeal | Yes | [2008] 3 SLR 121 | Singapore | Cited for the principle that “substantial injustice” in s 392(6)(c) amounts to something greater than just ordinary prejudice. |
| SMS Pte Ltd v Power & Energy Pte Ltd | High Court | Yes | [1996] 1 SLR 767 | Singapore | Cited for the principle that where the order breached is not an ‘unless’ order then the court will only strike out a defence if in all the circumstances there is a serious risk that a fair trial would not be possible by reason of the defendants’ breach. |
| Star News Shops v Stafford Refrigeration Ltd | Court of Appeal | Yes | [1998] 4 All ER 408 | England and Wales | Cited for the principle that it was a misuse of the court’s powers under the equivalent provision in the English Rules of Court to strike out the defence for non-compliance with a non-peremptory order of the court because it had the effect of debarring the party from advancing an arguable defence. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (2006 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
| Contracts (Rights of Third Parties) Act (Cap 53B) | Singapore |
| Evidence Act (Cap 97, 1997 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Thio Group
- Deed of Settlement
- Understanding
- Assurance
- Double Claim
- Fiduciary Duty
- Oppression
- Best Corporate Practices
15.2 Keywords
- Company Directorship
- Fiduciary Duty
- Oppression
- Family Business
- Singapore
- Corporate Governance
16. Subjects
- Company Law
- Fiduciary Duties
- Corporate Governance
17. Areas of Law
- Company Law
- Breach of Fiduciary Duty
- Civil Procedure