Paul De Fries v Noble Group Ltd: Share Option Scheme Dispute

Paul De Fries sued Noble Group Ltd in the High Court of Singapore, judgment date 2009-02-18, after Noble Group refused to allow him to exercise share options following his retrenchment from Noble Resources Ltd, a subsidiary of Noble Group. The court, Prakash J, dismissed De Fries's appeal, holding that the share options had not vested because he was no longer employed by the company on the vesting date.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Appeal dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Paul De Fries sues Noble Group Ltd over share options after his retrenchment. The court ruled against De Fries, holding the options had not vested.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Noble Group LtdDefendant, RespondentCorporationAppeal dismissedWon
Paul De FriesPlaintiff, AppellantIndividualAppeal dismissedLost

3. Judges

Judge NameTitleDelivered Judgment
Judith PrakashJYes

4. Counsels

Counsel NameOrganization
Kenneth PereiraAllen & Gledhill LLP
Muralli RajaramAllen & Gledhill LLP
Adrian WongRajah & Tann LLP

4. Facts

  1. Paul De Fries was employed by Noble Resources Ltd from August 2001 to November 15, 2007.
  2. Noble Resources Ltd was an indirect subsidiary of Noble Group Limited.
  3. De Fries was granted options to subscribe for shares in Noble Group in 2002 and 2003.
  4. The 2003 offer letter stated the options would vest fully on April 15, 2008, provided De Fries was qualified under the Scheme.
  5. De Fries's employment was terminated on November 15, 2007, due to the closure of his department.
  6. De Fries attempted to exercise his options in December 2007, but Noble Group refused.
  7. Rule 4.1(a)(i) of the Scheme states that a qualified employee would be a full-time employee of the defendant and its subsidiaries who had attained the age of 21.

5. Formal Citations

  1. Paul De Fries v Noble Group Ltd, Suit 354/2008, RA 378/2008, [2009] SGHC 40

6. Timeline

DateEvent
Paul De Fries employed by Noble Resources Ltd.
Paul De Fries nominated to participate in Noble Group Share Option Scheme 2001.
Defendant granted the plaintiff a further option to subscribe for shares.
Plaintiff held Options to subscribe for an aggregate of 17.160m shares.
Plaintiff partially exercised the Option he held and took up 660,000 shares.
Plaintiff was retrenched by NRL.
Plaintiff gave notice of his intention to exercise options.
Defendant told the plaintiff that he was not entitled to exercise the Options.
Plaintiff filed a summons.
Application heard before the Assistant Registrar.
Judgment issued.

7. Legal Issues

  1. Exercise of Share Options
    • Outcome: The court held that the plaintiff was not entitled to exercise the share options because they had not vested at the time of termination of his employment.
    • Category: Substantive
    • Related Cases:
      • [2008] SGHC 57

8. Remedies Sought

  1. Enforcement of rights under the Scheme
  2. Order for the defendant to issue shares

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Commercial Litigation

11. Industries

  • No industries specified

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Tan Ging Hoon v MMI Holdings LtdHigh CourtYes[2008] SGHC 57SingaporeCited for the principle that unvested options do not confer any rights of exercise on the holder.

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

  • Share Option Scheme
  • Market Price Option
  • Subscription Price
  • Vesting
  • Termination of Employment
  • Participant
  • Group Employees

15.2 Keywords

  • share options
  • employment
  • contract
  • vesting
  • termination

17. Areas of Law

Area NameRelevance Score
Share Option Schemes90
Contract Law85
Employment Law70
Company Law60

16. Subjects

  • Contractual Dispute
  • Employment Law
  • Share Options