Zim Integrated Shipping Services v Dafni Igal: Fiduciary Duty & Rebates

In Zim Integrated Shipping Services Ltd and others v Dafni Igal and others, the Court of Appeal of Singapore heard an appeal on December 2, 2010, regarding alleged fiduciary breaches. The appellants, including Zim Integrated Shipping Services Ltd, claimed that the respondents, including Dafni Igal, had breached their fiduciary duties. The court allowed the appeal in part, finding that the Fourth Respondent failed to account for rebate monies it received as the appellants’ agent, but dismissed the claims regarding the First Respondent’s employment with the Sixth Respondent while he was a director of the Second Appellant.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeal Allowed in Part

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal concerning fiduciary breaches. Court found the Fourth Respondent failed to account for rebate monies and dismissed claims regarding First Respondent's employment.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Zim Integrated Shipping Services LtdAppellantCorporationAppeal allowed in partPartial
Gold Star Line LtdAppellantCorporationAppeal allowed in partPartial
Seth Shipping LtdAppellantCorporationAppeal dismissedLost
Star Shipping Agencies (Singapore) Pte LimitedAppellantCorporationAppeal dismissedLost
Dafni IgalRespondentIndividualAppeal dismissedWon
Starship Agencies Sdn BhdRespondentCorporationAppeal allowedLost
Starship Carriers Pte LtdRespondentCorporationAppeal dismissedWon
Charter Shipping Agencies (S) Pte LtdRespondentCorporationAppeal dismissedWon
Ng Koo Kay BenedictRespondentIndividualAppeal dismissedWon
Rajathurai SuppiahRespondentIndividualAppeal dismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Chao Hick TinJustice of the Court of AppealNo
Andrew Phang Boon LeongJustice of the Court of AppealYes
V K RajahJustice of the Court of AppealNo

4. Counsels

Counsel NameOrganization
Terence TanRodyk & Davidson LLP
Goh Aik Leng MarkMark Goh & Co
Philip JeyaretnamRodyk & Davidson LLP
Goh Sue LynRodyk & Davidson LLP
Benny Jude PhilomenJoseph Tan Jude Benny LLP
K MuraitherapanyJoseph Tan Jude Benny LLP
Pey Yin JieJoseph Tan Jude Benny LLP
Lee Hwee Khiam AnthonyBih Li & Lee
Thng Tze Ern AudreyBih Li & Lee
Chua MarinaBih Li & Lee

4. Facts

  1. The First Appellant is a container shipping company.
  2. The Second Appellant is the First Appellant's dedicated feeder company.
  3. The Fourth Respondent was the First Appellant's shipping agent in Malaysia.
  4. The First Respondent was a director of the Second Appellant.
  5. The Fourth Respondent received rebates from Westports for outbound containers.
  6. The First Respondent was employed by the Sixth Respondent while a director of the Second Appellant.
  7. The First Respondent claimed he waived his salary from the Sixth Respondent.

5. Formal Citations

  1. Zim Integrated Shipping Services Ltd and others v Dafni Igal and others, Civil Appeal No 15 of 2010, [2010] SGCA 45

6. Timeline

DateEvent
Fourth Respondent incorporated after Second Respondent secured rights to act as First Appellant’s shipping agent in Malaysia.
Fourth Respondent entered into a Standard Agency Agreement with the Fourth Appellant to act as its sub-agent.
Fourth Respondent entered into an agreement with the Second Appellant to act as its shipping agent in Malaysia.
Employment Agreement between First Respondent and First Appellant.
First Respondent began employment with Sixth Respondent.
First Respondent resigned from First Appellant.
Suit 755 of 2007 filed.
Judgment reserved.

7. Legal Issues

  1. Breach of Fiduciary Duty
    • Outcome: The court found a breach of fiduciary duty regarding the Rebates issue but not regarding the Conflict issue.
    • Category: Substantive
    • Sub-Issues:
      • Conflict of interest
      • Failure to account
  2. Duty to Account
    • Outcome: The court held that the Fourth Respondent was obliged to account to the Appellants for the sum of RM1,477,474.
    • Category: Substantive

8. Remedies Sought

  1. Account of Profits
  2. Monetary Damages

9. Cause of Actions

  • Breach of Fiduciary Duty
  • Failure to Account

10. Practice Areas

  • Commercial Litigation
  • Shipping
  • Breach of Fiduciary Duty

11. Industries

  • Shipping

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Zim Integrated Shipping Services Ltd and others v Dafni Igal and othersHigh CourtYes[2010] 2 SLR 426SingaporeDecision from which this appeal arose.
Loo Chay Sit v Estate of Loo Chay Loo, deceasedCourt of AppealYes[2010] 1 SLR 286SingaporeCited for the distinction between the legal burden and the evidential burden.
Dunne v EnglishEnglish CourtYes(1874) LR 18 Eq 524EnglandEndorsed and applied in the context of the duty of full disclosure by a fiduciary.
Ng Eng Ghee and others v Mamata Kapildev Dave and others (Horizon Partners Pte Ltd, intervener) and another appealCourt of AppealYes[2009] 3 SLR(R) 109SingaporeApplied the principle enunciated in Dunne in the context of the duty of full disclosure.

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

  • Rebates
  • Fiduciary Duty
  • Shipping Agent
  • Conflict of Interest
  • Gratuitous Incentive Payments
  • Evidential Burden
  • Legal Burden

15.2 Keywords

  • fiduciary duty
  • rebates
  • shipping agent
  • conflict of interest
  • account of profits

17. Areas of Law

Area NameRelevance Score
Fiduciary Duties90
Agency Law70
Contract Law50
Company Law30

16. Subjects

  • Agency
  • Fiduciary Duties
  • Shipping