Go Dante Yap v Bank Austria: Investment Losses & Advisory Duty Dispute

In Go Dante Yap v Bank Austria Creditanstalt AG, the Court of Appeal of Singapore heard an appeal from Go Dante Yap concerning losses suffered on his investment portfolio following the Asian financial crisis. Yap claimed the bank made unauthorized investments and breached its duty to advise him. The court dismissed the appeal, finding Yap's claim of unauthorized investments unproven and clarifying the scope of a bank's advisory duty, emphasizing that while a contractual duty of skill and care exists, a specific tortious duty to advise is not automatically imposed.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding investment losses after the Asian financial crisis. The court addressed the bank's advisory duty and upheld the dismissal of the appeal.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Go Dante YapAppellantIndividualAppeal DismissedLost
Bank Austria Creditanstalt AGRespondentCorporationAppeal DismissedWon

3. Judges

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

4. Counsels

Counsel NameOrganization
Paul SeahTan Kok Quan Partnership
Eddee NgTan Kok Quan Partnership
Kannan RameshTan Kok Quan Partnership
Harjean KaurAdvocatus Law LLP
Christopher Anand DanielAdvocatus Law LLP

4. Facts

  1. Appellant opened accounts with Respondent's Hong Kong and Singapore branches in 1997.
  2. Appellant executed Account Opening and Custodian Agreement, Discretionary Investment Management Agreement, and Investment Authority Instructions.
  3. Appellant executed a loan facility letter for up to US$5 million.
  4. 16 investments were entered into by Respondent under Appellant's Singapore account.
  5. Appellant and Respondent had monthly meetings to review investment performance.
  6. Appellant suffered significant losses on three investments due to the Asian Financial Crisis.
  7. Appellant claimed the Respondent breached contractual and tortious duties to advise him.

5. Formal Citations

  1. Go Dante Yap v Bank Austria Creditanstalt AG, Civil Appeal No 156 of 2010, [2011] SGCA 39
  2. Go Dante Yap v Bank Austria Creditanstalt AG, , [2010] 4 SLR 916

6. Timeline

DateEvent
Appellant recommended services of Ms. Ching.
Appellant opened Hong Kong and Singapore accounts.
Appellant remitted approximately US$5 million into the Singapore account.
16 investments entered into by Ms Ching under the Appellant’s Singapore account.
Monthly meetings between Appellant and Ms Ching began.
Most of the securities comprising the 16 investments were either sold before maturity or redeemed upon maturity.
Only three of the 16 investments remained in the Singapore account.
Exchange of correspondence between the parties began.
Trial judge dismissed both of the Appellant's claims.
Appeal dismissed.

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that while a contractual duty of skill and care existed, the Respondent had discharged its duty.
    • Category: Substantive
    • Sub-Issues:
      • Failure to exercise reasonable skill and care
      • Breach of implied contractual duty
  2. Negligence
    • Outcome: The court found that while a tortious duty of care existed, the Respondent had discharged its duty.
    • Category: Substantive
    • Sub-Issues:
      • Failure to provide adequate advice
      • Breach of tortious duty of care
  3. Duty of Care
    • Outcome: The court clarified the scope of a bank's duty of care, distinguishing between contractual and tortious duties.
    • Category: Substantive
    • Sub-Issues:
      • Scope of duty of care in tort
      • Scope of duty of care in contract
      • Assumption of responsibility

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Breach of Contract
  • Negligence

10. Practice Areas

  • Commercial Litigation
  • Banking Litigation
  • Financial Services Litigation

11. Industries

  • Finance

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Go Dante Yap v Bank Austria Creditanstalt AGSingapore High CourtYes[2010] 4 SLR 916SingaporeThe decision from which this appeal arose.
IFE Fund SA v Goldman Sachs InternationalN/AYes[2007] 2 Lloyd’s Rep 449EnglandConsidered in relation to the advisory claim and the existence of a duty of care.
JP Morgan Chase Bank (formerly known as The Chase Manhattan Bank) (a body corporate) and others v Springwell Navigation Corporation (a body corporate)English High CourtYes[2008] EWHC 1186EnglandConsidered in relation to the advisory claim and the existence of a duty of care.
Titan Steel Wheels Limited v The Royal Bank of Scotland plcEnglish High CourtYes[2010] EWHC 211EnglandConsidered in relation to the advisory claim and the existence of a duty of care.
Titan Steel Wheels Limited v The Royal Bank of Scotland plcN/AYes[2010] 2 Lloyd’s Rep 92EnglandConsidered in relation to the advisory claim and the existence of a duty of care.
Crédit Industriel et Commercial v Teo Wai CheongSingapore High CourtYes[2010] 3 SLR 1149SingaporeConsidered in relation to the advisory claim and the existence of a duty of care.
Teo Wai Cheong v Crédit Industriel et CommercialSingapore Court of AppealYes[2011] SGCA 13SingaporeCited to note that a new trial was ordered in light of newly disclosed documents.
James Andrew Robinson v P E Jones (Contractors) LimitedEnglish Court of AppealYes[2011] EWCA Civ 9EnglandCited for the principle that contractual and tortious duties differ in their nature.
A C Billings & Sons Ltd v RidenHouse of LordsYes[1958] 1 AC 240EnglandCited by analogy regarding the tortious duty to advise.
Qualcast (Wolverhampton) Ltd v HaynesHouse of LordsYes[1959] 1 AC 743EnglandCited regarding the tortious duty to advise.
Henderson and others v Merrett Syndicates Ltd and othersHouse of LordsYes[1995] 2 AC 145EnglandLeading decision regarding the existence of a tortious duty of care concurrent with a contractual duty of care.
Bryan v MaloneyHigh Court of AustraliaYes(1995) 128 ALR 163AustraliaCited regarding the relationship of proximity arising by virtue of a contract.
Animal Concerns Research & Education Society v Tan Boon KweeSingapore High CourtYes[2011] 2 SLR 146SingaporeCited regarding the exclusion of a tortious duty of care.
Ng Giap Hon v Westcomb Securities Pte Ltd and othersSingapore Court of AppealYes[2009] 3 SLR(R) 518SingaporeCited regarding the implication of contractual terms.
Lister v Romford Ice and Cold Storage Co LtdHouse of LordsYes[1957] AC 555EnglandCited regarding the implied term of reasonable skill and care in contracts for services.
Bank of America National Trust and Savings Association v Herman Iskandar and anotherSingapore Court of AppealYes[1998] 1 SLR(R) 848SingaporeCited regarding the implied contractual duty of skill and care of a bank.
Yogambikai Nagarajah v Indian Overseas BankSingapore High CourtYes[1996] 2 SLR(R) 774SingaporeCited regarding the duty of care of a bank in the context of fraud.
Selangor United Rubber Estates Ltd v Cradock and others (No 3)English High CourtYes[1968] 1 WLR 1555EnglandCited regarding the duty of care of a bank in the context of fraud.
Spandeck Engineering (S) Pte Ltd v Defence Science & Technology AgencySingapore Court of AppealYes[2007] 4 SLR(R) 100SingaporeLaid down a single test to determine the imposition of a duty of care in all claims arising out of negligence in the context of pure economic loss.
Sutherland Shire Council v HeymanHigh Court of AustraliaYes(1985) 60 ALR 1AustraliaCited regarding the concept of an assumption of responsibility as the basis of a sufficiently proximate relationship.
Hedley Byrne & Co Ltd v Heller & Partners LtdHouse of LordsYes[1964] 1 AC 465EnglandSeminal decision regarding the concept of an assumption of responsibility as the basis of a sufficiently proximate relationship so as to give rise to a duty of care in the tort of negligence.
Customs and Excise Commissioners v Barclays Bank plcHouse of LordsYes[2007] 1 AC 181EnglandCited for the development of lower-level principles to determine the existence of a duty of care.
Smith v Eric S BushHouse of LordsYes[1990] 1 AC 831EnglandCited regarding the effect of an express disclaimer of responsibility.
Lloyd v Citicorp Australia Ltd and anotherNew South Wales Supreme CourtYes(1986) 11 NSWLR 286AustraliaCited regarding the standard of care to be expected of a private bank.
Roe v Minister of Health and anotherEnglish Court of AppealYes[1954] 2 WLR 915EnglandCited regarding the use of hindsight in assessing whether an alleged tortfeasor has been negligent.
Sie Choon Poh (trading as Image Galaxy) v Amara Hotel Properties Pte LtdSingapore High CourtYes[2005] 3 SLR(R) 576SingaporeCited as an exception where the Singapore courts have construed the meaning of the phrase 'gross negligence'.
Mühlbauer AG v Manufacturing Integration Technology LtdSingapore Court of AppealYes[2010] 2 SLR 724SingaporeCited to caution against excessively voluminous written cases.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Unfair Contract Terms ActSingapore

15. Key Terms and Keywords

15.1 Key Terms

  • Asian Financial Crisis
  • Investment Portfolio
  • Advisory Claim
  • Authorisation Claim
  • Account-opening Documents
  • Discretionary Investment Management Agreement
  • Investment Authority Instructions
  • Bakrie bonds
  • Rossiyskiy notes
  • Duty of care

15.2 Keywords

  • investment losses
  • advisory duty
  • bank
  • negligence
  • contract
  • financial crisis

17. Areas of Law

Area NameRelevance Score
Investments80
Banking and Finance75
Investment Portfolio70
Contract Law70
Financial Crisis65
Breach of Contract60
Torts50

16. Subjects

  • Banking
  • Financial Services
  • Investments
  • Contract Law
  • Tort Law