Deldar Tony Singh v Rajinder Singh: Striking Out Claim for Lack of Leave Under Companies Act

In Deldar Tony Singh and another v Rajinder Singh and others, the High Court of Singapore considered two summonses for the striking out of the Statement of Claim in Suit 444 of 2012 on the ground that the plaintiffs failed to obtain leave of court as required under s 299(2) of the Companies Act before commencing Suit 444. The applicants in SUM 3260 and SUM 3643 are the third and second defendants in Suit 444. The court granted the applications and ordered the Statement of Claim in Suit 444 to be struck out in favour of the second and third defendants.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Applications granted; Statement of Claim struck out in favour of the second and third defendants.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

The High Court struck out a claim against a company in liquidation and its liquidator for failing to obtain leave under s 299(2) of the Companies Act.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
LiquidatorDefendantOtherClaim Struck OutWon
Deldar Tony SinghPlaintiffIndividualClaim Struck OutLost
Rajinder SinghDefendantIndividual
CompanyDefendantCorporationClaim Struck OutWon

3. Judges

Judge NameTitleDelivered Judgment
Colin SeowAssistant RegistrarYes

4. Counsels

Counsel NameOrganization
Walter Ferix JustineJoseph Tan Jude Benny LLP
Ooi Jian YuanAbrahamLow LLC
Leng Siew Wei AloysiusAbrahamLow LLC

4. Facts

  1. Plaintiffs and first defendant were directors and shareholders of the second defendant, a company in liquidation.
  2. The company was placed under voluntary winding up pursuant to a special resolution.
  3. The third defendant was appointed the liquidator of the company.
  4. Plaintiffs commenced Suit 444 against the defendants regarding their respective shareholdings in the company.
  5. Plaintiffs alleged forgery of a Directors’ Resolution in Writing by the first defendant.
  6. The plaintiffs did not obtain leave of court before commencing Suit 444 against the Company and the Liquidator.

5. Formal Citations

  1. Deldar Tony Singh and another v Rajinder Singh and others, Suit No 444 of 2012 (Summons No 3260 of 2012 & Summons No 3643 of 2012), [2012] SGHCR 13

6. Timeline

DateEvent
Company incorporated by the first defendant
Directors’ Resolution in Writing signed
Alleged forgery of a Directors’ Resolution in Writing
Company placed under voluntary winding up
Plaintiffs commenced Suit 444
Judgment reserved

7. Legal Issues

  1. Requirement for Leave to Commence Action Against Company in Liquidation
    • Outcome: The court held that leave of court was required under s 299(2) of the Companies Act because the company was under a creditors’ voluntary winding up.
    • Category: Procedural
    • Sub-Issues:
      • Failure to obtain leave of court
      • Applicability of s 299(2) of the Companies Act
  2. Requirement for Leave to Commence Action Against Liquidator
    • Outcome: The court held that leave of court was required to commence action against the liquidator because the company was under a creditors’ voluntary winding up.
    • Category: Procedural
    • Sub-Issues:
      • Common law requirement for leave
      • Protection of liquidators from unmeritorious claims

8. Remedies Sought

  1. Declaration that the 75% DRIW is null and void
  2. Declaration that resolutions passed are null and void
  3. Order that shares be cancelled
  4. Order that fresh share certificates be issued

9. Cause of Actions

  • Forgery
  • Declaration that resolutions are null and void
  • Cancellation of shares

10. Practice Areas

  • Commercial Litigation
  • Insolvency
  • Corporate Law

11. Industries

  • No industries specified

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Eversendai Engineering Pte Ltd v Synergy Construction Pte Ltd (Ministry of Education, Third Party)High CourtYes[2004] SGHC 129SingaporeCited to support the conclusion that s 299 of the Companies Act applies only to creditors’ voluntary winding up.
LaserResearch (S) Pte Ltd (in liquidation) v Internech Systems Pte Ltd and another matterHigh CourtYes[2011] 1 SLR 382SingaporeCited for the rationale behind s 299(2) of the Companies Act, which is to prevent the company from being further burdened by expenses incurred in defending unnecessary litigation.
Korea Asset Management Corp v Daewoo Singapore Pte Ltd (in liquidation)High CourtYes[2004] 1 SLR(R) 671SingaporeCited for the rationale of s 299(2) and the statutory ring fencing regime that arises upon winding up.
Acton Engineering Pty Limited v Campbell and OthersFederal Court of AustraliaYes(1991) 103 ALR 437AustraliaCited to support the position that s 299(2) of the Companies Act applies only to a creditors' voluntary winding up.
Ogilvie-Grant & Anor v East liquidator of Gordon Grant and Grant Pty LtdSupreme Court of QueenslandYes(1983) 7 ACLR 669AustraliaCited to support the position that there should be no automatic prohibition upon proceedings against a company in members’ voluntary winding up, where the company is solvent.
Excalibur Group Pte Ltd v Goh Boon KokHigh CourtYes[2012] 2 SLR 999SingaporeCited for the common law requirement for leave to be obtained before an action or legal proceeding may be commenced against a liquidator.
Gerard v Worth of Paris, LtdN/AYes[1936] 2 All ER 905EnglandCited to support the principle that there is no real concern regarding the distribution of company assets pari passu among the creditors of a company which has been placed under a members’ voluntary winding up.
Sullivan v Energy Services International Pty Ltd (in liq)Supreme Court of New South WalesNo(2002) 171 FLR 106AustraliaCited to support the view that leave of court is not required before an action or proceeding may properly be commenced against a liquidator in a members’ voluntary winding up.
Armitage v Gainsborough Properties Pty Ltd & AnorN/ANo[2011] VSC 419AustraliaCited as an Australian decision involving court-appointed liquidators in compulsory liquidations.
Baxter & Ors v HamiltonN/ANo[2005] TASSC 64AustraliaCited as an Australian decision involving court-appointed liquidators in compulsory liquidations.
Mamone and 1 Ors v PantzerN/ANo[2001] NSWSC 26AustraliaCited as an Australian decision involving court-appointed liquidators in compulsory liquidations.
See Teow Guan & Ors v Kian Joo Holdings Sdn Bhd & OrsN/ANo[2010] 1 MLJ 547MalaysiaCited as a Malaysian decision involving court-appointed liquidators in compulsory liquidations.
Abric Project Management Sdn Bhd v Palmshine Palza Sdn Bhd & AnorN/ANo[2007] 3 MLJ 571MalaysiaCited as a Malaysian decision involving court-appointed liquidators in compulsory liquidations.
Chin Cheen Foh v Ong Tee ChewN/ANo[2003] 3 MLJ 57MalaysiaCited as a Malaysian decision involving court-appointed liquidators in compulsory liquidations.
Chi Liung Holdings Sdn Bhd v Ng Pyak YeowN/ANo[1995] 3 MLJ 204MalaysiaCited as a Malaysian decision involving court-appointed liquidators in compulsory liquidations.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Companies Act (Cap 50, 2006 Rev Ed) s 299(2)Singapore
Companies Act s 4(1)Singapore
Companies Act s 247Singapore
Companies Act s 248Singapore
Companies Act s 293Singapore
Companies Act s 290(1)(b)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Winding up
  • Liquidation
  • Leave of court
  • Creditors’ voluntary winding up
  • Members’ voluntary winding up
  • Companies Act
  • Statement of Claim
  • Directors’ Resolution in Writing
  • Declaration of solvency

15.2 Keywords

  • Winding up
  • Liquidation
  • Companies Act
  • Leave of court
  • Creditors’ voluntary winding up
  • Members’ voluntary winding up

17. Areas of Law

Area NameRelevance Score
Winding Up90
Company Law75
Civil Procedure50
Forgery30

16. Subjects

  • Company Law
  • Insolvency Law
  • Civil Procedure