Neptune Capital v Sunmax: Damages for Injunction & Undertaking Breach
In Neptune Capital Group Ltd and others v Sunmax Global Capital Fund 1 Pte Ltd and another, the Singapore High Court addressed an inquiry into damages sustained by the defendants, Sunmax Global Capital Fund 1 Pte Ltd and Li Hua, due to an injunction and subsequent undertaking that prevented them from disposing of certain shares. The plaintiffs, Neptune Capital Group Ltd and others, had their claims struck out, leading to a judgment in favor of the defendants on their counterclaims. The court, presided over by Judith Prakash J, found the plaintiffs jointly and severally liable for damages totaling $9,032,000 to Sunmax and $8,456,000 to Li Hua, related to losses incurred on Liongold shares and Asiasons shares.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Judgment for the Defendants
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court case concerning damages sustained due to an injunction and undertaking that restricted share disposal. Judgment for Defendants.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Li Hua | Defendant | Individual | Judgment for Defendant | Won | |
| Sunmax Global Capital Fund 1 Pte Ltd | Defendant | Corporation | Judgment for Defendant | Won | |
| Quah Su-Ling | Plaintiff | Individual | Claim Dismissed | Lost | |
| NEPTUNE CAPITAL GROUP LTD | Plaintiff | Corporation | Claim Dismissed | Lost | |
| CHINA DATA SYSTEM INVESTMENTS PTE LTD | Plaintiff | Corporation | Claim Dismissed | Lost | |
| INFINITE RESULTS HOLDING CORP | Plaintiff | Corporation | Claim Dismissed | Lost | |
| POWERLITE VENTURES LTD | Plaintiff | Corporation | Claim Dismissed | Lost | |
| SKYLINE AGENTS LTD | Plaintiff | Corporation | Claim Dismissed | Lost | |
| PETER CHEN HING WOON | Plaintiff | Individual | Claim Dismissed | Lost | |
| GE LEIQUAH | Plaintiff | Individual | Claim Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge | Yes |
4. Counsels
4. Facts
- Plaintiffs obtained an injunction restraining the defendants from disposing of certain shares.
- Defendants provided a voluntary undertaking not to dispose of the shares.
- The share prices plunged during the period the injunction and undertaking were in effect.
- Plaintiffs' claims were struck out, and judgment was entered for the defendants on their counterclaims.
- The judgment included an order for an inquiry into damages sustained by the defendants.
- Defendants calculated their losses based on the difference in share values.
- Plaintiffs argued the defendants' losses were not caused by the injunction or undertaking.
5. Formal Citations
- Neptune Capital Group Ltd and othersvSunmax Global Capital Fund 1 Pte Ltd and another, Suit No 630 of 2012(HC/AD No 3 of 2015), [2016] SGHC 148
6. Timeline
| Date | Event |
|---|---|
| Lawsuit filed | |
| Order restraining Sunmax from selling or disposing of Schedule 1 shares until 1 August 2012 or until further order | |
| Defendants provided Voluntary Undertaking | |
| Plaintiffs filed their statement of claim | |
| Defendants responded with their defence and counterclaim | |
| Plaintiffs issued seven cashier’s orders to pay various amounts outstanding under various agreements entered into between Sunmax and the first to fifth plaintiffs | |
| Court ordered the return of the Schedule 1 shares to the plaintiffs save for the 8 million Liongold shares since the ownership of the latter shares was disputed | |
| Defendants proposed to the plaintiffs that Mr Li be allowed to sell his 6 million Asiasons shares | |
| Mr Li filed a summons asking for liberty to sell the Asiasons shares | |
| Court granted Mr Li permission to sell his Asiasons shares on the basis that the proceeds from the sale thereof were to be paid into court pending the outcome of Summons 5031 | |
| Court granted the defendants’ application in Summons 5031 and discharged Orders 1 and 2 and the Voluntary Undertaking | |
| Parties were given directions to file and exchange their respective affidavits of evidence-in-chief | |
| Judgment was entered against the plaintiffs by the defendants | |
| Hearing of the inquiry | |
| Court dismissed China Data’s application to have the judgment against it set aside | |
| Oral hearing took place | |
| Judgment reserved |
7. Legal Issues
- Measure of Damages
- Outcome: The court determined the appropriate basis for assessing the defendants’ loss, considering the change in market values of the shares during the period of the injunction.
- Category: Substantive
- Sub-Issues:
- Valuation date for shares
- Mitigation of losses
- Related Cases:
- [1974] AC 295
- [2005] 3 SLR(R) 202
- [1891] 3 Ch 159
- Cross-Undertaking in Damages
- Outcome: The court considered whether a cross-undertaking in damages could be implied where none was given in respect of a voluntary undertaking.
- Category: Procedural
- Sub-Issues:
- Implied undertaking
- Enforcement of undertaking
- Related Cases:
- [2014] 4 SLR 1208
- [2016] SGHC 34
- Res Judicata
- Outcome: The court considered whether the issues raised by the plaintiffs were res judicata due to a prior default judgment.
- Category: Procedural
- Sub-Issues:
- Final and conclusive judgment on the merits
- Identity of subject matter
- Related Cases:
- (1988) 20 HLR 232
8. Remedies Sought
- Damages
9. Cause of Actions
- Breach of Undertaking
- Breach of Contract
10. Practice Areas
- Commercial Litigation
11. Industries
- Finance
- Investment
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| SH Cogent Logistics Pte Ltd v Singapore Agro Agricultural Pte Ltd | High Court | Yes | [2014] 4 SLR 1208 | Singapore | Cited for the principle that the court has discretion to determine whether an undertaking should be enforced. |
| Astro Nusantara International BV v PT Ayunda Prima Mitra and another matter | High Court | Yes | [2016] SGHC 34 | Singapore | Cited for the principle that the court has discretion to determine whether an undertaking should be enforced. |
| Ozer Properties Ltd v Ghayadi | English Court of Appeal | Yes | (1988) 20 HLR 232 | England | Cited to show that a judgment in default could create a situation of res judicata if it determined an issue which, when formulated, necessarily and with complete precision determined the rights of the parties. |
| Cukurova Finance Ltd v Alfa Telecom Turkey Ltd (Nos 3 to 5) | Unknown | Yes | [2015] 2WLR 875 | Unknown | Cited for the principle that the court has the equitable jurisdiction to revive a mortgagor’s equity of redemption after it has been destroyed. |
| CHS CPO GmbH (in bankruptcy) v Vikas Goel | Unknown | Yes | [2005] 3 SLR(R) 202 | Singapore | Cited for the principles applicable when fortification of an undertaking as to damages is applied for. |
| F Hoffmann-La Roche & Co AG v Secretary of State for Trade and Industry | Unknown | Yes | [1974] AC 295 | Unknown | Cited for the principle that the assessment of damages payable under a cross-undertaking in damages is made upon the same basis as that upon which damages for breach of contract would be assessed. |
| Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd | High Court of Australia | Yes | (1981) 146 CLR 249 | Australia | Cited for the view that the damages claimable should be those which flowed directly from the injunction and which could have been foreseen when the injunction was granted. |
| European Bank Ltd v Robb Evans of Robb Evans & Associates | High Court of Australia | Yes | [2010] HCA 6 | Australia | Cited for the view that the damages claimable should be those which flowed directly from the injunction and which could have been foreseen when the injunction was granted. |
| Moraitis Fresh Packaging (NSC) Pty Ltd v Fresh Express Australia Pty Ltd | Supreme Court of New South Wales | Yes | [2010] NSWSC 704 | Australia | Cited as a case where the court was satisfied by the special evidence presented. |
| Mansell v British Linen Company Bank | Unknown | Yes | [1891] 3 Ch 159 | England | Cited for the measure of damages used in cases of this nature. |
| Canadian Imperial Investment Pte Ltd v Pacific Century Regional Developments Ltd | Unknown | Yes | [2000] 3 SLR(R) 227 | Singapore | Cited for the principle that the court will adopt the market price as at the date of the injunction order as a default price in order to avoid engaging in excessive speculation. |
| Triodos Bank NV v Dobbs | Unknown | Yes | [2005] EWHC 108 (Ch) | England and Wales | Cited as an example of cases where the court was satisfied by the special evidence presented. |
| Practice Note | Chancery Division of the High Court of England | Yes | [1904] W.N.203 | England | Cited as the origin of the English law on cross-undertakings in damages. |
| Oberrheinische Metallwerke GmbH v Cocks | Unknown | Yes | [1906] W.N.127 | Unknown | Cited as support for the position that a cross-undertaking in damages is to be implied unless the contrary is agreed and expressed at the time. |
| W v. H (Family Division: Without Notice Orders) | High Court (Eng) | Yes | [2001] 1 All E.R. 300 | England | Cited as support for the position that a cross-undertaking in damages is to be implied unless the contrary is agreed and expressed at the time. |
| Lam Ping Wan, Sun Growth Securities Ltd v Ip Lam On | Unknown | Yes | [2000] HKCU 530 | Hong Kong | Cited as support for the position that the English position on cross-undertakings in damages has been adopted in Hong Kong. |
| Gustin v Taajamba Pty Ltd | Unknown | Yes | [1994] NSWCA 117 | Australia | Cited as an example of Australian cases which indicated that the practice in those courts was that the undertaking had to be given expressly either by the party or his legal representative and that if it was not so given it could not be included in the formal order. |
| Evans & Associates v European Bank Ltd | Unknown | Yes | (2009) 255 ALR 171 | Australia | Cited as an example of Australian cases which indicated that the practice in those courts was that the undertaking had to be given expressly either by the party or his legal representative and that if it was not so given it could not be included in the formal order. |
| SmithKline Beecham Plc v Apotex Europe Ltd | Unknown | Yes | [2006] 1 WLR 872 | Unknown | Cited for observations of Laddie J in A Bank v A Ltd, Times Law Report, 18 July 2000. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Injunction
- Undertaking
- Cross-undertaking in damages
- Res judicata
- Mitigation of losses
- Share price
- Voluntary undertaking
- Inquiry as to damages
- Liongold shares
- Asiasons shares
15.2 Keywords
- injunction
- damages
- shares
- undertaking
- assessment
- Sunmax
- Neptune Capital
- Liongold
- Asiasons
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Measure of Damages | 95 |
| Injunctions | 90 |
| Damages | 90 |
| Res Judicata | 85 |
| Estoppel | 60 |
| Contract Law | 50 |
| Guarantees and indemnities | 40 |
| Company Law | 30 |
| Best Efforts Clause | 20 |
16. Subjects
- Civil Litigation
- Damages Assessment
- Injunctions
- Securities Law