Higgins v Mulacek: Breach of Contract & Fiduciary Duty in Aircraft Management
In Higgins v Mulacek, the Singapore High Court addressed two suits: Suit 244, where Danial Patrick Higgins claimed breach of an oral contract against Philippe Emanuel Mulacek, Carlo Giuseppe Civelli, and Pacific LNG Operations Pte Ltd for aircraft management services; and Suit 733, where Singapore Air Charter Pte Ltd (SAC) sued Higgins for breach of fiduciary duty. The court dismissed Suit 244, finding no oral contract existed. In Suit 733, the court allowed SAC's claim in part, finding Higgins breached his fiduciary duties, and allowed Higgins's counterclaim in part for unpaid salary.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Suit 244 dismissed in its entirety. SAC's claim in Suit 733 allowed in part. Mr. Higgins's counterclaim in Suit 733 allowed in part.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case involving breach of contract and fiduciary duty claims related to aircraft management services. Judgment for SAC.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Carlo Giuseppe Civelli | Defendant, Defendant by counterclaim | Individual | Judgment for Defendant | Won | |
| Singapore Air Charter Pte Ltd | Plaintiff, Defendant by counterclaim | Corporation | Claim Allowed in Part | Partial | |
| Danial Patrick Higgins | Plaintiff, Defendant by counterclaim | Individual | Claim Dismissed | Lost | |
| Philippe Emanuel Mulacek | Defendant, Defendant by counterclaim | Individual | Judgment for Defendant | Won | |
| Pacific LNG Operations Pte Ltd | Defendant | Corporation | Judgment for Defendant | Won | |
| Nicholas Johnstone | Defendant by counterclaim | Individual | Judgment for Defendant | Won | |
| Daniel Chance Walker | Defendant by counterclaim | Individual | Judgment for Defendant | Won | |
| Stefan Wood | Defendant by counterclaim | Individual | Judgment for Defendant | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Edmund Leow | Judicial Commissioner | Yes |
4. Counsels
4. Facts
- Mr. Higgins claimed an oral contract existed for aircraft management services.
- SAC claimed Mr. Higgins breached his fiduciary duty.
- Mr. Higgins incorporated SAM while still serving as MD of SAC.
- Mr. Higgins received a sum of $316,000 from the acquisition of the Aircraft.
- Mr. Higgins retained a logbook relating to the maintenance of the Aircraft.
- AirLNG entered into an Aircraft Management Services Agreement with SAC.
- Mr. Higgins proposed the termination of the AMS Agreement.
5. Formal Citations
- Higgins, Danial Patrick v Mulacek, Philippe Emanuel and others and another suit, Suit No 244 of 2013 and Suit No 733 of 2014, [2016] SGHC 205
6. Timeline
| Date | Event |
|---|---|
| Singapore Air Charter Pte Ltd incorporated | |
| Danial Higgins met Philippe Mulacek at networking event | |
| AirLNG Ltd purchased the Aircraft | |
| Aircraft Management Services Agreement concluded between SAC and AirLNG | |
| Draft notice of termination sent to Mr. Higgins | |
| Mr. Higgins signed the notice of termination | |
| Mr. Higgins sent an electronic copy of the draft notice of termination | |
| Aircraft moved to Malaysia | |
| AMS Agreement termination took effect | |
| Mr. Higgins incorporated Singapore Aircraft Management Pte Ltd | |
| Mr. Higgins submitted a draft aircraft management contract to Mr. Ng | |
| AirLNG signed an aircraft management contract with Asia Aviation Company Pte Ltd | |
| Aircraft re-registered in the US | |
| Extraordinary general meeting scheduled for removing Mr. Higgins | |
| Mr. Higgins and his wife tendered their resignations | |
| Judgment reserved | |
| Judgment delivered |
7. Legal Issues
- Breach of Contract
- Outcome: The court held that there was no oral contract.
- Category: Substantive
- Breach of Fiduciary Duty
- Outcome: The court held that Mr. Higgins had breached his fiduciary duty to SAC.
- Category: Substantive
- Secret Profits
- Outcome: The court held that Mr. Higgins was liable to account to SAC for secret profits.
- Category: Substantive
8. Remedies Sought
- Monetary Damages
- Equitable Compensation
- Account of Profits
9. Cause of Actions
- Breach of Contract
- Breach of Fiduciary Duty
- Unjust Enrichment
10. Practice Areas
- Commercial Litigation
- Corporate Law
11. Industries
- Aviation
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Likpin International Ltd v Swiber Holdings Ltd and another | High Court | Yes | [2015] 5 SLR 962 | Singapore | Cited for the principle that for a contract to exist, there must be a meeting of minds to be bound by terms which are both certain and complete. |
| Gay Choon Ing v Loh Sze Ti Terence Peter and another appeal | Court of Appeal | Yes | [2009] 2 SLR(R) 332 | Singapore | Cited for the principle that negotiations between contracting parties must have crystallized into a contractually-binding agreement in which there is no uncertainty as to the terms of the contract concerned. |
| Grossner Jens v Raffles Holdings Ltd | High Court | Yes | [2004] 1 SLR(R) 202 | Singapore | Cited for the principle that there is no binding brokerage contract if the parties have failed to agree on the terms of the plaintiff’s remuneration, which would be a material term of the contract. |
| Foley v Classique Coaches Ltd | Not Available | Yes | [1934] 2 KB 1 | England and Wales | Cited for the rule that if there is no agreement as to a material term of the contract, there can be no binding agreement. |
| Sandz Solutions (Singapore) Pte Ltd and others v Strategic Worldwide Assets Ltd and others | Not Available | Yes | [2014] 3 SLR 562 | Singapore | Cited to support the principle that a trial is not a contest of memories. |
| Eng Chiet Shoong and others v Cheong Soh Chin and others and another appeal | Court of Appeal | Yes | [2016] SGCA 45 | Singapore | Cited for the principles of recovery for compensation for work done in situations where there is no express contract and the juridical basis for recovery under a claim in restitutionary quantum meruit. |
| Benedetti and another v Sawiris and others | Not Available | Yes | [2013] WLR (D) 286 | England and Wales | Cited for the elements required to make good a case for unjust enrichment. |
| Singapore Swimming Club v Koh Sin Chong Freddie | Not Available | Yes | [2016] 3 SLR 845 | Singapore | Cited for the further question to consider whether there are any defenses to the claim. |
| Leigh v Dickeson | Queen's Bench Division | Yes | (1884) 15 QBD 60 | England and Wales | Cited for the principle that where a defendant informs a claimant that he does not wish to receive a benefit but the claimant nevertheless proceeds to confer the benefit anyway, the defendant is under no obligation to pay for it. |
| Man Yip & Yihan Goh, “Liability for work done where contract is denied: contractual and restitutionary approaches” | Not Available | Yes | [2012] LMCLQ 289 | Singapore | Cited for the distinction between monetary benefits and non-monetary benefits. |
| Brewer Street Investments Ltd v Barclays Woollen Co Ltd | English Court of Appeal | Yes | [1954] 1 QB 428 | England and Wales | Cited as a case in which the defendants must objectively be taken to have valued the benefits in terms of the provision of the services themselves and therefore must be seen as having benefitted whether they came into possession of the premises or not. |
| M.S.M. Consulting v United Republic of Tanzania | Queen's Bench Division | Yes | [2009] EWHC 121 (QB) | England and Wales | Cited for the position in the authorities as to who bears the risk of the contract not materialising. |
| Ng Chee Wee Weng v Lim Jit Meng Bryan | Not Available | Yes | [2012] 1 SLR 457 | Singapore | Cited for the principle that parties may plead inconsistent causes of action in the alternative as long as the inconsistency does not, on the facts, offend common sense. |
| Rabiah Bee bte Mohamed Ibrahim v Salem Ibrahim | Not Available | Yes | [2007] 2 SLR(R) 665 | Singapore | Cited for the principle that there cannot be a claim in restitution which exists in parallel with an inconsistent contractual promise. |
| Beyonics Techology Ltd and another v Goh Chan Peng and others | High Court | Yes | [2016] SGHC 120 | Singapore | Cited for the core fiduciary duties and the approach to causation set out in the decision of the Privy Council in Brickenden v London Loan & Savings Co of Canada. |
| Brickenden v London Loan & Savings Co of Canada | Privy Council | Yes | [1934] 3 DLR 465 | Canada | Cited for the approach to causation where there has been a culpable breach of a core fiduciary relationship. |
| Bray v Ford | House of Lords | Yes | [1896] AC 44 | United Kingdom | Cited for the principle that a fiduciary is not entitled to make a profit out of his trust without the informed consent of his principal because this could give rise to a danger of a conflict of interest. |
| Industrial Development Consultants Ltd v Cooley | Not Available | Yes | [1972] 1 WLR 443 | England and Wales | Cited for the prohibition against the usurpation, by a fiduciary (usually a director), of corporate opportunities that properly belong to his principal. |
| Regal (Hastings) Ltd v Gulliver | House of Lords | Yes | [1967] 2 AC 134 | United Kingdom | Cited for the principle that the rule against the making of secret profits is stringently applied and bites even where the company did not, or even could not, take up the opportunity. |
| Mona Computer Systems (S) Pte Ltd v Singaravelu Murugan | Court of Appeal | Yes | [2014] 1 SLR 847 | Singapore | Cited for the principle that the rule against secret profits was a gains-based remedy aimed at disgorgement of all illicit profits obtained by the fiduciary. |
| Bhullar v Bhullar | English Court of Appeal | Yes | [2003] 2 BCLC 241 | England and Wales | Cited for the principle that the relevant question is simply whether the fiduciary’s exploitation of the opportunity is such as to attract the application of the rule. |
| Boardman v Phipps | House of Lords | Yes | [1967] 2 AC 46 | United Kingdom | Cited for the test to be applied in determining whether there was a conflict, which was whether reasonable men looking at the facts would think there is a real sensible possibility of conflict between the interests of the principal and the personal interests of the fiduciary. |
| Target Holdings Ltd v Redferns | House of Lords | Yes | [1996] 1 AC 421 | United Kingdom | Cited for the principle that equitable compensation functions as restitution for the loss which is suffered as a result of the breach of trust. |
| Quality Assurance Management Asia Pte Ltd v Zhang Qing | Not Available | Yes | [2013] 3 SLR 631 | Singapore | Cited for the important differences between the remedy of equitable compensation and the award of damages. |
| Andrew Mappouras v Waldrons Solicitors | England and Wales Court of Appeal (Civil Division) | Yes | [2002] EWCA Civ 842 | England and Wales | Cited for the principle that the award of nominal damages serves a vindicatory function, it “mark[s] the fact that there has been a breach of contract”. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (Cap 322, R 6, 2014 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Aircraft Management Services Agreement
- Fiduciary Duty
- Oral Contract
- Secret Profits
- Singapore Air Charter Pte Ltd
- AirLNG Ltd
- Gulfstream III Corporate Jet
- Singapore Aircraft Management Pte Ltd
15.2 Keywords
- breach of contract
- fiduciary duty
- aircraft management
- singapore
- aviation
- company law
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Fiduciary Duties | 80 |
| Contract Law | 75 |
| Director's Duties | 70 |
| Company Law | 65 |
| Commercial Disputes | 50 |
| Corporate Governance Disputes | 40 |
16. Subjects
- Contract Law
- Company Law
- Fiduciary Duty
- Aviation Law