Sakae Holdings Ltd v Gryphon Real Estate: Oppression of Minority Shareholders & Director's Fiduciary Duties

In consolidated actions, Sakae Holdings Ltd sued Gryphon Real Estate Investment Corporation Pte Ltd and others, including Ong Siew Kwee, Ho Yew Kong, and Ong Han Boon, for oppression and breach of fiduciary duty related to a joint venture company, Griffin Real Estate Investment Holdings Pte Ltd. The High Court of Singapore, with Judith Prakash JA presiding, found Mr. Ong, Mr. Ho, and Ong Han Boon liable for various acts of oppression. The court dismissed the third party claims against Douglas Foo Peow Yong, ordering the TP Plaintiffs to bear Mr. Foo’s costs on the indemnity basis.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Third party claims dismissed; TP Plaintiffs to bear Mr. Foo’s costs on the indemnity basis.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Sakae Holdings' suit against Gryphon Real Estate & others for oppression and breach of fiduciary duty. The court found directors liable for oppression.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
ERC Holdings Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
ERC Unicampus Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
Ho Yew KongDefendantIndividualUnsuccessful in defending the claimsLost
Douglas Foo Peow YongThird PartyIndividualThird party claims dismissedWon
Gryphon Real Estate Investment Corporation Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
Sakae Holdings LtdPlaintiffCorporationSuccessful in main actionWon
Ong Siew KweeDefendantIndividualUnsuccessful in defending the claimsLost
Ong Han BoonDefendantIndividualUnsuccessful in defending the claimsLost
Griffin Real Estate Investment Holdings Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
Gryphon Capital Management Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
ERC Institute Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
TYN Investment Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost
ERC Consulting Pte LtdDefendantCorporationUnsuccessful in defending the claimsLost

3. Judges

Judge NameTitleDelivered Judgment
Judith PrakashJudge of AppealYes

4. Counsels

Counsel NameOrganization
Vikram NairRajah & Tann Singapore LLP
Tan Ruo YuRajah & Tann Singapore LLP
Doreen ChiaRajah & Tann Singapore LLP
Khelvin XuRajah & Tann Singapore LLP
R Chandra MohanRajah & Tann Singapore LLP
Jonathan YuenRajah & Tann Singapore LLP
Samuel ChackoLegis Point LLC
Charmaine Chan-RichardLegis Point LLC
Lim Shack KeongLegis Point LLC
Cara Soo MinLegis Point LLC
Siraj OmarPremier Law LLC
Alexander LeePremier Law LLC
Jaikanth ShankarDrew & Napier LLC
Zhuo JiaxiangDrew & Napier LLC
Davinder SinghDrew & Napier LLC
Navin ShanmugarajDrew & Napier LLC
Samantha TanDrew & Napier LLC
V Kumar SharmaDrew & Napier LLC
Pradeep Singh KhosaDrew & Napier LLC

4. Facts

  1. Sakae and ERC Holdings invested in Griffin Real Estate Investment Holdings Pte Ltd to acquire units in Bugis Cube.
  2. Suit 122 was Sakae’s action against Mr Ong for breach of his fiduciary duty as a director of Sakae.
  3. Suit 1098 was Sakae’s action against Mr Ong, Mr Ho and Ong Han Boon for conducting the Company’s affairs oppressively.
  4. The defendants commenced third party proceedings against Douglas Foo Peow Yong, a director and chairman of Sakae and a director of the Company.
  5. The TP Plaintiffs dropped their claims for indemnification and concentrated only on their claims for contribution from Mr Foo.
  6. Mr. Ong and Ong Han Boon elected to call no evidence on the basis that there was no case to answer.

5. Formal Citations

  1. Sakae Holdings Ltd v Gryphon Real Estate Investment Corp Pte Ltd and others, Suits Nos 1098 and 122 of 2013, [2017] SGHC 100
  2. Sakae Holdings Ltd v Gryphon Real Estate Investment Corp Pte Ltd and others, , [2017] SGHC 73

6. Timeline

DateEvent
Suit 1098 of 2013 filed
Suit 122 of 2013 filed
Third Party Notice in Suit 122 filed by Mr. Ong
Third Party Notice in Suit 1098 filed by Mr. Ong and Ong Han Boon
Third Party Notice in Suit 1098 filed by Mr. Ho
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Trial commenced
Judgment delivered in respect of Sakae’s claims
Judgment reserved

7. Legal Issues

  1. Breach of Fiduciary Duty
    • Outcome: The court found that Mr. Ong breached his fiduciary duty to Sakae.
    • Category: Substantive
    • Sub-Issues:
      • Failure to exercise reasonable diligence
      • Failure to act bona fide in the company's interest
      • Failure to acquire sufficient knowledge of the company's business
  2. Oppression of Minority Shareholders
    • Outcome: The court found Mr. Ong, Mr. Ho, and Ong Han Boon liable for acts of oppression against Sakae.
    • Category: Substantive
  3. Contribution from Third Party
    • Outcome: The court dismissed the third party claims for contribution against Mr. Foo.
    • Category: Procedural
    • Related Cases:
      • [2012] 2 SLR 549

8. Remedies Sought

  1. Indemnification
  2. Contribution

9. Cause of Actions

  • Breach of Fiduciary Duty
  • Oppression

10. Practice Areas

  • Commercial Litigation
  • Corporate Law

11. Industries

  • Real Estate
  • Investment

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Tan Juay Pah v Kimly Construction Pte Ltd and othersCourt of AppealYes[2012] 2 SLR 549SingaporeCited for the three-step test to decide the issue of whether the liability is in respect of “the same damage”.
Royal Brompton Hospital NHS Trust v HammondN/AYes[2002] 1 WLR 1397EnglandCited for the three-step test to decide the issue of whether the liability is in respect of “the same damage”.
Airtrust (Singapore) Pte Ltd v Kao Chai-Chua LindaN/ANo[2014] 2 SLR 673SingaporeCited for the point that where one director is found liable to a company for breach of fiduciary duty, he can claim contribution from another director who is also in breach of such duty.
Tan Chin Yew Joseph v Saxo Capital Markets Pte LtdHigh CourtYes[2013] SGHC 274SingaporeCited for the principles on the award of indemnity costs.

13. Applicable Rules

Rule Name
Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 35 r 4(2)
Rules of Court O 59 r 5

14. Applicable Statutes

Statute NameJurisdiction
Companies Act (Cap 50, 2006 Rev Ed) s 157Singapore
Companies Act (Cap 50, 2006 Rev Ed) ss 199Singapore
Companies Act (Cap 50, 2006 Rev Ed) s 201Singapore
Companies Act s 216Singapore
Civil Law Act (Cap 43, 1999 Rev Ed) ss 15Singapore
Civil Law Act (Cap 43, 1999 Rev Ed) ss 16Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Oppression
  • Fiduciary Duty
  • Third Party Proceedings
  • Contribution
  • Indemnity
  • Minority Shareholder
  • Directors' Duties

15.2 Keywords

  • Oppression
  • Fiduciary Duty
  • Third Party
  • Contribution
  • Companies Act
  • Civil Law Act
  • Directors
  • Shareholders

17. Areas of Law

Area NameRelevance Score
Minority Oppression90
Fiduciary Duties85
Company Law80
Civil Procedure75
Director's Duties75
Third party proceedings70
Shareholders65
Costs60

16. Subjects

  • Company Law
  • Civil Procedure
  • Fiduciary Duties
  • Minority Shareholder Rights