Mukherjee v DyStar: Director's Right to Inspect Company Records under Section 199 of the Companies Act
In Mukherjee Amitava v DyStar Global Holdings (Singapore) Pte Ltd and others, the Singapore High Court addressed an application by Plaintiff Mukherjee, a director of DyStar, to inspect company records under Section 199 of the Companies Act. The court, presided over by Vinodh Coomaraswamy J, dismissed the application, finding that the plaintiff's primary purpose was to advance the interests of a minority shareholder in a minority oppression suit. The court held that this ulterior motive invalidated the director's right to inspect. The plaintiff was ordered to pay costs to the company and the other defendants.
1. Case Overview
1.1 Court
High Court of Singapore1.2 Outcome
Application dismissed with costs.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court judgment on a director's right to inspect company records under Section 199 of the Companies Act. Application dismissed.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| MUKHERJEE AMITAVA | Plaintiff | Individual | Application dismissed | Lost | Dinesh Dhillon Singh, Lim Dao Kai, Ivan Lim, Nigel Yeo |
| DYSTAR GLOBAL HOLDINGS (SINGAPORE) PTE LTD | Defendant | Corporation | Judgment in favor of Defendant | Won | See Chern Yang, Teng Po Yew |
| RUAN WEIXIANG | Defendant | Individual | Judgment in favor of Defendant | Won | Nandakumar Ponniya Servai, Wong Tjen Wee, Lucas Lim, Liu Ze Ming, Daniel Ho |
| XU YALIN | Defendant | Individual | Judgment in favor of Defendant | Won | Nandakumar Ponniya Servai, Wong Tjen Wee, Lucas Lim, Liu Ze Ming, Daniel Ho |
| YAO JIANFANG | Defendant | Individual | Judgment in favor of Defendant | Won | Nandakumar Ponniya Servai, Wong Tjen Wee, Lucas Lim, Liu Ze Ming, Daniel Ho |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Vinodh Coomaraswamy | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Dinesh Dhillon Singh | Allen & Gledhill LLP |
| Lim Dao Kai | Allen & Gledhill LLP |
| Ivan Lim | Allen & Gledhill LLP |
| Nigel Yeo | Allen & Gledhill LLP |
| See Chern Yang | Premier Law LLC |
| Teng Po Yew | Premier Law LLC |
| Nandakumar Ponniya Servai | Wong & Leow LLC |
| Wong Tjen Wee | Wong & Leow LLC |
| Lucas Lim | Wong & Leow LLC |
| Liu Ze Ming | Wong & Leow LLC |
| Daniel Ho | Wong & Leow LLC |
4. Facts
- Plaintiff is a director of DyStar Global Holdings (Singapore) Pte Ltd.
- Plaintiff applied under s 199 of the Companies Act to inspect company records.
- The company has three shareholders: Senda, Well Prospering, and Kiri Industries.
- Longsheng controls Senda and Well Prospering, making it the majority shareholder.
- Kiri Industries commenced a minority oppression suit against Senda and the company.
- The court found the plaintiff's primary purpose was to advance Kiri Industries' interests in the oppression suit.
- The plaintiff's request for documents was very broad, resembling a discovery request.
5. Formal Citations
- Mukherjee Amitava v DyStar Global Holdings (Singapore) Pte Ltd and others, Originating Summons No 863 of 2015, [2017] SGHC 314
6. Timeline
| Date | Event |
|---|---|
| Share subscription and shareholders’ agreement entered into | |
| Kiri Industries commenced minority oppression suit against Senda and the company | |
| Plaintiff requested documents and information | |
| Defendants responded to plaintiff's request | |
| Plaintiff took out application to inspect company records | |
| Court heard Kiri Industries’ application | |
| Court heard Kiri Industries’ application | |
| Kiri Industries applied for specific discovery | |
| Assistant registrar dismissed Kiri Industries' discovery application | |
| Hearing for plaintiff's substantive application | |
| Court dismissed Kiri Industries’ appeal against assistant registrar’s decision | |
| Plaintiff withdrew original schedule and indicated new set of documents | |
| Hearing resumed | |
| Judgment delivered |
7. Legal Issues
- Director's Right to Inspect Company Records
- Outcome: The court held that the director's right to inspect company records was invalidated by his ulterior purpose.
- Category: Substantive
- Sub-Issues:
- Ulterior purpose
- Scope of inspection rights
- Minority Oppression
- Outcome: The court found that the director's application was primarily to advance a minority oppression suit.
- Category: Substantive
8. Remedies Sought
- Order to inspect and take copies of company records
9. Cause of Actions
- Breach of Statutory Duty
10. Practice Areas
- Commercial Litigation
11. Industries
- No industries specified
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Burn v London and South Wales Coal Co and Risca Investment Co | N/A | Yes | (1890) 7 TLR 118 | N/A | Cited for the common law right of a director to see and take copies of documents belonging to his company. |
| Conway and Others v Petronius Clothing Co Ltd and Others | N/A | Yes | [1978] 1 WLR 72 | N/A | Cited for the principle that a director has a right to inspect company documents in order to properly perform his duties. |
| Wuu Khek Chiang George v ECRC Land Pte Ltd | Court of Appeal | Yes | [1999] 2 SLR(R) 352 | Singapore | Cited for the statutory right of a director to inspect a company’s accounting and other records under s 199(3) of the Companies Act and the principles governing that right. |
| Hau Tau Khang v Sanur Indonesian Restaurant Pte Ltd and another | N/A | Yes | [2011] 3 SLR 1128 | Singapore | Cited for the statutory right of a director to inspect a company’s accounting and other records under s 199(3) of the Companies Act and the principles governing that right. |
| Edman v Ross | N/A | Yes | (1922) 22 SR (NSW) 351 | New South Wales | Cited for the principle that the court will assume that a director is exercising his right of inspection for the company’s benefit unless there is clear proof to the contrary. |
| Alwie Handoyo v Tjong Very Sumito and another and another appeal | Court of Appeal | Yes | [2013] 4 SLR 308 | Singapore | Cited for the principle that the standard of proof on all issues in a civil case is proof on the balance of probabilities. |
| Berlei Hestia (NZ) Ltd v Fernyhough | N/A | Yes | [1980] 2 NZLR 150 | New Zealand | Cited for the analysis that a director's right of inspection is best analyzed as a power to inspect rather than a right to inspect. |
| Howard Smith Ltd v Ampol Petroleum Ltd and Others | N/A | Yes | [1974] AC 821 | N/A | Cited for the principle that a director who exercises a power for a combination of proper and improper purposes does so validly only if his primary or dominant purpose in doing so is a proper purpose. |
| Eclairs Group Ltd and another v JKX Oil and Gas plc | UK Supreme Court | Yes | [2016] 1 BCLC 1 | United Kingdom | Cited for the principle that a director who exercises a power for a combination of proper and improper purposes does so validly only if his primary or dominant purpose in doing so is a proper purpose. |
| Eclairs Group Ltd and another v JKX Oil and Gas plc and others | N/A | Yes | [2014] 1 BCLC 202 | N/A | Cited for the trial judge's findings of fact regarding the directors' purposes in exercising a power. |
| Whitehouse and another v Carlton Hotel Pty Ltd | High Court of Australia | Yes | (1987) 162 CLR 285 | Australia | Cited for the 'but for' test in the context of a director's exercise of a power. |
| Lim Kok Leong v Seen Joo Co Pte Ltd and others | N/A | Yes | [2015] 1 SLR 688 | Singapore | Cited for the argument that the statutory obligation to permit inspection under s 199(3) is an obligation not only of the company but also of its directors and managers. |
| Tan Cheng Bock v Attorney-General | N/A | Yes | [2017] 2 SLR 850 | Singapore | Cited for the principle that a reading of a statute which renders a provision otiose and meaningless ought to be avoided. |
| Attorney-General v Ting Choon Meng and another appeal | N/A | Yes | [2017] 1 SLR 373 | Singapore | Cited for the purposive and contextual approach to statutory interpretation. |
| Director General of Fair Trading v Buckland and Another | N/A | Yes | [1990] 1 WLR 920 | N/A | Cited for the principle that directors or other officers named in contempt proceedings have a degree of personal responsibility for the company’s breach of the order. |
| Attorney-General of Tuvalu and Another v Philatelic Distribution Corp Ltd and Others | N/A | Yes | [1990] 1 WLR 926 | N/A | Cited for the principle that directors or other officers named in contempt proceedings have a degree of personal responsibility for the company’s breach of the order. |
| Independent State of Papua New Guinea v PNG Sustainable Development Program Ltd | N/A | Yes | [2016] 2 SLR 366 | Singapore | Cited for the meaning of the phrase 'books of account and other records' in a company's articles of association. |
| Kumagai Gumi Co Ltd v Zenecon Pte Ltd and others and other appeals | N/A | Yes | [1995] 2 SLR(R) 304 | Singapore | Cited for the principle that in ascertaining the company’s best interests, a director would be perfectly entitled to examine those interests from a shareholder's perspective. |
| Oversea-Chinese Banking Corp Ltd and another v Justlogin Pte Ltd and another | N/A | Yes | [2004] 2 SLR(R) 675 | Singapore | Cited for the principle that in ascertaining the company’s best interests, a director would be perfectly entitled to examine those interests from a shareholder's perspective. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) Section 199 | Singapore |
| Companies Act Section 399 | Singapore |
| Companies Act Section 409A | Singapore |
| Companies Act Section 216 | Singapore |
| Companies Act Section 396A(3) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Director's right of inspection
- Accounting and other records
- Ulterior purpose
- Minority oppression
- Companies Act
- Related party transactions
15.2 Keywords
- director
- inspection
- company records
- Companies Act
- ulterior purpose
- minority oppression
16. Subjects
- Company Law
- Directors' Duties
- Inspection of Records
17. Areas of Law
- Company Law
- Civil Procedure