SCK Serijadi Sdn Bhd v Artison Interior Pte Ltd: Stay of Proceedings & Garnishee Order Nisi
SCK Serijadi Sdn Bhd applied to the High Court of Singapore to lift the stay of proceedings against Artison Interior Pte Ltd, which had commenced creditors’ voluntary winding-up. The stay was imposed on a garnishee order nisi obtained by SCK Serijadi against Artison Interior. Tan Siong Thye J dismissed the application in part, following the precedent set in Transbilt Engineering Pte Ltd v Finebuild Systems Pte Ltd. The court allowed the taxation of the plaintiff’s bill of costs for the purposes of submitting the claim before the liquidator.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Application dismissed in part.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Application to lift stay of proceedings on garnishee order nisi due to defendant's winding-up was dismissed. Court followed Transbilt Engineering precedent.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| SCK Serijadi Sdn Bhd | Plaintiff | Corporation | Application dismissed in part | Lost | Chia Swee Chye Kelvin |
| Artison Interior Pte Ltd | Defendant | Corporation | Application dismissed in part | Won | Tan Cheng Kiong |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Tan Siong Thye | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Chia Swee Chye Kelvin | Lumen Law Corporation |
| Tan Cheng Kiong | CK Tan & Co |
4. Facts
- Plaintiff obtained judgment against the defendant in DC Suit 286 on 27 June 2017.
- Plaintiff commenced two garnishee proceedings on 12 and 27 September 2017 and obtained garnishee orders nisi.
- Garnishee orders were served on the garnishee on 15 September and 2 October 2017 respectively.
- Defendant was placed under creditors’ voluntary winding-up on 5 October 2017.
- Plaintiff filed OS 1159 seeking to lift the stay of proceedings against the defendant.
- Defendant did not object to the plaintiff’s bill of costs being taxed for the purposes of submitting the claim before the liquidator.
- The total realisable assets of the defendant amounted to $291,961.
5. Formal Citations
- SCK Serijadi Sdn Bhd v Artison Interior Pte Ltd, Originating Summons No 1159 of 2017, [2018] SGHC 08
6. Timeline
| Date | Event |
|---|---|
| District Court Suit No 286 of 2015 filed | |
| Judgment obtained by plaintiff against defendant in DC Suit 286 | |
| Plaintiff filed bill of costs for DC Suit 286 | |
| First garnishee proceeding commenced | |
| First garnishee order served on the garnishee | |
| Second garnishee proceeding commenced | |
| Second garnishee order served on the garnishee | |
| Defendant placed under creditors’ voluntary winding-up | |
| Garnishee show cause proceedings adjourned | |
| Plaintiff filed OS 1159 seeking to lift the stay of proceedings | |
| Hearing for OS 1159 | |
| Decision issued on OS 1159 |
7. Legal Issues
- Stay of Proceedings
- Outcome: The court held that the stay of proceedings should not be lifted to allow the garnishee proceedings to continue, following the precedent in Transbilt Engineering Pte Ltd v Finebuild Systems Pte Ltd.
- Category: Procedural
- Sub-Issues:
- Lifting of stay of proceedings
- Effect of winding-up on existing proceedings
- Related Cases:
- [2005] 3 SLR(R) 550
- Secured Creditor Status
- Outcome: The court held that the service of a garnishee order nisi does not transform a judgment creditor into a secured creditor for the purposes of insolvency proceedings.
- Category: Substantive
- Sub-Issues:
- Effect of garnishee order nisi on creditor status
- Equitable charge
8. Remedies Sought
- Lifting of stay of proceedings
- Continuation of garnishee proceedings
- Taxation of bill of costs
9. Cause of Actions
- No cause of actions
10. Practice Areas
- Commercial Litigation
- Insolvency
- Debt Recovery
11. Industries
- No industries specified
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Transbilt Engineering Pte Ltd (in liquidation) v Finebuild Systems Pte Ltd | Court of Appeal | Yes | [2005] 3 SLR(R) 550 | Singapore | The court relied on this case, which was on all fours with the present case, to dismiss the plaintiff's application to lift the stay of proceedings. |
| Re Grosvenor Metal Co. Ltd | English Court | Yes | [1949] 2 All ER 948 | England | Cited as an example of inequitable behavior where the stay was lifted because the company had made certain representations to the judgment creditor to stall the execution against its assets. |
| Korea Asset Management Corp v Daewoo Singapore Pte Ltd (in liquidation) | High Court | Yes | [2004] 1 SLR(R) 671 | Singapore | Cited by way of obiter dicta regarding the rights of a secured creditor in insolvency proceedings. |
| Power Knight Pte Ltd v Natural Fuel Pte Ltd (in compulsory liquidation) and others | High Court | Yes | [2010] 3 SLR 82 | Singapore | Cited in obiter regarding assets encumbered by a valid security interest not being available for distribution among unsecured creditors. |
| In re Aro Co Ltd | English Court of Appeal | Yes | [1980] 2 WLR 453 | England | Cited in obiter regarding a secured creditor's independence from liquidation and the applicability of s 228 of the UK Companies Act 1948 to both secured and unsecured creditors. |
| The Hull 308 | Court of Appeal | Yes | [1991] 2 SLR(R) 643 | Singapore | Cited in the context of whether a writ in rem against a vessel could constitute security over that vessel. |
| In re Stanhope Silkstone Collieries Company | Court of Chancery | Yes | (1879) 11 Ch D 160 | England | Cited for the proposition that a garnishee order nisi does not operate to give the Plaintiff in the original action any security until it is served. |
| Croshaw v Lyndhurst Ship Company | High Court of Justice | Yes | [1897] 2 Ch 154 | England | Cited in relation to whether the appointment of a receiver conferred on the judgment creditor any charge over the debtor’s property. |
| N Joachimson (A Firm Name) v Swiss Bank Corporation | Court of Appeal | Yes | [1921] 3 KB 110 | England | Cited in relation to whether the service of a garnishee order nisi sufficiently operated as a banker’s demand. |
| Société Eram Shipping Co Ltd v Cie Internationale de Navigation and others | House of Lords | Yes | [2004] 1 AC 260 | England | Cited in relation to whether the court could make final a garnishee order nisi obtained in England as against a Hong Kong bank. |
| Galbraith v Grimshaw and Baxter | Court of Appeal | Yes | [1910] 1 KB 339 | England | Cited for the proposition that the garnishee order nisi made it a secured creditor. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) s 299 | Singapore |
| Companies Act s 334 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Garnishee order nisi
- Stay of proceedings
- Creditors’ voluntary winding-up
- Secured creditor
- Liquidator
- Equitable charge
- Companies Act
- Attachment
- Execution
15.2 Keywords
- garnishee
- winding-up
- stay of proceedings
- secured creditor
- insolvency
16. Subjects
- Civil Procedure
- Insolvency Law
17. Areas of Law
- Civil Procedure
- Insolvency Law
- Companies Act
- Garnishee Proceedings