Zillion Global v Deutsche Bank: Breach of Contract, Negligence, and Misrepresentation in Wealth Management
Zillion Global Limited and Fields Pacific Limited sued Deutsche Bank AG, Singapore Branch in the High Court of Singapore, alleging breach of contract, negligence, and misrepresentation related to their advisory accounts. The plaintiffs claimed that Deutsche Bank failed to provide regular updates, breached its duty of care, made misrepresentations regarding profits, and unilaterally closed out positions. The court, presided over by Justice Woo Bih Li, dismissed all of the plaintiffs' claims, finding that Deutsche Bank did not breach any implied terms, was not negligent, did not make actionable misrepresentations, and did not breach the contract by closing out positions.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Plaintiffs' claims dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Zillion Global sued Deutsche Bank for breach of contract, negligence, and misrepresentation related to advisory accounts. The court dismissed all claims.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Zillion Global Limited | Plaintiff | Corporation | Claim Dismissed | Lost | |
| Fields Pacific Limited | Plaintiff | Corporation | Claim Dismissed | Lost | |
| Deutsche Bank AG, Singapore Branch | Defendant | Corporation | Judgment for Defendant | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Woo Bih Li | Judge | Yes |
4. Counsels
4. Facts
- Zillion Global and Fields Pacific were companies owned by Mr. Pan Fang-Jen.
- The Plaintiffs were customers of Deutsche Bank's Private Wealth Management division.
- The Plaintiffs had both discretionary and advisory accounts with Deutsche Bank.
- The suit primarily concerned the advisory accounts.
- Deutsche Bank approached Pan in Taipei to introduce its PWM services.
- Pan injected approximately US$360m into the Accounts.
- Deutsche Bank gave advice and made recommendations to the Plaintiffs on transactions under the Accounts through the Relationship Manager Juan and a team of experts.
5. Formal Citations
- Zillion Global Ltd and another v Deutsche Bank AG, Singapore Branch, Suit No 716 of 2014, [2019] SGHC 165
6. Timeline
| Date | Event |
|---|---|
| Deutsche Bank approached Pan in Taipei to introduce its Private Wealth Management services. | |
| Advisory account in Fields' name opened. | |
| Advisory account in Zillion's name opened. | |
| Two discretionary accounts in Zillion’s name opened. | |
| Foreign exchange margin trading account linked to Zillion's advisory account opened. | |
| Zillion executed DB Master Agreement for Foreign Exchange Transactions and Derivatives Transactions. | |
| Zillion executed Risk Disclosure Statement (Foreign Exchange and Derivative Transactions). | |
| Deutsche Bank hosted Pan, Chang and Chen on a three-day all-expenses-paid trip to Hong Kong. | |
| Deutsche Bank had a meeting with Pan at the office of Deutsche Bank Hong Kong. | |
| Plaintiffs entered into various transactions. | |
| Deutsche Bank wrote a margin call letter addressed to Zillion. | |
| Deutsche Bank had a meeting with Pan at the office of Deutsche Bank Hong Kong. | |
| Juan sent an e-mail to Chang with the subject title "Fw: [Issued Margin Call Letter] / Zillion Global Group [with Zillion’s advisory account number]". | |
| Juan met Chang at Pan’s office in Taipei. | |
| Deutsche Bank had a meeting with Pan at the office of Deutsche Bank Hong Kong. | |
| Deutsche Bank closed out certain positions under the Accounts. | |
| Plaintiffs filed the writ of summons against Deutsche Bank. | |
| Trial on liability began. | |
| Trial on liability concluded. | |
| Judgment reserved. | |
| Judgment issued. |
7. Legal Issues
- Breach of Contract
- Outcome: The court held that Deutsche Bank did not breach any implied terms of the contract and did not breach the contract by closing out positions.
- Category: Substantive
- Sub-Issues:
- Breach of implied term
- Unilateral closing of positions
- Negligence
- Outcome: The court held that Deutsche Bank was not negligent in its advice or management of the accounts.
- Category: Substantive
- Sub-Issues:
- Breach of duty of care
- Failure to manage accounts
- Failure in risk management
- Misrepresentation
- Outcome: The court held that the plaintiffs failed to prove that Deutsche Bank made actionable misrepresentations.
- Category: Substantive
- Sub-Issues:
- Misleading profit representations
- Reliance on misrepresentations
- Limitation Act
- Outcome: The court did not need to rule on the applicability of the Limitation Act.
- Category: Procedural
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Negligence
- Misrepresentation
10. Practice Areas
- Commercial Litigation
- Banking Litigation
- Wealth Management
- Financial Advisory
11. Industries
- Finance
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Deutsche Bank AG v Chang Tse Wen and another appeal | Court of Appeal | Yes | [2013] 4 SLR 886 | Singapore | Cited for a description of accumulators. |
| Teo Wai Cheong v Crédit Industriel et Commercial and another appeal | Court of Appeal | Yes | [2013] 3 SLR 573 | Singapore | Cited for a description of accumulators. |
| Sembcorp Marine Ltd v PPL Holdings Pte Ltd and another and another appeal | Court of Appeal | Yes | [2013] 4 SLR 193 | Singapore | Cited for the three-step process to be used for implying a term in a contract. |
| CAA Technologies Pte Ltd v Newcon Builders Pte Ltd | Court of Appeal | Yes | [2017] 2 SLR 940 | Singapore | Cited for the principle that a term will not be implied where one party had expressly contemplated the gap. |
| Spandeck Engineering (S) Pte Ltd v Defence Science & Technology Agency | Court of Appeal | Yes | [2007] 4 SLR(R) 100 | Singapore | Cited for the requirements for a duty of care to arise in tort. |
| NTUC Foodfare Co-operative Ltd v SIA Engineering Co Ltd and another | Court of Appeal | Yes | [2018] 2 SLR 588 | Singapore | Cited for the proximity requirement in determining whether a duty of care exists. |
| Tradewaves Ltd and others v Standard Chartered Bank and another suit | High Court | Yes | [2017] SGHC 93 | Singapore | Cited for the principle that it was factually foreseeable that if the bank in question did not exercise reasonable care when making a decision to recommend a certain investment to the plaintiffs with non-discretionary accounts (advisory accounts), and if the plaintiffs acted on the recommendation, they might be harmed as a consequence. |
| Go Dante Yap v Bank Austria Creditanstalt AG | Court of Appeal | Yes | [2011] 4 SLR 559 | Singapore | Cited for the principle that an express disclaimer of responsibility can prevent a duty of care from arising in tort, by negating the proximity sought to be established by the concept of an “assumption of responsibility”, but such a disclaimer will be subject to the UCTA if it takes the form of a contractual exclusion clause. |
| Lam Chi Kin David v Deutsche Bank AG | Court of Appeal | Yes | [2011] 1 SLR 800 | Singapore | Cited for the principle that the parties did not seem to dispute that DB could make a margin call “in writing or verbally”. |
| Goldrich Venture Pte Ltd and another v Halcyon Offshore Pte Ltd | High Court | Yes | [2015] 3 SLR 990 | Singapore | Cited for a proposition about ostensible authority (also known as apparent authority) arising where there has been a representation by the conduct of a principal. |
| Koh Bee Choo v Choo Chai Huah | Court of Appeal | Yes | [2007] SGCA 21 | Singapore | Cited for the principle that for a court to draw an adverse inference, there must first be some substratum of evidence establishing a prima facie case against the person against whom the inference is to be drawn, and that person must have some particular access to the information he is said to be hiding. |
| Surender Singh s/o Jagdish Singh and another (administrators of the estate of Narindar Kaur d/o Sarwan Singh, deceased) v Li Man Kay and others | High Court | Yes | [2010] 1 SLR 428 | Singapore | Cited for the principle that it would not be appropriate to draw an adverse inference against a party from the failure to call a certain witness when that party had not deliberately omitted to call that individual or consciously concealed or held back evidence from the court. |
| Tribune Investment Trust Inc v Soosan Trading Co Ltd | Court of Appeal | Yes | [2000] 2 SLR(R) 407 | Singapore | Cited for the explanation of ostensible authority. |
| Armagas Ltd v Mundogas SA (The “Ocean Frost”) | House of Lords | Yes | [1986] 2 Lloyd’s Rep 109 | United Kingdom | Cited for the explanation of ostensible authority. |
| Guy Neale and others v Ku De Ta SG Pte Ltd | Court of Appeal | Yes | [2015] 4 SLR 283 | Singapore | Cited for the principle that the question of apparent authority is a question of mixed fact and law, and it is thus important to “analyse the facts to ascertain what exactly the alleged representation is”. |
| The “Bunga Melati 5” | Court of Appeal | Yes | [2016] 2 SLR 1114 | Singapore | Cited for the principle that the Court of Appeal noted its decision in Guy Neale, and did not think it necessary on the facts of the case before it to decide whether there is a real difference between the doctrines of ostensible authority and of agency by estoppel. |
| Fong Maun Yee and another v Yoong Weng Ho Robert | Court of Appeal | Yes | [1997] 1 SLR(R) 751 | Singapore | Cited for the principle that the negligent misrepresentation need not be the sole and decisive factor in inducing the representee to act and that it is sufficient if it played a real and substantial role in causing the representee to act to his detriment. |
| Jurong Town Corp v Wishing Star Ltd | Court of Appeal | Yes | [2005] 3 SLR(R) 283 | Singapore | Cited for the principle that the court may still find that the representee was induced by the misrepresentation if he relied partly on his own expertise and experience and partly on the misrepresentation. |
| Panatron Pte Ltd and another v Lee Cheow Lee and another | Court of Appeal | Yes | [2001] 2 SLR(R) 435 | Singapore | Cited for the principle that the court may still find that the representee was induced by the misrepresentation if he relied partly on his own expertise and experience and partly on the misrepresentation. |
| ACB v Thomson Medical Pte Ltd and others | Court of Appeal | Yes | [2017] 1 SLR 918 | Singapore | Cited for the principle that a negligence claim to be actionable requires specific proof of loss. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Limitation Act (Cap 163, 1996 Rev Ed) | Singapore |
| Limitation Act (Cap 163, 1996 Rev Ed) s 6(1)(a) | Singapore |
| Misrepresentation Act (Cap 390, 1994 Rev Ed) | Singapore |
| Misrepresentation Act (Cap 390, 1994 Rev Ed) s 2(1) | Singapore |
| Unfair Contract Terms Act (Cap 396, 1994 Rev Ed) | Singapore |
| Evidence Act (Cap 97, 1997 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Advisory Account
- Discretionary Account
- Private Wealth Management
- Margin Call
- Collateral Value
- Total Exposure
- Mark-to-Market Value
- Accumulators
- Trumpet
- ROCAs
- Financial Products
- Investment Objective
- Risk Profile
15.2 Keywords
- breach of contract
- negligence
- misrepresentation
- wealth management
- advisory account
- discretionary account
- financial products
- margin call
- Singapore High Court
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Contract Law | 75 |
| Negligence | 60 |
| Misrepresentation | 60 |
| Commercial Law | 40 |
| Civil Procedure | 20 |
16. Subjects
- Contract Law
- Tort Law
- Banking
- Financial Services
- Wealth Management
- Misrepresentation
- Negligence