DBS Bank v Davis Colin Niel: Interpleader Application over Property Sale Proceeds
DBS Bank Ltd filed an interpleader application in the High Court of Singapore to determine the claims to the balance sale proceeds of a property owned by Jannie Chan Siew Lee and Tay May Yi Sabrina, after DBS sold the property due to mortgage default. Davis Colin Niel and Kim Ji Soo, the purchasers who had an option to purchase the property, claimed an equitable lien over the proceeds. The Official Assignee, representing Chan's bankruptcy estate, also claimed the proceeds. The court held that the purchasers only had an equitable lien over the balance sale proceeds to the extent of their $187,750 deposit.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Purchasers only have an equitable lien over the balance sale proceeds to the extent of their $187,750 deposit. The lien is extinguished and they have no security over the remainder of the Disputed Sum for their outstanding claim.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Interpleader application by DBS Bank to determine claims to balance sale proceeds of a property. The court determined competing claims between the Official Assignee and purchasers.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| DBS Bank Ltd | Applicant | Corporation | Neutral | Neutral | Sasha Koh Yeong Hung |
| Davis Colin Niel | Respondent | Individual | Partial | Partial | Thomas Ng Hoe Lun |
| Kim Ji Soo | Respondent | Individual | Partial | Partial | Thomas Ng Hoe Lun |
| Official Assignee being Trustee in bankruptcy of Jannie Chan Siew Lee | Respondent | Government Agency | Won | Won | Zhong Zewei |
| Tay May Yi Sabrina | Respondent | Individual | Neutral | Neutral | Perry Elizabeth Wong Zhan Yan |
| The Comptroller of Income Tax | Respondent | Government Agency | Neutral | Neutral | Zheng Sicong |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Choo Han Teck | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Sasha Koh Yeong Hung | Yeo-Leong & Peh LLC |
| Thomas Ng Hoe Lun | Circular Law Chambers LLP |
| Zhong Zewei | Insolvency & Public Trustee’s Office |
| Perry Elizabeth Wong Zhan Yan | Tan Rajah & Cheah |
| Zheng Sicong | Inland Revenue Authority of Singapore |
4. Facts
- Chan and Tay owned an apartment unit as tenants-in-common.
- DBS was the mortgagee of the Property.
- Chan and Tay defaulted on mortgage payments.
- DBS obtained possession of the Property by a court order on 4 May 2018.
- DBS sold the Property on 13 May 2019 for $3.85m.
- Chan and Tay granted an Option to Purchase to the Purchasers on 17 September 2018.
- The Purchasers exercised the Option on 28 September 2018 and lodged a caveat on 8 October 2018.
- A bankruptcy application was filed against Chan on 2 November 2018.
- The Purchasers commenced legal proceedings against Chan and Tay on 15 January 2019.
- Chan was declared bankrupt on 27 May 2019.
5. Formal Citations
- DBS Bank Ltd v Davis, Colin Niel and others, Originating Summons No 985 of 2019, [2019] SGHC 245
6. Timeline
| Date | Event |
|---|---|
| DBS obtained possession of the Property by a court order | |
| Chan and Tay granted an Option to Purchase to Davis Colin Niel and Kim Ji Soo | |
| Purchasers exercised the Option | |
| Purchasers lodged a caveat against the Property | |
| Bankruptcy application was filed against Chan | |
| Completion was scheduled | |
| Purchasers commenced legal proceedings against Chan and Tay | |
| Purchasers obtained default judgment against Tay | |
| Purchasers obtained default judgment against Chan | |
| DBS sold the Property | |
| Chan was declared bankrupt |
7. Legal Issues
- Equitable Lien
- Outcome: The court held that the Purchasers only have an equitable lien over the balance sale proceeds to the extent of their $187,750 deposit.
- Category: Substantive
- Related Cases:
- [1994] 2 SLR(R) 68
- Bankruptcy
- Outcome: The court held that the Purchasers must file proofs of debt with the OA as did the Comptroller.
- Category: Substantive
8. Remedies Sought
- Return of deposit
- Damages for breach of contract
- Equitable lien over sale proceeds
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Real Estate Law
- Bankruptcy
- Civil Litigation
11. Industries
- Banking
- Real Estate
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Chip Thye Enterprises Pte Ltd v Development Bank of Singapore Ltd | Court of Appeal | Yes | [1994] 2 SLR(R) 68 | Singapore | Cited for the principle that a purchaser who has paid a deposit has an equitable lien on the surplus proceeds of sale, irrespective of whether the sale agreement was specifically enforceable or not. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Land Titles Act (Cap 157, 2004 Rev Ed) | Singapore |
| Bankruptcy Act (Cap 20, 2009 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Interpleader application
- Mortgagee sale
- Option to Purchase
- Equitable lien
- Bankruptcy
- Official Assignee
- Balance sale proceeds
- Judgment debt
- Caveat
15.2 Keywords
- Interpleader
- Mortgage
- Sale Proceeds
- Equitable Lien
- Bankruptcy
- Property
- Singapore
16. Subjects
- Property Law
- Bankruptcy Law
- Civil Procedure
17. Areas of Law
- Land Law
- Caveats
- Remedies of caveatee
- Sale of Land
- Remedies under uncompleted contract
- Bankruptcy Law
- Interpleader