Liberty Sky Investments v Goh Seng Heng: Indemnity & Guarantee Dispute

In Liberty Sky Investments Limited v Goh Seng Heng and Aesthetic Medical Partners Pte. Ltd., the High Court of Singapore heard a claim by Liberty Sky Investments (LSI) against Aesthetic Medical Partners (AMP) for payment under a purported indemnity agreement. LSI sought to recover the sale price plus interest after a trade sale or IPO of AMP did not occur. The court dismissed LSI's claim, finding that the purported indemnity was not a separate agreement but was encapsulated in a Sale and Purchase Agreement (SPA) to which AMP was not a party and which LSI had rescinded.

1. Case Overview

1.1 Court

High Court of Singapore

1.2 Outcome

Claim Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore court case involving Liberty Sky Investments' claim against Aesthetic Medical Partners for indemnity after a failed trade sale/IPO. Claim dismissed.

1.7 Decision Date

19 February 2019

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Goh Seng Heng	Defendant	Individual
Liberty Sky Investments Limited	Plaintiff	Corporation	Claim Dismissed	Lost	Keith Han of Cavenagh Law LLP Harpreet Singh Nehal of Cavenagh Law LLP Tan Tian Yi of Cavenagh Law LLP
Aesthetic Medical Partners Pte Ltd	Defendant	Corporation	Judgment for Defendant	Won	Rajaram Muralli Raja of Straits Law Practice LLC Narayanan Sreenivasan of Straits Law Practice LLC Kyle Gabriel Peters of Straits Law Practice LLC Ivan Qiu of Straits Law Practice LLC

3. Judges

Judge Name	Title	Delivered Judgment
Audrey Lim	Judicial Commissioner	Yes

4. Counsels

Counsel Name	Organization
Keith Han	Cavenagh Law LLP
Harpreet Singh Nehal	Cavenagh Law LLP
Tan Tian Yi	Cavenagh Law LLP
Rajaram Muralli Raja	Straits Law Practice LLC
Narayanan Sreenivasan	Straits Law Practice LLC
Kyle Gabriel Peters	Straits Law Practice LLC
Ivan Qiu	Straits Law Practice LLC

4. Facts

LSI entered into a SPA with Goh to purchase shares in AMP for $14,422,050.
LSI claimed AMP agreed to indemnify LSI if a trade sale or IPO did not occur within 24 months.
Neither a trade sale nor an IPO occurred within the stipulated timeframe.
LSI filed suit against AMP based on the purported indemnity agreement.
The SPA was executed only by LSI and Goh.
LSI rescinded the SPA due to alleged misrepresentations by Goh.
LSI claimed the indemnity existed outside the SPA, based on communications with Goh and Lee.

5. Formal Citations

Liberty Sky Investments Ltd v Goh Seng Heng and another, Suit No 457 of 2017, [2019] SGHC 40

6. Timeline

Date	Event
2014-10-23	Goh invited Florence to purchase shares in AMP.
2014-11-25	LSI entered into a sale and purchase agreement with Goh to purchase shares in AMP.
2015-12-31	Suit No 1311 of 2015 commenced.
2015-11-24	LSI issued a letter of demand to Goh giving notice that it was electing to rescind the SPA.
2016-12-02	LSI’s counsel wrote to AMP to state that it had formally notified Goh under Clause 4(vii) of the SPA.
2016-12-30	LSI’s counsel wrote to AMP to demand that AMP make payment pursuant to the obligations outlined in its 2 December 2016 letter.
2017-05-01	LSI commenced this suit against Goh and AMP.
2018-10-16	Trial began.
2018-10-19	Trial continued.
2018-11-19	Trial continued.
2018-12-21	Trial continued.
2019-02-20	Judgment reserved.

7. Legal Issues

Breach of Contract
- Outcome: The court found that there was no separate contract of indemnity or guarantee outside of the SPA.
- Category: Substantive
Enforceability of Indemnity
- Outcome: The court held that the purported indemnity was part of the SPA, to which AMP was not a party, and that the SPA had been rescinded.
- Category: Substantive
Guarantee vs. Indemnity
- Outcome: The court determined that the clauses in question were intended to create a guarantee.
- Category: Substantive

8. Remedies Sought

Payment of $19,073,162 under the Purported Indemnity
Declaration that Goh re-purchase the shares from LSI at the Sale Price plus 15% IRR

9. Cause of Actions

Breach of Contract
Claim on Purported Indemnity

10. Practice Areas

Commercial Litigation

11. Industries

Investment
Aesthetic Medicine

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Liberty Sky Investments Pte Ltd v Goh Seng Heng and another	High Court	Yes	[2019] SGHC 39	Singapore	Sets out the background facts and representations made by Goh that led to the SPA, which are relevant to the current suit.
PT Jaya Sumpiles Indonesia v Kristle Trading Ltd	Court of Appeal	Yes	[2009] 3 SLR(R) 689	Singapore	Cited for the principle that whether a guarantee or indemnity has been given is a matter of construction in each case.
American Home Assurance Co v Hong Lam Marine Pte Ltd	Court of Appeal	Yes	[1999] 2 SLR(R) 992	Singapore	Cited for the principle that there is usually no liability on the part of the guarantor if the underlying obligation is void, unenforceable, or the underlying obligation ceases to exist.
Joseph Mathew v Singh Chiranjeev	Court of Appeal	Yes	[2010] 1 SLR 338	Singapore	Cited for the principle that s 6(d) of the CLA (in the context of an option to purchase a property) could be satisfied by the joinder of several documents.
Hu Lee Impex Pte Ltd v Lim Aik Seng (trading as Tong Seng Vegetable Trading)	High Court	Yes	[2013] 4 SLR 176	Singapore	Cited as authority that the doctrine of part performance would be an equitable defence against any allegation of non-compliance with formality requirements.
Actionstrength Ltd v International Glass Engineering IN.GL.EN SpA and another	House of Lords	Yes	[2003] 2 AC 541	United Kingdom	Outlines requirements for estoppel to prevent a party from disputing the assumed effect of a guarantee.
BOM v BOK and another appeal	Court of Appeal	Yes	[2018] SGCA 83	Singapore	Clarifies that the narrow doctrine of unconscionability applies in Singapore.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Civil Law Act (Cap 43, 1999 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Sale and Purchase Agreement
SPA
Purported Indemnity
Internal Rate of Return
IRR
Trade Sale
Initial Public Offering
IPO
Guarantee
Rescission

15.2 Keywords

indemnity
guarantee
sale and purchase agreement
shares
investment
singapore
contract law

17. Areas of Law

Area Name	Relevance Score
Guarantee	90
Credit and Security	85
Contracts of indemnity	80
Contract Law	75
Banking and Finance	40
Corporate Law	30

16. Subjects

Contract Law
Guarantees
Indemnities
Corporate Law
Securities Law