Kazzaz v. Standard Chartered Bank: Negligent Misrepresentation & Banking Advice
Sheila Kazzaz and Ahmed Kazzaz sued Standard Chartered Bank and several of its employees in the Singapore International Commercial Court, alleging negligent misrepresentation, breaches of common law duty of care, and breaches of the DIFC Regulatory Law related to a property financing arrangement. The plaintiffs claimed they were induced into an unsuitable financial arrangement involving a mortgage, life insurance policy, and offshore trusts. The court, presided over by Anselmo Reyes IJ, dismissed the plaintiffs' claims, finding that the bank did not make misrepresentations and acted reasonably in its dealings with the Kazzaz family. The judgment was reserved on 14 October 2019.
1. Case Overview
1.1 Court
Singapore International Commercial Court1.2 Outcome
Plaintiffs' claims dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Sheila and Ahmed Kazzaz sued Standard Chartered Bank for negligent misrepresentation regarding a property financing arrangement. The court dismissed the claims.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Standard Chartered Bank | Defendant | Corporation | Judgment for Defendant | Won | |
| Sheila Kazzaz | Plaintiff | Individual | Claims Dismissed | Lost | |
| Ahmed Kazzaz | Plaintiff | Individual | Claims Dismissed | Lost | |
| Laurence Black | Defendant | Individual | Judgment for Defendant | Won | |
| Harish Phoolwani | Defendant | Individual | Judgment for Defendant | Won | |
| Naushid Mithani | Defendant | Individual | Judgment for Defendant | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Anselmo Reyes | International Judge | Yes |
4. Counsels
4. Facts
- The Kazzaz family became private banking clients of SCB's DIFC branch in October 2010.
- Ahmed took out a loan from SCB to pay the premium for a life insurance policy on Sheila’s life.
- Ahmed also took out a mortgage for a property where his daughter resided while studying in London.
- Ahmed invested the proceeds from the sale of Ducie Court in an investment portfolio with SCB.
- The Plaintiffs alleged that the Defendants made negligent misrepresentations about the PFA.
- The Plaintiffs alleged that the Defendants breached their common law duty of care.
- The Plaintiffs alleged that the Defendants breached the DIFC Regulatory Law.
5. Formal Citations
- Sheila Kazzaz and another v Standard Chartered Bank and others, Suit No 4 of 2018, [2019] SGHC(I) 15
6. Timeline
| Date | Event |
|---|---|
| Kazzaz family resided in Dubai | |
| Ahmed succeeded Sarchil as chairperson of the ASK Group | |
| Kazzaz family became private banking clients of SCB DIFC | |
| Ahmed first met Harish | |
| Ahmed met Clive Harrison in Jersey | |
| Ahmed met Harish, Laurence and Mark Jackman at lunch | |
| Ahmed met with Jyotsna Pandey from IPG Financial Services Pte Ltd | |
| Medical examination took place | |
| Harish and Laurence visited Sheila at her house for the purpose of signing documents | |
| SAHLK Trust was set up | |
| Meeting among Ahmed, Harish, Laurence and Michael | |
| Meeting with Walid Fattah | |
| Meeting among Ahmed, Harish, Laurence, Naushid and Walid | |
| The Policy was issued | |
| Laurence and Jyotsna visited Sheila at her villa | |
| Ducie Court was sold in March 2011 | |
| The Kazzaz family’s offer to buy the Westchester Property was accepted | |
| The purchase of Westchester Property was completed | |
| ASK Star Trust set up | |
| ASK Trust set up | |
| Ahmed was arrested in the US | |
| Ahmed was sentenced to 15-months’ imprisonment in the US | |
| Ahmed returned to Dubai | |
| SCB closed Ahmed’s personal accounts | |
| Tele-conference call with SCB and the representatives of the SCTG | |
| SCTG requested additional securities or payment of about US$450,000 by 15 June 2016 | |
| Ahmed learnt that SCTG was unable to continue providing fiduciary services | |
| SCB confirmed that the mortgage loan taken out by ASK Three for the Westchester Property would be extended to 30 September 2016 | |
| Ahmed sold an Iraqi property | |
| Ahmed was notified that SCB had surrendered the Policy | |
| Ahmed redeemed the mortgage over the Westchester Property | |
| Trial began | |
| Judgment reserved |
7. Legal Issues
- Negligent Misrepresentation
- Outcome: The court found that the bank did not make negligent misrepresentations to the plaintiffs.
- Category: Substantive
- Breach of Duty of Care
- Outcome: The court found that the bank did not breach its duty of care to the plaintiffs.
- Category: Substantive
- Breach of DIFC Regulatory Law
- Outcome: The court found that the bank did not breach the DIFC Regulatory Law.
- Category: Regulatory
8. Remedies Sought
- Monetary Damages
- Compensation for Loss and Damage
9. Cause of Actions
- Negligent Misrepresentation
- Breach of Contract
- Breach of Duty of Care
- Breach of Statutory Duty
10. Practice Areas
- Commercial Litigation
- Banking
- Financial Services
- Trusts
- Negligence
- Misrepresentation
11. Industries
- Financial Services
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Rickshaw Investments Ltd v Nicolai Baron von Uexkull | Court of Appeal | Yes | [2007] 1 SLR(R) 377 | Singapore | Cited for the double actionability test in cases involving foreign torts. |
| Hedley Byrne & Co Ltd v Heller & Partners Ltd | House of Lords | Yes | [1964] AC 465 | England and Wales | Cited as the leading case for establishing liability for negligent misrepresentation causing pure economic loss. |
| RBC Properties Pte Ltd v Defu Furniture Pte Ltd | Court of Appeal | Yes | [2015] 1 SLR 997 | Singapore | Cited to query the remedial scope of Misrepresentation Act s 2(1). |
| Royscot Trust Ltd. v Rogerson | Court of Appeal | Yes | [1991] 2 QB 297 | England and Wales | Cited for the view that damages for negligent misrepresentation should be assessed as if the misrepresentation was made fraudulently. |
| JIO Minerals FZC v Mineral Enterprises Ltd | Court of Appeal | Yes | [2011] 1 SLR 391 | Singapore | Cited for the purposes underlying the Misrepresentation Act. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Misrepresentation Act (Cap 390, 1994 Rev Ed) | Singapore |
| DIFC Regulatory Law (DIFC Law No.1 of 2004) | Dubai International Financial Centre |
15. Key Terms and Keywords
15.1 Key Terms
- Property Financing Arrangement
- Premium Loan
- Mortgage
- Investment Portfolio
- Trust Structures
- Professional Client
- DIFC Regulatory Law
15.2 Keywords
- negligent misrepresentation
- banking advice
- property financing
- duty of care
- DIFC
- Singapore
- Standard Chartered Bank
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Misrepresentation | 80 |
| Banking and Finance | 75 |
| Negligence | 70 |
| Torts | 70 |
| Financial Services | 65 |
| Contract Law | 60 |
| Breach of Contract | 60 |
| Damages Assessment | 60 |
| Trust Law | 50 |
| Asset Protection | 40 |
| Litigation | 40 |
| Agency and Distributorships | 30 |
| Personal Injury | 20 |
16. Subjects
- Banking
- Finance
- Misrepresentation
- Negligence
- Financial Regulation
- Trusts