Aero-Gate Pte Ltd v Engen Marine Engineering: Civil Contempt & Mareva Injunction Breach

Aero-Gate Pte Ltd appealed against the High Court's decision in committal proceedings against Mdm Selvarajoo Mageswari and Mr Ramasamy Tanabalan, officers of Engen Marine Engineering Pte Ltd, for breaching a Mareva injunction. The Court of Appeal of Singapore, comprising Judith Prakash JA, Woo Bih Li J, and Quentin Loh J, partially allowed the appeal, increasing the fines for both Mdm Mageswari and Mr Tanabalan, finding the initial sentences too lenient given their conduct. Aero-Gate had commenced legal proceedings against Engen Marine Engineering Pte Ltd in relation to disputes arising out of two purchase orders.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeal Allowed in Part

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Aero-Gate appealed against the High Court's decision regarding Engen Marine's officers' contempt of a Mareva injunction. The Court of Appeal partially allowed the appeal, increasing the fines.

1.7 Decision Date

21 July 2020

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Aero-Gate Pte Ltd	Appellant, Plaintiff	Corporation	Appeal Allowed in Part	Partial	Navinder Singh of KSCGP Juris LLP Farah Nazura bte Zainudin of KSCGP Juris LLP
Engen Marine Engineering Pte Ltd	Respondent, Defendant	Corporation	Appeal Partially Upheld	Partial
Selvarajoo Mageswari	Respondent	Individual	Fine Increased	Partial
Tanabalan Ramasamy	Respondent	Individual	Fine Increased	Partial

3. Judges

Judge Name	Title	Delivered Judgment
Judith Prakash	Judge of Appeal	Yes
Woo Bih Li	Judge	No
Quentin Loh	Judge	No

4. Counsels

Counsel Name	Organization
Navinder Singh	KSCGP Juris LLP
Farah Nazura bte Zainudin	KSCGP Juris LLP

4. Facts

Aero-Gate obtained a Mareva injunction against Engen Marine in 2012.
Mdm Mageswari and Mr Tanabalan were running Engen Marine at all material times.
Mdm Mageswari affirmed an affidavit listing assets worth approximately $4.4m.
Engen Marine vacated its premises in March 2014 and moved assets to different locations.
The Company failed to disclose the UOB SGD account when they filed the affidavit in August 2012.
The Company's ownership of the Soon Lee property was not disclosed.
Engen Offshore was incorporated under the names of the children of Mdm Mageswari and Mr Tanabalan on 19 August 2013.

5. Formal Citations

Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd and another appeal, , [2020] SGCA 73
Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd, Civil Appeal No 172 of 2018, Civil Appeal No 172 of 2018
Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd, Suit No 373 of 2012, Suit No 373 of 2012
Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd, Civil Appeal No 173 of 2018, Civil Appeal No 173 of 2018
Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd, Suit No 373 of 2012, Suit No 373 of 2012

6. Timeline

Date	Event
2012-05-08	Appellant commenced legal proceedings against the Company
2012-08-06	Appellant filed an ex parte summons for a Mareva injunction against the Company
2012-08-08	Mareva injunction was granted
2012-08-28	Mdm Mageswari affirmed an affidavit setting out a list of assets
2013-03-28	Judge found in favor of the appellant, allowing the appellant’s claim and dismissing the Company’s counterclaim
2013-09-10	The sheriff seized 19 of the Company’s assets from its premises
2013-10-31	19 assets were returned to the Company
2013-11-26	The Court of Appeal upheld the Judge’s findings in relation to the appellant’s claims but allowed the appeal in respect of the Company’s counterclaim
2014-03-01	Company vacated premises at 13 Tuas Avenue 11
2014-03-25	Company informed the appellant of the location of assets
2014-06-01	Two assets in the Singatac premises were seized by the sheriff
2016-01-05	Damages payable to the appellant were assessed
2016-09-01	UOB SGD account was only disclosed during the examination of judgment debtor proceedings
2016-12-01	Appellant executed a WSS on the assets at Soon Lee Street and found only seven assets there
2017-07-01	Mdm Mageswari disclosed that the missing five assets were to be moved shortly thereafter to a warehouse known as the “Hock Ann Warehouse”
2019-09-17	Judgment reserved
2020-07-22	Judgment

7. Legal Issues

Breach of Mareva Injunction
- Outcome: The Court of Appeal found that the respondents had breached the Mareva injunction by failing to disclose assets and dealing with assets under injunction.
- Category: Substantive
- Sub-Issues:
  - Dissipation of assets
  - Failure to disclose assets
  - Dealing with assets under injunction
- Related Cases:
  - [2007] 2 SLR(R) 518
Civil Contempt
- Outcome: The Court of Appeal found the respondents in civil contempt of court for breaching the Mareva injunction.
- Category: Substantive
- Sub-Issues:
  - Disobedience of court order
  - Intentional act in breach of order
  - Personal involvement in breach
- Related Cases:
  - [2016] 3 SLR 1
Sentencing for Civil Contempt
- Outcome: The Court of Appeal increased the fines for the respondents, finding the initial sentences too lenient.
- Category: Procedural
- Sub-Issues:
  - Factors in determining sentence
  - Custodial sentence as last resort
  - Consideration of legal advice
- Related Cases:
  - [2016] 3 SLR 1

8. Remedies Sought

Committal to Prison
Fines
Costs

9. Cause of Actions

Breach of Contract
Contempt of Court

10. Practice Areas

Commercial Litigation

11. Industries

Oil and Gas

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Mok Kah Hong v Zheng Zhuan Yao	Court of Appeal	Yes	[2016] 3 SLR 1	Singapore	Cited for guidance on the relevant considerations in arriving at the appropriate sentence for civil contempt.
OCM Opportunities Fund II, LP and others v Burhan Uray (alias Wong Ming Kiong) and others	High Court	Yes	[2005] 3 SLR(R) 60	Singapore	Examined as a case where a term of imprisonment was ordered because the contemnor had deliberately disobeyed an injunction in clear defiance of the authority of the court and/or was a repeat offender.
Maruti Shipping Pte Ltd v Tay Sien Djim and others	High Court	Yes	[2014] SGHC 227	Singapore	Examined as a case where a term of imprisonment was ordered because the contemnor had deliberately disobeyed an injunction in clear defiance of the authority of the court and/or was a repeat offender.
Toyota Tsusho (Malaysia) Sdn Bhd v Foo Tseh Wan and others	High Court	Yes	[2017] 4 SLR 1215	Singapore	Examined as a case where a term of imprisonment was ordered because the contemnor had deliberately disobeyed an injunction in clear defiance of the authority of the court and/or was a repeat offender.
Knight v Clifton	English Court of Appeal	Yes	[1971] Ch 700	England and Wales	Cited for the principle that a prohibition in a Mareva order is absolute and is not to be related to intent unless otherwise stated on the face of the order.
Pertamina Energy Trading Ltd v Karaha Bodas Co LLC and others	Court of Appeal	Yes	[2007] 2 SLR(R) 518	Singapore	Cited for the principle that it is only necessary to prove that the relevant conduct of the party alleged to be in breach of the court order was intentional and that it knew of all the facts which made such conduct a breach of the order.
Director General of Fair Trading v Buckland	Unspecified	Yes	[1990] 1 WLR 920	England and Wales	Cited for the principle that a director’s mere passive or inadvertent behaviour will not render him liable to contempt if no allegation of misconduct or wilful behaviour is made against that director.
Re Galvanised Tank Manufacturers’ Association’s Agreement	Unspecified	Yes	[1965] 2 All ER 1003	England and Wales	Cited for the principle that a director’s mere passive or inadvertent behaviour will not render him liable to contempt if no allegation of misconduct or wilful behaviour is made against that director.
Tay Kar Oon v Tahir	Court of Appeal	Yes	[2017] 2 SLR 342	Singapore	Cited for the principle that procedural fairness in committal proceedings entails ensuring that the alleged contemnor understands the nature of the allegations against him and is given an opportunity to respond to them.
Technigroup Far East Pte Ltd and another v Jaswinderpal Singh s/o Bachint Singh and others	Unspecified	Yes	[2018] 3 SLR 1391	Singapore	Cited as a civil contempt case.
Ho Seow Wan v Ho Poey Wee and others	High Court	Yes	[2015] SGHC 304	Singapore	Cited as a civil contempt case.
PT Sandipala Arthaputra and others v STMicroelectronics Asia Pacific Pte Ltd and others	Unspecified	Yes	[2018] 4 SLR 818	Singapore	Cited as a civil contempt case.
Brightex Paints (S) Pte Ltd v Tan Ongg Seng (in his personal capacity and trading as Starlit(S) Trading) and others	High Court	Yes	[2019] SGHC 116	Singapore	Cited as a civil contempt case.
STX Corp v Jason Surjana Tanuwidjaja and others	Unspecified	Yes	[2014] 2 SLR 1261	Singapore	Cited as a civil contempt case.
Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd	High Court	Yes	[2018] SGHC 267	Singapore	Grounds of Decision of the High Court Judge.

13. Applicable Rules

Rule Name
O 52 r 2(2) of the Rules of Court
O 45 r 5(1)(ii) of the Rules of Court
O 45 r 5 of the Rules of Court

14. Applicable Statutes

Statute Name	Jurisdiction
Rules of Court (Cap 332, R 5, 2014 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Mareva Injunction
Contempt of Court
Civil Contempt
Dissipation of Assets
Affidavit
Committal Proceedings
Shadow Director
O 52 statements
SCB SGD account
UOB SGD account

15.2 Keywords

Mareva Injunction
Contempt
Civil Contempt
Singapore
Court of Appeal
Assets
Disclosure
Director
Fine

17. Areas of Law

Area Name	Relevance Score
Mareva Injunctions	95
Contempt of Court	90
Civil Contempt	90
Civil Procedure	30
Litigation	20
Evidence Law	20
Contract Law	10

16. Subjects

Civil Procedure
Contempt of Court
Injunctions