Kazzaz v. Standard Chartered Bank: Negligent Misrepresentation & Banking Advice
The Court of Appeal of Singapore dismissed an appeal by Sheila and Ahmed Kazzaz against Standard Chartered Bank concerning alleged misrepresentations related to financial arrangements. The Kazzazes claimed that Standard Chartered Bank made misrepresentations regarding a property financing arrangement, including a mortgage, investments, and life insurance policy. The court upheld the trial judge's decision, finding that the bank did not make the alleged misrepresentations and that the Kazzazes were classified as professional clients with sufficient financial understanding.
1. Case Overview
1.1 Court
Court of Appeal of the Republic of Singapore1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
The Court of Appeal dismissed an appeal by Sheila and Ahmed Kazzaz against Standard Chartered Bank regarding alleged misrepresentations related to financial arrangements.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Standard Chartered Bank | Respondent, Defendant | Corporation | Judgment for Respondent | Won | |
| Sheila Kazzaz | Appellant, Plaintiff | Individual | Claim Dismissed | Lost | |
| Ahmed Kazzaz | Appellant, Plaintiff | Individual | Claim Dismissed | Lost | |
| Laurence Black | Defendant | Individual | |||
| Harish Phoolwani | Defendant | Individual | |||
| Naushid Mithani | Defendant | Individual |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge of Appeal | No |
| Steven Chong | Judge of Appeal | No |
| Robert French | International Judge | Yes |
4. Counsels
4. Facts
- Sheila and Ahmed Kazzaz are citizens of the United Kingdom, resident in Dubai.
- Ahmed decided to sell Ducie Court and place the proceeds with SCB.
- Phoolwani suggested that Ducie Court’s sale proceeds might be applied to a property financing arrangement.
- Ahmed wanted to establish a private banking account and move the sale proceeds to SCB.
- Ahmed signed documents declaring he qualified as a “Professional Client” under Dubai Financial Services Authority Rules.
- The SAHLK Trust was established to hold a life insurance policy over Sheila’s life.
- Ducie Court was sold for £5,313,195.53, and the proceeds were deposited with SCB.
5. Formal Citations
- Sheila Kazzaz and another v Standard Chartered Bank, CA/CA 203/2019, [2020] SGCA(I) 03
6. Timeline
| Date | Event |
|---|---|
| Sarchil Kazzaz died; Ahmed succeeded him as Chairman of the ASK Group | |
| Ahmed set up the St Bernard Trust | |
| Ahmed decided to sell Ducie Court | |
| Ahmed met with Harish Phoolwani of SCB Dubai | |
| Phoolwani sent an email to Ahmed indicating SCB’s response to Ahmed’s approach | |
| Phoolwani made a call to Ahmed | |
| Ahmed sent an email to Phoolwani suggesting they meet | |
| Ahmed and Phoolwani met | |
| Ahmed and Phoolwani had a follow-up telephone conversation | |
| Ahmed provided further details of his existing trust structures | |
| Meeting in Jersey between Ahmed and Clive Harrison | |
| Meeting with Phoolwani, Black and Mark Jackman of SCB | |
| Black sent an email to Ahmed advising him on how SCB’s services could advance his objectives | |
| Account opening documents were signed | |
| Sheila signed the Client Agreement, Client Declaration and a Client Investment Questionnaire | |
| Phoolwani sent Ahmed an email attaching financing charts prepared by IPG | |
| The SAHLK Trust was established | |
| SCTG signed the account opening application with SCB and applied for credit facilities | |
| Ahmed, Phoolwani, Black and Michael Evans met | |
| Ahmed sent an email to Phoolwani asking that he meet with Walid Fattah | |
| Ahmed described Fattah as his financial advisor | |
| Phoolwani met Fattah | |
| Further meeting occurred | |
| Phoolwani sent an email to Fattah summarizing the meeting on 28 February 2011 | |
| Ducie Court was sold in early March 2011 | |
| The first part of the Ducie Court sale proceeds, being £2m, was deposited with SCB | |
| Loan drawdown of US$13,863,738 | |
| Premium payment was made to Manulife, and the life insurance policy was issued | |
| Phoolwani sent a Client Advisory Proposal to Ahmed | |
| Phoolwani asked Ahmed for his response to the Client Advisory Proposal | |
| Ahmed took out a loan of US$850,000 | |
| Ahmed took out a loan of US$650,000 | |
| Ahmed took out a loan of US$1m | |
| Ahmed wrote to Phoolwani requesting a further transfer of US$1m | |
| Phoolwani sent an email to Ahmed | |
| Ahmed took out a loan of US$500,000 | |
| The ASK Star Trust was established | |
| Ahmed informed SCB that Sheila had found a suitable London flat at Westchester House | |
| Ahmed took out a loan of US$500,000 | |
| Ahmed took out a loan of US$500,000 | |
| Ahmed complained to Phoolwani | |
| Ask Three Ltd obtained the mortgage loan from SCB | |
| The ASK Trust was established | |
| The purchase of the Westchester property was completed | |
| Phoolwani sent an email to Ahmed | |
| Ahmed was arrested | |
| Rohit Sharma emailed Ahmed | |
| Ahmed was imprisoned | |
| SCB asked for additional security of about US$450,000 by 15 June 2016 | |
| SCB surrendered the policy | |
| Oral hearing | |
| Court dismissed the appeal |
7. Legal Issues
- Negligent Misrepresentation
- Outcome: The court found that the bank did not make negligent misrepresentations.
- Category: Substantive
- Sub-Issues:
- Duty of care
- Breach of duty of care
- Causation
- Breach of Duty of Care
- Outcome: The court found that the bank did not breach its duty of care.
- Category: Substantive
- Pleadings
- Outcome: The court held that one of the alleged misrepresentations was unpleaded.
- Category: Procedural
8. Remedies Sought
- Compensation
- Damages
9. Cause of Actions
- Negligence
- Negligent Misrepresentation
- Breach of Fiduciary Duty
10. Practice Areas
- Commercial Litigation
- Banking Litigation
11. Industries
- Financial Services
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Sheila Kazzaz and another v Standard Chartered Bank and others | Singapore International Commercial Court | Yes | [2019] SGHC(I) 15 | Singapore | The judgment under appeal; provides the factual background and trial judge's findings. |
| V Nithia (co-administratrix of the estate of Ponnusamy Sivapakiam, deceased) v Buthmanaban s/o Vaithilingam and another | Court of Appeal | Yes | [2015] 5 SLR 1422 | Singapore | Cited for the principle that pleadings define the boundary of the parties’ cases and the general rule is that the court is precluded from deciding on a matter that the parties have decided not to put in issue. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (Cap 322, R 5, 2014 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Misrepresentation Act (Cap 390, 1994 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Property Financing Arrangement
- Premium Loan
- Professional Client
- SAHLK Trust
- Ducie Court
- Client Advisory Proposal
- ASK Group
- Margin Call
- Collateral Security
- Investment Portfolio
15.2 Keywords
- misrepresentation
- banking
- financial advice
- investment
- loan
- trust
- Singapore
- appeal
- negligence
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Misrepresentation | 80 |
| Banking and Finance | 75 |
| Negligence | 70 |
| Contract Law | 60 |
| Civil Procedure | 50 |
| Agency Law | 30 |
| Equity | 25 |
16. Subjects
- Banking
- Financial Services
- Misrepresentation
- Civil Litigation