Singapore Recreation Club v Abdul Rashid: Unauthorised Bonuses & Wrongful Dismissal
The Singapore Recreation Club (SRC) sued Abdul Rashid Mohamed Ali, its former general manager, and Goh Kok Guan, its former president, in the High Court of Singapore, alleging breaches of fiduciary duties related to unauthorized 'special' bonuses paid to Rashid and the operation of the Club's Residence. Rashid counterclaimed for wrongful dismissal. The court dismissed the Club's claims against both defendants, finding that the bonuses were approved by the management committee (MC) and that the Residence operations were known to the MC. The court allowed Rashid's counterclaim in part, awarding him damages for unpaid salary in lieu of notice but dismissing his claims for other benefits.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Club's claims dismissed; Rashid's counterclaim succeeds in part.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
SRC sues Abdul Rashid and Goh Kok Guan over unauthorized bonuses and Residence operations. Rashid counterclaims for wrongful dismissal. Claims dismissed.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Singapore Recreation Club | Plaintiff, Defendant in Counterclaim | Association | Claims Dismissed | Lost | Ponnampalam Sivakumar, Anand George, Tan Ming Quan |
| Abdul Rashid Mohamed Ali | Defendant, Plaintiff in Counterclaim | Individual | Counterclaim Allowed in Part | Partial | Pateloo Eruthiyanathan Ashokan, Soon Meiyi Geraldine |
| Goh Kok Guan | Defendant | Individual | Claims Dismissed | Won | Pateloo Eruthiyanathan Ashokan, Soon Meiyi Geraldine |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Ang Cheng Hock | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Ponnampalam Sivakumar | BR Law Corporation |
| Anand George | BR Law Corporation |
| Tan Ming Quan | BR Law Corporation |
| Pateloo Eruthiyanathan Ashokan | Withers KhattarWong LLP |
| Soon Meiyi Geraldine | Withers KhattarWong LLP |
4. Facts
- Abdul Rashid was employed by the Club as its general manager and secretary from June 2002 until August 2014.
- In April 2014, nine of the 12 members elected to the MC were part of a team led by Dr. Singh.
- On 11 August 2014, the MC resolved to terminate Abdul Rashid's employment.
- Abdul Rashid was given the option to resign or be given two months’ notice of the termination of his employment.
- Abdul Rashid opted for resignation and signed a pre-prepared letter of resignation.
- The Club claimed Abdul Rashid removed Club property on the night of 11 August 2014.
- On 1 September 2014, Abdul Rashid was summarily dismissed for unprofessional conduct.
5. Formal Citations
- Singapore Recreation Club v Abdul Rashid Mohamed Ali and another, Suit No 1104 of 2017, [2020] SGHC 156
6. Timeline
| Date | Event |
|---|---|
| Singapore Recreation Club established. | |
| Abdul Rashid employed as general manager and secretary. | |
| Abdul Rashid received special annual bonus for FY2004. | |
| Abdul Rashid received special annual bonus for FY2005. | |
| Dr. Sarbjit Singh became a member of the MC. | |
| Abdul Rashid received special annual bonus for FY2006. | |
| Purchase requisition for two Dell laptops. | |
| Payment advice for Dell laptops. | |
| One of the Dell laptops was 'retired'. | |
| Urban Redevelopment Authority granted written permission for the Club to operate the Residence. | |
| The Club started operating guest rooms (the Residence). | |
| URA sent an email to the Club regarding the marketing of the Residence guest rooms to members of the public. | |
| MC meeting discussed the email from the URA. | |
| Hotel Licensing Board sent a letter stating that the Residence was being operated as a hotel without a proper license. | |
| MC elections; Dr. Singh's team elected. | |
| MC resolved to terminate Abdul Rashid's employment; Rashid opted to resign. | |
| Abdul Rashid returned to the Club to do his handover. | |
| Abdul Rashid was summarily dismissed. | |
| Complaint made by Dr. Singh against Goh Kok Guan. | |
| Club commenced proceedings against Abdul Rashid in the State Courts. | |
| Goh Kok Guan was suspended by the Club. | |
| Goh Kok Guan's tenure as Club's president ended. | |
| Club amended its case to add new claims in relation to 'special' annual bonuses. | |
| Club further amended its case to add new claims in relation to guest rooms. | |
| Club applied for and obtained an order for the transfer of the State Court action to the High Court. | |
| Trial began. | |
| Judgment reserved. | |
| Judgment issued. |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that the Club had no proper basis to summarily dismiss the first defendant, and the first defendant is accordingly entitled to his salary-in-lieu-of-notice for his two-month notice period.
- Category: Substantive
- Sub-Issues:
- Wrongful Dismissal
- Failure to pay salary in lieu of notice
- Breach of employment contract
- Breach of Fiduciary Duty
- Outcome: The court found that there was no merit to the Club’s claim against the second defendant for breach of any duties he might owe, fiduciary or otherwise, in relation to the bonuses paid to the first defendant.
- Category: Substantive
- Sub-Issues:
- Failure to ensure collection of Visiting Member fees
- Procuring unauthorized bonus payments
- Permitting unauthorized commission payments
- Wrongful Dismissal
- Outcome: The court found that the Club had no proper basis to summarily dismiss the first defendant, and the first defendant is accordingly entitled to his salary-in-lieu-of-notice for his two-month notice period.
- Category: Substantive
8. Remedies Sought
- Equitable Compensation
- Damages
- Indemnification
9. Cause of Actions
- Breach of Contract
- Breach of Fiduciary Duty
- Unjust Enrichment
- Wrongful Dismissal
10. Practice Areas
- Civil Litigation
11. Industries
- Recreation
- Hospitality
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| In re Hampshire Land Company | High Court of Chancery | Yes | [1896] 2 Ch 743 | England and Wales | Cited for the Re Hampshire Land principle regarding the attribution of an agent’s knowledge of breach of duty to the principal. |
| Singapore Swimming Club v Koh Sin Chong Freddie | Court of Appeal | Yes | [2016] 3 SLR 845 | Singapore | Cited for the application of the Re Hampshire Land principle in Singapore law. |
| Ng Eng Ghee and others v Mamata Kapildev Dave and others | Court of Appeal | Yes | [2009] 3 SLR(R) 109 | Singapore | Cited for the definition of fiduciary duty and the obligation of loyalty. |
| Bristol and West Building Society v Mothew | Court of Appeal | Yes | [1998] Ch 1 | England and Wales | Cited for the elements of fiduciary duty, including loyalty and good faith. |
| Turf Club Auto Emporium Pte Ltd and others v Yeo Boong Hua and others and another appeal | Court of Appeal | Yes | [2018] 2 SLR 655 | Singapore | Cited for the principle that not all relationships within settled categories are invariably fiduciary relationships. |
| United Overseas Bank Ltd v Lippo Marina Collection Pte Ltd and others | High Court | Yes | [2016] 2 SLR 597 | Singapore | Cited for the application of the Re Hampshire Land principle in cases of fraud or conspiracy. |
| Freight Connect (S) Pte Ltd v Paragon Shipping Pte Ltd | Court of Appeal | Yes | [2015] 5 SLR 178 | Singapore | Cited for the principle that an indemnity should not be ordered where a claim by a third party is only a possibility. |
| Trans Trust SPRL v Danubian Trading Co Ltd | Court of Appeal | Yes | [1952] 2 QB 297 | England and Wales | Cited for the principle that it would not be correct to make a declaration of indemnity. |
| Deeny v Gooda Walker Ltd (in liquidation) | High Court | Yes | [1995] 1 WLR 1206 | England and Wales | Cited for the principle to defer dealing with the claimants’ future losses until it had been determined. |
| RDC Concrete Pte Ltd v Sato Kyogo (S) Pte Ltd and another appeal | Court of Appeal | Yes | [2007] 4 SLR(R) 413 | Singapore | Cited for the approach to determine whether the first defendant’s alleged acts in defiance of the instruction given by Dr Singh were sufficiently serious to constitute repudiatory breach of his contract of employment. |
| Phosagro Asia Pte Ltd v Piattchanine, Iouri | High Court | Yes | [2016] 5 SLR 1052 | Singapore | Cited for the approach to determine whether the first defendant’s alleged acts in defiance of the instruction given by Dr Singh were sufficiently serious to constitute repudiatory breach of his contract of employment. |
| Loh Siok Wah v American International Assurance Co Ltd | High Court | Yes | [1998] 2 SLR(R) 245 | Singapore | Cited for the principle that being an ex gratia payment, the Club is fully within its rights to stand firm and refuse to make this payment to the first defendant now that he has been summarily dismissed. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Societies Regulations (Cap 311, Rg 1, 2008 Rev Ed) | Singapore |
| Hotels Act (Cap 127, 1999 Rev Ed) | Singapore |
| Societies Act (Cap 311, 2014 Rev Ed) | Singapore |
| Planning Act (Cap 232, 1998 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Management Committee
- General Manager
- Special Bonuses
- Visiting Member Fees
- Residence
- Wrongful Dismissal
- URA Condition
- Societies Regulations
15.2 Keywords
- Singapore Recreation Club
- Abdul Rashid
- Goh Kok Guan
- Wrongful Dismissal
- Fiduciary Duty
- Unauthorised Bonuses
- Residence
- Management Committee
16. Subjects
- Employment Law
- Contract Law
- Unincorporated Associations
- Fiduciary Duty
17. Areas of Law
- Unincorporated Associations and Trade Unions
- Friendly societies
- Employment Law
- Contract Law