Viking Engineering v. Feen: Minority Oppression & Share Valuation Dispute

In a minority oppression action, Viking Engineering Pte Ltd sued Bjornar Feen and others. The court ordered Feen to purchase Viking Engineering's shares in Viking Inert Gas Pte Ltd (VIG), with the fair value to be determined by an independent valuer. After the valuer's report was produced, Feen challenged the report. The High Court dismissed Feen's challenge, fixing the purchase price of Viking Engineering's shares in VIG at the value set by the report. The court found that the valuer had not materially departed from his instructions, nor was there any manifest error in the report.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Originating Summons dismissed; purchase price of shares fixed at the valuation stated in the Report.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Singapore court addresses minority oppression claim, judicial review of share valuation, and expert determination challenges. Judgment upholds independent valuer's report.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Viking Engineering Pte LtdPlaintiff, DefendantCorporationOriginating Summons dismissedWon
Bjornar Feen also known as Bjoernar FeenDefendant, PlaintiffIndividualOriginating Summons dismissedLost
Feen Marine Pte LtdDefendant, PlaintiffCorporationOriginating Summons dismissedLost
Viking Inert Gas Pte LtdDefendant, PlaintiffCorporationOriginating Summons dismissedLost
Scanjet Feen IGS Pte LtdDefendant, PlaintiffCorporationOriginating Summons dismissedLost
Feen Marine Scrubbers Pte LtdDefendant, PlaintiffCorporationOriginating Summons dismissedLost

3. Judges

Judge NameTitleDelivered Judgment
Valerie TheanJudgeYes

4. Counsels

Counsel NameOrganization
Mahesh Rai s/o Vedprakash RaiDrew & Napier LLC
Yong Wei Jun JonathanDrew & Napier LLC
Wong Soon Peng AdrianRajah & Tann Singapore LLP
Ang Leong HaoRajah & Tann Singapore LLP
Sara SimRajah & Tann Singapore LLP

4. Facts

  1. Viking Engineering and Mr. Feen were joint venture partners in VIG.
  2. Viking Engineering sold a 21% shareholding in VIG to Mr. Feen, resulting in Mr. Feen holding a 70% shareholding and Viking Engineering holding 30%.
  3. Viking Engineering commenced a minority oppression action against Mr. Feen and other defendants.
  4. The court ordered Mr. Feen to purchase Viking Engineering's shares in VIG, with the fair value to be determined by an independent valuer.
  5. The parties agreed to appoint Mr. Hayler of FTI Consulting to conduct the valuation.
  6. Mr. Hayler produced a report valuing Viking Engineering's shares at S$13.2 million.
  7. Mr. Feen challenged the report, alleging material departures from instructions and manifest errors.

5. Formal Citations

  1. Viking Engineering Pte Ltd v Feen, Bjornar and others and another matter, Suit No 294 of 2017 (Summonses Nos 4610 of 2019 and 793 of 2020) and Originating Summons No 1324 of 2019 and Summons No 751 of 2020, [2020] SGHC 78

6. Timeline

DateEvent
Sale and purchase agreement signed between Viking Engineering and Mr. Feen regarding VIG shares.
Viking Engineering commenced Suit No 294 of 2017 for minority oppression.
Leave was given to Viking Engineering to amend its prayers to include a buy-out of Viking Engineering’s shares in VIG by Mr Feen.
Injunction granted to restrain Mr Feen from using the name “Viking” and ordered Mr Feen to purchase Viking Engineering’s entire shareholding in VIG.
Court held that no discount should be applied for Viking Engineering’s minority shareholding and ordered adjustments for diversion of opportunities.
Parties agreed to appoint Mr Hayler of FTI to conduct the valuation.
Letter of Engagement (LOE) circulated to the parties.
Claims were settled by parties.
VIG’s name was changed to Stokke Engineering Pte Ltd.
Report released to parties after Mr Feen paid the requisite sums.
Viking Engineering filed Summons No 4610 of 2019 seeking payment of S$13.2 million.
Mr. Feen and the remaining defendants filed Originating Summons No 1324 of 2019 challenging the Report.
Court dismissed OS 1324/2019 and fixed the purchase price of Viking Engineering’s shareholding in VIG at the price set by the Report.
Grounds of decision issued.

7. Legal Issues

  1. Minority Oppression
    • Outcome: The court addressed the minority oppression claim in the context of determining the fair value of shares.
    • Category: Substantive
    • Sub-Issues:
      • Diversion of business opportunities
      • Breach of sale and purchase agreement
  2. Judicial Review of Valuation
    • Outcome: The court held that the valuer had not materially departed from his instructions, nor was there any manifest error in the Report.
    • Category: Procedural
    • Sub-Issues:
      • Material departure from instructions
      • Manifest error in expert's determination
  3. Expert Determination
    • Outcome: The court found that the expert's determination was not qualified and that the expert had properly considered the diverted business.
    • Category: Procedural
    • Sub-Issues:
      • Qualified determination
      • Reliance on assumptions
      • Consideration of diverted business

8. Remedies Sought

  1. Buy-out of shares
  2. Declaration that the Report was not final and binding
  3. Setting aside or disregarding the Report

9. Cause of Actions

  • Minority Oppression
  • Breach of Contract

10. Practice Areas

  • Commercial Litigation
  • Corporate Law
  • Valuation Disputes

11. Industries

  • Engineering
  • Marine

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
The Oriental Insurance Co Ltd v Reliance National Asia Re Pte LtdHigh CourtYes[2009] 2 SLR(R) 385SingaporeCited for the grounds on which an expert determination may be set aside.
Poh Cheng Chew v K P Koh & Partners Pte Ltd and anotherHigh CourtYes[2014] 2 SLR 573SingaporeCited for the grounds on which an expert determination may be set aside.
Jones v Sherwood Computer Services PlcEnglish Court of AppealYes[1992] 1 WLR 277England and WalesCited for the two-step approach to determining whether an expert departed from instructions.
Evergreat Construction Co Pte Ltd v Presscrete Engineer Pte LtdHigh CourtYes[2006] 1 SLR(R) 634SingaporeCited for the two-step approach to determining whether an expert departed from instructions and the principle that a party in default cannot take advantage of their own wrong.
Veba Oil Supply & Trading GmbH v Petrotrade IncUnknownYes[2002] 1 All ER 703England and WalesCited for the definition of 'material' departure from instructions.
Yashwant Bajaj v Toru UedaCourt of AppealYes[2020] 1 SLR 36SingaporeCited regarding qualified determinations and their effect on binding agreements.
Poh Fu Tek and others v Lee Shung Guan and othersHigh CourtYes[2018] 4 SLR 425SingaporeCited for the principle that the price of shares in a minority oppression action should be fair, just, and equitable.
Channel Tunnel Group Ltd v Balfour Beatty Construction LtdHouse of LordsYes[1993] AC 334United KingdomCited for the principle that parties must show good reasons for departing from agreements for dispute resolution.
Shorrock Ltd and another v Meggit plcEnglish Court of AppealYes[1991] BCC 471England and WalesCited regarding qualified determinations and their effect on binding agreements.
Thio Syn Kym Wendy and others v Thio Syn Pyn and anotherHigh CourtYes[2018] SGHC 54SingaporeCited for the principle that the question of whether to apply a discount for non-marketability should ordinarily be left to be determined by the independent valuer in his expertise.
Liew Kit Fah and others v Koh Keng Chew and othersCourt of AppealYes[2019] SGCA 78SingaporeCited for the principle that the lack of marketability was industry specific and for that reason agreed with the view expressed in Thio Syn Kym.
Campbell v EdwardsCourt of AppealYes[1976] 1 WLR 403England and WalesCited for the principle that it is simply the law of contract.
Geowin Construction Pte Ltd (in liquidation) v Management Corporation Strata Title Plan No 1256High CourtYes[2007] 1 SLR(R) 1004SingaporeCited for the principles applicable to manifest error in expert determinations.
Nikko Hotels (UK) Ltd v MEPC plcUnknownYes[1991] 2 EGLR 103England and WalesCited for the principle that if an expert answers the right question in the wrong way his decision will nevertheless be binding.
Legal & General Life of Australia Ltd v A Hudson Pty LtdSupreme Court of New South WalesYes(1985) 1 NSWLR 314AustraliaCited for examples of manifest errors.
Walton Homes Ltd v Staffordshire County CouncilHigh Court of JusticeYes[2013] EWHC 2554 (Ch)England and WalesCited for examples of manifest errors.
Holt v CoxUnknownYes(1997) 23 ACSR 590AustraliaCited for the principle that mistakes in the expert’s reasoning process are not regarded as manifest errors.
Teo Lay Gek and another v Hoang Trong Binh and othersHigh CourtYes[2019] SGHC 84SingaporeCited for the principle that it would not be proper for the court to adjudicate between the merits of the contrasting opinions in deciding whether or not to set aside an expert’s determination.
United Overseas Bank Ltd v Bank of ChinaHigh CourtYes[2006] 1 SLR(R) 57SingaporeCited for the elements necessary to ground an estoppel.
Tacplas Property Services Pte Ltd v Lee Peter Michael (administrator of the estate of Lee Ching Miow, deceased)High CourtYes[2000] 1 SLR(R) 159SingaporeCited for the principle that mere silence would not normally suffice to ground an estoppel unless there was a duty to speak.
Mok Kah Hong v Zhong Zhuan YaoHigh CourtYes[2016] 3 SLR 1SingaporeCited for the principle that the power to grant an order under O 45 r 6(2) of the ROC is discretionary.
NK v NLCourt of AppealYes[2010] 4 SLR 792SingaporeCited for the principle that the court will be slow to find that the valuation is in error, since by appointing an expert in the first place the court has taken the position that the matter is best left to the expert.
Viking Engineering Pte Ltd v Feen, Bjornar and othersHigh CourtYes[2019] SGHC 158SingaporeCited regarding Mr. Feen’s failure to co-operate with the valuation process.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Companies Act (Cap 50, 2006 Rev Ed)Singapore
Rules of Court (Cap 322, R 5, 2014 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Minority oppression
  • Share valuation
  • Expert determination
  • Material departure from instructions
  • Manifest error
  • Discounted Cash Flow (DCF)
  • Comparative analysis
  • Letter of Engagement (LOE)
  • Diversion of business opportunities
  • Lack of marketability
  • Qualified determination

15.2 Keywords

  • minority oppression
  • share valuation
  • expert determination
  • Singapore
  • Companies Act
  • Viking Engineering
  • Bjornar Feen

17. Areas of Law

Area NameRelevance Score
Minority Oppression90
Valuation80
Company Law75
Commercial Disputes60
Contract Law50
Civil Procedure40
Arbitration30

16. Subjects

  • Company Law
  • Valuation
  • Civil Procedure
  • Corporate Governance