Teo Yong Soon v Kwan Yuen Heng: Unlicensed Moneylending & Loan Recovery
In Teo Yong Soon v Kwan Yuen Heng, the High Court of Singapore heard a claim by Teo Yong Soon against Kwan Yuen Heng for recovery of $1,621,000 in interest-free loans. Kwan defended by claiming Teo was an unlicensed moneylender. Justice Chan Seng Onn ruled in favor of Teo, finding Kwan liable for the full amount, rejecting the defense under the Moneylenders Act.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Teo Yong Soon sues Kwan Yuen Heng for $1,621,000 in interest-free loans. The court found Kwan liable, rejecting his defense of unlicensed moneylending.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Teo Yong Soon | Plaintiff | Individual | Judgment for Plaintiff | Won | Uthayasurian s/o Sidambaram |
| Kwan Yuen Heng | Defendant | Individual | Claim Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chan Seng Onn | Judge of the High Court | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Uthayasurian s/o Sidambaram | Phoenix Law Corporation |
4. Facts
- Teo loaned Kwan a total of $1,621,000.00 in cash on seven occasions.
- Kwan claimed the loans were unenforceable under the Moneylenders Act as Teo was an unlicensed moneylender.
- Kwan admitted to borrowing $550,000.00 but claimed to have repaid $1,497,000.00 in cash.
- Teo maintained the loans were interest-free, while Kwan claimed they were interest-bearing.
- Teo provided bank statements and cash cheques to support his claim of the loan amounts.
- Kwan's police report contained inconsistencies regarding the loan amounts and repayments.
- WhatsApp messages between Teo and Kwan related to a separate Malaysian Loan.
5. Formal Citations
- Teo Yong Soon v Kwan Yuen Heng, Suit No 777 of 2019, [2021] SGHC 112
6. Timeline
| Date | Event |
|---|---|
| Parties knew each other from 1997 and became family friends. | |
| Kwan engaged Teo to carry out renovation works on his apartment at Tanjong Rhu. | |
| Kwan engaged Teo to carry out renovation works on his apartment in Sentosa. | |
| Kwan engaged Teo to carry out renovation works on his commercial property at The Alexcier. | |
| Teo and his wife made an investment of $200,000.00 with Kwan. | |
| Arrangement reached where Teo would broker property deals for Kwan’s clients to earn commissions. | |
| Teo loaned Kwan $500,000.00. | |
| Teo loaned Kwan $400,000.00. | |
| Teo loaned Kwan $55,000.00. | |
| Teo loaned Kwan $245,000.00. | |
| Teo loaned Kwan $15,000.00. | |
| Teo loaned Kwan $372,000.00. | |
| A company set up by Kwan appointed Teo as the agent under a Buyer Agency Agreement. | |
| Teo loaned Kwan $34,000.00. | |
| Kwan filed a police report against Teo. | |
| Suit filed in Suit No 777 of 2019. | |
| Defence (Amendment No. 1) filed. | |
| Kwan's affidavit evidence-in-chief dated 1 September 2020. | |
| Trial began. | |
| Plaintiff’s and Defendant's closing submissions dated. | |
| Hearing date. | |
| Judgment reserved. |
7. Legal Issues
- Unlicensed Moneylending
- Outcome: The court held that Teo was not an unlicensed moneylender under the Moneylenders Act.
- Category: Substantive
- Enforceability of Loan Agreements
- Outcome: The court held that the loan agreements were enforceable as Teo was not an unlicensed moneylender.
- Category: Substantive
- Quantum of Loans
- Outcome: The court found that the total quantum of the loans extended by Teo to Kwan was $1,621,000.00.
- Category: Substantive
- Repayment of Loans
- Outcome: The court found that Kwan had not made any repayment to Teo for the loans.
- Category: Substantive
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Debt Recovery
10. Practice Areas
- Commercial Litigation
- Debt Recovery
11. Industries
- Finance
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| City Hardware Pte Ltd v Kenrich Electronics Pte Ltd | High Court | Yes | [2005] 1 SLR(R) 733 | Singapore | Cited for the principle that the Moneylenders Act is social legislation designed to regulate unscrupulous unlicensed moneylenders. |
| Sheagar s/o T M Veloo v Belfield International (Hong Kong) Ltd | Court of Appeal | Yes | [2014] 3 SLR 524 | Singapore | Cited for the principles applicable to section 14(2) of the Moneylenders Act regarding unenforceability of loans granted by unlicensed moneylenders. |
| Mak Chik Lun and others v Loh Kim Her and others and another action | High Court | Yes | [2003] 4 SLR(R) 338 | Singapore | Cited for explaining the application of the presumption in section 3 of the Moneylenders Act. |
| Litchfield v Dreyfus | King's Bench Division | Yes | [1906] 1 KB 584 | England and Wales | Cited for the test of whether the alleged moneylender is one who is ready and willing to lend to all and sundry provided that they are from his point of view eligible. |
| Neville, Guy v Andrla, Dominic | High Court | Yes | [2017] SGHC 295 | Singapore | Cited for the principle that the court asks whether the loans are part of an ongoing and routine series of transactions made by the alleged moneylender. |
| Ng Kum Peng v PP | High Court | Yes | [1995] 2 SLR(R) 900 | Singapore | Cited for guidance on what constitutes continuity and system in moneylending transactions. |
| Ding Leng Kong v Mok Kwong Yue and others | High Court | Yes | [2003] 4 SLR(R) 637 | Singapore | Cited for the principle that the existence of a number of loans does not necessarily mean that the lender is a moneylender. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Moneylenders Act (Cap 188, 2010 Rev Ed) | Singapore |
| Moneylenders Act s 14(2) | Singapore |
| Moneylenders Act s 2 | Singapore |
| Moneylenders Act s 3 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Unlicensed Moneylender
- Moneylenders Act
- Interest-Free Loan
- Cash Cheques
- Malaysian Loan
- Repayment
- Loan Agreement
15.2 Keywords
- Loan
- Moneylender
- Unlicensed
- Singapore
- Contract
- Debt
16. Subjects
- Contract Law
- Financial Law
- Moneylending
17. Areas of Law
- Moneylenders Act
- Contract Law
- Credit and Security
- Loans of money