Choo Cheng Tong Wilfred v Phua Swee Khiang: Contract Formation & Illegality

In Choo Cheng Tong Wilfred v Phua Swee Khiang and Ding Pei Chai, the Singapore High Court addressed a claim by Mr. Choo for consultancy fees against Mr. Phua and Mr. Ding, and counterclaims by Mr. Phua for an account of proceeds from Atech shares and by Mr. Ding for repayment of loans. The court dismissed Mr. Choo's claim, finding that the fees were for legal work done without a valid practicing certificate, and allowed Mr. Phua's counterclaim for an accounting of the Atech shares and Mr. Ding's counterclaim for the repayment of loans.

1. Case Overview

1.1 Court

General Division of the High Court

1.2 Outcome

Claim dismissed; counterclaim for accounting of shares allowed; counterclaim for repayment of loans allowed.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore High Court case involving a claim for consultancy fees and counterclaims for repayment of loans and accounting of shares.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Choo Cheng Tong WilfredPlaintiff, Defendant in counterclaimIndividualClaim DismissedLost
Phua Swee KhiangDefendant, Plaintiff in counterclaimIndividualCounterclaim AllowedWon
Ding Pei ChaiDefendant, Plaintiff in counterclaimIndividualCounterclaim AllowedWon

3. Judges

Judge NameTitleDelivered Judgment
Tan Siong ThyeJudgeYes

4. Counsels

Counsel NameOrganization
Che Wei ChinCovenant Chambers LLC
Chan Wai Kit Darren DominicCharacterist LLC
Ng Yi Ming DanielCharacterist LLC
Ang Leong HaoRajah & Tann Singapore LLP
Chow Chao Wu JansenRajah & Tann Singapore LLP

4. Facts

  1. Mr. Choo, a law graduate, claimed consultancy fees for work done between 2000 and 2012.
  2. Mr. Phua and Mr. Ding disputed the agreements and claimed Mr. Choo lacked a valid practicing certificate.
  3. Mr. Phua counterclaimed for an account of proceeds from the sale of Atech shares held in trust.
  4. Mr. Ding counterclaimed for repayment of loans amounting to S$24,000.
  5. Mr. Choo did not have a valid practicing certificate for certain periods.
  6. The defendants argued that Mr. Choo was to be remunerated in accordance with a contingent arrangement which is void for champerty.
  7. The defendants asserted that they had fully and finally settled all the fees payable by them to Mr Choo in 2013.

5. Formal Citations

  1. Choo Cheng Tong Wilfred v Phua Swee Khiang and another, Suit No 678 of 2018, [2021] SGHC 154
  2. Australia and New Zealand Banking Group Ltd v Ding Pei Chai and others, Originating Summons No 902 of 2002, [2004] 3 SLR(R) 489

6. Timeline

DateEvent
Mr Choo admitted as an advocate and solicitor of the Supreme Court of Singapore
Mr Choo had a valid practising certificate under the Legal Profession Act
Disputes between the defendants and Mr Lee arose
The Melbourne Properties were sold
Mr Choo was a stock dealer in Phillip Securities Pte Ltd
Oral agreement made for Mr Phua to pay Mr Choo a fixed fee of S$50,000
Oral agreement made for Mr Phua to pay Mr Choo hourly rates of S$800 per hour for ordinary work and S$1,200 per hour for work on foreign issues
Mr Lee made unauthorised transfers of about A$8.4m from the sale proceeds of the Melbourne Properties
Mr Lee returned A$5.25m out of the A$8.4m to the defendants and himself
Oral agreement made for Mr Phua to pay Mr Choo hourly rates of S$800 per hour for ordinary work and S$1,200 per hour for work on foreign issues
The defendants and Mr Lee entered into an agreement to set aside A$1.8m of the sale proceeds from the Melbourne Properties
Sum of A$1.8m was deposited in an Asian Currency Unit account
Oral agreement made for the defendants to pay Mr Choo hourly rates of S$800 per hour for ordinary work and S$1,200 per hour for work on foreign issues
The defendants agreed to pay Mr Choo a fixed fee of A$50,000 if he successfully negotiated a settlement with M/s Mei Leong
Mr Phua and M/s Mei Leong entered into a settlement agreement regarding the Letters of Indemnity
Advance of A$20,000 paid to Mr Choo
Balance sum of A$30,000 paid to Mr Choo
The OS 601 Interpleader Proceedings were commenced
Sum of A$1.8m was deposited in an Asian Currency Unit account
The defendants asserted control over Gracedale and the ACU Account
Oral agreement made between Mr Choo and M/s Mei Leong, for M/s Mei Leong to pay Mr Choo a retainer of A$30,000 per year
The defendants instructed ANZ Bank to remit A$820,000 of the ACU Account Moneys to M/s Mei Leong and A$150,000 to Mr Choo
ANZ Bank filed for interpleader relief in Originating Summons No 902 of 2002
Letter of Agreement and Undertaking signed
Trust Agreement signed
Consultancy Agreement signed
The OS 601 Interpleader Proceedings were eventually settled
Judgment of Ang J in ANZ v Ding was delivered
Mr Phua and Mr Choo signed another Letter of Agreement and Undertaking
The defendants commenced proceedings against Mr Lee in the Federal Court of Australia
The Australian Proceedings concluded
Tripartite Agreement signed
The defendants commenced proceedings against Mr Lee and Gracedale in the High Court of the BVI
Deed of Agreement of Transfer of Beneficial Interest signed
S$150,000 paid by bank transfer from Mr Ding to Mr Choo
S$50,000 in cash paid to Mr Choo by hand
The BVI Proceedings concluded
The defendants commenced Suit No 420 of 2014 in the High Court against Mr Lee
The defendants entered into a settlement agreement with Mr Lee
S 420 was discontinued
Mr Ding demanded that Mr Choo repay these loans within 14 days from the date of the letter
Writ of summons issued in this Suit
Judgment reserved

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that the oral agreements alleged by the plaintiff did not exist.
    • Category: Substantive
  2. Illegality
    • Outcome: The court held that the plaintiff was an unauthorized person under the Legal Profession Act and was barred from recovering fees for legal work done without a valid practicing certificate.
    • Category: Substantive
    • Related Cases:
      • [1988] 1 SLR(R) 281
  3. Champerty
    • Outcome: The court found that the 20% remuneration arrangement was champertous and therefore void as it was contrary to public policy.
    • Category: Substantive
    • Related Cases:
      • [2007] 1 SLR(R) 989
  4. Limitation of Actions
    • Outcome: The court held that even if some of the claims were valid, they were time-barred under the Limitation Act.
    • Category: Procedural

8. Remedies Sought

  1. Monetary Damages
  2. Account of Profits

9. Cause of Actions

  • Breach of Contract
  • Failure to Account

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Securities

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Turner (East Asia) Pte Ltd v Builders Federal (Hong Kong) LtdHigh CourtYes[1988] 1 SLR(R) 281SingaporeCited for the principle that the Legal Profession Act aims to protect the public from unauthorized legal service providers and to preserve public confidence in the legal profession. Sets out the tests for determining when a person is acting as an advocate and solicitor.
Australia and New Zealand Banking Group Ltd v Ding Pei ChaiHigh CourtNo[2004] 3 SLR(R) 489SingaporeCited to provide background facts of the case, specifically the Melbourne property investments and the disputes between the defendants and Mr. Lee.
Loy Chin Associates Pte Ltd v Autohouse Trading Pte LtdHigh CourtYes[1991] 1 SLR(R) 740SingaporeCited for the principle that a claim based on quantum meruit must be pleaded.
Ting Siew May v Boon Lay ChooCourt of AppealNo[2014] 3 SLR 609SingaporeCited for the factors to consider when determining whether to deny recovery based on illegality.
Recovery Vehicle 1 Pte Ltd v Industries Chimiques Du Senegal and another appeal and another matterCourt of AppealNo[2021] 1 SLR 342SingaporeCited to argue that Mr. Choo cannot rely on his practicing certificate ex post facto as a shield against the provisions of the LPA.
Cornall v NagleSupreme Court of VictoriaYes[1995] 2 VR 188AustraliaCited for the principle that giving legal advice is central to the practice of law.
Public Prosecutor v Bhaskaran ShamkumarDistrict CourtNo[2005] SGDC 147SingaporeCited to highlight the policy concerns underlying the prohibition on unauthorized persons acting as advocates and solicitors.
Law Society of Singapore v Tan See Leh JonathanHigh CourtNo[2020] 5 SLR 418SingaporeCited to highlight the policy concerns underlying the prohibition on unauthorized persons acting as advocates and solicitors.
Public Prosecutor v Mahadevan LukshumayehDistrict CourtNo[2005] SGDC 129SingaporeCited as an example of cases where the accused persons were charged under s 33 of the LPA.
Public Prosecutor v Jasvendar Kaur d/o Avtar SinghDistrict CourtNo[2006] SGDC 216SingaporeCited as an example of cases where the accused persons were charged under s 33 of the LPA.
Rabiah Bee bte Mohamed Ibrahim v Salem IbrahimHigh CourtNo[2007] 2 SLR(R) 655SingaporeCited to argue that there was no solicitor-client relationship between Mr. Choo and the defendants.
ARS v ARTHigh CourtYes[2015] SGHC 78SingaporeCited for the guiding principles on the proper approach for determining the existence of an oral agreement.
Day, Ashley Francis v Yeo Chin Huat Anthony and othersHigh CourtYes[2020] 5 SLR 514SingaporeCited for the guiding principles on the proper approach for determining the existence of an oral agreement.
Coburn v ColledgeEnglish Court of AppealYes[1897] 1 QB 702EnglandCited for the principle that, absent any agreement to the contrary, the provider of the service is entitled to be paid once the work has been completed.
ICE Architects Ltd v Empowering People Inspiring CommunitiesHigh CourtYes[2018] EWHC 281 (QB)EnglandCited for the principle that, absent a special term of the agreement, the cause of action accrues at the time of completion of works in a services agreement.
BMI Tax Services Pte Ltd v Heng Keok Meng and othersHigh CourtYes[2019] SGHC 9SingaporeCited for applying the approach taken in ICE Architects.
Ling Kai Seng and another v Outram Realty Pte LtdHigh CourtNo[1991] 1 SLR(R) 885SingaporeCited for the proposition that the limitation period runs from the date the claimant is aware that the breach occurred.
Asia-American Investments Group Inc v UBS AG (Singapore Branch) and anotherHigh CourtNo[2017] SGHC 113SingaporeCited for the proposition that the limitation period runs from the date the claimant is aware that the breach occurred.
Ochroid Trading Ltd and another v Chua Siok Lui (trading as VIE Import & Export) and anotherCourt of AppealNo[2018] 1 SLR 363SingaporeCited for the application of the defence of illegality.
Otech Pakistan Pvt Ltd v Clough Engineering Ltd and anotherCourt of AppealYes[2007] 1 SLR(R) 989SingaporeCited for the definition of champerty and the rationale for treating champertous agreements as contrary to public policy.
Law Society of Singapore v Kurubalan s/o Manickam RengarajuCourt of AppealYes[2013] 4 SLR 91SingaporeCited for the rationale for treating champertous agreements as contrary to public policy, especially in the context of lawyers.
Kam Thai Leong Dennis v Asian Infrastructure LtdCourt of AppealYes[2020] SGCA 87SingaporeCited for the principle that novation requires the consent of both the original and the new contracting parties.
Fairview Developments Pte Ltd v Ong & Ong Pte Ltd and another appealCourt of AppealYes[2014] 2 SLR 318SingaporeCited for the principle that the court will consider the relevant contractual, contextual and commercial background against which the document purporting to effect the novation came about.
Power Solar System Co Ltd (in liquidation) v Suntech Power Investment Pte LtdHigh CourtYes[2018] SGHC 233SingaporeCited for the principle that when it is proved that a payment was made in the absence of circumstances justifying a presumption of advancement or any other plausible explanation as to why the sum of money was advanced, the court is entitled to infer that the sum of money was a loan that was meant to be repaid.
Browne v DunnHouse of LordsYes (1893) 6 R 67EnglandCited for the rule that requires parties to put to a witness important points of contention in order to give the witness a fair opportunity to meet that contention, and that failure to do so may preclude the party concerned from making that submission.
Daniel Fernandez v Edith Woi and anotherHigh CourtYes[2021] SGHC 117SingaporeCited for the rule that requires parties to put to a witness important points of contention in order to give the witness a fair opportunity to meet that contention, and that failure to do so may preclude the party concerned from making that submission.

13. Applicable Rules

Rule Name
Rules of Court (Cap 322, R 5, 2014 Rev Ed)

14. Applicable Statutes

Statute NameJurisdiction
Legal Profession Act (Cap 161, 2009 Rev Ed)Singapore
Limitation Act (Cap 163, 1996 Rev Ed)Singapore
Evidence Act (Cap 97, 1997 Rev Ed)Singapore
Civil Law Act (Cap 43, 1999 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Consultancy Fees
  • Practicing Certificate
  • Champerty
  • Limitation Act
  • Atech Shares
  • ACU Account
  • Legal Profession Act
  • Melbourne Properties
  • Trust Agreement
  • Interpleader Proceedings

15.2 Keywords

  • Contract
  • Illegality
  • Champerty
  • Legal Profession
  • Consultancy Fees
  • Limitation
  • Account
  • Shares

17. Areas of Law

Area NameRelevance Score
Contract Law90
Limitation70
Legal Ethics and Professional Responsibility60
Champerty60
Evidence Law50
Civil Procedure40
Maintenance40
Trust Law40
Estoppel30
Costs30
Agency Law20
Company Law20
Torts20

16. Subjects

  • Contract Law
  • Legal Profession
  • Civil Procedure
  • Trusts