Indian Bank v Green Mint Pte Ltd: Illegality & Public Policy in Loan Contracts Procured by Bribery
In Indian Bank v Green Mint Pte Ltd, the High Court of Singapore addressed whether a borrower and its guarantors could resist a loan recovery and guarantee enforcement, respectively, on the grounds of illegality due to alleged bribery of the bank's officers. The bank sued Green Mint Pte Ltd, Gupta Vaibhav, and Arvind Sharma for defaulting on a loan. Philip Jeyaretnam J allowed the bank's appeal, granting judgment for the bank, holding that the bribery allegations did not constitute a valid defense against the loan recovery or guarantee enforcement.
1. Case Overview
1.1 Court
General Division of the High Court1.2 Outcome
Appeal allowed and judgment given to the bank.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case regarding a loan obtained through bribery. The court ruled that the borrower cannot resist recovery of the loan based on illegality.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Indian Bank | Plaintiff, Defendant in counterclaim | Corporation | Appeal Allowed | Won | Namazie Mirza Mohamed, Tay Jing En |
| Green Mint Pte Ltd | Defendant, Plaintiff in counterclaim | Corporation | Claim Dismissed | Lost | Satwant Singh s/o Sarban Singh |
| Gupta Vaibhav | Defendant | Individual | Claim Dismissed | Lost | Satwant Singh s/o Sarban Singh |
| Arvind Sharma | Defendant | Individual | Claim Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Philip Jeyaretnam | Judge of the High Court | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Namazie Mirza Mohamed | Mallal & Namazie |
| Tay Jing En | Mallal & Namazie |
| Satwant Singh s/o Sarban Singh | Satwant & Associates |
4. Facts
- Indian Bank granted banking and trading facilities to Green Mint Pte Ltd.
- The facilities were secured by a pledge of US$1,100,000 held in a fixed deposit account.
- The facilities were renewed and varied by a letter of offer issued on 7 December 2020.
- The second and third defendants gave a joint and several guarantee to the bank.
- Green Mint Pte Ltd defaulted on the payment of sums outstanding to the bank.
- The bank uplifted the fixed deposit by way of partial set-off and satisfaction of what was outstanding.
- The defendants alleged that they obtained the loan by bribing the bank’s officers.
5. Formal Citations
- Indian Bank v Green Mint Pte Ltd and others, Suit No 349 of 2021 (Registrar’s Appeal No 285 of 2021), [2021] SGHC 265
6. Timeline
| Date | Event |
|---|---|
| Bank granted banking and trading facilities to the borrower via letter of offer. | |
| Facilities were renewed and varied by a letter of offer. | |
| Borrower accepted renewed facilities. | |
| Guarantors signed the joint and several personal guarantee. | |
| Bank's solicitor issued notices demanding payment to the borrower and the guarantors. | |
| Bank issued fresh notices of demand for US$546,920.78. | |
| Bank issued a writ. | |
| First and second defendants filed a defence and counterclaim, while the third defendant filed a defence. | |
| First and second defendants provided particulars. | |
| Third defendant provided particulars. | |
| Third defendant provided particulars. | |
| Bank filed an application for summary judgment and to strike out the borrower’s counterclaim. | |
| Assistant Registrar granted unconditional leave to defend and struck out the borrower’s counterclaim. | |
| Judgment reserved. | |
| Judgment delivered. |
7. Legal Issues
- Illegality of Contract
- Outcome: The court held that the borrower could not resist recovery of the loan on the ground of illegality.
- Category: Substantive
- Related Cases:
- [2014] 3 SLR 609
- [2018] 1 SLR 363
- Enforcement of Guarantee
- Outcome: The court held that the guarantor could not resist enforcement of the guarantee on the ground of illegality.
- Category: Substantive
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Enforcement of Guarantee
10. Practice Areas
- Commercial Litigation
- Banking Litigation
11. Industries
- Banking
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Ting Siew May v Boon Lay Choo and another | Court of Appeal | Yes | [2014] 3 SLR 609 | Singapore | Cited for the doctrine of illegality. |
| Ochroid Trading Ltd and another v Chua Siok Lui (trading as VIE Import & Export) and another | Court of Appeal | Yes | [2018] 1 SLR 363 | Singapore | Cited for the doctrine of illegality. |
| Panama and South Pacific Telegraph Co v India Rubber, Gutta Percha, and Telegraph Works Co | Court of Chancery | Yes | (1875) LR 10 Ch App 515 | England and Wales | Cited for the principle that an innocent party has the option to avoid a contract procured by a bribe. |
| Aquila Advisory Ltd v Faichney and others (Crown Prosecution Service intervening) | UK Supreme Court | Yes | [2021] 1 WLR 5666 | United Kingdom | Cited for the principle that the unlawful acts and dishonest state of mind of directors could not be attributed to the company in civil proceedings against those directors. |
| Honeywell International Middle East Ltd v Meydan Group LLC (formerly known as Meydan LLC) | High Court of Justice | Yes | [2014] EWHC 1344 (TCC) | England and Wales | Cited to show that there is no English public policy requiring a court to refuse to enforce a contract procured by bribery. |
| National Iranian Oil Company v Crescent Petroleum Company International Ltd and another | High Court of Justice | Yes | [2016] EWHC 510 (Comm) | England and Wales | Cited to show that there is no English public policy requiring a court to refuse to enforce a contract procured by bribery. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Illegality
- Public Policy
- Bribery
- Loan
- Guarantee
- Summary Judgment
- Triable Issue
- Fixed Deposit
- Letter of Offer
- Banking Facilities
15.2 Keywords
- Contract
- Illegality
- Bribery
- Loan
- Guarantee
- Singapore
- Banking
16. Subjects
- Contract Law
- Banking Law
- Civil Procedure
17. Areas of Law
- Contract Law
- Civil Procedure
- Credit And Security
- Banking Law
- Illegality and Public Policy