Tonny Permana v One Tree Capital Management: Fiduciary Duties & Investment Agreement Dispute

Tonny Permana appealed to the Appellate Division of the High Court of Singapore against the decision of the trial judge dismissing his claims against One Tree Capital Management Pte Ltd and Gerald Yeo. The claims were based on breaches of fiduciary duties and dishonest assistance related to an investment in a Malaysian shopping mall project. The court, comprising Quentin Loh JAD, See Kee Oon J, and Chua Lee Ming J, dismissed the appeal, finding that Permana had waived the breaches of fiduciary duties by signing a trust deed after being informed of fundamental changes to the investment structure.

1. Case Overview

1.1 Court

Appellate Division of the High Court

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Ex Tempore Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding fiduciary duties in an investment agreement. The court dismissed the claims, finding the appellant had waived breaches by signing a trust deed.

1.7 Decision Date

23 August 2021

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Tonny Permana	Appellant, Plaintiff	Individual	Appeal Dismissed	Lost	Lee Hwee Khiam Anthony of Bih Li & Lee LLP Huineng Clement Chen of Bih Li & Lee LLP
One Tree Capital Management Pte Ltd	Respondent, Defendant	Corporation	Claims Dismissed	Won	Siraj Omar of Drew & Napier LLC Allister Brendan Tan Yu Kuan of Drew & Napier LLC Joelle Tan of Drew & Napier LLC Teng Po Yew of Drew & Napier LLC
Gerald Yeo	Respondent, Defendant	Individual	Claims Dismissed	Won	Siraj Omar of Drew & Napier LLC Allister Brendan Tan Yu Kuan of Drew & Napier LLC Joelle Tan of Drew & Napier LLC Teng Po Yew of Drew & Napier LLC

3. Judges

Judge Name	Title	Delivered Judgment
Quentin Loh	Judge of the Appellate Division	Yes
See Kee Oon	Judge of the High Court	No
Chua Lee Ming	Judge of the High Court	No

4. Counsels

Counsel Name	Organization
Lee Hwee Khiam Anthony	Bih Li & Lee LLP
Huineng Clement Chen	Bih Li & Lee LLP
Siraj Omar	Drew & Napier LLC
Allister Brendan Tan Yu Kuan	Drew & Napier LLC
Joelle Tan	Drew & Napier LLC
Teng Po Yew	Drew & Napier LLC

4. Facts

Appellant invested US$1.6m in a Malaysian shopping mall project through Respondents.
Investment was initially structured as a convertible loan note (CLN).
Respondents terminated the Investment Agreement and discharged the Security Documents without informing the Appellant.
Respondents altered the investment structure to a shareholder's loan provided by OTC.
Appellant signed a Trust Deed after being informed of the changes.
The Project failed and Midas was liquidated, resulting in the loss of the Appellant's investment.
The Appellant was aware that the investment was no longer secured when he signed the Trust Deed.

5. Formal Citations

Tonny Permana v One Tree Capital Management Pte Ltd and another, Civil Appeal No 32 of 2021, [2021] SGHC(A) 8

6. Timeline

Date	Event
2013-11-19	OTC sent an email to the Appellant regarding the Project.
2013-11-25	Draft documents were sent to the Appellant.
2013-11-28	Investment Agreement and Deed of Guarantee were dated.
2013-11-29	The designated account received US$1.6m from the Appellant.
2014-02-11	GY sent an email informing that the structure of the Appellant’s investment had to be changed.
2014-03-03	Email exchanges on details relating to the proposed change began.
2014-05-14	Email exchanges on details relating to the proposed change ended.
2014-07-26	Respondents entered into a Memorandum of Agreement with TCW and Mr Wang Yingde.
2014-08-03	GY emailed Ms Tiolani and informed her that the structure of the Appellant’s investment would be altered.
2014-08-18	OTC issued a letter to Midas, TCW and WJG stating that OTC had terminated the Investment Agreement.
2014-08-31	Trust deed was dated.
2014-09-03	GY sent Ms Tiolani a trust deed to be executed.
2014-11-17	GY sent an email summarising what he wished to convey to the Appellant about his investment.
2014-11-18	Ms Tiolani sent an email to the Respondents inquiring into the Security Documents under the Trust Deed.
2014-11-19	GY replied stating that the Share Charge and Guarantee had been voided.
2014-11-20	Appellant signed the Trust Deed.
2021-08-24	Judgment delivered.

7. Legal Issues

Breach of Fiduciary Duty
- Outcome: The court found that the Respondents breached their fiduciary duties but the Appellant waived these breaches by signing the Trust Deed.
- Category: Substantive
- Sub-Issues:
  - Conflict of interest
  - Failure to act in the best interest of the principal
  - Termination of Investment Agreement without consent
  - Discharge of Security Documents without consent
  - Altering investment structure without consent
- Related Cases:
  - [2017] 3 SLR 957
  - [1995] 2 AC 145
Waiver of Breach
- Outcome: The court held that the Appellant waived the breaches of fiduciary duties by signing the Trust Deed, signifying his agreement to the changes in the investment structure.
- Category: Substantive
- Related Cases:
  - [2017] 3 SLR 957

8. Remedies Sought

Monetary Damages

9. Cause of Actions

Breach of Fiduciary Duty
Dishonest Assistance

10. Practice Areas

Commercial Litigation
Investment Disputes

11. Industries

Finance
Investment Management
Real Estate

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Tonny Permana v One Tree Capital Management Pte Ltd and another	High Court	Yes	[2021] SGHC 37	Singapore	The appeal was against the decision of the trial judge in this case.
Henderson v Merrett Syndicates Ltd	N/A	Yes	[1995] 2 AC 145	N/A	Cited regarding the attenuation or displacement of an agent's duty of loyalty by the provisions of the underlying contract.
Nordic International Ltd v Morten Innhaug	N/A	Yes	[2017] 3 SLR 957	Singapore	Cited to distinguish between ratification of a transaction and ratification of breaches of fiduciary duties.

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

Convertible Loan Note
Trust Deed
Investment Agreement
Security Documents
Shareholder Loan
Fiduciary Duty
Waiver
Ratification
Agent
Principal

15.2 Keywords

fiduciary duty
investment agreement
waiver
convertible loan note
trust deed
One Tree Capital
Tonny Permana

17. Areas of Law

Area Name	Relevance Score
Fiduciary Duties	95
Contract Law	60
Agency Law	50
Waiver	40
Estoppel	40
Investment	30
Company Law	30
Civil Litigation	25

16. Subjects

Fiduciary Relationships
Investment Agreements
Breach of Contract
Waiver
Agency