DyStar v Kiri: Breach of Contract & Res Judicata in Shareholder Agreement
In a case before the Singapore International Commercial Court, DyStar Global Holdings (Singapore) Pte Ltd sued Kiri Industries Ltd and Manishkumar Pravinchandra Kiri for breach of contract. Kiri counterclaimed, alleging that DyStar breached Clause 7.2 of their Share Subscription and Shareholders Agreement (SSSA) by failing to treat Kiri as a preferred supplier. The court, presided over by Anselmo Reyes IJ, dismissed Kiri's counterclaim, finding that DyStar did not breach the agreement.
1. Case Overview
1.1 Court
Singapore International Commercial Court1.2 Outcome
Counterclaim dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
DyStar sued Kiri for breach of contract. Kiri counterclaimed, alleging DyStar breached a shareholder agreement. The court dismissed Kiri's counterclaim.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| DyStar Global Holdings (Singapore) Pte Ltd | Plaintiff | Corporation | Counterclaim Dismissed | Won | |
| Kiri Industries Ltd | Defendant | Corporation | Counterclaim Dismissed | Lost | |
| Manishkumar Pravinchandra Kiri | Defendant | Individual | Not involved in Counterclaim | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Anselmo Reyes | International Judge | Yes |
4. Counsels
4. Facts
- DyStar and Kiri entered into a Share Subscription and Shareholders Agreement (SSSA) in 2010.
- Clause 7.2 of the SSSA stipulated that DyStar should procure that Kiri be a preferred supplier.
- Kiri alleged that DyStar reduced purchases from Kiri from 2012 onwards, breaching Clause 7.2.
- DyStar argued that the Counterclaim was barred by issue estoppel and was an abuse of process.
- DyStar also argued that Clause 7.2 was merely aspirational and not an enforceable obligation.
- DyStar contended that it had valid commercial justifications for reducing purchases from Kiri.
- DyStar claimed Kiri was an unreliable supplier due to quality issues and financial problems.
5. Formal Citations
- DyStar Global Holdings (Singapore) Pte Ltd v Kiri Industries Ltd and another, Suit No 7 of 2020, [2021] SGHC(I) 12
6. Timeline
| Date | Event |
|---|---|
| Share Subscription and Shareholders Agreement signed. | |
| DyStar filed SIC/S 3/2017 against Kiri. | |
| Kiri filed SIC/S 4/2017 against DyStar. | |
| SICC ordered Senda to buy out Kiri's minority interest. | |
| Kiri commenced action against DyStar in India. | |
| DyStar filed Suit No 7 of 2020 against Kiri. | |
| Deputy Registrar ordered transfer of proceedings to SICC. | |
| Indian action withdrawn after DyStar applied for anti-suit injunction. | |
| Trial of the Counterclaim began. | |
| Trial of the Counterclaim ended. | |
| SICC determined Kiri's shares should be valued at US$481.6 million. | |
| Judgment reserved. |
7. Legal Issues
- Breach of Contract
- Outcome: The court held that DyStar did not breach Clause 7.2 of the SSSA.
- Category: Substantive
- Sub-Issues:
- Enforceability of contractual terms
- Certainty of terms
- Failure to treat as preferred supplier
- Issue Estoppel
- Outcome: The court held that the Counterclaim was not barred by issue estoppel.
- Category: Procedural
- Abuse of Process
- Outcome: The court held that the Counterclaim was not an abuse of process under the extended doctrine of res judicata.
- Category: Procedural
- Sub-Issues:
- Extended doctrine of res judicata
- Henderson v Henderson doctrine
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- International Arbitration
11. Industries
- Chemicals
- Textiles
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| DyStar Global Holdings (Singapore) Pte Ltd v Kiri Industries Ltd and others and another suit | Singapore International Commercial Court | Yes | [2018] 5 SLR 1 | Singapore | Cited for the SICC's direction that the valuation of Kiri's shares should be as at the date of its judgment. |
| Kiri Industries Ltd v Senda International Capital Ltd and another | Singapore High Court (International) | Yes | [2021] SGHC(I) 6 | Singapore | Cited for the SICC's determination of the value of Kiri's shares at US$481.6 million. |
| Goh Nellie v Goh Lian Teck and others | Court of Appeal | Yes | [2007] 1 SLR(R) 453 | Singapore | Cited for the principle that a judgment must be a conclusive determination of liability or rights to be res judicata. |
| Griffin Real Estate Investment Holdings Pte Ltd (in liquidation) v ERC Unicampus Pte Ltd | High Court | Yes | [2019] 5 SLR 105 | Singapore | Cited for the principle that only determinations necessary for the decision and fundamental to it will create an issue estoppel. |
| Gazprom Export LLC v DDI Holdings Limited and others | High Court of Justice (England and Wales), Commercial Court | Yes | [2020] EWHC 303 (Comm) | England and Wales | Cited by DyStar to support the argument that the Counterclaim is an abuse of process under the extended doctrine of res judicata. |
| Henderson v Henderson | Not specified | Yes | [1843–60] All ER Rep 378 | Not specified | Cited for the principle that a court should not allow a party to litigate what it ought to have litigated previously. |
| Johnson v Gore Wood & Co | House of Lords | Yes | [2002] 2 AC 1 | United Kingdom | Cited for the principle that the burden rests on the defendant to establish that it is oppressive or an abuse of process for him to be subjected to the second action. |
| Brisbane City Council v Attorney General for Queensland | Privy Council | Yes | [1979] AC 411 | Australia | Cited within Johnson v Gore Wood & Co for the principle that the true basis of the rule in Henderson v Henderson is abuse of process. |
| Manson v Vooght | Not specified | Yes | [1999] BPIR 376 | Not specified | Cited within Johnson v Gore Wood & Co for the principle that it may be sensible to advance claims separately in a particular case. |
| Whitecap Leisure Ltd v John H Rundle Ltd | Court of Appeal | Yes | [2008] 2 Lloyd’s Rep 216 | England and Wales | Cited for the principle that courts are reluctant to find contractual provisions uncertain if they demonstrate the parties intended some effect. |
| Broadley Construction Pte Ltd v Alacran Design Pte Ltd | Court of Appeal | Yes | [2018] 2 SLR 110 | Singapore | Cited for the principle that parties are bound by the terms of agreements they have signed, even if they did not read the contract before signing. |
| CBX and another v CBZ and others | Singapore Court of Appeal (International) | Yes | [2021] SGCA(I) 4 | Singapore | Cited for the approach to pre-transfer costs in SICC cases and the complexity of a dispute as a factor in deciding whether to give an uplift on pre-transfer costs. |
13. Applicable Rules
| Rule Name |
|---|
| Order 59 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) |
| Appendix G to the Supreme Court Practice Directions |
| O 110 r 46 ROC |
| O 110 r 12(5) ROC |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Preferred supplier
- Share Subscription and Shareholders Agreement
- SSSA
- Issue estoppel
- Res judicata
- Abuse of process
- Clause 7.2
- Textile chemicals
- Dyestuffs
- Dyes
15.2 Keywords
- Contract
- Shareholder
- Preferred Supplier
- DyStar
- Kiri
- Singapore
- Litigation
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Breach of Contract | 75 |
| Contract Law | 75 |
| Res Judicata | 60 |
| Abuse of Process | 50 |
| Shareholders Agreement | 40 |
| Share Subscription | 35 |
| Company Law | 30 |
| Corporate Law | 30 |
| Minority Oppression | 25 |
| Appeal | 20 |
| Costs | 20 |
| International Commercial Court | 15 |
| Interest | 10 |
16. Subjects
- Contract Law
- Shareholder Disputes
- Commercial Litigation