Tan Teck Kee v Ratan Kumar Rai: Fiduciary Duty, Director's Duties, Civil Procedure
Tan Teck Kee appealed the High Court's decision in favor of Ratan Kumar Rai, concerning Suit 160 of 2019 and Summons No 2708 of 2021. The Court of Appeal of Singapore, comprising Judith Prakash JCA, Tay Yong Kwang JCA, and Steven Chong JCA, addressed whether a director, Tan Teck Kee, owed concurrent fiduciary duties to both a third party, Ratan Kumar Rai, and his principal company, Worldbridgeland (Cambodia) Co Ltd. The court dismissed Tan Teck Kee's appeal in Suit 160, upholding the finding that he owed fiduciary duties to Rai and was liable to account on the basis of wilful default. The court allowed the appeal in SUM 2708, declaring the service of the Order and the penal notice was improper.
1. Case Overview
1.1 Court
Court of Appeal of the Republic of Singapore1.2 Outcome
Appeal Dismissed in Part
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding a director's fiduciary duties to a third party and his company. The court dismissed the appeal, upholding the finding of fiduciary duty.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Tan Teck Kee | Appellant | Individual | Appeal Dismissed in Part | Lost | |
| Ratan Kumar Rai | Respondent | Individual | Appeal Allowed in Part | Partial | |
| Seah Hock Thiam | Defendant | Individual | No Appeal | Neutral | |
| Worldbridgeland (Cambodia) Co Ltd | Defendant | Corporation | Default Judgment | Default |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Justice of the Court of Appeal | No |
| Tay Yong Kwang | Justice of the Court of Appeal | No |
| Steven Chong | Justice of the Court of Appeal | Yes |
4. Counsels
4. Facts
- Ratan Kumar Rai, Seah Hock Thiam, and Seah Chong Hwee discussed investing in Cambodian real property.
- Tan Teck Kee, based in Cambodia, was involved in these discussions but lacked capital to invest.
- An oral agreement was reached to purchase Cambodian land for profit, with Seah Hock Thiam as custodian of funds.
- Cambodian law restricted land ownership to citizens or companies with majority Cambodian ownership.
- Oknha Rithy Sear, a Cambodian businessman, joined the venture and held the majority shares in Worldbridgeland (Cambodia) Co Ltd.
- Worldbridgeland (Cambodia) Co Ltd purchased plots of land in Phnom Penh with funds from Ratan Kumar Rai and other investors.
- Ratan Kumar Rai transferred a significant sum to Esun International Pte Ltd, controlled by Seah Hock Thiam, rather than directly to Worldbridgeland (Cambodia) Co Ltd.
5. Formal Citations
- Tan Teck Kee v Ratan Kumar Rai, Civil Appeal No 1 of 2022, [2022] SGCA 62
6. Timeline
| Date | Event |
|---|---|
| Worldbridgeland (Cambodia) Co Ltd incorporated | |
| Worldbridgeland (Cambodia) Co Ltd entered into a sale and purchase agreement to purchase Plot A | |
| Tan Teck Kee issued 'Cambodian Investment Funds' document | |
| Worldbridgeland (Cambodia) Co Ltd entered into a sale and purchase agreement to purchase Plot B | |
| Joint venture agreement entered between Worldbridgeland (Cambodia) Co Ltd and Oxley Holdings Limited | |
| Tan Teck Kee sent 'Investment Agreement for ‘The Bridge’’ document | |
| Worldbridgeland (Cambodia) Co Ltd and Oxley Holdings Limited agreed to amend the joint venture agreement | |
| Oxley Holdings reimbursed Worldbridgeland (Cambodia) Co Ltd US$15 million | |
| Worldbridgeland (Cambodia) Co Ltd apportioned US$15 million amongst the remaining investors | |
| Tan Teck Kee informed Ratan Kumar Rai that Worldbridgeland (Cambodia) Co Ltd would be receiving dividends from Oxley Diamond | |
| Tan Teck Kee confirmed that US$10 million had been received from Oxley Diamond | |
| Cheques issued to Ratan Kumar Rai by Seah Hock Thiam | |
| Cheque issued to Ratan Kumar Rai by Seah Hock Thiam | |
| Tan Teck Kee informed Ratan Kumar Rai that there would be a further distribution of US$10 million | |
| Tan Teck Kee informed Ratan Kumar Rai that the total amount, after deductions, would be US$7,650,000 | |
| Cheque issued to Ratan Kumar Rai by Seah Hock Thiam | |
| Ratan Kumar Rai commenced Suit 160 against Seah Hock Thiam and Tan Teck Kee | |
| Oxley Holdings issued a press release reporting sales from The Bridge | |
| Worldbridgeland (Cambodia) Co Ltd received a further sum of US$35 million from Oxley Diamond | |
| Worldbridgeland (Cambodia) Co Ltd added as a third defendant | |
| Tan Teck Kee's resignation as a director of Worldbridgeland (Cambodia) Co Ltd was effective | |
| Order for specific discovery against Worldbridgeland (Cambodia) Co Ltd granted | |
| Order served on Worldbridgeland (Cambodia) Co Ltd | |
| Order and a penal notice served on Tan Teck Kee | |
| Date of first hearing | |
| Judgment reserved |
7. Legal Issues
- Fiduciary Duty
- Outcome: The court held that Tan Teck Kee owed fiduciary duties to Ratan Kumar Rai.
- Category: Substantive
- Sub-Issues:
- Breach of fiduciary duty
- Scope of fiduciary duty
- Concurrent fiduciary duties
- Related Cases:
- [2021] SGHC 276
- [2017] 1 SLR 654
- [2012] FCAFC 6
- Wilful Default
- Outcome: The court upheld the order that Tan Teck Kee account to Ratan Kumar Rai on the basis of wilful default.
- Category: Substantive
- Sub-Issues:
- Wrongful deductions
- Failure to disclose information
- Unilateral retention of funds
- Related Cases:
- [2005] SGCA 4
- Contempt of Court
- Outcome: The court declared that the service of the Order and the penal notice was improper.
- Category: Procedural
- Sub-Issues:
- Defective service of order
- Enforcement of order
- Compliance with rules of court
8. Remedies Sought
- Account
- Account on the basis of wilful default
9. Cause of Actions
- Breach of Fiduciary Duty
- Account
10. Practice Areas
- Commercial Litigation
11. Industries
- Real Estate
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Ratan Kumar Rai v Seah Hock Thiam and others | High Court | Yes | [2021] SGHC 276 | Singapore | This is the judgment under appeal. The Court of Appeal affirmed the High Court's decision that Tan Teck Kee owed fiduciary duties to Ratan Kumar Rai. |
| Multi-Pak Singapore Pte Ltd (in receivership) v Intraco Ltd and others | Court of Appeal | Yes | [1992] 2 SLR(R) 382 | Singapore | Cited regarding the principle that a court may not make a finding based on facts not pleaded. |
| V Nithia (co-administratrix of the estate of Ponnusamy Sivapakiam, deceased) v Buthmanaban s/o Vaithilingam and another | Court of Appeal | Yes | [2015] 5 SLR 1422 | Singapore | Cited regarding the law and principles of pleadings. |
| JTrust Asia Pte Ltd v Group Lease Holdings Pte Ltd and others | Court of Appeal | Yes | [2020] 2 SLR 1256 | Singapore | Cited regarding the law and principles of pleadings. |
| Fan Ren Ray and others v Toh Fong Peng and others | Court of Appeal | Yes | [2020] SGCA 117 | Singapore | Cited regarding the law and principles of pleadings. |
| Tan Yok Koon v Tan Choo Suan and another and other appeals | Court of Appeal | Yes | [2017] 1 SLR 654 | Singapore | Cited for the inquiry of whether the putative fiduciary had voluntarily placed himself in a position where the law can objectively impute an intention on his part to undertake fiduciary duties. |
| Susilawati v American Express Bank Ltd | High Court | Yes | [2009] 2 SLR(R) 737 | Singapore | Cited for the characteristics of a fiduciary relationship. |
| Commodities Intelligence Centre Pte Ltd v Mako International Trd Pte Ltd and others | High Court | Yes | [2022] SGHC 131 | Singapore | Cited for the characteristics of a fiduciary relationship. |
| Bristol and West Building Society v Mothew | Chancery Division | Yes | [1998] Ch 1 | England and Wales | Cited for the principle that single-minded loyalty is the unique and distinguishing obligation owed by fiduciaries. |
| Sim Poh Ping v Winsta Holding Pte Ltd and another and other appeals | Court of Appeal | Yes | [2020] 1 SLR 1199 | Singapore | Cited for the principle that single-minded loyalty is the unique and distinguishing obligation owed by fiduciaries. |
| Grimaldi v Chameleon Mining NL (No 2) and another | Federal Court of Australia | Yes | [2012] FCAFC 6 | Australia | Cited for the description of a fiduciary relationship. |
| Children’s Investment Fund Foundation (UK) v Attorney General and others (sub nom Lehtimäki v Cooper) | UK Supreme Court | Yes | [2022] AC 155 | United Kingdom | Cited regarding the reasonable or legitimate expectations of the supposed principal. |
| PT Sandipala Arthaputra and others v STMicroelectronics Asia Pacific Pte Ltd and others | Court of Appeal | Yes | [2018] 1 SLR 818 | Singapore | Cited regarding the principle in Said v Butt. |
| Tongbao (Singapore) Shipping Pte Ltd and another v Woon Swee Huat and others | High Court | Yes | [2019] 5 SLR 56 | Singapore | Cited regarding the principle that only custodial fiduciaries are liable to account. |
| Cheong Soh Chin and others v Eng Chiet Shoong and others | Court of Appeal | Yes | [2019] 4 SLR 714 | Singapore | Cited regarding the principle that a fiduciary is liable to account. |
| UVJ and others v UVH and others and another appeal | Court of Appeal | Yes | [2020] 2 SLR 336 | Singapore | Cited regarding the principle that a fiduciary is liable to account. |
| Libertarian Investments Ltd v Hall | Hong Kong Court of Final Appeal | Yes | (2013) 16 HKCFAR 681 | Hong Kong | Cited regarding the principle that a fiduciary is liable to account. |
| Ong Jane Rebecca v Lim Lie Hoa and others | Court of Appeal | Yes | [2005] SGCA 4 | Singapore | Cited regarding the principle that a prayer for an account to be taken on the basis of wilful default requires proof of at least one instance of such default. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (2014 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Administration of Justice (Protection) Act 2016 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Fiduciary Duty
- Wilful Default
- Oral Understanding
- Cambodian Investment Funds
- Investment Agreement
- Worldbridgeland (Cambodia) Co Ltd
- The Bridge
- Joint Venture Agreement
- Oxley Holdings Limited
- Director's Duties
15.2 Keywords
- Fiduciary Duty
- Director
- Civil Procedure
- Contempt
- Singapore
- Real Estate
- Investment
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Fiduciary Duties | 90 |
| Civil Procedure | 75 |
| Chancery and Equity | 70 |
| Contempt of Court | 65 |
| Accounting and Inquiry | 50 |
16. Subjects
- Fiduciary Duty
- Company Law
- Civil Procedure
- Equity