Sim Guan Seng v One Organisation: Insolvency, Undervalue Transactions & Unfair Preferences

In the case of Sim Guan Seng and others v One Organisation Ltd and others, the General Division of the High Court of Singapore, presided over by Justice Vinodh Coomaraswamy, ruled in favor of the plaintiffs (trustees in bankruptcy) on August 26, 2022. The case involved claims of fraudulent transactions, transactions at an undervalue, and unfair preferences related to the bankruptcy of Fan Kow Hin. The court found several transactions to be fraudulent conveyances or transactions at an undervalue, ordering the defendants to restore assets to the bankrupt's estate.

1. Case Overview

1.1 Court

General Division of the High Court

1.2 Outcome

Judgment for the Plaintiffs.

1.3 Case Type

Insolvency

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore High Court judgment on insolvency, undervalue transactions, and unfair preferences in a bankruptcy case involving Sim Guan Seng and One Organisation.

1.7 Decision Date

25 August 2022

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Chee Yin Meh	Defendant	Individual	Orders to transfer the 58 shares to the Trustees	Lost	Goh Kok Leong of Ang & Partners Daniel Tan of Ang & Partners Dillion Chua of Ang & Partners
Khor Boon Hong	Plaintiff	Individual	Judgment for Plaintiff	Won	Chew Jing Wei of Allen & Gledhill LLP Andrew Chan of Allen & Gledhill LLP Alexander Yeo of Allen & Gledhill LLP
Goh Yeow Kiang Victor	Plaintiff	Individual	Judgment for Plaintiff	Won	Chew Jing Wei of Allen & Gledhill LLP Andrew Chan of Allen & Gledhill LLP Alexander Yeo of Allen & Gledhill LLP
Sim Guan Seng	Plaintiff	Individual	Judgment for Plaintiff	Won	Chew Jing Wei of Allen & Gledhill LLP Andrew Chan of Allen & Gledhill LLP Alexander Yeo of Allen & Gledhill LLP
One Organisation Limited	Defendant	Corporation	Orders to restore to the Bankrupt’s estate all of the transfers it received from the Bankrupt	Lost	Goh Kok Leong of Ang & Partners Daniel Tan of Ang & Partners Dillion Chua of Ang & Partners
Gateway Plus Limited	Defendant	Corporation	Order to pay to the Trustees the sum of $2.18m	Lost	Goh Kok Leong of Ang & Partners Daniel Tan of Ang & Partners Dillion Chua of Ang & Partners

3. Judges

Judge Name	Title	Delivered Judgment
Vinodh Coomaraswamy	Judge of the High Court	Yes

4. Counsels

Counsel Name	Organization
Goh Kok Leong	Ang & Partners
Daniel Tan	Ang & Partners
Dillion Chua	Ang & Partners
Chew Jing Wei	Allen & Gledhill LLP
Andrew Chan	Allen & Gledhill LLP
Alexander Yeo	Allen & Gledhill LLP

4. Facts

A bankruptcy order was made against Fan Kow Hin on 30 March 2017.
The plaintiffs were appointed as Fan Kow Hin's trustees in bankruptcy.
The trustees believed the Bankrupt entered into fraudulent transactions before his bankruptcy.
The Bankrupt transferred 58 shares in One Organisation Limited to his wife, Chee Yin Meh.
The Bankrupt and his wife created and backdated agreements to justify the share transfer.
The Bankrupt transferred assets to One Organisation Limited in 2015 and 2016.
The Bankrupt transferred his shares in One Organisation Private Limited to Gateway Plus Limited.

5. Formal Citations

Sim Guan Seng and others v One Organisation Ltd and others, Suit No 1078 of 2017, [2022] SGHC 194

6. Timeline

Date	Event
2017-03-30	Bankruptcy order made against Fan Kow Hin
2017-12-01	Trustees commenced action against the defendants
2020-02-04	Trial began
2020-02-07	Trial
2020-02-11	Trial
2020-02-12	Trial
2020-02-14	Trial
2020-02-17	Trial
2020-07-07	Trial
2022-08-26	Judgment reserved

7. Legal Issues

Fraudulent Conveyance
- Outcome: The court found several transactions to be fraudulent conveyances.
- Category: Substantive
- Related Cases:
  - [1996] 3 SLR(R) 637
Transaction at an Undervalue
- Outcome: The court found several transactions to be transactions at an undervalue.
- Category: Substantive
Unfair Preference
- Outcome: The court did not find any transactions to be unfair preferences.
- Category: Substantive
Sham Agreement
- Outcome: The court found the POA to be a sham agreement.
- Category: Substantive
- Related Cases:
  - [2014] 1 SLR 24
  - [2014] 4 SLR 532
  - [2016] 3 SLR 663
Insolvency
- Outcome: The court found that the Bankrupt was insolvent during the relevant periods.
- Category: Substantive

8. Remedies Sought

Restoration of the bankrupt’s estate
Damages

9. Cause of Actions

Fraudulent Conveyance
Transaction at an Undervalue
Unjust Enrichment
Conspiracy

10. Practice Areas

Insolvency Litigation
Bankruptcy Law
Commercial Litigation

11. Industries

No industries specified

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
The Enterprise Fund II Limited v Jong Hee Sen	High Court	Yes	[2020] 3 SLR 419	Singapore	Cited regarding a deed of undertaking and the inability to pay a sum due under its terms.
Belfield International (Hong Kong) Ltd v Sheagar s/o T M Veloo	Court of Appeal	Yes	[2014] 1 SLR 24	Singapore	Cited for the principle regarding the intention to be bound by agreements and proving a document is a sham.
Zulaikha Bee bte Mohideen Abdul Kadir v Quek Chek Khiang and others	Court of Appeal	Yes	[2014] 4 SLR 532	Singapore	Cited for the principle regarding the intention to be bound by agreements and proving a document is a sham.
iTronic Holdings Pte Ltd v Tan Swee Leon and another suit	High Court	Yes	[2016] 3 SLR 663	Singapore	Cited for the principle that a sham agreement is intended to be devoid of legal effect and to be nothing more than a pretence to mislead third parties.
Quah Kay Tee v Ong and Co Pte Ltd	High Court	Yes	[1996] 3 SLR(R) 637	Singapore	Cited for the principle that a fraudulent intent will be irrebuttably imputed to a person who conveys property for no consideration when insolvent.
Saunders v Vautier	Rolls Court	Yes	(1841) 4 Beav 115	England and Wales	Cited for the principle that the beneficiaries of a bare trust can terminate the trust and direct the trustee to transfer the trust property to them.
Beconwood Securities Pty Ltd v Australia and New Zealand Banking Group Limited	Federal Court of Australia	Yes	(2008) 246 ALR 361	Australia	Cited for the principle that the borrower in a share loan agreement acquires full and good title to the shares.
CMG Equity Investments Pty Ltd v Australia and New Zealand Banking Group Ltd	Supreme Court of New South Wales	Yes	(2008) 65 ACSR 650	Australia	Cited for the principle that it is antithetical to the commercial purpose of a share lending agreement for there to be any separation of legal title from the beneficial interest in the shares.
Eric Stonham (Trustee in Bankruptcy of Sebastian Ramrattan) v Sebastian Ramrattan and another	High Court of Justice	Yes	[2010] EWHC 1033 (Ch)	England and Wales	Cited regarding a transfer of property with a forged signature and the resulting trust.
Stonham v Ramrattan and another	Court of Appeal	Yes	[2011] 1 WLR 1617	England and Wales	Cited regarding a transfer of property with a forged signature and the resulting trust.
Godfrey v Torpy	High Court of Justice	Yes	[2007] Bus LR 1203	England and Wales	Cited regarding a transfer of property with forged documents and the resulting trust.
Ng Bok Eng Holdings Pte Ltd and another v Wong Ser Wan	Court of Appeal	Yes	[2005] 4 SLR(R) 561	Singapore	Cited for the principle that a fraudulent intent will be irrebuttably imputed to a person who conveys property for no consideration when insolvent.

13. Applicable Rules

Rule Name
O 38 r 2(1) of the Rules of Court (2014 Rev Ed)
O 38 r 2(5)
O 41 r 5(1) of the Rules of Court
O 41 r 5(2) of the Rules of Court
O 38 r 3(2)(a)
O 38 r 4

14. Applicable Statutes

Statute Name	Jurisdiction
Bankruptcy Act (Cap 20, 2009 Rev Ed)	Singapore
s 59 of the Bankruptcy Act (Cap 20, 2009 Rev Ed)	Singapore
s 76(1) read with s 36(2) of the Act	Singapore
s 100(4) of the Act	Singapore
s 100(3) of the Act	Singapore
s 101(2) of the Act	Singapore
s 101(9)(b) of the Act	Singapore
s 103 of the Evidence Act	Singapore
s 108 of the Evidence Act	Singapore
s 17 read with s 19 of the Evidence Act (Cap 97, 1997 Rev Ed)	Singapore
s 62(1) of the Evidence Act	Singapore
s 32(1) of the Evidence Act	Singapore
s 73B of the Conveyancing and Law of Property Act 1886 (Cap 61, 1994 Rev Ed)	Singapore
s 98 of the Act	Singapore
Insolvency, Restructuring and Dissolution Act 2018	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Bankruptcy
Trustees in bankruptcy
Fraudulent conveyance
Transaction at an undervalue
Unfair preference
Insolvency
Sham agreement
Shadow director
Nominee
POA
SLA
SAMP

15.2 Keywords

Insolvency
Bankruptcy
Fraudulent Conveyance
Transactions at Undervalue
Unfair Preference
Singapore
High Court

17. Areas of Law

Area Name	Relevance Score
Insolvency Law	95
Transactions at an undervalue	90
Administration of Insolvent Estates	90
Avoidance of transfer	85
Unfair preferences	80
Company Law	30
Contract Law	20
Corporate Law	20
Property Law	15
Evidence	10

16. Subjects

Insolvency
Bankruptcy
Fraudulent Conveyance
Transactions at Undervalue
Unfair Preference