Syed Ibrahim v Wavoo Abdusalam: Statutory Derivative Action & Cross-Examination
In Syed Ibrahim Shaik Mohideen v Wavoo Abdusalam Shahul Hameed and others, the General Division of the High Court of Singapore heard an application by the first and second defendants for leave to cross-examine the plaintiff on his affidavits filed in support of his application for leave to commence a statutory derivative action against the first and second defendants in the name of the third defendant, Suvai Foods Pte Ltd. The plaintiff's application was premised on the first and second defendants’ alleged breaches of fiduciary duties in their capacities as directors. Goh Yihan JC dismissed the application with costs, holding that cross-examination should only be allowed in the exceptional case.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Application dismissed with costs.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Application for leave to cross-examine the plaintiff in a statutory derivative action. The court dismissed the application, emphasizing the high threshold for cross-examination.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Syed Ibrahim Shaik Mohideen | Plaintiff | Individual | Application to cross-examine plaintiff denied | Lost | |
| Wavoo Abdusalam Shahul Hameed | Defendant | Individual | Application for leave to cross-examine denied | Lost | |
| Abdul Latiff Hajara Marliya | Defendant | Individual | Application for leave to cross-examine denied | Lost | |
| Suvai Foods Pte Ltd | Defendant | Corporation | Unrepresented and absent | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Goh Yihan | Judicial Commissioner | Yes |
4. Counsels
4. Facts
- The plaintiff sought leave to commence a statutory derivative action against the first and second defendants.
- The plaintiff alleged breaches of fiduciary duties by the first and second defendants as directors of the third defendant.
- The applicants sought to cross-examine the plaintiff on his affidavits filed in support of his application.
- The court dismissed the application for cross-examination, finding it unnecessary and potentially oppressive.
- The plaintiff was a co-founder and majority shareholder of the Company.
- The first defendant was a co-founder and minority shareholder of the Company.
- The second defendant was a director and minority shareholder of the Company.
5. Formal Citations
- Syed Ibrahim Shaik Mohideen v Wavoo Abdusalam Shahul Hameed and others, Originating Summons No 779 of 2021 (Summons No 2371 of 2022), [2022] SGHC 228
6. Timeline
| Date | Event |
|---|---|
| Company incorporated in Singapore | |
| Second defendant appointed as a director of the Company | |
| Plaintiff became a majority shareholder of the Company | |
| First defendant became a minority shareholder of the Company | |
| Plaintiff removed as director of the Company | |
| Company diverted revenue to a new bank account | |
| Lawsuit filed | |
| Applicants informed the plaintiff of their intention to cross-examine him | |
| Hearing before the court | |
| Judgment issued |
7. Legal Issues
- Leave to cross-examine in statutory derivative action
- Outcome: The court held that it is exceedingly difficult for a court to order cross-examination in an application for leave to commence a statutory derivative action.
- Category: Procedural
- Related Cases:
- [2022] SGHC 187
- [1995] 1 SLR(R) 730
- [2002] 1 SLR(R) 471
- Breach of Fiduciary Duties
- Outcome: The court did not make a determination on the breach of fiduciary duties, as the case concerned an application for leave to cross-examine.
- Category: Substantive
8. Remedies Sought
- Leave to commence a statutory derivative action
9. Cause of Actions
- Breach of Fiduciary Duty
- Statutory Derivative Action
10. Practice Areas
- Commercial Litigation
- Corporate Law
11. Industries
- Food Manufacturing
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Tan Chun Chuen Malcolm v Beach Hotel Pte Ltd and another | High Court | Yes | [2022] SGHC 187 | Singapore | Cited for the requirements for an application for leave under s 216A of the Companies Act, specifically the notice, good faith, and interest requirements. |
| Tan Sock Hian v Eng Liat Kiang | High Court | Yes | [1995] 1 SLR(R) 730 | Singapore | Cited for the principle that an order for cross-examination should not be lightly granted in relation to an interlocutory matter as it would in effect allow the parties to have a rehearsal before trial. |
| Punton and another v Ministry of Pensions and National Insurance | English Court of Appeal | Yes | [1963] 1 WLR 186 | England and Wales | Cited for the principle that the originating summons process is to provide a convenient and speedy avenue for litigants to obtain a declaration of their respective rights from the court. |
| Woon Brothers Investments Pte Ltd v Management Corporation Strata Title Plan No 461 and others | Court of Appeal | Yes | [2011] 4 SLR 777 | Singapore | Cited for the principle that where there are substantial factual disputes which will render the originating summons a writ all but in name, it should be converted to a writ. |
| Jiangsu Overseas Group Co Ltd v Concord Energy Pte Ltd and another matter | High Court | Yes | [2016] 4 SLR 1336 | Singapore | Cited for the principle that there must be good reasons beyond the existence of factual disputes to allow oral evidence and cross-examination in an originating summons. |
| AQZ v ARA | High Court | Yes | [2015] 2 SLR 972 | Singapore | Cited for the principle that the existence of substantial disputes of fact as to whether a party had entered into the relevant arbitration agreement is not by itself a sufficient reason to allow oral evidence or cross-examination. |
| Ang Thiam Swee v Low Hian Chor | Court of Appeal | Yes | [2013] 2 SLR 340 | Singapore | Cited for the principle that to satisfy the requirement in s 216A(3)(c) of the Companies Act, the applicant must cross the threshold of convincing the court that the company’s claim would be legitimate and arguable. |
| Yeo Sing San v Sanmugam Murali and another | High Court | Yes | [2016] SGHC 14 | Singapore | Cited for the principle that the application for leave is only to provide a form of filtering, and it is clear that such filtering can only be at a broad level at this stage. |
| Urs Meisterhans v GIP Pte Ltd | High Court | Yes | [2011] 1 SLR 552 | Singapore | Cited for the principle that there is no need at the application for leave stage to show that the intended action will or is likely to succeed but what needs to be shown instead is that the claim is legitimate and arguable. |
| Agus Irawan v Toh Teck Chye and others | High Court | Yes | [2002] 1 SLR(R) 471 | Singapore | Cited for the principle that at the leave application stage, the court need not and ought not be drawn into an adjudication on the disputed facts and that leave to cross-examine in such situations ought to be sparingly granted. |
| Pang Yong Hock and another v PKS Contracts Services Pte Ltd | Court of Appeal | Yes | [2004] 3 SLR(R) 1 | Singapore | Cited for approving the explanation of the law in Agus Irawan. |
| Ma Wai Fong Kathryn v Trillion Investment Pte Ltd and others | High Court | Yes | [2020] 5 SLR 1374 | Singapore | Cited by the applicants for support that the test for cross-examination is one of necessity, but the court disagreed with this interpretation. |
| Petroships Investment Pte Ltd v Wealthplus Pte Ltd and others | High Court | Yes | [2015] SGHC 145 | Singapore | Cited as the only local case the parties could find that had allowed cross-examination, but the court found the case to be of limited assistance in shedding light on when cross-examination should be ordered in the present context. |
| Swansson v R A Pratt Properties Pty Ltd and another | Supreme Court of New South Wales | Yes | [2002] 42 ACSR 313 | Australia | Cited for the principle that cross-examination on the merits of any proposed derivative action will usually be permitted only with leave of the court and only to a limited extent. |
13. Applicable Rules
| Rule Name |
|---|
| O 38 r 2(2) of the Rules of Court (2014 Rev Ed) |
| O 28 r 4(3) of the Rules of Court (2014 Rev Ed) |
| O 15 rr 7(5) and 7(6) of the Rules of Court 2021 |
| O 3 r 1 of the Rules of Court 2021 |
| O 88 r 2(1) of the Rules of Court |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
| s 216A of the Companies Act | Singapore |
| Companies Act 2006 (c 46) (UK) | United Kingdom |
| s 260 of the Companies Act 2006 (c 46) (UK) | United Kingdom |
| Corporations Act 2001 (Cth) | Australia |
| s 237(1) of the Corporations Act 2001 (Cth) | Australia |
15. Key Terms and Keywords
15.1 Key Terms
- Statutory derivative action
- Cross-examination
- Leave application
- Fiduciary duty
- Originating summons
- Companies Act
- Prima facie case
- Material disputes of fact
15.2 Keywords
- Statutory derivative action
- Cross-examination
- Companies Act
- Fiduciary duty
- Singapore
- Civil procedure
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Statutory derivative action | 80 |
| Company Law | 75 |
| Fiduciary Duties | 70 |
| Civil Procedure | 50 |
| Contract Law | 30 |
16. Subjects
- Civil Procedure
- Companies Law
- Cross-examination
- Statutory Derivative Action