Alternative Advisors Investments v Asidokona Mining: Loan Recovery & Guarantee Dispute
In Suit No 734 of 2018, the High Court of Singapore ruled in favor of the plaintiffs, Alternative Advisors Investments Pte Ltd (AAI) and Supreme Star Investments Ltd (SSI), against the defendants, Asidokona Mining Resources Pte Ltd (Asidokona) and Soh Sai Kiang (Mr. Soh), for the recovery of an outstanding loan. AAI claimed the outstanding sum and interest due from the defendants pursuant to a S$2 million loan granted to Asidokona and personally guaranteed by Mr. Soh. The court granted judgment in favour of the plaintiff, dismissing the defendants' defenses, including allegations of illegal moneylending and champerty.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court grants judgment to Alternative Advisors Investments for a loan default, dismissing defenses of illegality and champerty.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Alternative Advisors Investments Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff | Won | |
| Asidokona Mining Resources Pte Ltd | Defendant | Corporation | Judgment against Defendant | Lost | |
| Soh Sai Kiang | Defendant | Individual | Judgment against Defendant | Lost | |
| Supreme Star Investments Ltd | Plaintiff | Corporation | Neutral | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Hoo Sheau Peng | Judge | Yes |
4. Counsels
4. Facts
- SSI extended a S$2m loan to Asidokona in 2016, guaranteed by Mr. Soh.
- In 2018, SSI assigned the loan to AAI.
- The defendants received the loan amount but failed to make full repayments.
- The loan agreement stipulated a 5% monthly interest rate.
- The loan was secured by Mr. Soh's personal guarantee and a charge on Asidokona's shares.
- Asidokona made various interest payments totaling S$900,000.
- AAI claimed the outstanding principal, interest, and default interest.
5. Formal Citations
- Alternative Advisors Investments Pte Ltd and another v Asidokona Mining Resources Pte Ltd and another, Suit No 734 of 2018, [2022] SGHC 41
6. Timeline
| Date | Event |
|---|---|
| Mr. Soh contacted Mr. Wong to arrange a S$2m loan to Asidokona. | |
| Mr. Soh confirmed that he would proceed with the loan. | |
| Mr. Ong sent an email to Mr. Soh regarding draft loan documentation. | |
| Mr. Soh replied to Mr. Ong's email highlighting that the draft loan agreement was not attached. | |
| Mr. Soh decided to sign off on 22 July 2016. | |
| Mr. Soh attended JLC Advisors’ office to sign the loan documents. | |
| The S$2m loan was fully disbursed by DBS cheques to Asidokona. | |
| Initial Term of the loan expired. | |
| Mr. Soh confirmed that he would renew the Loan Agreement on a month to month basis. | |
| Asidokona failed to redeem the loan and SSI issued a statutory demand to Mr. Soh. | |
| Mr. Ong expressed SSI’s disappointment with the empty promises made by the defendants. | |
| All rights under the Loan Agreement and the Personal Guarantee were assigned from SSI to AAI. | |
| This action was filed by AAI. | |
| Notice of First Deed of Assignment was given to Asidokona and Mr. Soh. | |
| The Deed of Charge was assigned from SSI to AAI. | |
| Notice of Second Deed of Assignment was given. | |
| There was one round of amendments to the Statement of Claim. | |
| SSI was struck off the BVI Register of Companies. | |
| SSI was restored to the BVI Register of Companies. | |
| Judgment reserved. |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that Asidokona breached the Loan Agreement by failing to repay the loan and interest in full.
- Category: Substantive
- Validity of Assignment
- Outcome: The court held that the Deeds of Assignments were valid and did not contravene s 5A(2) of the CLA on the basis that they savour maintenance and champerty.
- Category: Substantive
- Enforceability of Interest Clauses
- Outcome: The court found that the interest clauses under the Loan Agreement were enforceable and did not amount to penalty clauses in law.
- Category: Substantive
- Illegal Moneylending
- Outcome: The court rejected the defendants' argument that the loan was an illegal moneylending transaction under the MLA.
- Category: Substantive
- Locus Standi
- Outcome: The court found that AAI, as the equitable assignee, could proceed with the action against Asidokona and Mr Soh even when SSI, the equitable assignor, was no longer a party to the action.
- Category: Procedural
- Validity of Ratification
- Outcome: The court found that the Ratification was valid in the circumstances so as to cure any lack of authority on the part of Mr Wong and or Mr Ong.
- Category: Substantive
- Illegality
- Outcome: The court rejected the Illegality Defence.
- Category: Substantive
8. Remedies Sought
- Monetary Damages
- Delivery of Share Certificates
- Delivery of Share Transfer Forms
9. Cause of Actions
- Breach of Contract
- Breach of Guarantee
10. Practice Areas
- Commercial Litigation
- Banking Law
11. Industries
- Mining
- Financial Services
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Ma Hongjin v SCP Holdings Pte Ltd | Court of Appeal | Yes | [2021] 1 SLR 304 | Singapore | Cited for the principle that the evidential burden can shift as the civil trial progresses. |
| Lena Leowardi v Yeap Cheen Soo | Court of Appeal | Yes | [2015] 1 SLR 581 | Singapore | Cited for the principle that a submission of “no case to answer” will only succeed if the evidence led by the plaintiff, at face value, does not establish a case in law or is so unsatisfactory or unreliable that the plaintiff has not discharged its burden of proof. |
| Parkway Hospitals Singapore Pte Ltd (trading as Mount Elizabeth Hospital) and another v Sandar Aung | High Court | No | [2007] 1 SLR(R) 227 | Singapore | Cited for the principle that an assignee cannot sue in his own name and the assignor must be made a co-plaintiff. |
| Cooperatieve Centrale Raiffeisen-Boerenleenbank BA (trading as Rabobank International), Singapore Branch v Motorola Electronics Pte Ltd | High Court | No | [2010] 3 SLR 48 | Singapore | Cited for the principle that the procedural bar is still in place in Singapore. |
| Yongnam Development Pte Ltd v Springleaves Tower Ltd and anor | High Court | No | [2004] 1 SLR(R) 348 | Singapore | Cited for the principle that the court has a discretion to dispense with the procedural requirement that assignor be joined as party to a claim by an assignee. |
| Performing Right Society Ltd v London Theatre of Varieties Ltd | House of Lords | Yes | [1924] AC 1 | United Kingdom | Cited for the principle that the defendants should not be allowed to succeed on the Locus Standi Defence and thereby escape any liability entirely. |
| Cavenagh Investment Pte Ltd v Kaushik Rajiv | High Court | Yes | [2013] 2 SLR 543 | Singapore | Cited for the principle that ratification is akin to an assent by the principal to the transaction entered into by the unauthorised agent by adopting the agent’s otherwise unauthorised acts. |
| Sheagar s/o T M Veloo v Belfield International (Hong Kong) Ltd | Court of Appeal | Yes | [2014] 3 SLR 524 | Singapore | Cited for the framework in relation to s 14(2) of the Moneylenders Act 2008 (Act 31 of 2008) (which is in pari materia with s 19(3) of the MLA). |
| E C Investment Holding Pte Ltd v Ridout Residence Pte Ltd and another (Orion Oil Ltd and another, interveners) | High Court | No | [2011] 2 SLR 232 | Singapore | Cited for the two tests to determine if a person is carrying on the business of moneylending. |
| Lim Lie Hoa and another v Ong Jane Rebecca | Court of Appeal | Yes | [1997] 1 SLR(R) 775 | Singapore | Cited for the principles as redefined and stated in the classic case of Trendtex Trading Corporation and another v Credit Suisse [1982] AC 679 regarding maintenance and champerty. |
| Trendtex Trading Corporation and another v Credit Suisse | House of Lords | Yes | [1982] AC 679 | United Kingdom | Cited for the principles regarding maintenance and champerty. |
| Leiman, Ricardo and another v Noble Resources Ltd and another | Court of Appeal | Yes | [2020] 2 SLR 386 | Singapore | Cited for the principle that the rule against contractual penalties applies only to secondary obligations and not primary obligations. |
| CLAAS Medical Centre Pte Ltd v Ng Boon Ching | High Court | Yes | [2010] 2 SLR 386 | Singapore | Cited for the principle that where parties stipulate in a contract the sum to be paid in the event of a breach, it is for the party being sued on the agreed sum to show that the term is a penalty. |
| Dunlop Pneumatic Tyre Co, Ltd v New Garage and Motor Co, Ltd | House of Lords | Yes | [1915] AC 79 | United Kingdom | Cited for the test for penalty clauses is whether the sum stipulated for is extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach. |
| Denka Advantech Pte Ltd and another v Seraya Energy Pte Ltd and another and other appeals | Court of Appeal | Yes | [2021] 1 SLR 631 | Singapore | Cited for the test for penalty clauses is whether the sum stipulated for is extravagant and unconscionable in amount in comparison with the greatest loss that could conceivably be proved to have followed from the breach. |
| Abani Trading Pte Ltd v BNP Paribas and another appeal | Court of Appeal | Yes | [2014] 3 SLR 909 | Singapore | Cited for the principle that the court must have the power to override the parties’ agreement as to costs in order to preserve the integrity of the administration of justice. |
| Total English Learning Global Pte Ltd and another v Kids Counsel Pte Ltd and another suit | High Court | No | [2014] SGHC 258 | Singapore | Cited to show that an equitable assignment would generally require the assignee to join the assignor to the action. |
| Alternative Advisors Investments Pte Ltd and another v Asidokona Mining Resources Pte Ltd and another | High Court | No | [2020] SGHC 125 | Singapore | Cited to show that Mr Wong’s affidavits “expressly state that they were made on behalf of both plaintiffs and confirm that both plaintiffs do not have in their possession, custody or power the documents which the defendants seek”. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Civil Law Act 1909 | Singapore |
| Moneylenders Act 2008 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Loan Agreement
- Personal Guarantee
- Deed of Charge
- Assignment
- Default Interest
- Ratification
- Equitable Assignee
- Excluded Moneylender
15.2 Keywords
- loan
- guarantee
- assignment
- moneylending
- contract
- default
- interest
- Singapore
- High Court
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Assignment Law | 85 |
| Contract Law | 80 |
| Breach of Contract | 75 |
| Guarantee | 70 |
| Damages | 65 |
| Illegality and public policy | 60 |
| Liquidated Damages | 55 |
| Banking and Finance | 50 |
| Banking Law | 40 |
| Commercial Disputes | 30 |
16. Subjects
- Contract Law
- Banking Law
- Commercial Litigation
- Assignment
- Moneylending