Lim Chang Huat v Stronghold Global Holdings: Breach of Contract and Admissibility of Hearsay Evidence

In Lim Chang Huat v Stronghold Global Holdings Limited, the Court of Appeal of Singapore dismissed an appeal by Lim Chang Huat against the decision of the International Judge, which found that Lim had breached a share purchase agreement (SPA) by failing to provide requisite financial documents to Stronghold. The court upheld the Judge's decision that Stronghold was entitled to terminate the SPA due to Lim's breach of sections 5.02, 5.03, 6.02(d) and 6.02(f) of the SPA. The court also ordered Lim to return a deposit of RM5 million to Stronghold.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Ex Tempore Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding breach of share purchase agreement. Court upheld decision that Lim Chang Huat failed to provide financial documents, breaching contract.

1.7 Decision Date

12 September 2023

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Lim Chang Huat	Appellant	Individual	Appeal Dismissed	Lost	Ng Khai Lee Ivan of Infinitus Law Corporation Phyllis Wong Shi Ting of Infinitus Law Corporation Leo Cheng Suan of Infinitus Law Corporation
Stronghold Global Holdings Limited (in liquidation)	Respondent	Corporation	Appeal Dismissed	Won	Ong Boon Hwee William of Allen & Gledhill LLP Wong Pei Ting of Allen & Gledhill LLP Lim Jun Rui Ivan of Allen & Gledhill LLP Wong Ling Yun of Allen & Gledhill LLP

3. Judges

Judge Name	Title	Delivered Judgment
Steven Chong	Judge of the Court of Appeal	Yes
Belinda Ang Saw Ean	Judge of the Court of Appeal	No
Arjan Kumar Sikri	International Judge	No

4. Counsels

Counsel Name	Organization
Ng Khai Lee Ivan	Infinitus Law Corporation
Phyllis Wong Shi Ting	Infinitus Law Corporation
Leo Cheng Suan	Infinitus Law Corporation
Ong Boon Hwee William	Allen & Gledhill LLP
Wong Pei Ting	Allen & Gledhill LLP
Lim Jun Rui Ivan	Allen & Gledhill LLP
Wong Ling Yun	Allen & Gledhill LLP

4. Facts

Mr. Lim agreed to sell his shares in NEP Holdings to Stronghold under a share purchase agreement.
The SPA required Mr. Lim to provide audited financial statements and consolidated management accounts.
Stronghold claimed Mr. Lim failed to provide the requested financial documents.
The International Judge found Mr. Lim failed to fulfill requests in breach of the SPA.
Mr. Lim argued the Judge erred in failing to consider Malaysian law.
Mr. Lim contested the admissibility of the EY Note and E-mail Correspondence.
Mr. Lim argued Stronghold repudiated the SPA.
Mr. Lim disputed the order to return the deposit of RM5m.

5. Formal Citations

Lim Chang Huat v Stronghold Global Holdings Limited (in liquidation), Civil Appeal No 5 of 2023, [2023] SGCA(I) 6

6. Timeline

Date	Event
2017-06-30	Share purchase agreement signed
2017-08-01	EY Note provided to Ms. Wei of Ozner
2017-08-01	Alleged private arrangement between Mr. Lim and Mr. Xiao regarding the deposit
2017-10-10	Mr. Kong sends email to Ms. Wei with attachments
2017-10-31	Mr. Kong sends email to EY
2017-12-28	Meeting between Mr. Xiao and Mr. Lim
2017-12-28	EY sends email to Mr. Kong and Mr. Sun regarding outstanding documents
2017-12-29	Advancement Plan sent to Mr. Lim
2018-09-30	Termination Notice issued by Stronghold
2020-06-12	Case Management Conference
2023-09-13	Judgment delivered

7. Legal Issues

Breach of Contract
- Outcome: The court held that Mr. Lim breached the share purchase agreement by failing to provide the requisite financial documents.
- Category: Substantive
- Sub-Issues:
  - Failure to provide financial documents
  - Failure to provide audited financial statements
  - Failure to provide consolidated management accounts
Admissibility of Evidence
- Outcome: The court held that the EY Note and the E-mail Correspondence were admissible under s 32(1)(b) of the Evidence Act.
- Category: Procedural
- Sub-Issues:
  - Admissibility of hearsay evidence
  - Admissibility of business records

8. Remedies Sought

Termination of contract
Return of deposit

9. Cause of Actions

Breach of Contract

10. Practice Areas

Commercial Litigation

11. Industries

Financial Services

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
EFT Holdings, Inc and another v Marinteknik Shipbuilders (S) Pte Ltd and another	Singapore High Court	Yes	[2014] 1 SLR 860	Singapore	Cited for the principle that Singapore law applies if parties do not prove foreign law.
Berjaya Times Squares Sdn Bhd (formerly known as Berjaya Ditan Sdn Bhd) v M Concept Sdn Bhd	Federal Court of Malaysia	Yes	[2010] 1 MLJ 597	Malaysia	Cited regarding rescission of contract and failure of consideration, but distinguished as Stronghold sought return of moneys based on contractual rights, not common law rescission.
Hock Huat Iron Foundry (suing as a firm) v Naga Tembaga Sdn Bhd	Malaysian High Court	Yes	[1999] 1 MLJ 65	Malaysia	Cited regarding reasonable time to remedy default, but found irrelevant as the provision of financial information was to take place prior to the end date.
iVenture Card Limited and others v Big Bus Singapore City Sightseeing Pte Ltd and others	Singapore Court of Appeal	Yes	[2022] 1 SLR 302	Singapore	Cited for the definition of repudiatory breach.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Evidence Act 1893	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Share Purchase Agreement
Due Diligence
Financial Statements
Management Accounts
Repudiation
Deposit
Termination Notice

15.2 Keywords

breach of contract
share purchase agreement
admissibility of evidence
hearsay
financial documents

17. Areas of Law

Area Name	Relevance Score
Breach of Contract	75
Evidence	65
Share Purchase Agreement	60
Contract Law	60
Due Diligence	55
Commercial Disputes	50
Termination of Agreement	45
Admissibility of evidence	40
Foreign Law	35
Arbitration	30
Company Law	25
Bankruptcy	15

16. Subjects

Contract Law
Evidence Law
Commercial Law