Kroll v Cyberdyne Tech Exchange: Minority Oppression Claim & Pleadings
In Kroll, Daniel v Cyberdyne Tech Exchange Pte Ltd and others, the General Division of the High Court of Singapore addressed an application by the defendants, Cyberdyne Tech Exchange Pte Ltd, Wong Yoke Qieu, Gabriel, Bai Bo, and Lily Hong Yingli, for further and better particulars in a minority oppression claim brought by the plaintiff, Daniel Kroll, under s 216(1) of the Companies Act. The court, presided over by AR Perry Peh, ruled that the plaintiff must provide particulars regarding the source of legitimate expectations relied upon in the claim, but only for acts or incidents of conduct that are relied on as a ground of relief. The court allowed the application in part, specifying which requests for particulars were to be answered.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Application for further and better particulars allowed in part.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Minority oppression claim involving Cyberdyne Tech Exchange. Court addresses particulars required in pleadings under Companies Act s 216(1).
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Daniel Kroll | Plaintiff | Individual | Application for further and better particulars allowed in part | Partial | Tan Ee Hsien |
| Cyberdyne Tech Exchange Pte Ltd | Defendant | Corporation | Application for further and better particulars allowed in part | Partial | Nikhil Angappan |
| Wong Yoke Qieu, Gabriel | Defendant | Individual | Application for further and better particulars allowed in part | Partial | Raeza Ibrahim, Yap Zhan Ming, Kimberly Ng, Annette Kong |
| Bai Bo | Defendant | Individual | Application for further and better particulars allowed in part | Partial | Raeza Ibrahim, Yap Zhan Ming, Kimberly Ng, Annette Kong |
| Lily Hong Yingli | Defendant | Individual | Application for further and better particulars allowed in part | Partial | Raeza Ibrahim, Yap Zhan Ming, Kimberly Ng, Annette Kong |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Perry Peh | Assistant Registrar | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Tan Ee Hsien | WongPartnership LLP |
| Nikhil Angappan | Drew & Napier LLC |
| Raeza Ibrahim | Salem Ibrahim LLC |
| Yap Zhan Ming | Salem Ibrahim LLC |
| Kimberly Ng | Salem Ibrahim LLC |
| Annette Kong | Salem Ibrahim LLC |
4. Facts
- Kroll invested in CTX after being approached by Wong and Hong.
- Kroll purchased 81,000 shares in CTX pursuant to a Subscription Agreement dated 31 March 2019.
- Wong was a shareholder and director of CTX until 8 May 2020.
- Kroll held Wong’s CTX shares on trust for Wong under a Share Trust Agreement.
- Kroll avers that Wong and Hong pressured him to exit CTX at a low price.
- Kroll avers that Wong failed to disclose that CTX was already valued at US$200m pursuant to the Investment Agreements.
- Kroll’s shareholding was severely diluted from 7.67% to 0.67%.
5. Formal Citations
- Kroll, Daniel v Cyberdyne Tech Exchange Pte Ltd and others, Suit No 915 of 2021 (Summons No 1405 of 2023), [2023] SGHCR 11
6. Timeline
| Date | Event |
|---|---|
| Subscription Agreement signed | |
| Wong resigned as director of CTX | |
| Kroll began to develop suspicions over Wong and Hong’s conduct of CTX’s affairs | |
| CTX obtained in-principle approval from the MAS for the CML | |
| Convertible loan agreement dated | |
| Wong and Hong agreed to increase Kroll’s shareholding percentage upwards to 3.24% | |
| Convertible loan agreement dated | |
| Wong agreed to give Kroll additional shares | |
| Kroll resigned as a director of CTX | |
| Convertible loan agreement dated | |
| Deadline to meet the IPA Conditions | |
| CTX committed to repurchase all of Xiamen Anne’s shareholding in CTX | |
| Entities remitted a total of US$1.3m to CTX | |
| Entities remitted a total of US$1.3m to CTX | |
| Asia Green Fund extended an interest-free loan of US$1.2m to CTX | |
| Wong and Hong pressured Kroll to exit CTX at a low price | |
| Extraordinary general meeting of CTX | |
| Deadline for CTX to re-submit its CML application to the MAS | |
| Bai became a director of CTX | |
| Shares issued to entities controlled by Bai | |
| CTX obtained the CML | |
| Suit No 915 of 2021 filed | |
| Defendants’ request for particulars dated | |
| Date of first hearing | |
| Judgment reserved |
7. Legal Issues
- Minority Oppression
- Outcome: Court ruled that the plaintiff must provide particulars regarding the source of legitimate expectations relied upon in the claim, but only for acts or incidents of conduct that are relied on as a ground of relief.
- Category: Substantive
- Sub-Issues:
- Breach of legitimate expectations
- Commercial unfairness
- Related Cases:
- [2010] 2 SLR 776
- [2017] SGHC 196
- Pleadings
- Outcome: Court determined what constitutes 'material facts' in a minority oppression claim and whether they include the source of legitimate expectations.
- Category: Procedural
- Sub-Issues:
- Material facts
- Further and better particulars
- Related Cases:
- [2015] 5 SLR 1422
- [2017] 3 SLR 559
8. Remedies Sought
- Relief under s 216(1) of the Companies Act
9. Cause of Actions
- Minority Oppression
10. Practice Areas
- Commercial Litigation
- Corporate Law
11. Industries
- Corporate Finance
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| V Nithia (co-administratrix of the estate of Ponnusamy Sivapakiam, deceased) v Buthmanaban s/o Vaithilingam and another | High Court | Yes | [2015] 5 SLR 1422 | Singapore | Cited for the principle that pleadings should set out the allegations of fact which a party asserting has to prove to the satisfaction of the court and on which it is entitled to relief under the law. |
| EA Apartments Pte Ltd v Tan Bek | High Court | Yes | [2017] 3 SLR 559 | Singapore | Cited for the principle that a party must set out in its pleadings the “material facts”, which are facts necessary for the purpose of formulating a complete cause of action. |
| Sharikat Logistics Pte Ltd v Ong Boon Chuan and others | High Court | Yes | [2011] SGHC 196 | Singapore | Cited for the principle that “material facts” are to be distinguished from the evidence by which the pleaded facts are to be proven, which will not be an appropriate subject in a request for particulars. |
| Over & Over Ltd v Bonvests Holdings Ltd and another | Court of Appeal | Yes | [2010] 2 SLR 776 | Singapore | Cited for the principle that Section 216(1) of the Companies Act provides for four alternative but non-disjunctive situations in which relief may be invoked by a minority shareholder, the common thread of which is the existence of unfairness. |
| Thio Syn Kym Wendy and others v Thio Syn Pyn and others | High Court | Yes | [2017] SGHC 196 | Singapore | Cited for the principle that the standards of fair dealing and fair play are derived from the legitimate expectations of the minority shareholder. |
| Lim Kok Wah and others v Lim Boh Yong and others and other matters | High Court | Yes | [2015] 5 SLR 307 | Singapore | Cited for the principle that legitimate expectations arise either from the minority’s legal rights enjoyed under the instruments that regulate their intra-corporate relationship with the majority, or informal understandings or assumptions shared between the minority and the majority. |
| BWG v BWF | High Court | Yes | [2020] 1 SLR 1296 | Singapore | Cited for the principle that under the doctrine of approbation and reprobation as applied in the context of litigation, a party is precluded from adopting an inconsistent position against another party in the proceedings. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Minority oppression
- Legitimate expectations
- Material facts
- Further and better particulars
- Share dilution
- Commercial unfairness
- Companies Act
- Pleadings
- Investment Agreements
- Share Trust Agreement
15.2 Keywords
- Minority oppression
- Companies Act
- Pleadings
- Singapore
- Cyberdyne Tech Exchange
- Shareholder rights
16. Subjects
- Company Law
- Civil Procedure
- Minority Rights
17. Areas of Law
- Civil Procedure
- Company Law
- Minority Oppression