Budhrani v INTL FCStone: Breach of Contract, Misrepresentation, and Margin Calls in Silver Futures Trading

In a suit before the General Division of the High Court of Singapore, Rajesh Harichandra Budhrani sued INTL FCStone Pte Ltd, Chandrawati Alie, and Song Oi Lan for breach of contract, misrepresentation, duress and undue influence, arising from a margin call made in March 2020 amidst a falling silver futures market. INTL FCStone counterclaimed for US$198,222.60 due to Mr. Budhrani's breach of contract. The court, presided over by See Kee Oon JAD, dismissed Mr. Budhrani's claims, finding no evidence of undue influence, duress, misrepresentation, or breach of contract by the defendants, and granted judgment for INTL FCStone on its counterclaim.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Plaintiff's claim dismissed; Judgment for the First Defendant on its counterclaim.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Rajesh Budhrani's claim against INTL FCStone for breach of contract and misrepresentation over margin calls was dismissed. The court found no wrongdoing by INTL FCStone.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Rajesh Harichandra BudhraniPlaintiff, Defendant in counterclaimIndividualClaim DismissedLost
INTL FCStone Pte LtdDefendant, Plaintiff in counterclaimCorporationCounterclaim AllowedWon
Chandrawati AlieDefendantIndividualClaim DismissedWon
Song Oi LanDefendantIndividualClaim DismissedWon

3. Judges

Judge NameTitleDelivered Judgment
See Kee OonJudge of the High CourtYes

4. Counsels

Counsel NameOrganization
Gabriel PeterGabriel Law Corporation
Manoj NandwaniGabriel Law Corporation
Sameer MelberGabriel Law Corporation
Disa SimRajah & Tann Singapore LLP
Torsten CheongRajah & Tann Singapore LLP
Jodi SiahRajah & Tann Singapore LLP

4. Facts

  1. Mr. Budhrani was a client of UOBBF since 2007, trading in silver futures contracts.
  2. The Agreements with UOBBF were novated to INTL FCStone on 7 October 2019.
  3. INTL FCStone made a margin call on Mr. Budhrani in March 2020 amidst a falling silver futures market.
  4. Mr. Budhrani held 88 lots of silver futures prior to 13 March 2020.
  5. INTL FCStone's policy allowed it to liquidate a client's open positions when the margin ratio fell below 20%.
  6. Mr. Budhrani sold his silver futures contracts on 16 March 2020 after conversations with INTL FCStone employees.
  7. INTL FCStone counterclaimed for US$198,222.60 due to Mr. Budhrani's breach of contract.

5. Formal Citations

  1. Rajesh Harichandra Budhrani v INTL FCStone Pte Ltd, Suit No 295 of 2020, [2024] SGHC 18

6. Timeline

DateEvent
Mr. Budhrani became a client of UOB Bullion and Futures Limited
Mr. Budhrani entered into a Client Agreement with UOBBF
Agreements with UOBBF were novated to INTL FCStone Pte Ltd
Mr. Budhrani spoke to an employee of INTL FCStone about a possible margin call
INTL FCStone sent Mr. Budhrani two daily statements by email indicating a margin call for US$398,527.60
INTL FCStone sent Mr. Budhrani an email regarding the margin call
Mr. Budhrani sold his silver futures contracts
Mr. Budhrani commenced this claim
INTL FCStone changed its name to StoneX Financial Pte Ltd
Hearing commenced
Hearing continued
Hearing concluded
Judgment reserved

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found no breach of contract by the defendants.
    • Category: Substantive
    • Sub-Issues:
      • Contractual terms
      • Exclusion clauses
      • Formation
  2. Misrepresentation
    • Outcome: The court found no misrepresentation by the defendants.
    • Category: Substantive
    • Sub-Issues:
      • Fraud and deceit
      • Negligent misrepresentation
  3. Duress
    • Outcome: The court found no duress exerted by the defendants.
    • Category: Substantive
  4. Undue Influence
    • Outcome: The court found no undue influence exerted by the defendants.
    • Category: Substantive

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Breach of Contract
  • Misrepresentation
  • Duress
  • Undue Influence

10. Practice Areas

  • Commercial Litigation
  • Contract Disputes
  • Financial Services Law

11. Industries

  • Financial Services

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Lam Chi Kin David v Deutsche Bank AGHigh CourtYes[2011] 1 SLR 800SingaporeCited to argue that a margin call had to take the form of a letter intended to be a margin call, rather than a notification.
BOM v BOKCourt of AppealYes[2019] 1 SLR 349SingaporeCited for the elements required to prove actual undue influence.
Rajabali Jumabhoy and others v Ameerali R Jumabhoy and othersCourt of AppealYes[1997] 2 SLR(R) 296SingaporeCited to support the argument that Mr. Budhrani was a mature man able to weigh the consequences of his actions.
Ahmad Ebrahim s/o S M E Mohamed Sadik v Ilangchizian ManogaranHigh CourtYes[2019] SGHC 167SingaporeCited to support the argument that the defendants did not have the capacity to influence Mr. Budhrani.
Tjong Very Sumito and others v Chan Sing En and othersCourt of AppealYes[2012] 3 SLR 953SingaporeCited for the elements required to show that he acted under duress.
Pao On v Lau Yiu LongPrivy CouncilYes[1980] AC 614England and WalesCited for the effect of duress.
Forde v Birmingham City CouncilCourt of AppealYes[2009] 1 WLR 2732England and WalesCited for the effect of undue influence.
Britestone Pte Ltd v Smith & Associates Far East LtdCourt of AppealYes[2007] 4 SLR(R) 855SingaporeCited for the evidential burden of proving his case.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Unfair Contract Terms Act (Cap 396, 1994 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Margin call
  • Silver futures
  • Margin trading account
  • Initial margin
  • Maintenance margin
  • Margin ratio
  • Equity deficit
  • 20% Policy
  • Execution Only Contract
  • Novation Deed

15.2 Keywords

  • Contract
  • Breach
  • Misrepresentation
  • Margin call
  • Silver futures
  • Singapore
  • INTL FCStone
  • Budhrani

17. Areas of Law

Area NameRelevance Score
Contract Law90
Misrepresentation70
Duress65
Undue Influence65
Fraud and Deceit60
Negligence50
Litigation40
Civil Practice40
Civil Litigation40
Banking and Finance30
Banking Litigation30
Banking Law30

16. Subjects

  • Contract Law
  • Financial Markets
  • Civil Litigation