Envy Asset Management v Lau Lee Sheng: Striking Out Pleadings & Amendment Application
The liquidators of Envy Asset Management Pte Ltd, Envy Management Holdings Pte Ltd, and Envy Global Trading Pte Ltd brought an action against Lau Lee Sheng, Teo Wei Wen, Benjamin, Shen Xuhuai, Koh Hong Jie (Xu Hongjie), Edmund Chan Pak Kum, Guo Yujia, Ang Wen Min, Daniel, and Chua Wei Jian, Jordan, former employees of the Envy Companies, to recover certain sums that were paid to the defendants in connection with a non-existent nickel trading scheme. Lau Lee Sheng and Teo Wei Wen, Benjamin filed counterclaims. The first and second defendants appealed against the decision to refuse their application for the striking out of the claimants’ claim against them for certain amounts. The High Court dismissed the appeal, finding that the claimants had shown a reasonable cause of action.
1. Case Overview
1.1 Court
General Division of the High Court1.2 Outcome
Appeal dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding striking out claim for Overwithdrawn Sums. The court dismissed the appeal, finding the claim had a reasonable cause of action.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Envy Asset Management Pte Ltd (in liquidation) | Claimant, Defendant in Counterclaim | Corporation | Appeal dismissed | Lost | |
| Bob Yap Cheng Ghee | Claimant, Defendant in Counterclaim | Individual | Appeal dismissed | Lost | |
| Tay Puay Cheng | Claimant, Defendant in Counterclaim | Individual | Appeal dismissed | Lost | |
| Toh Ai Ling | Claimant, Defendant in Counterclaim | Individual | Appeal dismissed | Lost | |
| Envy Management Holdings Pte Ltd (in liquidation) | Claimant, Defendant in Counterclaim | Corporation | Appeal dismissed | Lost | |
| Envy Global Trading Pte Ltd (in liquidation) | Claimant, Defendant in Counterclaim | Corporation | Appeal dismissed | Lost | |
| Lau Lee Sheng | Defendant, Claimant in Counterclaim, Appellant | Individual | Appeal dismissed | Lost | |
| Teo Wei Wen, Benjamin | Defendant, Claimant in Counterclaim, Appellant | Individual | Appeal dismissed | Lost | |
| Shen Xuhuai | Defendant | Individual | Neutral | Neutral | |
| Koh Hong Jie (Xu Hongjie) | Defendant, Claimant in Counterclaim | Individual | Neutral | Neutral | |
| Edmund Chan Pak Kum | Defendant | Individual | Neutral | Neutral | |
| Guo Yujia | Defendant, Claimant in Counterclaim | Individual | Neutral | Neutral | |
| Ang Wen Min, Daniel | Defendant | Individual | Neutral | Neutral | |
| Chua Wei Jian, Jordan | Defendant | Individual | Neutral | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Goh Yihan | Judge | Yes |
4. Counsels
4. Facts
- Envy Asset Management Pte Ltd (EAM) purported to be in the business of nickel trading from early 2016 to early 2020.
- Investors invested in EAM’s purported nickel trading by entering into Letters of Agreement (LOAs) with EAM.
- EAM’s purported nickel trading was non-existent.
- Profits were paid out to earlier investors from the invested funds of subsequent investors.
- The liquidators of the Envy Companies brought an action to recover certain sums that were paid to the defendants.
- The Overwithdrawn Sums represent the fictitious profits from the non-existent nickel trading that were paid out to the relevant defendants.
- The claimants have applied a “running account” approach to compute the quantum of the Overwithdrawn Sums.
5. Formal Citations
- Envy Asset Management Pte Ltd (in liquidation) and others v Lau Lee Sheng and others, Originating Claim No 193 of 2022 (Registrar’s Appeal No 243 of 2023), [2024] SGHC 38
6. Timeline
| Date | Event |
|---|---|
| Envy Asset Management Pte Ltd purported to be in the business of nickel trading | |
| Envy Asset Management Pte Ltd ceased nickel trading | |
| Originating Claim No 193 of 2022 filed | |
| Registrar’s Appeal No 243 of 2023 filed | |
| 8th Affidavit of Bob Yap Cheng Ghee in HC/SUM 2893/2023 filed | |
| 1st and 2nd Defendants’ Written Submissions in HC/SUM 2893/2023 filed | |
| 3rd Affidavit of Lau Lee Sheng in HC/OC 193/2022 filed | |
| 3rd Affidavit of Teo Wei Wen, Benjamin in HC/OC 193/2022 filed | |
| 1st and 2nd Defendants’ Written Submissions in HC/RA 243/2023 filed | |
| Claimants’ Written Submissions in HC/RA 243 filed | |
| Judgment reserved | |
| Judgment delivered |
7. Legal Issues
- Striking out of pleadings
- Outcome: The court dismissed the appeal to strike out the pleadings.
- Category: Procedural
- Amendment of pleadings
- Outcome: The court did not allow the prayer for the pleadings to be amended.
- Category: Procedural
8. Remedies Sought
- Recovery of Overwithdrawn Sums
9. Cause of Actions
- Transactions defrauding creditors
- Transactions at an undervalue
- Unfair preferences
- Unjust enrichment
10. Practice Areas
- Litigation
11. Industries
- Finance
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Leong Quee Ching Karen v Lim Soon Huat and others | High Court | Yes | [2023] 4 SLR 1133 | Singapore | Cited for general observations on the law on striking out. |
| Wing Joo Loong Ginseng Hong (Singapore) Co Pte Ltd v Qinghai Xinyuan Foreign Trade Co Ltd and another and another appeal | Court of Appeal | Yes | [2009] 2 SLR(R) 814 | Singapore | Cited for the principle that the power to strike out is very sparingly exercised. |
| Ko Teck Siang v Low Fong Mei | Court of Appeal | Yes | [1992] 1 SLR(R) 22 | Singapore | Endorsed the English Court of Appeal case of Wenlock v Moloney on striking out. |
| Wenlock v Moloney | English Court of Appeal | Yes | [1965] 1 WLR 1238 | England and Wales | Cited for the principle that the power to strike out is very sparingly exercised. |
| Koh Kim Teck v Credit Suisse AG, Singapore Branch | High Court | Yes | [2015] SGHC 52 | Singapore | Cited for the principle that the applicant in a striking out application bears the burden of proving that the claim is obviously unsustainable. |
| Bank of China Ltd, Singapore Branch v BP Singapore Pte Ltd and others | High Court | Yes | [2021] 5 SLR 738 | Singapore | Cited for the principle that the applicant in a striking out application bears the burden of proving that the claim is obviously unsustainable. |
| Gabriel Peter & Partners (suing as a firm) v Wee Chong Jin and others | Court of Appeal | Yes | [1997] 3 SLR(R) 649 | Singapore | Cited for the guiding principle in determining what constitutes a reasonable cause of action. |
| Iskandar bin Rahmat and others v Attorney-General and another | Court of Appeal | Yes | [2022] 2 SLR 1018 | Singapore | Cited for the test under O 9 r 16(1)(a) and considerations of public policy and the interests of justice. |
| Tan Eng Khiam v Ultra Realty Pte Ltd | High Court | Yes | [1991] 1 SLR(R) 844 | Singapore | Cited for the principle that a court will presume the pleaded facts to be true in favour of the claimant. |
| Kim Hok Yung and others v Cooperatieve Centrale Raiffeisen-Boerenleenbank BA (trading as Rabobank) (Lee Mon Sun, third party) | High Court | Yes | [2000] 2 SLR(R) 455 | Singapore | Cited for the principle that there would be an abuse of process if a claimant knowingly pursues a case that is doomed to fail. |
| Asian Eco Technology Pte Ltd v Deng Yiming | High Court | Yes | [2023] SGHC 260 | Singapore | Cited for the observation that the grounds of abuse of process and interests of justice under O 9 r 16 of the ROC 2021 should not be construed too widely. |
| Peloso, Matthew v Vikash Kumar and another | High Court | Yes | [2023] SGHC 308 | Singapore | Cited regarding affidavit evidence. |
| Ching Mun Fong (executrix of the extate of Tan Geok Tee, deceased) v Liu Cho Chit and another appeal | Court of Appeal | Yes | [2000] 1 SLR(R) 53 | Singapore | Cited for the court’s approach to an application to strike out the statement of claim. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court 2021 |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Conveyancing and Law of Property Act (Cap 61, 1994 Rev Ed) | Singapore |
| Insolvency, Restructuring and Dissolution Act 2018 (2020 Rev Ed) | Singapore |
| Misrepresentation Act (Cap 390, 1994 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Nickel trading
- Letters of Agreement
- Overwithdrawn Sums
- Internal Transfers
- Running account
- Liquidation
15.2 Keywords
- Striking out
- Pleadings
- Amendment
- Nickel trading
- Liquidation
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Striking out | 90 |
| Judicial Management | 85 |
| Winding Up | 80 |
| Bankruptcy | 75 |
| Restructuring and Dissolution | 70 |
| Company Law | 60 |
| Civil Procedure | 50 |
16. Subjects
- Civil Procedure
- Insolvency Law