Eng Lee Ling v Maybank: Court Consent for Property Disposition Before Bankruptcy Order

Mdm Eng Lee Ling and Mr. Dong Yu applied to the High Court of Singapore for consent to sell a jointly-owned property before bankruptcy orders were made against them. The court, presided over by Aedit Abdullah J, dismissed the applications, finding that the proposed disposition did not adequately benefit the general body of creditors and demonstrated a preference towards one creditor, Maybank Singapore Limited. DBS Bank Ltd, another creditor, objected to the applications.

1. Case Overview

1.1 Court

General Division of the High Court

1.2 Outcome

Applications dismissed.

1.3 Case Type

Insolvency

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

The High Court considered applications for court consent to sell property before a bankruptcy order. The court dismissed the applications, finding a lack of benefit to creditors.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Official AssigneeRespondentGovernment AgencyNo position takenNeutral
DBS Bank LtdRespondentCorporationObjection upheldWon
Maybank Singapore LimitedRespondentCorporationNo position takenNeutral
Eng Lee LingApplicantIndividualApplication dismissedDismissed
Dong YuApplicantIndividualApplication dismissedDismissed

3. Judges

Judge NameTitleDelivered Judgment
Aedit AbdullahJudge of the High CourtYes

4. Counsels

Counsel NameOrganization
Chua Beng ChyeRajah & Tann Singapore LLP
Cherie TanRajah & Tann Singapore LLP
Foung Han PeowRajah & Tann Singapore LLP
Tris XavierYuen Law LLC

4. Facts

  1. Mdm Eng and Mr Dong jointly own a property.
  2. Bankruptcy applications were filed against Mdm Eng by Maybank and DBS.
  3. A bankruptcy application was filed against Mr Dong by DBS.
  4. Mdm Eng and Mr Dong entered into an agreement to sell the property to a third-party purchaser.
  5. The purchaser refused to complete the sale due to concerns about obtaining good title.
  6. Mdm Eng and Mr Dong sought the court's consent to proceed with the sale.
  7. DBS objected to the applications.

5. Formal Citations

  1. Re Eng Lee Ling and another matter, , [2024] SGHC 52

6. Timeline

DateEvent
Bankruptcy application filed against Mdm Eng by Maybank Singapore Limited
Mdm Eng's affidavit was dated
Bankruptcy application filed against Mr Dong by DBS Bank Ltd
Dong's affidavit was dated
Applicant’s Written Submissions in OSB 3/2024 was dated
Bankruptcy application filed against Mdm Eng by DBS Bank Ltd
Affidavit of Mok Pei Fong was dated
Hearing of OSB 3 and OSB 20
DBS Bank Ltd’s Skeletal Submissions was dated
Judgment reserved
Judgment issued

7. Legal Issues

  1. Jurisdiction of the court to consent to a proposed disposition of property by a debtor prior to the making of a bankruptcy order
    • Outcome: The court confirmed that it has the jurisdiction under s 328 of the Insolvency, Restructuring and Dissolution Act 2018 to consent to a proposed disposition of property by a debtor prior to the making of a bankruptcy order against him/her.
    • Category: Jurisdictional
  2. Whether the court should grant the orders sought by Mdm Eng and Mr Dong on the facts of their respective applications
    • Outcome: The court dismissed the applications, finding that the proposed disposition did not adequately benefit the general body of creditors and demonstrated a preference towards one creditor.
    • Category: Substantive

8. Remedies Sought

  1. Court consent to proceed with the sale of property

9. Cause of Actions

  • No cause of actions

10. Practice Areas

  • Insolvency
  • Bankruptcy Law

11. Industries

  • No industries specified

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Alternative Advisors Investments Pte Ltd v Asidokona Mining Resources Pte LtdCourt of AppealYes[2024] SGCA 3SingaporeCited for the definition of ratification.
Centaurea International Pte Ltd (in liquidation) v Citus Trading Pte LtdHigh CourtYes[2017] 3 SLR 513SingaporeCited for the possibility of seeking the court’s consent for a proposed disposition after a winding-up petition had been filed against a company.
Tan Cheng Bock v Attorney-GeneralHigh CourtYes[2017] 2 SLR 850SingaporeCited for the principle that an absurd construction should be eschewed.
Sutherland, Hugh David Brodie v Official Assignee and anotherHigh CourtYes[2021] 4 SLR 752SingaporeCited for the primary consideration when the court exercises its discretion to validate a disposition is that the disposition should promote an “orderly and rateable distribution to the general body of creditors”
Stanford International Bank (in liquidation) v HSBC Bank plcCourt of AppealYes[2023] AC 761England and WalesCited for the principle that the payment of a preference unjustly enriches the preferred creditor at the expense of the remaining unsecured creditors.
Re Rescupine LtdHigh Court of JusticeYes[2003] EWHC 216 (Ch)England and WalesCited to show that the court will not validate a proposed sale even if it means that the sale will be lost in the absence of any valuation report, or any evidence of proper marketing by the applicant.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Insolvency, Restructuring and Dissolution Act 2018Singapore
Section 328 of the Insolvency, Restructuring and Dissolution Act 2018Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Bankruptcy application
  • Disposition of property
  • Prospective validation order
  • Pari passu principle
  • Preference
  • General body of creditors
  • Bankruptcy order
  • Insolvency, Restructuring and Dissolution Act

15.2 Keywords

  • Bankruptcy
  • Insolvency
  • Property disposition
  • Court consent
  • Creditors
  • Singapore
  • High Court

17. Areas of Law

Area NameRelevance Score
Insolvency Law95
Bankruptcy90
Restructuring and Dissolution85
Avoidance of transfer70
Winding Up30

16. Subjects

  • Bankruptcy
  • Insolvency Law
  • Property Law