DNG FZE v PayPal Pte Ltd: Striking Out Pleadings for Breach of Unless Order

In DNG FZE v PayPal Pte Ltd, the High Court of Singapore heard an appeal by DNG FZE against the decision to strike out its claim against PayPal for breach of contract and a declaration that a liquidated damages clause is void. The striking out was due to DNG FZE's breach of an unless order regarding discovery obligations. The High Court dismissed the appeal, finding that DNG FZE had breached the unless order and that striking out was a proportionate response.

1. Case Overview

1.1 Court

General Division of the High Court of the Republic of Singapore

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

The High Court dismissed DNG FZE's appeal, upholding the decision to strike out its claim against PayPal for breaching an unless order related to discovery obligations.

1.7 Decision Date

11 March 2024

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
D.N.G FZE	Plaintiff, Appellant	Corporation	Appeal Dismissed	Lost	Oommen Mathew of Omni Law LLC Ong Tai Tiong Desmond of Solitaire LLP Ong Siew Choo of Solitaire LLP
PayPal Pte Ltd	Defendant, Respondent	Corporation	Claim Struck Out	Won	Teo Chun-Wei Benedict of Drew & Napier LLC Lim Siyang Lucas of Drew & Napier LLC Yap En Li of Drew & Napier LLC Chan Ejia Sabrina of Drew & Napier LLC

3. Judges

Judge Name	Title	Delivered Judgment
Goh Yihan	Judge of the High Court	Yes

4. Counsels

Counsel Name	Organization
Oommen Mathew	Omni Law LLC
Ong Tai Tiong Desmond	Solitaire LLP
Ong Siew Choo	Solitaire LLP
Teo Chun-Wei Benedict	Drew & Napier LLC
Lim Siyang Lucas	Drew & Napier LLC
Yap En Li	Drew & Napier LLC
Chan Ejia Sabrina	Drew & Napier LLC

4. Facts

Plaintiff failed to fully comply with a Discovery Order to disclose certain documents.
A First Unless Order was issued, requiring the plaintiff to file its SLOD and AVSLOD by 22 September 2023.
Plaintiff filed a blank Plaintiff’s 2nd Supplementary List of Documents.
A Second Unless Order was issued, giving the plaintiff a final opportunity to comply with its discovery obligations.
Plaintiff filed its 6th Supplementary List of Documents after the deadline.
AR Koonar found that the plaintiff had failed to provide full discovery of Category 1, 2, and 5 documents.
AR Koonar decided to strike out the plaintiff’s case due to the plaintiff’s breach of the Second Unless Order.

5. Formal Citations

DNG FZE v PayPal Pte Ltd, Suit No 758 of 2021 (Registrar’s Appeal No 24 of 2024 and Summons No 326 of 2024), [2024] SGHC 65

6. Timeline

Date	Event
2020-06-15	Plaintiff set up a PayPal business account with the defendant.
2020-08-04	Defendant placed a permanent limitation on the plaintiff's account.
2022-03-22	Defendant's List of Documents filed.
2022-05-25	Defendant filed HC/SUM 1966/2022 to seek discovery of certain documents.
2022-07-06	SUM 1966 was heard and the plaintiff was ordered to disclose documents.
2022-08-01	Plaintiff’s appeal against the Discovery Order was dismissed.
2022-11-08	Plaintiff filed its Supplementary List of Documents.
2022-12-13	Plaintiff filed Statement of Claim (Amendment No 1).
2023-06-13	Defendant changed its solicitors.
2023-08-21	Defendant amended and filed its Defence and Counterclaim (Amendment No 2).
2023-08-22	Parties directed to file Supplementary Lists of Documents.
2023-09-08	Plaintiff requested more time to file its SLOD.
2023-09-11	Plaintiff requested the court for an extension to file its SLOD.
2023-09-19	Pre-Trial Conference before AR Liew; First Unless Order issued.
2023-09-22	Plaintiff filed a blank Plaintiff’s 2nd Supplementary List of Documents.
2023-09-27	Defendant’s solicitors wrote to the plaintiff’s solicitors regarding discovery compliance.
2023-10-02	Plaintiff’s solicitors replied to defendant’s solicitors regarding discovery.
2023-10-10	AR Liew directed the plaintiff to produce documents by 13 October 2023.
2023-10-13	Plaintiff’s solicitors wrote to defendant’s solicitors regarding the discovery process.
2023-10-16	AR Liew directed the defendant to file its application for specific discovery.
2023-10-16	Plaintiff’s solicitors wrote to defendant’s solicitors regarding the discovery process.
2023-10-18	Plaintiff’s solicitors wrote to defendant’s solicitors with a table listing the documents requested.
2023-10-30	Defendant’s solicitors wrote to plaintiff’s solicitors stating that the plaintiff had not provided full discovery.
2023-11-03	Plaintiff’s solicitors sent a letter to defendant’s solicitors, attaching drafts of its further SLODs.
2023-11-06	Plaintiff’s solicitors sent two emails to defendant’s solicitors, attaching drafts of its further SLODs.
2023-11-17	Defendant filed HC/SUM 3556/2023 to strike out the plaintiff’s case.
2023-12-13	AR Koonar heard the First Striking Out Application.
2023-12-15	AR Koonar heard the First Striking Out Application; Second Unless Order issued.
2024-01-05	Plaintiff filed its 6th Supplementary List of Documents.
2024-01-08	Defendant took out a second application to strike out the plaintiff’s case.
2024-01-18	Mr Karim’s notarised affidavit was filed.
2024-01-26	AR Koonar heard the Second Striking Out Application.
2024-01-29	AR Koonar decided to strike out the plaintiff’s case.
2024-02-06	Plaintiff filed HC/SUM 326/2024 to adduce further evidence.
2024-02-13	High Court heard RA 24 and SUM 326.
2024-02-14	High Court dismissed RA 24.
2024-03-12	Judgment Date

7. Legal Issues

Breach of Unless Order
- Outcome: The court found that the plaintiff had breached the unless order and failed to demonstrate that the breach was not intentional or contumelious.
- Category: Procedural
- Sub-Issues:
  - Failure to comply with discovery obligations
  - Intentional or contumelious breach
- Related Cases:
  - [1954] 1 WLR 1489
  - [1999] 1 SLR(R) 361
  - [2013] 3 SLR 1179
  - [1992] 1 WLR 1196
Striking Out Pleadings
- Outcome: The court held that striking out the plaintiff's case was a proportionate response to its non-compliance with discovery obligations.
- Category: Procedural
- Sub-Issues:
  - Proportionality of striking out
  - Abuse of process
- Related Cases:
  - [2013] 3 SLR 1179
  - [2022] 3 SLR 964
Admissibility of New Evidence
- Outcome: The court allowed the admission of new evidence, finding it apparently credible, but ultimately dismissed the appeal.
- Category: Procedural
- Sub-Issues:
  - Reasonable diligence
  - Relevance of evidence
  - Credibility of evidence
- Related Cases:
  - [1954] 1 WLR 1489
  - [2019] 2 SLR 341

8. Remedies Sought

Return of liquidated damages
Declaration that the Liquidated Damages Clause is void and unenforceable

9. Cause of Actions

Breach of Contract

10. Practice Areas

Commercial Litigation

11. Industries

E-commerce
Financial Services

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Ladd v Marshall	N/A	Yes	[1954] 1 WLR 1489	N/A	Cited for the threefold requirements for admitting new evidence on appeal.
Toh Eng Lan v Foong Fook Yue and another appeal	Court of Appeal	Yes	[1998] 3 SLR(R) 833	Singapore	Cited as an example of a case that interpreted the term 'special grounds' in O 55D r 11(1) of the ROC 2014 to refer to the threefold requirements in Ladd v Marshall.
ARW v Comptroller of Income Tax and another and another appeal	Court of Appeal	Yes	[2019] 1 SLR 499	Singapore	Cited as an example of a case that interpreted the term 'special grounds' in O 55D r 11(1) of the ROC 2014 to refer to the threefold requirements in Ladd v Marshall.
AnAn Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Co)	Court of Appeal	Yes	[2019] 2 SLR 341	Singapore	Cited for the principle that cases applying the Ladd v Marshall requirements should be analyzed as lying on a spectrum.
SW Trustees Pte Ltd (in compulsory liquidation) and another v Teodros Ashenafi Tesemma and others (Teodros Ashenafi Tesemma, third party)	High Court	Yes	[2023] SGHC 273	Singapore	Cited for the principle that the court should exercise its discretion to admit further evidence pursuant to the overarching considerations of proportionality and prejudice.
Syed Mohamed Abdul Muthaliff and another v Arjan Bhisham Chotrani	Court of Appeal	Yes	[1999] 1 SLR(R) 361	Singapore	Cited for accepting the English Court of Appeal’s summary of the applicable principles in Hytec Information Systems Ltd v Coventry City Council.
Hytec Information Systems Ltd v Coventry City Council	English Court of Appeal	Yes	[1997] 1 WLR 1666	England and Wales	Cited for the principles applicable to unless orders, including that an unless order is an order of last resort and that failure to comply will ordinarily result in the sanction being imposed.
Mitora Pte Ltd v Agritrade International (Pte) Ltd	Court of Appeal	Yes	[2013] 3 SLR 1179	Singapore	Cited extensively for the principles relating to unless orders and striking out, including the need to consider proportionality.
In re Jokai Tea Holdings Ltd	English Court of Appeal	Yes	[1992] 1 WLR 1196	England and Wales	Cited for the principle that the relevant question in cases involving a failure to comply with an 'unless' order is whether such failure is intentional and contumelious.
Teo Wai Cheong v Crédit Industriel et Commercial and another appeal	Court of Appeal	Yes	[2013] 3 SLR 573	Singapore	Cited for the rationale behind the court’s power to make draconian orders for non-compliance with discovery obligations, even in the absence of an unless order.
Saxo Bank A/S v Innopac Holdings Ltd	High Court	Yes	[2022] 3 SLR 964	Singapore	Cited for summarizing the applicable principles in relation to when a court is to strike out pleadings under O 24 r 16(1) in the face of a party’s non-compliance with its discovery obligations.
Alliance Management SA v Pendleton Lane P and another and another suit	N/A	Yes	[2008] 4 SLR(R) 1	N/A	Cited for the principle that the exercise of the discretion whether to strike out is a fact-sensitive inquiry.
Teo Wee Ping Benjamin and another v Grande Corp Pte Ltd	Court of Appeal	Yes	[2020] 2 SLR 308	Singapore	Cited for the suggestion that the defendant was entitled to final judgment following the striking out of the plaintiff’s case, since it was claiming for liquidated damages.
New Civilbuild Pte Ltd v Guobena Sdn Bhd and another	High Court	Yes	[2000] 1 SLR(R) 368	Singapore	Cited for the argument that the defendant was only entitled to interlocutory judgment with damages to be assessed because the veracity of a liquidated damages clause is a mixed question of law and fact.
Husband’s of Marchwood Ltd v Drummond Walker Developments Ltd	English Court of Appeal	Yes	[1975] 1 WLR 603	England and Wales	Cited as an example of an alternative to striking out, namely ordering the payment of the plaintiff’s claim or part thereof into court where the defaulting party is a defendant.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Rules of Court 2014	Singapore
Order 24 Rule 16(1) of the Rules of Court 2014	Singapore
Order 55D Rule 11(1) of the Rules of Court 2014	Singapore
Supreme Court of Judicature Act 1969	Singapore
Rules of Court 2021	Singapore
Order 11 Rule 7 of the Rules of Court 2021	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Unless order
Discovery obligations
Striking out
Contumelious breach
Proportionality
Supplementary List of Documents
Discovery Order
Liquidated damages
Permanent Limitation
Acceptable Use Policy

15.2 Keywords

Unless order
Striking out
Discovery
Civil procedure
Singapore
PayPal
Breach of contract

17. Areas of Law

Area Name	Relevance Score
Breach of unless order	90
Striking out	85
Civil Practice	75
Civil Litigation	70
Evidence	60
Proportionality	50
Contract Law	30
Jurisdiction	20

16. Subjects

Civil Procedure
Discovery
Appeals
Commercial Litigation