Civil asset recovery – jurisdictional issues

Parallel proceedings

Is there any restriction on civil proceedings progressing in parallel with, or in advance of, criminal proceedings concerning the same subject matter?

There are no restrictions.

Forum

In which court should proceedings be brought?

  • For actions where the claim amount is up to S$20,000: Small Claims Tribunal. This amount may be raised to S$30,000 with the permission of the court and if both parties agree.
  • For actions where the claim amount does not exceed S$60,000: Magistrates’ Court.
  • For actions where the claim amount is between S$60,000 and S$250,000: the District Court.
  • For actions where the claim amount exceeds S$250,000: General Division of the High Court.
Limitation

What are the time limits for starting civil court proceedings?

The Limitation Act 1959 (the LA) is the authoritative statute governing limitation periods for civil proceedings in Singapore. The general starting points for some key causes of action are as follows:

  • Actions founded on contract or tort: six years from the date of accrual of the relevant cause of action (section 6(1)(a) LA).
  • Actions founded on unjust enrichment: there is no statutory limitation period (Esben Finance Limited & Ors v Neil Wong Hou Liang [2022] SGCA(I) 1).
  • Actions founded on breaches of trust or equitable obligations: There is a six-year limitation period prescribed by section 22(2) of the LA, but this is subject to section 22(1) of the LA. The applicability of section 22(2) may also depend on the exact characterisation of the nature of the trust or equitable obligations alleged to be breached (Yong Kheng Leong and another v Panweld Trading Pte Ltd and another [2012] SGCA 59).

 

Where the action is based on fraud or mistake, the limitation period begins to run from the time that the claimant has discovered the fraud or mistake, or could have, with reasonable diligence, discovered the fraud or mistake: section 29 LA.

Jurisdiction

In what circumstances does the civil court have jurisdiction? How can a defendant challenge jurisdiction?

Under Singapore law, civil jurisdiction founded on either:

  • service of originating process on the defendant in accordance with Singapore’s civil procedural rules; or
  • submission by the defendant to the jurisdiction of the Singapore courts.

(Section 16 of the Supreme Court of Judicature Act 1969.)

 

Generally speaking, civil jurisdiction in Singapore is not founded merely on the subject matter of the dispute or the dispute’s connecting factors to the Singapore courts.

Most challenges to the Singapore civil court’s jurisdiction are brought by defendants who are served with process outside Singapore. Defendants may challenge the existence or appropriateness of the exercise of the courts’ jurisdiction by contending one or more of the following:

  • the claimant had failed to show a good arguable case that the dispute has a sufficient connection to Singapore, by reference to the list of connecting factors found in paragraph 63(3) of the Supreme Court Practice Directions 2021;
  • the claimant had failed to show that Singapore is the forum conveniens;
  • the claimant had failed to show a serious question to be tried on the merits of the proposed claim;
  • the claimant had, in making the initial without-notice application for permission to serve process out of the jurisdiction, failed to satisfy its duty of full and frank disclosure; and/or
  • the claimant had failed to serve process in compliance with the terms of the permission granted by the Singapore court; and
  • the claimant had failed to serve process in accordance with the law of the jurisdiction in which the defendant was purportedly served with process.

Civil asset recovery – procedure

Admissibility of evidence

What rules apply to the admissibility of evidence in civil proceedings?

In civil proceedings, evidence is generally adduced by way of affidavits of evidence-in-chief.

The rules on hearsay (out-of-court statements) are some of the important rules related to admissibility of evidence in civil proceedings. With extensive amendments to the Evidence Act 1893 (the Evidence Act) in 2012, the hearsay rules have been reformed such that the civil courts now tend to lean in favour of admitting hearsay, with trial judges given broad powers to determine what weight to ascribe to the hearsay relied on.

Hearsay (is admissible if it falls within one or more of the ‘gateways’ in section 32(1) of the Evidence Act 1893 (the Evidence Act).

Even where hearsay evidence is prima facie admissible, the court has the residual discretion under section 32(3) of the Evidence Act to refuse to admit such evidence if it would not be in the interests of justice for the evidence to be admitted.

Turning to opinion evidence, expert opinion on points of scientific, technical or other specialised knowledge is admissible under section 47(1) of the Evidence Act.

With respect to foreign law specifically, foreign law is still generally to be proved by way of expert evidence. However, the Singapore International Commercial Court (the SICC) has introduced a novel procedure where, upon the application of any party, foreign law may be determined on the basis of submissions instead of expert evidence (see O 16 Rule 8 of the SICC Rules 2021).

Witnesses

What powers are available to compel witnesses to give evidence?

If the witness is present in Singapore, pursuant to O 15 Rule 4 of the Rules of Court 2021 (the ROC 2021), a party may apply to the court for an ‘order to attend court‘ or an ’order to produce documents‘ (more commonly known as subpoenas) to be issued against the witness.

Publicly available information

What sources of information about assets are publicly available?

The following is some of the publicly available information:

  • Singapore Land Authority: Land asset and title searches; and
  • Accounting and Corporate Regulatory Authority: Information on privately incorporated limited liability companies, limited liability partnerships, as well as sole proprietorships may be found here. The information available for public access includes the date of incorporation of the business, the nature of business activity, registered office address and financial statements of business entities, as well as identities and contact details of owners, shareholders, directors and officers of the business.
Cooperation with law enforcement agencies

Can information and evidence be obtained from law enforcement and regulatory agencies for use in civil proceedings?

If the law enforcement or regulatory agency is a party to the proceedings, the other party may, pursuant to O 11 Rule 3 of the ROC 2021, apply for the court to order ’production of requested documents’ (more commonly known as specific discovery) as against the agency.

If the agency is a non-party to the proceedings, a party may, pursuant to O 11 Rule 11 of the ROC 2021, apply for the court to order ’production against non-parties’.

However, there are some legal immunities entitling law enforcement or regulatory agencies to withhold production of documents:

  • For instance, section 126 of the Evidence Act allows the withholding of communications made to a public officer in their official capacity, and whose disclosure the officer considers would be contrary to the public interest.
  • The agency may also seek to rely on the common law doctrine of public interest immunity. The relevant test is whether the public interest in the administration of justice is outweighed by the public interest sought to be protected by withholding production of documents (see Mah Kiat Siang v Attorney-General & Ors [2021] SHC 202 at paragraph 80).
Third-party disclosure

How can information be obtained from third parties not suspected of wrongdoing?

Before proceedings are commenced, under O 11 Rule 1 of the ROC 2021, the court may order the production of documents or information. After proceedings are commenced, under the same O 11 Rule 1 of the ROC 2021, the court may order a non-party to produce documents or information.

Civil asset recovery – remedies and relief

Non-compliance with court orders

How do courts punish failure to comply with court orders?

Under section 4 of the Administration of Justice (Protection) Act 2016 read with O 23 of the ROC 2021, the court may commit a party for contempt in failing to comply with court orders. Such contempt is punishable by imprisonment or a fine, or both.

Obtaining evidence from other jurisdictions

How can information be obtained through courts in other jurisdictions to assist in the civil proceedings?

Under O 9 Rule 24(1) of the ROC 2021, a party may apply to the Singapore court for an order for a witness to be examined out of Singapore before a trial (an order for pretrial examination).

The applying party must persuade the Singapore court of the three factors as set out in O 9 Rule 24(2) of the ROC 2021.

The applying party must also satisfy the Singapore court of the grounds set out in O 9 Rule 24(3) of the ROC 2021:

 

Pursuant to O 9 r 24(5), where the jurisdiction in which the evidence is to be taken is a jurisdiction to which the Hague Convention on the Taking of Evidence Abroad in Civil or Commercial Matters 1970 (the Hague Evidence Convention) applies, the applying party may include a request for the issue of a letter of request to the relevant jurisdiction, in the forms prescribed by the Hague Evidence Convention.

Assisting courts in other jurisdictions

What assistance will the civil court give in connection with civil asset recovery proceedings in other jurisdictions?

Injunctions in Singapore in aid of foreign court proceedings

The Singapore courts have the power to grant injunctions in aid of foreign court proceedings (see Bi Xiaoqiong v China Medical Technologies, Inc (in liquidation) and another [2019] SGCA 50).

 

Enforcement of foreign court judgments under the Choice of Courts Agreement Act 2016

Where a relevant foreign court is: (1) in a state that is a party to the Hague Convention on Choice of Court Agreement; and (2) the subject of an exclusive choice of court agreement between parties, judgments of that foreign court in connection with a dispute between those parties may be enforced in Singapore pursuant to the Choice of Courts Agreement Act 2016 (the Choice of Courts Agreement).

 

Enforcement of foreign court judgments under the Reciprocal Enforcement of Commonwealth Judgments Act 1921 and the Reciprocal Enforcement of Judgments Act 1959

Under the Reciprocal Enforcement of Commonwealth Judgments Act 1921 (RECJA), judgments obtained in superior courts of the United Kingdom and other commonwealth jurisdictions specified in the Reciprocal Enforcement of Commonwealth Judgments (Extension) (Consolidation) Notification may be registered and enforced in the Singapore courts. As of the date of publication, the jurisdictions to which RECJA is applicable include New Zealand, Malaysia, Pakistan, Brunei and India.

Under the Reciprocal Enforcement of Foreign Judgments Act 1959 (REFJA), judgment obtained in courts specified by subsidiary legislation may be registered and enforced in the Singapore courts. As of the date of publication, the only jurisdiction to which REFJA is applicable is the Hong Kong Special Administrative Region. Where the Choice of Courts Act is applicable, neither RECJA nor REFJA would be applicable.

 

Enforcement of foreign court judgments under the common law

Where the Choice of Courts Act, RECJA and REFJA do not apply, money judgments of foreign courts may be recognised and enforced pursuant to the common law.

The claimant must bring a fresh originating claim in the Singapore court, and must satisfy the court that:

  • the judgment is for a definite sum of money;
  • the judgment is final and conclusive;
  • the judgment is rendered by a court of competent jurisdiction, that is to say the defendant was present in the relevant jurisdiction or submitted to the relevant court;
  • the judgment cannot be for a sum payable in respect of taxes, a fine or other penalty; or
  • the judgment was not obtained by fraud or contrary to natural justice, or contrary to public policy (Poh Soon Kiat v Desert Palace Inc (trading as Caesars Palace) [2009] SGCA 60).
Causes of action

What are the main causes of action in civil asset recovery cases, and do they include proprietary claims?

In the section below, we briefly discuss the key causes of action in civil asset recovery cases.

 

Breach of contract

The claimant must show that there was a subsisting contract that was breached by the defendant.   

 

Breach of trustees’ or other equitable obligations

First, it must be established that the defendant is a fiduciary. Fiduciaries are commonly trustees, employees, partners, directors of a company, solicitors and parties to a common law agency relationship: Ng Eng Ghee and others v Mamata Kapildev Dave and others (Horizon Partners Pte Ltd, intervener) and another appeal [2009] SGCA 14 (Ng Eng Ghee) at paragraph 108. A claimant may allege that the fiduciary has breached their fiduciary duties, which may include the strict duty to act in good faith, not to misuse trust property, or make unauthorised profit via their powers as a fiduciary: Ng Eng Ghee at paragraphs 137 and 142.

 

Dishonest assistance and knowing receipt

This is a cause of action instituted against a party whom the law regards as an accessory to a breach of trust or other equitable or fiduciary obligations.

 

Unjust enrichment

In unjust enrichment, a claimant seeks recovery of the enrichment on the basis that the claimant should not be deprived by the benefit: Wee Chiaw Sek Anna v Ng Li-Ann Genevieve (sole executrix of the estate of Ng Hock Seng, deceased) and another [2013] SGCA 36 at paragraph 108. The claimant must establish that:

  • the defendant has been enriched;
  • the enrichment was at the expense of the plaintiff;
  • the enrichment had an unjust factor (example: mistake induced by fraud or a failure of consideration); and
  • the defendant cannot avail himself or herself of any defences: Wee Chiaw Sek Anna at [98]-[99].

 

Tort of conversion

A claim in conversion arises where there is an interference in the claimant’s proprietary interest in property, with proprietary interest defined as the claimant having immediate possession or a right to immediate possession of the property in question. See UCO Bank (formerly known as United Commercial Bank) v Ringler Pte Ltd [1995] SGCA 23 at [18].

Remedies

What remedies are available in a civil recovery action?

Breach of contract

The default remedy in response to a breach of contract is an order of damages, and, in an appropriate case, an entitlement to terminate the contract.

The court awards specific performance (an order requiring the defendant to actually perform the contract) only if the claimant persuades the court that damages are not an adequate remedy.

 

Torts

Similarly, the default remedy in response to a tort is an order for damages. This is true, even for the torts that seek to vindicate the claimant’s title to property (for example, the torts of conversion, detinue or trespass to land).

 

Causes of action related to trusts or equitable obligations

There are a wide range of remedies available where the claimant has established a breach of trust or other equitable or fiduciary obligations. They include the following:

  • equitable compensation (see for instance Sim Poh Ping v Winsta Holding Pte Ltd & Anor [2020] SGCA 35);
  • an account of administration on a general or common basis;
  • an account of administration on a wilful default basis; or
  • an account of profits (see UVJ & Ors v UVH & Ors and another appeal [2020] SGCA 49).

 

Where assets impressed with equitable obligations or their traceable proceeds are in the hands of a defendant who is not a bona fide purchaser for value without notice, the claimant may possibly obtain a proprietary remedy against the defendant in the form of an institutional or remedial constructive trust (see Zaiton Binte Adom v Nafsiah Bte Wagiman & another [2022] SGHC 189 at paragraphs 105 to 108 and 141 to 151).

 

Unjust enrichment

The recent decision of a five-judge panel of the Singapore Court of Appeal in Esben Finance Limited & Ors v Neil Wong Hou Liang [2022] SGCA(I) 1 suggests that a claim for restitution in response to unjust enrichment is distinct from a claim for proprietary remedies based on the vindication of property rights.

It is therefore of crucial importance that the appropriate causes of action and reliefs in an asset recovery civil claim are properly characterised and pleaded.

Judgment without full trial

Can a victim obtain a judgment without the need for a full trial?

There are a number of ways that a victim may obtain a judgment without a need for a full trial:

  •  First, a victim may obtain judgment in default. This is possible where, after the originating claim is served on the defendant, the defendant either fails to file a notice of intention to contest or not to contest, or a defence within the time prescribed by the Rules of Court 2021.
  • Second, a victim may obtain judgment if the defendant indicates that they do not intend to contest any of the victim’s claim.
  • Third, a victim may apply to court for summary judgment under O 9 Rule 17 ROC 2021.
Post-judgment relief

What post-judgment relief is available to successful claimants?

A successful claimant who is unsure of the assets that the respondent has available, it may apply under O 22 Rule 11 of the ROC 2021 for the enforcement respondent to be examined orally in court or to make an affidavit on the properties owned by the enforcement respondent beneficially whether in whole or in part or which they will be entitled to in future.

The court may also order the enforcement respondent to produce documents that are appropriate (see O 22 Rule 11(2) of the ROC 2021). This will allow the claimant to know what assets there are to enforce the judgment.

A party may also apply for a local or worldwide injunction prohibiting the disposal of assets in Singapore or worldwide (see O 13 Rule 1(6) and (7) ROC 2021).

Enforcement

What methods of enforcement are available?

To enforce a judgment, a party takes out a single application under Order 22 of the ROC 2021.

If the enforcement applicant is aware of the properties of the enforcement respondent, an application may be made under O 22 Rule 2(1) and (3) of the ROC 2021. Such an application is done by summons without notice with a supporting affidavit, not earlier than three days after the court order has been served on the enforcement respondent.

Funding and costs

What funding arrangements are available to parties contemplating or involved in litigation and do the courts have any powers to manage the overall cost of that litigation?

Third-party litigation funding

The torts of champerty and maintenance (ie, entering into agreements to be interested in the fruits of another party’s litigation) has been abolished in Singapore in 2017.

However, a champertous agreement may be considered contrary to public policy and be declared void.

Under section 5B of the Civil Law Act, third-party funding is permitted for proceedings listed under Rule 3 of the Civil Law (Third Party Funding) Regulations 2017. Detailed requirements for third-party funding arrangements detailed at Rule 4 of the Regulations.

 

Contingency or conditional fee arrangements

Traditionally, contingency or conditional fee arrangements are prohibited pursuant to Rule 18 of the Legal Profession (Professional Conduct Rules) 2015 (the PCR). However, following the enactment of the Legal Profession (Conditional Fee Agreement) Regulations 2022 (the CFAR), conditional fee agreements may be entered into for international and domestic arbitration proceedings, some proceedings in the Singapore International Commercial Court, and related court and mediation proceedings. The exact scope of proceedings where conditional fee arrangements are allowed may be found in Rule 3 of the CFAR.

 

Powers of the court to manage litigation costs

The court has the power to order parties to attempt to resolve a dispute by amicable resolution. It may also suggest solutions for amicable resolution of the dispute to parties at any time it thinks fit (see O 5 Rule 3(1) and (5) ROC 2021).

Solicitors, as officers of the court, also have an overriding duty to consider costs of litigation and amicable resolution.

The court, in making costs orders at the end of litigation, has a wide discretion and can take into account a broad range of factors, including the proportionality with which the litigation had been conducted.

The court may, through the appropriate cost orders, penalise any party that it considers to have conducted the litigation in an unreasonable or disproportionate manner.