Goldring, Timothy Nicholas v Public Prosecutor and other appeals [2015] SGHC 158

The Singapore High Court’s decision in Goldring, Timothy Nicholas v Public Prosecutor and other appeals involved an interesting question - whether one can rely on a non-reliance clause to negate the element of inducement required to establish the offence of cheating. The High Court answered this in the negative for the following reasons:

  • As a matter of interpretation, and in the absence of clear language to the contrary, it is highly improbable that the contracting parties would have intended to exclude a party’s liability for fraud by way of such a clause.
  • Even if such a clause could be interpreted to exclude liability for fraud:
  • The clause would be void under the Unfair Contract Terms Act (the “UCTA”), which prevents a party from contractually excluding liability for breach, except insofar as it is reasonable to exclude such liability; and
  • The clause would be contrary to public policy.

Background facts

The facts of this case were straightforward. The appellants, Timothy Nicholas Goldring and John Andrew Nordmann were directors and shareholders of Profitable Plots Pte Ltd. They were accused of conspiring to cheat a number of investors by inducing them to invest in a scheme known as the Boron Scheme, under which investors could earn returns of 12.5% on the principal amount invested within a maximum of six months from the date of investment. When the Boron Scheme was marketed to the public, it was represented that the money invested would be used exclusively to finance the purchase of Boron Products and that the Boron Products had already been pre-sold to major corporations.

Based on these representations, various investors invested in the Boron Scheme. The contractual documentation contained two non-reliance clauses that read:

By signing the Product Request Form, the Buyer(s) confirm that they have read and accept the conditions detailed herein, and that the purchase of the product(s) by the Buyer is based solely upon the Buyer’s own discretion.”

The transferee hereby acknowledges that no statement, representation, warranty or covenant has been made to it which has induced it to enter into this Transfer by the Transferor or any agent, employee or solicitor of the Transferor (which oral or otherwise) concerning the Property. [sic]”

The representations were false, and the Boron Scheme a sham. The appellants were convicted in the State Courts of conspiracy to cheat, and sentenced to a total term of imprisonment of seven and eight years respectively. The appellants appealed against their conviction and sentence; while the Prosecution cross-appealed against the appellant’s sentences.

Appellants’ arguments

On appeal, the appellants argued that the charge of cheating could not have been made out as a matter of law since the investors had not been “induced” by the above representations into investing in the Boron Scheme in light of the two non-reliance clauses.


The Court dismissed the appellants’ appeal against their convictions.

Non-reliance clause should not be interpreted as excluding liability for fraud in absence of clear language

The High Court held that the representations were false and neither innocent nor negligent. They were fraudulent and dishonest under the Penal Code. The High Court held that the two non-reliance clauses did not operate to relieve the appellants of liability for their fraud. Instead, the two non-reliance clauses would, on their proper construction, only exclude liability for honest mistakes and not from fraud. The High Court held that the clauses merely precluded reliance on representations that amounted to value judgments (e.g. that the Boron Scheme was a “good” or “low-risk” investments), and not representations about “inherent and fundamental qualities embodied” in the product.

The High Court observed that a clause purporting to exclude liability for fraud is often part of the very machinery that advances and disguises that fraud. Hence, the upholding of such a clause would be inimical to notions of justice.

The court further distinguished clauses purporting to exclude liability for a principal’s fraud (impermissible) from those purporting to exclude liability for an agent’s fraud (permissible). The court noted that in the former case, the principal knows fully and is in full control of what he is doing, and it would be clearly against public policy for his liability to be excluded.

Even if a non-reliance clause interpreted as excluding liability for fraud, it should be void under UCTA because it is unreasonable

The High Court held that the UCTA subjects non-reliance clauses to a requirement of reasonableness, the test for which is set out in section 11 of the UCTA. The High Court held that it could not have been reasonably in any investor’s contemplation to agree to a clause protecting the appellants from their own fraud. Accordingly, the non-reliance clauses were void to the extent that they purported to exclude liability for fraud.

The court also dismissed the appellants’ and the Prosecution’s appeal against the appellants’ sentences on the basis that the sentences were neither “manifestly harsh” nor “manifestly lenient”.

Practical impact

There is ample authority in the civil context for the proposition that one cannot contract out of one’s own fraud. The High Court’s decision in this case makes it clear that, in addition to his civil liabilities, a fraudulent party will also continue to be criminally liable for his fraud - regardless of whether there is a non-reliance clause.