Jinsung Construction v Roko Trading: Conversion of Construction Equipment and Director's Personal Liability
In Jinsung Construction Co Ltd Singapore Branch v Roko Trading Pte Ltd and Choi Sung Jong, the High Court of Singapore ruled in favor of the plaintiff, Jinsung Construction, finding Choi Sung Jong, the director of Roko Trading, personally liable for the conversion of construction equipment. The court determined that Choi Sung Jong was the controlling mind behind Roko Trading and had orchestrated a scheme to deceive Jinsung Construction, justifying the lifting of the corporate veil. The court awarded Jinsung Construction $1.35 million, representing the outstanding balance for the equipment's sale price.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
The High Court held Choi Sung Jong, director of Roko Trading, personally liable for conversion of Jinsung Construction's equipment due to his controlling role and deceptive actions.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Jinsung Construction Co Ltd Singapore Branch | Plaintiff | Corporation | Judgment for Plaintiff | Won | |
| Roko Trading Pte Ltd | Defendant | Corporation | Liability Admitted | Lost | |
| Choi Sung Jong | Defendant | Individual | Judgment for Plaintiff | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Shiever Subramanium Ramachandran | Grays LLC |
| Prabhakaran s/o Narayanan Nair | Derrick Wong & Lim BC LLP |
4. Facts
- The plaintiff claimed against the defendants for the conversion of construction equipment.
- The second defendant was the sole shareholder and main director of the first defendant.
- The first defendant admitted liability for the plaintiff’s claim.
- The second defendant arranged for the equipment to be stored at Tiong Woon Crane’s facility.
- The plaintiff and the first defendant entered into an agreement for the sale of the equipment.
- The first defendant sold parts of the equipment to ZYG and Soilmec without informing the plaintiff.
- The second defendant offered the plaintiff a reduced sum in full and final settlement of the payment obligation.
5. Formal Citations
- Jinsung Construction Co Ltd Singapore Branch v Roko Trading Pte Ltd and another and another suit, Suits Nos 716 and 641 of 2010, [2012] SGHC 50
6. Timeline
| Date | Event |
|---|---|
| Second defendant arranged for the equipment to be stored at Tiong Woon Crane’s facility. | |
| Plaintiff and first defendant entered into an agreement for the sale of the equipment. | |
| First defendant entered into an agreement with ZYG Investment Pte Ltd to sell one part of the equipment. | |
| Plaintiff sent a series of emails to the second defendant reminding him about the payment obligation under the agreement. | |
| Plaintiff sent an email to the first defendant, with an official letter attached demanding payment. | |
| First defendant entered into another agreement with Soilmec Far East Pte Ltd, to sell the remaining part of the equipment. | |
| Second defendant sent an email asking for payment to be delayed. | |
| Plaintiff sent an email to the second defendant, recommending another Korean company as a possible buyer. | |
| Second defendant proposed that the first defendant make payment of the sum of $600,000, in full and final settlement. | |
| Plaintiff sent an email to Tiong Woon Crane, instructing the company not to release the equipment. | |
| Plaintiff approached the second defendant to seek an explanation about the missing equipment. | |
| Plaintiff commenced proceedings. | |
| Judgment Reserved. |
7. Legal Issues
- Personal Liability of Director for Company's Tort
- Outcome: The court held the director personally liable for the company's tort, finding that he was the controlling mind and spirit of the company and had procured or directed the commission of the tort.
- Category: Substantive
- Sub-Issues:
- Controlling mind and spirit of the company
- Procuring or directing the commission of the tort
- Related Cases:
- [2004] 3 SLR(R) 543
- Lifting the Corporate Veil
- Outcome: The court lifted the corporate veil, holding the director personally liable for the company's actions due to his control and involvement in the tortious act.
- Category: Substantive
- Related Cases:
- [2004] 3 SLR(R) 543
- [1897] AC 22
8. Remedies Sought
- Damages
- Delivery up of the equipment
9. Cause of Actions
- Conversion
10. Practice Areas
- Commercial Litigation
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| TV Media Pte Ltd v De Cruz Andrea Heidi and another | Court of Appeal | Yes | [2004] 3 SLR(R) 543 | Singapore | Cited as the leading local authority on the issue of a director's personal liability for a company's torts and the lifting of the corporate veil. |
| Salomon v A Solomon and Co, Ltd | N/A | Yes | [1897] AC 22 | N/A | Cited for the fundamental principle of company law that a company is a separate legal entity from its members or shareholders. |
| Rainham Chemical Works, Ltd v Belvedere Fish Guano Co Ltd | N/A | Yes | [1921] 2 AC 465 | N/A | Cited for the principle that proof of a tort by a company does not automatically prove that the directors are also guilty of the tort. |
| Gabriel Peter & Partners v Wee Chong Jin | N/A | Yes | [1997] 3 SLR(R) 649 | Singapore | Cited for the principle that proof of a tort by a company does not automatically prove that the directors are also guilty of the tort. |
| Performing Right Society, Ltd v Ciryl Theatrical Syndicate, Ltd | N/A | Yes | [1924] 1 KB 1 | N/A | Cited for the exception to the principle of separate legal entity, where directors may be liable as joint tortfeasors if they 'procured or directed' the wrong to be done. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Conversion
- Corporate Veil
- Director's Liability
- Controlling Mind
- Joint Tortfeasor
- Procured or Directed
- Equipment
- Agreement
- Financial Difficulties
- Misrepresentation
15.2 Keywords
- Conversion
- Director Liability
- Corporate Veil
- Construction Equipment
- Singapore High Court
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Conversion | 90 |
| Lifting corporate veil | 85 |
| Breach of Contract | 80 |
| Torts | 75 |
| Contract Law | 70 |
| Commercial Disputes | 65 |
| Company Law | 60 |
| Fraud and Deceit | 50 |
16. Subjects
- Corporate Law
- Tort
- Commercial Law