Carpe Diem Holdings v Carpe Diem Playskool: Insolvency, Avoidance of Transactions & Land Sale

1. Case Overview

2. Parties and Outcomes

3. Judges

4. Counsels

4. Facts

1. Carpe Diem Holdings Pte Ltd is in the business of providing childcare services through franchising.
2. Carpe Diem Playskool Pte Ltd was the franchisee of Carpe Diem Holdings Pte Ltd until 31 December 2015.
3. The first defendant was placed in creditors’ voluntary liquidation on 16 January 2016.
4. The present dispute stemmed from a decade-long relationship between the plaintiff and the first defendant.
5. The plaintiff asserted an equitable interest in the Lease on the basis of the exercise of the Option Clause.
6. The Sale and Purchase Agreement included the transfer of the Lease to the fourth defendant.
7. The plaintiff did not exercise the Option Clause before the execution of the Sale and Purchase Agreement.

5. Formal Citations

1. Carpe Diem Holdings Pte Ltd v Carpe Diem Playskool Pte Ltd and others, Originating Summons No 360 of 2017, [2018] SGHC 37

6. Timeline

7. Legal Issues

1. Whether the fourth defendant had an interest in the Lease, equitable or otherwise, pending completion upon execution of the Sale and Purchase Agreement
   • Outcome: The court found that the fourth defendant acquired an equitable interest in the Lease as at the date of execution of the Sale and Purchase Agreement.
   • Category: Substantive
   • Sub-Issues:
     • Whether the Sale and Purchase Agreement conferred an equitable interest pending completion
     • Whether the plaintiff had an earlier equitable interest that took priority over the fourth defendant’s equitable interest
   • Related Cases:
     • (1876) 2 Ch D 499
     • [1993] 2 SLR(R) 644
     • [1904] 1 Ch 658
     • (1881) 18 Ch D 1
     • [1994] 2 SLR(R) 314
     • [1993] 1 SLR(R) 246
     • [2006] 2 SLR(R) 637
2. Whether the second defendant had an obligation to disclaim the Franchise Agreement before completing the assignment of the Lease to the fourth defendant pursuant to the Sale and Purchase Agreement
   • Outcome: The court found that the second defendant did not have a legal obligation to disclaim the Franchise Agreement.
   • Category: Substantive
3. Whether the fourth defendant was liable for the tort of conversion of the Lease
   • Outcome: The court found that the fourth defendant was not liable for the tort of conversion of the Lease.
   • Category: Substantive
   • Related Cases:
     • [2009] 4 SLR(R) 1101
4. Whether the fourth defendant was liable for the tort of inducing breach of contract of the Franchise Agreement
   • Outcome: The court found that the fourth defendant was not liable for the tort of inducing breach of contract.
   • Category: Substantive
5. Whether leave ought to be granted to the plaintiff to commence legal proceedings against the first defendant and second defendant
   • Outcome: The court did not grant leave to the plaintiff to commence proceedings against the first defendant and second defendant.
   • Category: Procedural
   • Related Cases:
     • [2004] 1 SLR(R) 671
     • [2011] 1 SLR 382
     • [2017] 2 SLR 898
     • [2012] 2 SLR 999

8. Remedies Sought

1. Leave to commence proceedings
2. Reversal of the transfer of the Lease
3. Damages for loss of profit

9. Cause of Actions

• Breach of Contract
• Tort of Conversion
• Tort of Inducing Breach of Contract

10. Practice Areas

• Insolvency
• Liquidation
• Commercial Litigation

11. Industries

• Childcare

12. Cited Cases

13. Applicable Rules

14. Applicable Statutes

15. Key Terms and Keywords

17. Areas of Law

16. Subjects

• Insolvency
• Contract Law
• Land Law