Ho Yu Tat v Chen Kok Siang: Striking Out & Bankrupt's Duty
Edward Ho Yu Tat, a bankrupt in Malaysia, appealed against the decision to strike out his Suit 965/2018 against Joseph Chen Kok Siang and Joseph Chen & Co for breach of contract and negligence. The Court of Appeal dismissed the appeal, holding that under Section 38(1)(a) of the Malaysian Insolvency Act, Ho Yu Tat required the Director General of Insolvency's prior sanction to commence legal proceedings in Singapore, which he did not obtain before starting the suit.
1. Case Overview
1.1 Court
Court of Appeal of the Republic of Singapore1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding whether a bankrupt in Malaysia needs the Director General of Insolvency's sanction before starting legal proceedings in Singapore.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Edward Ho Yu Tat | Appellant, Plaintiff | Individual | Appeal Dismissed | Lost | Fitzgerald Paul Michael of Paul Fitzgerald |
| Joseph Chen Kok Siang | Respondent, Defendant | Individual | Won | Won | |
| Joseph Chen & Co | Respondent, Defendant | Corporation | Won | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Tay Yong Kwang | Judge of Appeal | Yes |
| Woo Bih Li | Judge | No |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Fitzgerald Paul Michael | Paul Fitzgerald |
| Christopher Anand s/o Daniel | Advocatus Law LLP |
| Harjean Kaur | Advocatus Law LLP |
| Keith Valentine Lee Jia Jin | Advocatus Law LLP |
4. Facts
- The appellant, a Malaysian citizen, was made a bankrupt in Malaysia on 10 December 2014.
- The appellant commenced Suit 965/2018 against the respondents for breach of contract and/or negligence on 1 October 2018.
- The appellant did not seek the Director General of Insolvency’s sanction before commencing Suit 965/2018.
- The Director General of Insolvency granted sanction on 14 December 2018, after the commencement of the suit.
- The respondents applied to strike out Suit 965/2018 on the ground that the appellant had commenced the suit without the Director General of Insolvency’s sanction.
- The Assistant Registrar struck out Suit 965/2018, and the High Court Judge affirmed the decision.
- The appellant argued that prior sanction was not required because his claims had vested in the Director General of Insolvency.
5. Formal Citations
- Ho Yu Tat Edward v Chen Kok Siang Joseph and another, Civil Appeal No 162 of 2019, [2020] SGCA 38
6. Timeline
| Date | Event |
|---|---|
| Appellant commenced the Underlying Suit in the High Court against Nanyang Technological University. | |
| Underlying Suit was transferred from the High Court to the Subordinate Courts. | |
| Appellant engaged the second respondent to represent him in the Underlying Suit. | |
| Appellant’s defamation claim was dismissed by the District Judge. | |
| Appellant terminated the respondents’ retainer. | |
| District Judge’s grounds of decision were released. | |
| Appellant’s appeal against the District Judge’s decision was dismissed by Choo Han Teck J in the High Court. | |
| Appellant was made a bankrupt in Malaysia by a bankruptcy order of the Penang High Court. | |
| Appellant commenced the present action against the respondents. | |
| Appellant applied to the Director General of Insolvency for his sanction. | |
| Respondents entered an appearance in the present action. | |
| Director General of Insolvency informed the appellant that he approved the sanction for him to start and to continue with his action at the Singapore High Court. | |
| Respondents applied to strike out Suit 965/2018. | |
| The Judge affirmed the AR’s decision in her oral judgment. | |
| Appeal heard by way of video-conferencing facilities. | |
| Grounds of decision released. |
7. Legal Issues
- Legal standing of a bankrupt to commence legal proceedings
- Outcome: The court held that the appellant, being a bankrupt in Malaysia, required the prior sanction of the Director General of Insolvency to commence legal proceedings in Singapore.
- Category: Substantive
- Sub-Issues:
- Failure to obtain prior sanction from the Director General of Insolvency
- Retrospective effect of sanction
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Negligence
10. Practice Areas
- Litigation
- Insolvency
- Bankruptcy
11. Industries
- Legal Services
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Standard Chartered Bank v Loh Chong Yong Thomas | Court of Appeal | Yes | [2010] 2 SLR 569 | Singapore | Cited to determine whether the prior sanction of the Official Assignee is necessary for claims that do not vest in the Official Assignee. |
| Edward Ho Yu Tat v Nanyang Technology University, Singapore | District Court | Yes | [2014] SGDC 135 | Singapore | Cited as the decision in the Underlying Suit, where the appellant's defamation claim was dismissed. |
| Goh Eng Hwa v M/S Laksamana Realty Sdn Bhd | Court of Appeal | Yes | [2004] 3 MLJ 97 | Malaysia | Cited for the principle that filing an action without the Director General of Insolvency's previous sanction would result in the action being null and void. |
| Akira Sales & Services (M) Sdn Bhd v Nadiah Zee bt Abdullah and another appeal | Federal Court | Yes | [2018] 2 MLJ 537 | Malaysia | Cited to support the argument that Section 38(1)(a) of the Malaysian Insolvency Act applies to claims vested in the Director General of Insolvency. |
| Dato’ Kuah Tian Nam v Tan Wrun Peng | N/A | Yes | [2009] 9 MLJ 464 | Malaysia | Cited to support the argument that an undischarged bankrupt must obtain the previous sanction of the DGI to institute a claim. |
| Kesang Leasing Sdn Bhd v Dato’ Hj Mat @ Mat Shah bin Ahmad & Ors | N/A | Yes | [2009] 7 MLJ 305 | Malaysia | Cited to support the argument that an undischarged bankrupt must obtain the previous sanction of the DGI to defend an action. |
| Priyakumary Muthucumaru & Anor v Gunasingam a/l Ramasingam (a bankrupt) | N/A | Yes | [2006] 6 MLJ 511 | Malaysia | Cited to support the argument that an undischarged bankrupt must obtain the previous sanction of the DGI to maintain the action and continue with the case. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (Cap 322, R 5, 2014 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Insolvency Act 1967 (Act 360 w.e.f 31 December 1988) (M’sia) | Malaysia |
| Singapore Bankruptcy Act (Cap 20, 2009 Rev Ed) | Singapore |
| Singapore Bankruptcy Act (Cap 20, 2009 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Director General of Insolvency
- Sanction
- Bankruptcy
- Legal Standing
- Insolvency Act
- Previous Sanction
- Undischarged Bankrupt
15.2 Keywords
- Bankruptcy
- Insolvency
- Singapore
- Malaysia
- Director General of Insolvency
- Legal Standing
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Bankruptcy | 90 |
| Insolvency Law | 85 |
| Civil Procedure | 75 |
16. Subjects
- Bankruptcy
- Civil Procedure
- Insolvency