30 October 2020
Perry, Tamar and another v Esculier, Bonnet Servane Michele Thais and another  SGHC(I) 22
Suit No 4 of 2020 (Summons No 55, 62 and 64 of 2020)
Decision of Simon Thorley IJ:
Outcome: SICC orders that the claim for unjust enrichment in the Statement of Claim and the consequential prayer for relief be struck out. Leave to amend the writ and the statement of claim was denied. The case was also deemed to be an offshore case.
1) The Plaintiffs and Defendants were investors in funds administered by a group of companies trading under the name “Lexinta”. The activities of these companies appear to have been directed by a Spanish citizen resident in Switzerland, Bismark Antonio Badilla Rivera (“Badilla”). The first Plaintiff asserts that Badilla, through the Lexinta group, was running a fraudulent Ponzi scheme.
2) The Defendants were, apparently, relatively early investors in the scheme. Following demands made on the Defendants’ behalf, sums amounting to around US$10 million were credited by Lexinta to the first Defendant’s bank account with DBS Bank Ltd (“DBS”) in Singapore (the “Disputed Monies”). Around this period of time, the Plaintiffs (and persons from whom they derive title) claimed to have deposited in excess of US$24 million with Lexinta. It was also claimed that Lexinta dissipated it as part of the Ponzi scheme to earlier investors including the Defendants.
3) Both the Plaintiffs and the Defendants subsequently asserted their rights to the Disputed Monies. This resulted in DBS availing itself of interpleader proceedings. The present suit was commenced as a result of those interpleader proceedings.
4) In these Summonses, the Defendants sought to strike out a claim relating to unjust enrichment in the Statement of Claim. The Plaintiffs, on the other hand, sought leave to amend the Statement of Claim to include a third alternative claim and to join Lexinta Group Ltd, a Hong Kong company, as a Defendant in the action. The Plaintiffs also sought a declaration that this was an offshore case.
The Court’s decision
The striking out issue
5) The Court held that interpleader proceedings are a statutory creation of limited nature. The object of such proceedings is only to assist a mere custodian of property to identify to whom it owes liability in relation to that property. The property in question has to be property over which the Court is able to exercise jurisdiction. Once jurisdiction is established, there is no requirement that the custodian should seek leave to serve the proceedings out of the jurisdiction on any of the claimants: at .
6) The present action was not a freestanding action and had been commenced for the limited statutory purpose of seeking to resolve rival claims to the ownership of the property: at .
7) The claim in unjust enrichment, however, was a personal claim. The Court did not have the power to allow it to be brought as part of interpleader proceedings: at  and . As the Defendants are foreign nationals, to allow the claim in unjust enrichment would allow the Plaintiffs to circumvent the requirement of seeking leave to serve out of jurisdiction: at . The claim in unjust enrichment was therefore ordered to be struck out: at .
Leave to amend the Writ and Statement of Claim
8) First, the Court granted leave to amend and clarify various particulars relating to the propriety claim to the Disputed Monies: at .
9) Secondly, however, leave to join Lexinta Group Ltd as a party to the action was not granted. The presence of Lexinta Group Ltd was not necessary for the purpose of resolving the interpleader dispute: at  to . Even if there had been a valid basis for concluding that there was an issue involving Lexinta Group Ltd to be raised, the Court held that it would not have been just and convenient to join it to proceedings. There was no evidence of it being a company of substance or of officers being available and capable of conducting proceedings: at .
10) Thirdly, the Court refused to grant leave to amend the Statement of Claim to invoke s 73B of the Conveyancing and Law of Property Act (Cap 61, 1994 Rev Ed) or its equivalent under the law of Hong Kong (s 60 of the Conveyancing and Property Ordinance (Cap 219)). Such a claim was personal in nature and could not be brought in interpleader proceedings: at  to .
The offshore case issue
11) The Court began this issue by holding that the requirements under O 110 r 1(2)(f)(i) and O 110 r 1(2)(f)(ii) of the Rules of Court (Cap 332, R 5, 2014 Rev Ed) were disjunctive requirements: at  to .
12) The only connection to Singapore in this case was that the Disputed Monies were held in a Singapore bank account: at  and . The guidelines in the Singapore International Commercial Court Practice Directions 29(3)(c) suggest that this was of itself insufficient to constitute the necessary substantial connection. The Court rejected the argument that this guideline was only appropriate in cases such as Mareva injunctions or funding through Singapore banks as no rational distinction could be drawn in this regard: at  and . Consequentially, the Court held that the action was an offshore case.
13) While the application for an offshore case had been made over three months too late, the Court exercised its discretion and granted an extension of time for the application. This was because by the time the action had been transferred to the SICC, the pleadings had already closed, and the 28-day period for application had already expired: at  and .
This summary is provided to assist in the understanding of the Court’s grounds of decision. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s grounds of decision.
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