Part I: Introduction ............................................................................... more Part I: Introduction ........................................................................................... 440 Part II: The Controversy .................................................................................. 441 A. The Theoretical Debate ................................................................... 441 B. The Empirical Evidence ................................................................... 448 Part II: A Comparative Survey ........................................................................ 451 A. Canada ............................................................................................. 451 B. United States .................................................................................... 453 Part III: Evolution of DCS in Singapore .......................................................... 459 Part IV: Charting the Middle Path ................................................................... 463 Part V: Conclusion ........................................................................................... 467 Postscript: ........................................................................................................ 467
This case comment discusses AI Enterprises Ltd v Bram Enterprises Ltd [2014] SCC 12, a recent dec... more This case comment discusses AI Enterprises Ltd v Bram Enterprises Ltd [2014] SCC 12, a recent decision of the Supreme Court of Canada. The court held, substantially endorsing the majority reasoning in OBG v Allan, that only an actionable civil wrong could constitute "unlawful means". However, the Canadian court justified this result on a conceptual premise that appears to differ from that assumed in OBG. Moreover, the Canadian court did not think it necessary to introduce the gloss that Lord Hoffmann propounded in OBG, viz that the illegal conduct must have interfered with the third party’s liberty to deal with the claimant. Further, the court critically evaluated a number of other strictures that had been previously applied to "unlawful means". The result is a tort that bears close resemblance to that crafted in OBG but which also differs from it in subtle but important ways.
Do shareholders have reserve or residual powers of management when the board is unable or unwilli... more Do shareholders have reserve or residual powers of management when the board is unable or unwilling to act? In Chan Siew Lee v TYC Investment Pte Ltd [2015] 5 SLR 409, the Singapore Court of Appeal answered this question in the affirmative. In so doing, the court employed a contractarian approach, rationalising the power as one that is conferred on shareholders by a term implied in the company’s constitution on the basis of necessity or business efficacy. But a closer review will demonstrate that the court’s analysis, despite its overt reliance on contractual principles, is ultimately of a hybrid nature that takes on board both contractual as well as public policy concerns. This approach aptly reflects the complex nature of the company’s internal workings and warns against a reductionist approach that tackles the issue from a monolithic (contractual) perspective.
Can an agent who is not authorised to contract for a company nevertheless be clothed with ostensi... more Can an agent who is not authorised to contract for a company nevertheless be clothed with ostensible authority to communicate the principal’s approval? Conventional understanding of apparent authority may suggest not, for the representation as to the principal’s approval may be no different from the agent’s self-authorisation. However, the controversial case of First Energy v Hungarian International Bank Ltd (“First Energy”) has held otherwise. Although the correctness of First Energy has been doubted, it has recently been unequivocally affirmed by the Privy Council in Kelly v Fraser. This note considers how Kelly v Fraser may affect the reception of First Energy in Singapore.
But in neither decision was this considered a straightforward conclusion. The complication lay in... more But in neither decision was this considered a straightforward conclusion. The complication lay in a unique feature shared by both cases, ie, that the alleged conspiracy was perpetrated by the company and a director who was also its alter ego. This gave rise to a conceptual conundrum: since the tort of conspiracy 3 requires proof of an agreement or combination, can this element realistically be established when the mind of the company is really that of its alter ego or its "directing mind and will"? 4 Or more simply, can two legal persons who share one and the same mind conspire? In Nagase, the High Court held that these questions presented no insuperable difficulty because the possibility of such complicity had already been implicitly accepted by the Singapore Court of Appeal in an earlier decision. 5 And in Lim Leong Huat, it was emphasised that the separate legal personality of the company amply justified this conclusion. 6 3 This article contends that both Nagase and Lim Leong Huat took too narrow an approach in focusing on the tort of conspiracy. Although both decisions were right in rejecting the conceptual impediment to such liability, they did not, with respect, sufficiently address the reasons that would justify the imposition of tortious liability on the director. It is important to note that the conspiracies alleged in both Nagase and Lim Leong Huat related to the company's breach of contract.
Part I: Introduction ............................................................................... more Part I: Introduction ........................................................................................... 440 Part II: The Controversy .................................................................................. 441 A. The Theoretical Debate ................................................................... 441 B. The Empirical Evidence ................................................................... 448 Part II: A Comparative Survey ........................................................................ 451 A. Canada ............................................................................................. 451 B. United States .................................................................................... 453 Part III: Evolution of DCS in Singapore .......................................................... 459 Part IV: Charting the Middle Path ................................................................... 463 Part V: Conclusion ..........................
Part I: Introduction ............................................................................... more Part I: Introduction ........................................................................................... 440 Part II: The Controversy .................................................................................. 441 A. The Theoretical Debate ................................................................... 441 B. The Empirical Evidence ................................................................... 448 Part II: A Comparative Survey ........................................................................ 451 A. Canada ............................................................................................. 451 B. United States .................................................................................... 453 Part III: Evolution of DCS in Singapore .......................................................... 459 Part IV: Charting the Middle Path ................................................................... 463 Part V: Conclusion ........................................................................................... 467 Postscript: ........................................................................................................ 467
This case comment discusses AI Enterprises Ltd v Bram Enterprises Ltd [2014] SCC 12, a recent dec... more This case comment discusses AI Enterprises Ltd v Bram Enterprises Ltd [2014] SCC 12, a recent decision of the Supreme Court of Canada. The court held, substantially endorsing the majority reasoning in OBG v Allan, that only an actionable civil wrong could constitute "unlawful means". However, the Canadian court justified this result on a conceptual premise that appears to differ from that assumed in OBG. Moreover, the Canadian court did not think it necessary to introduce the gloss that Lord Hoffmann propounded in OBG, viz that the illegal conduct must have interfered with the third party’s liberty to deal with the claimant. Further, the court critically evaluated a number of other strictures that had been previously applied to "unlawful means". The result is a tort that bears close resemblance to that crafted in OBG but which also differs from it in subtle but important ways.
Do shareholders have reserve or residual powers of management when the board is unable or unwilli... more Do shareholders have reserve or residual powers of management when the board is unable or unwilling to act? In Chan Siew Lee v TYC Investment Pte Ltd [2015] 5 SLR 409, the Singapore Court of Appeal answered this question in the affirmative. In so doing, the court employed a contractarian approach, rationalising the power as one that is conferred on shareholders by a term implied in the company’s constitution on the basis of necessity or business efficacy. But a closer review will demonstrate that the court’s analysis, despite its overt reliance on contractual principles, is ultimately of a hybrid nature that takes on board both contractual as well as public policy concerns. This approach aptly reflects the complex nature of the company’s internal workings and warns against a reductionist approach that tackles the issue from a monolithic (contractual) perspective.
Can an agent who is not authorised to contract for a company nevertheless be clothed with ostensi... more Can an agent who is not authorised to contract for a company nevertheless be clothed with ostensible authority to communicate the principal’s approval? Conventional understanding of apparent authority may suggest not, for the representation as to the principal’s approval may be no different from the agent’s self-authorisation. However, the controversial case of First Energy v Hungarian International Bank Ltd (“First Energy”) has held otherwise. Although the correctness of First Energy has been doubted, it has recently been unequivocally affirmed by the Privy Council in Kelly v Fraser. This note considers how Kelly v Fraser may affect the reception of First Energy in Singapore.
But in neither decision was this considered a straightforward conclusion. The complication lay in... more But in neither decision was this considered a straightforward conclusion. The complication lay in a unique feature shared by both cases, ie, that the alleged conspiracy was perpetrated by the company and a director who was also its alter ego. This gave rise to a conceptual conundrum: since the tort of conspiracy 3 requires proof of an agreement or combination, can this element realistically be established when the mind of the company is really that of its alter ego or its "directing mind and will"? 4 Or more simply, can two legal persons who share one and the same mind conspire? In Nagase, the High Court held that these questions presented no insuperable difficulty because the possibility of such complicity had already been implicitly accepted by the Singapore Court of Appeal in an earlier decision. 5 And in Lim Leong Huat, it was emphasised that the separate legal personality of the company amply justified this conclusion. 6 3 This article contends that both Nagase and Lim Leong Huat took too narrow an approach in focusing on the tort of conspiracy. Although both decisions were right in rejecting the conceptual impediment to such liability, they did not, with respect, sufficiently address the reasons that would justify the imposition of tortious liability on the director. It is important to note that the conspiracies alleged in both Nagase and Lim Leong Huat related to the company's breach of contract.
Part I: Introduction ............................................................................... more Part I: Introduction ........................................................................................... 440 Part II: The Controversy .................................................................................. 441 A. The Theoretical Debate ................................................................... 441 B. The Empirical Evidence ................................................................... 448 Part II: A Comparative Survey ........................................................................ 451 A. Canada ............................................................................................. 451 B. United States .................................................................................... 453 Part III: Evolution of DCS in Singapore .......................................................... 459 Part IV: Charting the Middle Path ................................................................... 463 Part V: Conclusion ..........................
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