SINGAPORE - Veteran skincare doctor and PPP Laser Clinic founder, Dr Goh Seng Heng, succeeded in stopping a company from checking with his bank to see if the $14 million it paid to buy shares still remained in his account.
The Court of Appeal, in allowing Dr Goh's appeal, criticised the company, Liberty Sky Investments (LSI), for not notifying Dr Goh when it applied to court last year to compel the bank to disclose the details sought.
"LSI had commenced the (lawsuit) in a manner that plainly went against the spirit of the law," said Judge of Appeal Andrew Phang on Thursday (Oct 5).
"LSI was, in essence, trying to steal a march on Dr Goh. In view of such conduct, LSI could not be said to have come to the court with clean hands," he added, in judgment grounds for the court, which included Judges of Appeal Judith Prakash and Tay Yong Kwang.
LSI, linked to a Shanghai-based couple who are franchisees for the PPP brand in Suzhou, is involved in a pending High Court suit against Dr Goh to rescind the share sale pact and recover the $14 million.
Dr Goh founded Aesthetic Medical Partners (AMP) in 2008. Through its wholly owned subsidiary Aesthetic Medical Holdings, it operates a chain of clinics under the PPP laser brand. Dr Goh remains a shareholder in AMP.
LSI had inked a deal in 2014 where Dr Goh would sell 32,049 shares in AMP to LSI for $14,422,000.
The company wants to back out, alleging the deal was clinched following fraudulent misrepresentations, while Dr Goh is denying the claims in the pending High Court suit.
In May last year, LSI applied to court to uncover documents from the bank to check if the sale price monies remained in Dr Goh's account or were shifted elsewhere.
On the same day, LSI applied for a Mareva injunction to freeze Dr Goh's assets. He was given notice of this, but not of its court move to check his bank account.
LSI succeeded in its case in the High Court last November.
Dr Goh appealed to the top court in relation to the bank account. He appealed against the Mareva separately, and the injunction was also later lifted.
His team of lawyers, led by Mr Adrian Tan, argued that LSI had to show "compelling evidence" of fraud regarding the asset and that there was a risk the asset would be dissipated to justify a court order to preserve the asset, which was not the case here.
Senior Counsel Harpreet Singh Nehal urged the court to uphold the High Court decision, pointing out that the sale proceeds had been used to buy two properties, among other things. He added that about $4 million of the purchase price remained unaccounted for.
The court, in examining the issues, was not convinced, and found that LSI had failed to show a prima facie case of fraud or inducement, in relation to the representations that led to the sale deal.
The court also held that LSI had not come with clean hands to court, having applied to check on documents related to the bank account on the same day it applied for a Mareva injunction to freeze Dr Goh's assets, and yet not notifying him of the former.
SC Singh accepted that LSI should have done so, noted the court.
The court allowed Dr Goh's appeal and reminded lawyers of following "the spirit of the law and not just the letter of the law".