Follow-up on Court’s Decision to Set Aside a Service Order in Case Spanning Singapore-PRC

In Kiri Industries Limited v Senda International Capital Limited & Anor [2024] SGHC(I) 15, the Singapore International Commercial Court (“SICC“) upheld the principle that when a Chinese national resident in the People’s Republic of China (“PRC“) is to be examined under an examination of judgment debtor order (“EJD Order“), the relevant treaty procedure should be followed, rather than by allowing the EJD Order to be served on him out of jurisdiction in the PRC.

By way of background, the plaintiff (“Kiri“) sought to vary or discharge an order setting aside leave to serve an EJD Order on Mr Ruan (a former director of the defendant, “Senda“) out of jurisdiction (“service out order“). The Court set aside the service out order against Mr Ruan based on the following grounds:

(a)  The service out order also applied to the director of Senda (“Ms Fan“), who had succeeded in having the service out order set aside in relation to her. One ground (“Treaty Ground“) rested on the Treaty on Judicial Assistance in Civil and Commercial Matters between the People’s Republic of China and the Republic of Singapore (“Treaty“). The SICC held that the alternative process of taking evidence by judicial assistance under the Treaty should be followed, rather than by permitting service of the EJD order on Ms Fan, a Chinese national resident in the PRC.

(b)  Although Mr Ruan did not apply to have the service out order set aside in relation to him, counsel for Kiri nonetheless accepted that if the reasons to set aside the service out order as regards Ms Fan applied equally to Mr Ruan, the service out order should likewise be set aside as regards Mr Ruan. Importantly, Mr Ruan was likewise a Chinese national resident in the PRC.

(c) The SICC therefore ordered that the service out order as regards Mr Ruan be set aside, albeit with the condition that the setting aside order was “subject to any application made within 10 days by the parties or either of them to vary or discharge the [setting aside] order”.

Kiri applied to vary or discharge the setting aside of the service out order as regards Mr Ruan based on four arguments against the Treaty Ground. However, the SICC noted that none of the arguments provided any basis to distinguish between Ms Fan and Mr Ruan’s positions. For instance, Kiri argued that the service out order effectively required Mr Ruan to come to Singapore to be examined; it therefore took effect in Singapore and not the PRC, and thus did not infringe Chinese sovereignty. However, this argument was rejected by the SICC as it applied equally to Ms Fan, and did not explain why the service out order as regards Mr Ruan should be treated differently.

The SICC highlighted that any application to vary or discharge the setting aside of the service out order as regards Mr Ruan should be based on grounds that do not apply to Ms Fan. As Kiri was not able to identify any grounds to vary or discharge the setting aside of the service out order as regards Mr Ruan that applied only to Mr Ruan and not Ms Fan, the SICC dismissed Kiri’s application, and ordered that the setting aside of the service out order as regards Mr Ruan be made unconditional.

Senda and Ms Fan were successfully represented by Priscilla Soh (Partner) and Darren Lim (Senior Associate) of Rajah & Tann Singapore’s China-Related Investment Dispute Resolution Practice.

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