Company Law in SG

MeOwSuSan SG

Hallo ! I been busy lately hardy post, I came a cross a Big Problem it give me a big headache till now, trying very hard to solve this.

Problem :

I have a customer who a designer, he own his own company and was a Pte Ltd, one day he come to me request my company to help him do the job and will pay us after 30days. at first we refuse but he keep calling hope we help him.

So we help him, but when the payment is due he refuse to pay up, and refuse to pick up our call and email.

Later we file a case in court to get Leger assistance, but the company address he use was not his company, and they don't function there... we was shock, does Singapore allow Pte Ltd to function this way. This is a so call hole in law?

Should Singapore Government look in to the matter, We can't take any Leger action that they pass out, because is Pte Ltd we can took sue him only the company...

What is the best way? there since many Law hole is Singapore Law protect company? or destroy....

maurizio13 SG

I am not too sure if your circumstances qualify for this rule,

Link: Piercing / Lifting the Corporate Veil

consult a lawyer if in doubt, but it's going to cost alot of money if you decide to take legal actions.

If amounts are too small, which I think they are, maybe you can file a writ at the small claims tribunal.

Link: Small Claims Tribunal

The best solution is still to discuss with "that person" regarding payment, hope you can settle the matter amicably.

Also, you should quantify the amount of evidence you hold to prove your case.

Master -_- SG

if the deal is less than 5k, i suggest you just write it off as bad debts..to pursue it further in court will just drag your expenses and opportunity costs away..remember, you are suing him to get back the money..to get him to cover your legal expenses is another matter altogether...

Just remember to practice further and stricter control when concluding a deal, prepare a contract and make him sign..check the background..the judge isnt gonna give you brownie points should he find out if you didnt practice stricter controls in the first place.

MeOwSuSan SG

thank you for the advise .

Leger action been taken was mention early on ....

firstly Small only suitable amount less than 10k and it only apply if the person appear , it does help much if the company is pte ltd ... I try liao ... not much help...

if the person don't come they can't do any thing ....

Lawyer got liao ... no use .... less you want to spend alot of money to windup his business. How much you want to spent? singapore fee is very XXXX even the lawyer ... so the money you get back may not enough to cover the fee...

So is there hole in the Laws they made ?

monoslayer SG

find debt collection agencies. Rolling Eyes

MeOwSuSan SG

Is more than 5k than why ....

But the judgment pass down unable to apply.

even he sign contract we can't do much .... abit like liang tou bu cao an(in chinese).

He background clean but heart dirty how?

But the only thing I not sure, why a company own money even you have a court order you only can do so little .... where is laws...

maurizio13 SG

First thing you need to establish is whether he is capable of paying the debt, if his company is really insolvent, then no point taking him to court, it's going to cost tens of thousands. I am sure your lawyers have already told you, if you win the case, the person losing has to pay 2/3 your legal cost, so your legal cost is only 1/3 if you win the case.

If he is capable of paying the debt, you need to know how confident of you in winning the case. Don't listen to those money hungry lawyers, they will most likely pour more petrol in to the fire and suggest you proceed with the case. That is how they make money.

Is the money he owes your company in one big contract or several contracts? Not sure if you can do this, maybe you can try proceeding your case in Small Claims Tribunal in piece meal fashion (each individual contract).

MeOwSuSan SG

They are blood sucker !!!!

All the money they collect, you need to give them 40% of the share ....they too much ...

OVER Charge !!! Mad Government need to control the fee.....

Master -_- SG

not necessarily, the defendant have to pay legal costs to the plaintiff…depends on the judgement of the judge

monoslayer SG

dunno tis is helpful anot..

http://app.subcourts.gov.sg/e-adr/index.aspx

maurizio13 SG

If you have lawyers representing you, maybe you should ask them about "Piercing / Lifting the Corporate Veil", it means going after the ultimate person behind this sham, he is hiding behind incorporation to commit his frauds.

C. Fraud or Sham

The corporate veil may be lifted where there has been a fraud or other breach of the law.15 The fraud and sham argument refers to the use of a corporation by the controller to evade a legal or fiduciary obligation, where the corporation is used as a front to mask real obligations.

As the full Federal Court noted in Donnelly v. Edelsten16 "[t]he argument [of fraud] is, of course circular. It can only succeed if the argument of sham succeeds . . . ."17 If a company is a "sham" or "façade" then it has incorporated merely to disguise the reality of its operations18 or evade obligations.19

In order to pierce the corporate veil for fraud, the company "must have the intention to use the corporate structure in such a way as to deny the plaintiff some pre-existing legal right."20 More specifically, the corporation is used in a manner to avoid a legal obligation.21 It is generally permissible to form companies to avoid a future liability, for example in a risky business venture that may fail; however, courts may not allow a company to be formed to avoid performing an existing legal duty.

Nevertheless, such arguments can be criticised for disregarding the separate entity principle.22 In regards to a "sham" corporation, Windeyer J. has held "[i]f a company is duly incorporated and registered under the [Corporations] Act and the proper records are kept in due form and the prescribed returns are made, it continues to exist as a legal entity. In that sense it is a reality not a sham."23

MeOwSuSan SG

can't go small claim, any way I try before it never work ... but even if i go also no use, if the person don't appear on the date given, they also can't take action specially PTE LTD ....

MeOwSuSan SG

the best is too wind up the company .... check their account .....

but this will cost alot, you may not able to go back the money ....

count fee + Leger fee cost more , you may not recover your loss...

HyperFocal SG

I look at your scenario, & I say it is not so much a loophole in Singapore's Commercial Law/s. It's your own naivity...

In business, it is a Jungle out there, and people are truly Animals - any chance they get, they WILL EAT YOU.

When you go into a Jungle, first find out which Jungle, what type, and Where on earth it is. Then, find out the kinds of animals inside this Jungle...

This way, better chance to survive....