Low Sing Khiang v Logicmills Learning Centre Pte. Ltd. and others

Mr Low Sing Khiang, a businessman, entered into a shareholders agreement dated 1 September 2014 with LogicMills Learning Centre Pte Ltd, an enrichment education company whose directors and shareholders were a married couple, Ms Seet Chuen Yee Eunice and Mr Mark Robert Nowacki. They set up a joint venture company, LogicMills Academy (LA), with Mr Low paying $70,000 for 70,000 shares and chairing the board. It was undisputed that the couple gave Mr Low a presentation on 8 May 2014, but the parties disagreed about what was said. Mr Low alleged they represented that LogicMills' programmes and curriculum were endorsed, validated and certified by the Ministry of Education (MOE), and its brochure described them as MOE-certified and Validated & Endorsed. The defendants said they had only referred to a MOE-funded research project and its report.

Mr Low lent LA money as director's loans. In 2016 he pressed for proof of MOE endorsement; on 20 July 2016 Ms Seet resigned as LA director and gave notice to terminate the agreement. Mr Low's solicitors wrote on 14 September 2016 seeking repayment and proof of MOE validation. He said parents withdrew their children and he suspended LA's operations around December 2016. In Suit No 707 of 2018 he sought rescission and damages under s 2 of the Misrepresentation Act, with alternative claims based on two alleged oral agreements and unjust enrichment. The couple, acting in person, alleged that Mr Low himself had directed the MOE marketing and had fabricated evidence of withdrawals.

1. Whether claims could be pursued against Ms Seet and Mr Nowacki personally, given the pleadings.
2. Whether LogicMills was liable for misrepresentation under s 2 of the Misrepresentation Act.
3. Whether Mr Low validly rescinded the shareholders agreement and what damages he could recover.

Statutory misrepresentation lies only between contracting parties, so it could only run against LogicMills. Negligent misrepresentation was not properly pleaded against anyone, and the bare plea that the couple were the directing mind and will of LogicMills did not disclose an alter ego case.

The judge found that the representations were made as Mr Low alleged: the brochure's infographic conveyed that the curriculum was MOE validated, endorsed and certified, which a reasonable person would not split into separate concepts. When Mr Low repeatedly asked for a certificate or MOE email, Ms Seet was evasive, never sent it and never told him no formal validation existed. It was undisputed that, if made, the representations were untrue. The statutory defence failed: in 2012 an MOE officer had told Mr Nowacki to stop using MOE in advertising, and his explanation that the officer had overstepped his authority was rejected. Mr Low relied on the representations, as shown by LA's own Validated by MOE marketing, and refund cheques and unchallenged evidence from two parents showed loss when students withdrew.

The 14 September 2016 letter rescinded the agreement, and attending later AGMs or registering a domain did not amount to clear affirmation. The defendants' challenges to the authenticity of LA's financial statements were largely speculative, and the judge accepted that Mr Low provided $577,625 to LA, which he would not have done but for the misrepresentations. The alternative claims on the oral agreements did not need to be decided.

Lee Seiu Kin J allowed the claim in part. LogicMills was held liable for innocent misrepresentation under s 2 of the Misrepresentation Act and ordered to pay $577,625 in damages, and the court declared that Mr Low validly rescinded the shareholders agreement, with LogicMills entitled to have his LA shares transferred back. The claims against Ms Seet and Mr Nowacki were dismissed, with costs to be heard.