HENRY QUEK PENG HOCK v CHIA SWEE HUN

Facts

Henry Quek, aged 62, founder of the Far Ocean Group, suffered strokes on 26 June 2020 and 8 October 2020. On 4 August 2021 the court found he lacked capacity and appointed his sister, Quek Lee Tiam (Judy), as his deputy under the Mental Capacity Act 2008. Through Judy, he sued Chia Swee Hun in Suit No 778 of 2021. Ms Chia, a Malaysian hairdresser he met around 2003, had been in a romantic relationship with him and lived with him at his home, The Tiara, until early 2020, when she returned to Malaysia. By then the relationship was strained. After the second stroke, Judy asked her to come back to care for him, and she returned on 13 October 2020.

The suit claimed assets Judy said Ms Chia held for Henry: a Kuala Lumpur flat and MM2 Asia bonds and shares bought with his money in her name before the strokes; a bond coupon; withdrawals by Ms Chia from a joint time deposit account; $800,000 transferred from his POSB savings account and two cheques of $500,000 each in February 2021; The Tiara, transferred to her by a deed of gift dated 19 January 2021, with $218,600 in stamp duty paid by Henry; $800,000 in cash allegedly taken from his safe; and watches and jewellery. After Henry was admitted to the Institute of Mental Health in April 2021, Ms Chia signed a document listing items she said he had given her. Judy relied on two 2018 letters in which Henry stated that various assets were held on trust for him; Ms Chia disputed their authenticity.

Issues

1. Whether the two 2018 letters were genuinely signed by Henry
2. When Henry lost mental capacity
3. Whether the assets bought before the strokes and the joint account moneys were held on trust for Henry or were gifts to Ms Chia
4. Whether the February 2021 transfers and the transfer of The Tiara were invalid for incapacity or undue influence
5. Whether Ms Chia took $800,000 in cash and converted the watches and jewellery

Holding

Audrey Lim J allowed the claim in part, rejecting only the claim to $800,000 in cash said to have been taken in October 2020, which was not proved. The judge set aside the deed of gift and ordered Ms Chia to transfer The Tiara and the Kuala Lumpur flat to Henry at her own cost, repay the $64,268.40 coupon, and hold any stamp duty refund on trust for him or compensate him. She must account for, and submit to tracing of, the share proceeds, the joint account withdrawals, the $800,000 POSB transfer and the $1m in cheques, and pay $943,000 in damages for conversion of the watches and jewellery. Orders on the restructured bonds and costs were reserved.

Reasoning

The court found the 2018 letters authentic: Henry's sons witnessed him sign them, and Ms Chia's handwriting expert compared only one specimen, used copies, and conceded under cross-examination that Henry might have signed them.

On capacity, the court accepted Dr Fones' evidence, supported by the treating neurologist, that the second stroke caused severe aphasia and a neurocognitive disorder. Henry's incoherent messages and the evidence of family and independent witnesses supported the functional test. He lacked capacity from about 9 October 2020.

For the assets bought before the strokes, Henry paid and the letters showed he did not intend a gift, so resulting trusts arose; no express trust was shown because nothing showed he told Ms Chia she held them on trust. Her account of funding the bonds herself was inconsistent and contradicted by bank records, and the court found the joint account moneys were Henry's. It found that her withdrawals from the joint time deposit account were made without his knowledge or approval and amounted to fraudulent misappropriation.

The February 2021 transfers and the transfer of The Tiara occurred after capacity was lost and were set aside. Independently, a relationship of trust and confidence existed because Henry depended on her, the transactions called for explanation, and Ms Chia did not rebut the presumption of undue influence. Her messages showed her exploiting his vulnerability, and the bank officer recorded the POSB transfer as for her to manage the fund.

The cash claim failed for lack of corroboration. Ms Chia was found to have listed the watches and jewellery for sale on her own online account, so damages were set at the final listed prices.

From the judgment