SWIFT MAIDS PTE. LTD. & Anor v CHEONG YI QIANG & 4 Ors

Facts

Swift Maids Pte Ltd and Swift Maids Resources Pte Ltd are foreign domestic worker (FDW) employment agencies run as a single business. Mr Cheong Yi Qiang was their general manager from 21 March 2018 until 6 March 2020 under a written contract with the first plaintiff. Recruitbee Employment Pte Ltd, a rival agency, was incorporated on 23 March 2019 with Mr Cheong and Ms Toh, a Swift Maids customer and freelance designer, as its registered directors; Ms Aung, a former Swift Maids employee who later supplied FDW biodata, claimed Mr Cheong was her nominee. Recruitbee Helpers Pte Ltd was later set up to continue the business after Recruitbee Employment's licence was suspended.

In 2020 three biodata suppliers stopped supplying Swift Maids, three experienced sales staff left for Recruitbee Employment, and Swift Maids' expected boom during the Covid-19 period did not materialise while Recruitbee did well. In Suit No 238 of 2021 the plaintiffs sued Mr Cheong for breach of contract, breach of confidence and breach of fiduciary duty, sued the other defendants for dishonest assistance, and sued all of them for unlawful means conspiracy. They alleged that Mr Cheong had taken their customer, FDW and supplier information to divert business to Recruitbee, initially claiming a wrongful gain of an estimated $744,359.31. They also complained of invoices from Pixelate, a deregistered business Mr Cheong had owned, an $8,190 cash advance for a supplier, and 28 transport claims.

Issues

1. Whether Mr Cheong breached his employment contract, including by his involvement with Recruitbee Employment and the Pixelate invoices.
2. Whether Mr Cheong breached his equitable or contractual duty of confidence.
3. Whether Mr Cheong owed fiduciary duties, so that the other defendants could be liable for dishonest assistance.
4. Whether the defendants were liable for unlawful means conspiracy.

Holding

The High Court allowed the claim against Mr Cheong for breach of his employment contract in part, ordering him to pay the first plaintiff nominal damages of $1,000 for his involvement in setting up and operating Recruitbee Employment and a further $1,000 for the Pixelate transactions. It dismissed the claims for breach of fiduciary duty, breach of confidence, the transport claims and the $8,190 payment, unlawful means conspiracy and dishonest assistance. Costs were to be heard.

Reasoning

Mr Cheong breached cll 8.3, 8.4 and 13.4 of his contract and the implied duty of good faith and fidelity. While still employed he was a registered director and shareholder of Recruitbee Employment, lent his name to its licence application and bank account, introduced an investor, joined a Myanmar meeting about its marketing, helped recruit staff and booked a flight for one of its FDWs using a Recruitbee e-mail address. Unlike Smile Inc Dental Surgeons Pte Ltd v Lui Andrew Stewart [2012] 4 SLR 308, he crossed into actual competition. The court disbelieved his account of the Pixelate invoices and found he had used Pixelate as a front to bill Swift Maids without consent, though Swift Maids received the services and no overcharging was proved. The $8,190 was found to have reached the supplier, and the transport claims were not shown to be for Recruitbee.

On confidence, the plaintiffs had pleaded a wrongful gain case, so they bore the burden under the traditional test and could not rely on the modified I-Admin approach. Supplier contacts were part of Mr Cheong's general knowledge, and FDW biodata was often posted online. Crucially, the plaintiffs could not name a single customer or FDW diverted using their information, ran no forensic checks, and relied on conjecture. Even under the modified approach, Mr Cheong's conscience was unaffected: his phone held limited information obtained in normal work, and Recruitbee's evidence, supported by a plaintiffs' witness, showed it won business through walk-ins, outreach lunches and online portals.

Mr Cheong was not a fiduciary. As general manager, not a director, his authority was confined to operations, and the directors and finance team controlled payments and could check him, so Swift Maids was not peculiarly vulnerable. The dishonest assistance claims therefore failed.

The conspiracy claim failed because setting up a competitor, even if harmful to Swift Maids, was not a combination intended to injure it by unlawful means; the staff left after Mr Cheong did and for their own reasons; and no loss was proved. The court declined to draw adverse inferences to fill gaps in the plaintiffs' case. As neither the fact nor the amount of loss was proved, only nominal damages were awarded.

From the judgment