MPM CAPITAL PTE. LTD. v DESPACE PROJECT AND DESIGN PTE. LTD. & Anor

Facts

MPM Capital Pte Ltd sued Despace Project and Design Pte Ltd (Despace) and Mr Sum Chong Fai in District Court Originating Claim No 1516 of 2025. According to MPM Capital, Despace had broken several loan agreements which Mr Sum had guaranteed. Mr Sum is the sole director and shareholder of Despace.

In Summons No 552 of 2026, Despace and Mr Sum applied for Mr Sum to act for Despace in the claim. MPM Capital did not object, except that it asked for a condition: that Mr Sum undertake to be personally responsible for any legal costs ordered against Despace. Mr Sum opposed that condition. The application was heard by a Deputy Registrar.

Issues

1. Whether Mr Sum should be given permission to represent Despace under O 4 r 3(3) of the Rules of Court 2021
2. Whether permission should be conditional on Mr Sum undertaking to pay any costs ordered against Despace

Holding

The Deputy Registrar allowed the application in SUM 552, giving Mr Sum permission to act for Despace, and did so without requiring any undertaking from him to be personally responsible for costs ordered against Despace. Costs were ordered to be in the cause.

Reasoning

Mr Sum was duly authorised by Despace and was a proper person with sufficient executive or administrative capacity to represent it, so permission was granted.

On the condition, MPM Capital relied on Bulk Trading SA v Pevensey Pte Ltd and another [2015] 1 SLR 538, where the High Court said a similar costs undertaking would be fair and reasonable. The Deputy Registrar distinguished it on two grounds. In Bulk Trading the court doubted the representative's grasp of his duties and the good faith of the application, whereas nothing suggested that Mr Sum or Despace had acted unreasonably or improperly. And the director there was a third party, while Mr Sum is a co-defendant; if MPM Capital won against both, the usual costs order would be joint and several, so an undertaking would add little.

The condition also sat uneasily with the separate legal personality of a company. An officer representing a company must act in its interests, and the bar for personal costs orders against directors and shareholders is high, as explained in SIC College of Business and Technology Pte Ltd v Yeo Poh Siah and others [2016] 2 SLR 118. Because the condition had substantively the same effect as a personal costs order, the same caution applied. The Deputy Registrar suggested that courts should be slow to impose such conditions and might instead consider a less drastic step, such as limiting the officer's right of audience to a certain stage of the proceedings. Where the officer or company had behaved unreasonably, as in Bulk Trading, such an undertaking could be appropriate, but here it was not needed for the proper administration of justice.

From the judgment