XSQ v LLD

The claimant filed Small Claims Tribunals Claim No 13773 of 2022 against the respondent on 6 June 2022, seeking damages of $14,328.00. The background was the 2022 downturn in cryptocurrency markets, in which the stablecoin TerraUSD lost its peg to the US dollar and its value fell nearly to zero in or around May 2022.

At the first consultation on 14 July 2022, the claimant alleged that material on the respondent's website misled her into believing TerraUSD was a relatively safe investment, leading her to buy $14,328.00 worth of it from the respondent. The respondent denied selling her any TerraUSD. It said it ran an online platform on which people deposited cryptocurrencies in exchange for interest, which it then lent to borrowers. After the respondent produced evidence that she had deposited her TerraUSD on its platform, the claimant conceded that she probably bought it elsewhere, but claimed that the respondent's material had influenced her. In her claim form she described the dispute as a contract for the sale of goods. The Assistant Registrar discontinued the claim at the consultation for want of jurisdiction and later gave these grounds.

1. Whether the claim was a specified claim relating to a contract for the sale of goods within the tribunal's jurisdiction.
2. Whether cryptocurrency such as TerraUSD falls within the definition of goods in s 61(1) of the Sale of Goods Act 1979.
3. Whether depositing TerraUSD with the respondent for interest was a contract for the provision of services.

First, the claimant had conceded that she did not buy TerraUSD from the respondent, so there was no contract of sale between the parties at all. That alone warranted discontinuance.

Second, even on her original case there would have been no sale of goods. Since the tribunal's statute does not define goods, the Assistant Registrar adopted the definition in the Sale of Goods Act, which existed earlier and dealt with the same subject matter. Goods there means personal chattels other than things in action and money. Personal chattels cover only tangible property capable of physical possession, so cryptocurrency is excluded. The Assistant Registrar also preferred a broad view of things in action as a residual category for all intangible property, noting that the Court of Appeal in Quoine Pte Ltd v B2C2 Ltd [2020] 2 SLR 20 had left open the type of property cryptocurrency is. On that view TerraUSD would be a thing in action and so excluded from goods for that reason as well.

Third, for completeness under the judge-led approach, the Assistant Registrar considered whether the deposit was a contract for services. Relying on the ordinary meaning of service and the Minister's reference to poor workmanship during the second reading of the bill, services meant one party doing work for another. The claimant had not paid the respondent to do any work. The transaction appeared analogous to a bank deposit earning interest, under which she acquired a thing in action, namely a debt for her TerraUSD plus interest, rather than a service.

The tribunal ordered that the claim be discontinued under s 17(3) of the Small Claims Tribunals Act 1984 because it fell outside the tribunal's jurisdiction. No decision was made on the merits, and the claimant was told she was free to pursue her claim in the appropriate forum.