Value Monetization III Ltd v Lim Beng Choo

In an earlier action (Suit 441), International Healthway Corp Ltd (IHC) sued lenders and others over loan facilities that had been held void. On 9 July 2020 the High Court held a group of Crest entities, including Value Monetization III Ltd (VMIII) and The Enterprise Fund III Ltd (EFIII), and IHC's former chief executive jointly and severally liable for $12,594,646.74, and held Ms Lim Beng Choo, a senior IHC officer, jointly and severally liable for $4,538,800 of that sum for negligence. Pending appeal, EFIII and VMIII paid IHC in September 2020. On 30 March 2021 the Court of Appeal affirmed Ms Lim's liability but overturned the findings against VMIII and another entity; it later held that VMIII, having paid on behalf of all the Crest entities, should look to its co-defendants for contribution.

On 8 July 2022 VMIII and EFIII sued Ms Lim for contribution in Originating Claim No 125 of 2022 and Originating Claim No 126 of 2022. On 12 September 2022 she issued third party notices and statements of claim against several Crest entities and individuals, seeking contribution and, against some, an indemnity. An assistant registrar struck these out as time-barred. Ms Lim appealed in six registrar's appeals, which the Judge dismissed on 11 September 2023. She then appealed in respect of one third party only, and the Judge gave full grounds.

1. Whether the assistant registrar should have allowed some third parties to amend their defences at the hearing to plead limitation.
2. Whether Ms Lim's contribution claims were time-barred under s 6A of the Limitation Act 1959.
3. Whether the third party claims were barred by res judicata or were an abuse of process.

On amendment, the Judge accepted that the third parties could be criticised for changing position, but no new facts were pleaded, the proceedings were at an early stage, and Ms Lim suffered no prejudice since one third party had already pleaded limitation and she was ready to meet it.

On limitation, the right to contribution under s 15(1) of the Civil Law Act 1909 rests on a common liability to the original claimant; no new right arises when a defendant later seeks contribution. Ms Lim's own notices relied on her liability in Suit 441. Under s 6A(1) and (3), the right accrued on 9 July 2020, the date of the High Court judgment that fixed both her liability and its amount, and s 6A(4) meant the appeal judgment did not move that date. The period expired on 8 July 2022, so the notices filed on 12 September 2022 were out of time. The payments by EFIII and VMIII did not extinguish or suspend her right; she remained liable to contribute her share of the common liability. Her argument that her liability had not yet arisen was also self-defeating. The Judge agreed with Aer Lingus plc v Gildacroft Ltd and another [2006] EWCA Civ 4 that time runs from a judgment fixing quantum, but that was satisfied here. Her indemnity claims were likewise out of time.

The Judge stressed that contribution may be claimed before liability is decided, and that against a co-defendant the procedure under O 10 r 8 of the Rules of Court 2021 should almost always be used. Though not deciding res judicata, he observed that parts of her pleaded case appeared to re-argue findings on her negligence and could be an abuse of process.

The High Court dismissed all six appeals because Ms Lim's contribution claims against the third parties were time-barred. The assistant registrar had not erred in striking out her third party statements of claim.