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Cite as: [2015] EWHC 759 (Comm)

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		Neutral Citation Number: [2015] EWHC 759 (Comm)
		Case No: 2014 FOLIO 18

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT

Royal Courts of Justice
Strand, London, WC2A 2LL

26/03/2015

B e f o r e :

MRS JUSTICE CARR DBE
____________________

Between:

	QUAH SU-LING	Claimant
	- and -
	GOLDMAN SACHS INTERNATIONAL	Defendant

____________________

Mr Richard Millett Q.C. (instructed by Devonshires Solicitors) for the Claimant
Mr Ben Valentin and Ms Rebecca Loveridge (instructed by White & Case LLP) for the Defendant
Hearing dates: 11th and 12th March 2015
____________________

HTML VERSION OF JUDGMENT
____________________

Mrs Justice Carr :

Introduction and the Parties

This is an application by the Claimant, Ms Quah Su-Ling ("Ms Quah"), for permission to amend her Particulars of Claim. The application was issued on 10^th February 2015, some three weeks before the trial was due to commence (on 4^th March 2015). The application has led to the vacation of the trial dates in circumstances set out in more detail below. Ms Quah accepts that, were her application to succeed, she must pay the costs of the amendment and the costs of the action thrown away by the amendment and the adjournment (contractually on an indemnity basis) and that any permission should be conditional on a payment of 40% on account of any such reasonable costs.

There is a counter-application issued on 27^th February 2015 by the Defendant, Goldman Sachs International ("GS"). In the event that the application to amend were to fail, GS asks for the claim to be dismissed or struck out pursuant to CPR 3.4(2), and that it be granted summary judgment on its Counterclaim pursuant to CPR 24.2, all with costs.

Ms Quah is a sophisticated private investor permanently resident in Singapore. She is presently the Chief Executive Officer and an Executive Director of IPCO International Ltd ("IPCO"), an investment holdings company listed on the Singapore Exchange Ltd ("SGX"). As at 15^th February 2013 she declared to GS that :

a) her net worth and net investible assets were US$50 – US$100million;

b) she had broad exposure to investment in equities and sufficient knowledge (among other things) of investing in equities on SGX;

c) she had two or more years of experience of purchasing securities or borrowing against assets on margin, and sufficient knowledge of that type of activity.

GS is regulated by the Financial Conduct Authority.

The Facts

On 15^th February 2013, following an introduction by her investment consultant, Mr William Chan of Stamford Management Pte Ltd ("Mr Chan"), Ms Quah opened a private wealth management account with GS ("the account") for the purpose of increasing her shareholding in LionGold Corp Ltd ("Liongold") through a margin loan facility dated 15^th February 2013 ("the facility"). GS did not advise her on this course of action. It was a decision taken by Ms Quah independently and/or on the advice of Mr Chan.

The express terms of the facility permitted GS to call the loan in at any time and for any reason. Clause 15 of GS' applicable General Terms and Conditions ("Clause 15") provided materially as follows :

"..15.2 On Demand Loan; Increased Costs

Each Loan will be outstanding from day to day and repayable in the currency or currencies in which it is denominated on demand (such demand to be effective immediately) provided that [GS] shall give you reasonable time in all the circumstances to effect the mechanics of repayment prior to issuing a Close-Out Notice. For the avoidance of doubt, the Close-Out Notice may, in certain circumstances, be given on the same day on which the demand was made…

15.6.1 A Loan is an "on demand" facility, so [GS] can demand immediate repayment of any amount outstanding at any time and for any reason."

Ms Quah duly drew down monies under the facility. By 1^st October 2013 the sums drawn down were as follows :

a) SG$36,614,280.32; and

b) US$19,263,830.27

secured against the following assets as collateral, in summary, :

a) 31,700,000 shares in Asisasons Capital Ltd ("Asiasons");

b) 3,500,000 shares in Blumont Group Limited ("Blumont");

c) 31,633,000 shares in LionGold;

d) 28,247,376 GSI High Yield Rate Portfolio Fund units;

e) 731,577, 962 GSI Global High Yield Mutual Fund units; and

f) 60,573,320 GSI Global Strategic Income Bond Portfolio units,

(together "the Custody Assets").

The shares in Asiasons, Blumont and Liongold are referred to below as "the Shares".

At 8.45am (Singapore time) on 2^nd October 2013 Mr Tan Bong Loo ("Mr Tan"), GS' investment professional responsible for Ms Quah's account, orally informed Ms Quah (through Mr Chan) by telephone that GS required repayment of sums outstanding under the facility and that it was no longer comfortable lending margin against the Shares. At about 9.20am (Singapore time) Mr Chan telephoned Mr Tan asking for more time to pay, which request was refused.

At 11.47 am (Singapore time) GS made a written demand for repayment of the entire sums outstanding under the facility, namely SG$36,614,280.32 and S$19,263,830.27 ("the demand"). Payment was demanded by 1.30pm (Singapore time), failing which the account would be closed out and the facility terminated. Ms Quah did not repay the loan following the demand.

At 1.37pm (Singapore time) GS accordingly issued notice of default. Over the course of the following three weeks (between 2^nd and 23^rd October 2013) GS took steps to sell the Custody Assets pursuant to its contractual power of sale. The sales of the Shares were carried out on the SGX. Some, but not all shares in Asiasons were sold between 2^nd and 4^th October 2013. The sale of shares in Liongold commenced on 4^th October 2013. The sale of shares in Blumont commenced on 7^th October 2013.

The proceeds of sale were insufficient to meet Ms Quah's debt to GS.

It is said for Ms Quah that the share prices held up well on 2^nd and 3^rd October 2013. But by the time that trading in the Shares was suspended at 10am on 4^th October 2013 their value had fallen dramatically. When trading re-opened on 7^th October 2013 their value fell yet further.

As will later become apparent, at the heart of Ms Quah's proposed new case relating to liquidation of the Shares by GS are events said to have taken place shortly prior to the demand within GS, as allegedly revealed by GS' disclosure and the witness statements served for GS.

As to that, in the very early hours of 2^nd October 2013 (Singapore time) GS' head of private wealth management for the Asia Pacific region, a Mr Ronald Lee ("Mr Lee"), telephoned GS' managing director of the private wealth management group in Singapore, Mr Jason Moo ("Mr Moo"). Mr Lee patched in GS' global co-head of investment management in New York, Mr Eric Lane ("Mr Lane"). Mr Lane told Mr Moo that he was uncomfortable with the risks in Ms Quah's account, that GS should not be lending against the Shares, and that GS "needed to move the risk off our books" and to start selling first thing the next morning if Ms Quah was not able to find alternative financing to repay the loans. He wanted GS to "have eliminated its risk in relation to these accounts" by 4^th October 2013. Mr Moo then (at 3am Singapore time) called Mr Tan and instructed him to be in a position to start selling the Shares the next morning.

Ms Quah now says that it is to be inferred from these events that GS was in possession of critical information about Asiasons, Blumont and LionGold which would show or suggest (a) not only that the market value of the companies was too high but that it was so over-valued that if a market correction were to occur it would leave GS seriously exposed to losses, and (b) that such a market correction was or was likely to be imminent, such that there was an urgent need to sell the shares in the companies immediately ("GS' alleged knowledge").

Procedural chronology

Ms Quah has been represented throughout by leading counsel (although there was a change of leading counsel in or about late December 2014) and commercial London solicitors (namely Wiggin LLP until 21^st July 2014 when her current solicitors, Devonshires, came on the record for her and who have remained on the record for her ever since). In late December 2014 she appears also to have instructed solicitors in Singapore to advise her on these proceedings.

Ms Quah issued proceedings in the Queen's Bench Division on 5^th November 2013. This was the same day as she was informed that GS was considering bringing bankruptcy proceedings against her. Particulars of Claim were served on 20^th November 2013. The proceedings were commenced without Ms Quah first having obtained any expert advice. According to her third witness statement, they were issued simply on the basis of her "own experience and opinions". By March 2014 at the latest, however, she was aware that the obtaining of expert advice was "crucial" to her case, having been so advised by her lawyers (as set out in her second witness statement).

A Defence and Counterclaim were served on 16^th December 2013. The Counterclaim was for SG$15,148,930.77 and US$287,914.08, being the amounts outstanding under the facility. Ms Quah served a Reply and Defence to Counterclaim on 13^th January 2014. Ms Quah served Further Information pursuant to a request dated 16^th December 2013 on 15^th January 2014. On 30^th January 2014 the proceedings were transferred by consent to the Commercial Court. GS served Further Information pursuant to a request dated 21^st January 2014 on 14^th February 2014. All statements of case have been verified in the normal way.

A case management conference was held before Popplewell J on 6^th March 2014. He directed that the case should be case managed and heard together with a related action brought by another private wealth client of GS, a Mr James Hong ("Mr Hong"). Mr Hong discontinued his claim on 4^th July 2014, and GS was subsequently granted summary judgment on its counterclaim against him.

Popplewell J gave full directions to trial, which was fixed between the parties on 28^th March 2014 to commence on 24^th February 2015. Amongst other things, Ms Quah was given permission to serve expert evidence by 17^th October 2014 with provision for GS to serve expert evidence in reply by 21^st November 2014.

The parties gave standard disclosure on 23^rd May 2014. On 8^th August 2014, following a short extension agreed at Ms Quah's request following her change of solicitor, witness statements were exchanged. Ms Quah served a witness statement from herself and a Mr Patrick Lim ("Mr Lim"). GS served five witness statements : from Mr Tan, Ms Jannie Kek, Mr Josh Wang, Mr Chang Lee Liow and Mr Moo.

On 26^th September 2014 GS gave supplemental disclosure of some 185 documents relating to GS' decision-making process in the build up to the demand. These documents had come to light in the context of another customer claim, namely a claim by a Ms Ng Su Ling against GS also arising out of a demand on 2^nd October 2013 ("the Ng proceedings"). The Ng proceedings are fixed for trial in the Commercial Court in October 2015.

Between September and December 2014, GS' solicitors corresponded with Ms Quah's solicitors in relation to trial preparation matters. Amongst other things, they took on responsibility for the preparation of trial bundles.

Ms Quah did not serve any expert evidence on or by 17^th October 2014. On 6^th November 2014 her solicitors wrote to confirm that she did not intend to adduce any "based on the current scope of the evidence available". There followed correspondence between the parties on the question of whether Ms Quah intended to pursue those parts of her case dependent upon expert evidence. In the absence of a definitive answer, GS served its expert evidence from Dr Desmond Fitzgerald on 5^th December 2014 (an extended date for which GS obtained permission).

Dr Fitzgerald's report addresses each of the issues on which permission to adduce expert evidence had been granted. He concludes that GS achieved best execution for Ms Quah and that there was no evidence whatsoever to support the allegation that GS' actions had caused or contributed to the collapse in price of the Shares.

On 8^th January 2015, days before the pre-trial review fixed for 16^th January 2015, Ms Quah's solicitors indicated that Ms Quah :

a) would be applying to vacate the trial and for it to be re-fixed for a date after October 2015;

b) would be applying for permission to serve late expert evidence.

Such an application was filed and served on behalf of Ms Quah on 9^th January 2015.

The application for an adjournment was made on the basis that Ms Quah could not attend the trial dates as then fixed because of a clash with the hearing of arbitral proceedings to which she was a defendant in Singapore. It was also indicated that she could not travel to London in March 2015 because her passport had been impounded by the Singapore authorities. No hint was given that Ms Quah and her solicitors had not reviewed GS' evidence in detail with the result that, even ignoring questions of expert evidence, her case might be very far from ready for trial. The pre-trial review proceeded on the basis that neither the Court nor GS had any reason to doubt that her case as then pleaded was not the one being taken to trial.

At the pre-trial review Eder J refused the application for adjournment (with costs), but delayed commencement of the trial to 4^th March 2015 to avoid any overlap with arbitration proceedings in which Ms Quah was involved in Singapore. He granted permission for Ms Quah to give her evidence by video-link. Ms Quah's application to serve expert evidence out of time was adjourned pending production of a draft expert report.

Accordingly GS' solicitors corresponded thereafter in relation to preparation for trial commencing on 4^th March 2015.

However, on 6^th February 2015 Ms Quah's solicitors wrote to GS' solicitors as follows :

"Pursuant to instructions we have very recently received, we are currently preparing an application for permission to amend the Particulars of Claim very substantially ("the Amendment Application"). The amendments will abandon large parts of our client's case as it presently stands, and will seek substantially to re-plead the claim (and defence to counterclaim). …The Amendment Application will also seek further disclosure of documents from your client.

…we would anticipate that if permission for the amendments is granted, your client would wish to serve further factual and expert evidence.

…we will be proposing that the trial slot be used to determine the Amendment Application.…In the event the Amendment Application is refused, our client has instructed us that she will not proceed further with the action. …"

The trial dates thus fell to be vacated on the basis that a) were the amendment to be allowed, vacation was inevitable b) were the amendment to be disallowed, the claim would not proceed.

Ms Quah's application to amend (together with an application to vacate the trial date and for expedited re-fixing) was issued on 10^th February 2015 and served on GS' solicitors on 11^th February 2015. In Ms Quah's solicitors' letter to the Court, sent before service of the application on GS and without its knowledge or consent, it was said :

"The amendments are very substantial and they wholly change the nature of the case. Should the application succeed, it is plain that the trial will have to be adjourned from its current slot, in order to give the Defendant an opportunity to address the new case and to serve further evidence in support. Should the application fail, our client has instructed us that she will withdraw her claims. Accordingly, either way, the full current trial slot will not be required."

Against this background, the matter came before the Court on Ms Quah's application to amend on 11^th and 12^th March 2015.

The original case and the new case

The claim which Ms Quah has pursued at all times up to and indeed beyond the pre-trial review ("the original case") is, in summary, as follows :

a) GS "dumped" the Shares on the market from 2^nd October 2013. This caused a dramatic fall in their price;

b) GS failed to use reasonable efforts to obtain the best price available for the Shares because it should not have sold the Shares on the SGX at all from 2^nd October 2013, or should have ceased any sale of the Shares from 4^th October 2013;

c) the only reasonable course of action open to GS in the circumstances was a sale of the Shares by way of private placement. GS should have sold the Shares to a third party purchaser, Vicario Investments, found by Ms Quah;

d) had GS not sold the Shares from 2^nd October 2013, the proposed sale to Vicario Investments would have completed and enabled Ms Quah to repay the sum demanded, thereby avoiding the loss caused by selling the Shares from 2^nd October 2013.

By the proposed new case ("the new case") Ms Quah seeks to allege that :

a) GS acted in breach of Clause 15 in failing to give her a reasonable time to effect the mechanics of payment before issuing a notice of default and termination. A period of 48 hours' notice was required;

b) GS ought to have immediately and aggressively sold the Shares on the SGX from 2^nd October 2013 so that the loan was repaid in full before the collapse of the price of the Shares on 4^th October 2013; alternatively

c) GS ought to have warned Ms Quah on 2^ndOctober 2013 that the price of the Shares was about to undergo a significant market correction. She alleges that, in those circumstances, she would have immediately given instructions to sell the Shares aggressively on the SGX.

In more detail, the proposed amendments allege :

a) further express terms of the contract;

b) a new plea as to the true construction of Clause 15, in particular as to what "a reasonable time in all the circumstances to effect the mechanics of payment" meant. There is also a new plea as to the circumstances in which a close-out notice can be given on the same day as a demand;

c) statutory duties owed by GS under section 138(D)(2) of the Financial Services and Market Act 2000 ("FSMA") and the Conduct of Business Sourcebook ("COBS") rules, said to be imported into the contract either by force of law by that section or by clause 1.5 of GS' General Terms and Conditions;

d) new facts as to what GS is said to have known or believed about the imminent crash of the prices of the Shares, but did not tell Ms Quah, immediately prior to the making of the demand and the issuing of the default notice and close-out notice. Ms Quah states that the core of the complaint is that given (i) the fact that the concerns about the Shares had been escalated to senior management in New York (ii) the sudden and unexpected nature of the instruction given by Mr Lane to Mr Moo, (iii) the circumstances and timing of that instruction (at 2.30 am); (iv) Mr Lane's decision and instruction to Mr Moo to call in Ms Quah's loan and start liquidating her entire position immediately, and (v) the fact that, on the information that they had, GS Singapore personnel had not made such a decision themselves, but had had it imposed on them from New York, it is to be inferred that GS was in possession of critical information about Asiasons, Blumont and LionGold which would show or suggest (a) not only that the market value of the companies was too high but that it was so over-valued that if a market correction were to occur it would leave GS seriously exposed to losses, and (b) that such a market correction was or was likely to be imminent, such that there was an urgent need to sell the shares in the companies immediately;

e) a plea that had she known the relevant facts, Ms Quah would not have sought to delay the sales of the Shares but on the contrary, she would not have feared that GS would have dumped her shares and taken steps to prevent dumping, but would have actively encouraged or initiated an immediate and urgent liquidation of as many shares as possible based on an aggressive selling strategy (consistent with maintaining the price in the market) as soon as possible before the imminent market correction that GS feared could occur. That would have produced sales proceeds in excess of SG$40 million instead of the SG$7 million that was in fact achieved by GS ;

f) new allegations of breach of contract, namely :

i) breach of clause 15.2 of GS' General Terms and Conditions by :

failing to give Ms Quah reasonable time to effect the mechanics of payment before issuing a default notice and close-out notice. The period should have been 48 hours, and on any view 1 hour 42 minutes was not reasonable. The notices were not contractually compliant and therefore invalid and the sales carried out in breach of contract;

issuing a notice of default and termination on the same day as the demand notice;

ii) breach of clause 5.4 and Part E of GS' General Terms and Conditions by failing to warn or advise Ms Quah of their information and belief as to the true values of the Companies and their imminent collapse and failing to take all reasonable steps to obtain the best possible result for her on realisation in the light of those concerns;

iii) breach of clause 4.4 and 4.6 of GS' General Terms and Conditions by specifically failing to sell any shares in LionGold or in Blumont at all on 2^nd and 3^rd October 2013;

g) allegations of breach of statutory duty, namely under COBS, in failing to act fairly and professionally in Ms Quah's best interests, failing to take reasonable steps to ensure that its recommendations or her trade decisions were suitable for her, and failing to warn her that based on the information GS had, that the service was no longer appropriate for her, and in particular by failing to tell her what it knew, failing to take all reasonable steps to get the best prices and failing to sell any shares in Blumont or LionGold at all on 2^nd and 3^rd October 2013;

h) new pleas of loss and damage flowing from these breaches, namely loss of sales proceeds of either S$49,883,445 or S$38,882,995 depending on what participation rates for what shares would have been used;

i) new claims for relief, namely damages representing the difference between the realised value of the shares and the value of the shares had either of the selling strategies which GS should have adopted been adopted, in the sum of either SG$28,286,392, or SG$17,285,942. These exceed the amount of GS' counterclaim.

Principles to be applied

An application to amend will be refused if it is clear that the proposed amendment has no real prospect of success. The test to be applied is the same as that for summary judgment under CPR Part 24. Thus the applicant has to have a case which is better than merely arguable. The court may reject an amendment seeking to raise a version of the facts of the case which is inherently implausible, self-contradictory or is not supported by contemporaneous documentation.

Beyond that, the relevant principles applying to very late applications to amend are well known. I have been referred to a number of authorities : Swain-Mason v Mills & Reeve [2011] 1 WLR 2735 (at paras. 69 to 72, 85 and 106); Worldwide Corporation Ltd v GPT Ltd [CA Transcript No 1835] 2 December 1988; Hague Plant Limited v Hague [2014] EWCA Civ 1609 (at paras. 27 to 33); Dany Lions Ltd v Bristol Cars Ltd [2014] EWHC 928 (QB) (at paras. 4 to 7 and 29); Durley House Ltd v Firmdale Hotels plc [2014] EWHC 2608 (Ch) (at paras. 31 and 32); Mitchell v News Group Newspapers [2013] EWCA Civ 1537.

Drawing these authorities together, the relevant principles can be stated simply as follows :

a) whether to allow an amendment is a matter for the discretion of the court. In exercising that discretion, the overriding objective is of the greatest importance. Applications always involve the court striking a balance between injustice to the applicant if the amendment is refused, and injustice to the opposing party and other litigants in general, if the amendment is permitted;

b) where a very late application to amend is made the correct approach is not that the amendments ought, in general, to be allowed so that the real dispute between the parties can be adjudicated upon. Rather, a heavy burden lies on a party seeking a very late amendment to show the strength of the new case and why justice to him, his opponent and other court users requires him to be able to pursue it. The risk to a trial date may mean that the lateness of the application to amend will of itself cause the balance to be loaded heavily against the grant of permission;

c) a very late amendment is one made when the trial date has been fixed and where permitting the amendments would cause the trial date to be lost. Parties and the court have a legitimate expectation that trial fixtures will be kept;

d) lateness is not an absolute, but a relative concept. It depends on a review of the nature of the proposed amendment, the quality of the explanation for its timing, and a fair appreciation of the consequences in terms of work wasted and consequential work to be done;

e) gone are the days when it was sufficient for the amending party to argue that no prejudice had been suffered, save as to costs. In the modern era it is more readily recognised that the payment of costs may not be adequate compensation;

f) it is incumbent on a party seeking the indulgence of the court to be allowed to raise a late claim to provide a good explanation for the delay;

g) a much stricter view is taken nowadays of non-compliance with the Civil Procedure Rules and directions of the Court. The achievement of justice means something different now. Parties can no longer expect indulgence if they fail to comply with their procedural obligations because those obligations not only serve the purpose of ensuring that they conduct the litigation proportionately in order to ensure their own costs are kept within proportionate bounds but also the wider public interest of ensuring that other litigants can obtain justice efficiently and proportionately, and that the courts enable them to do so.

The Commercial Court has a long tradition of pro-actively managing litigation brought before it for the benefit of all users (as recognised, for example, in Worldwide Corp Ltd (supra)). The timetables laid out in and the requirements of the Admiralty and Commercial Court Guide, such as the requirement in D12.2 for provision of a progress monitoring information sheet, are designed precisely to avoid last minute problems which delay the start of trials or cause adjournment.

Principles applied

General considerations

First, the application arises in unusual circumstances. The combination of Ms Quah's concessions that a) her current claim, the original case, is unsustainable and b) permission to replace it with the new case would inevitably lead to a substantive adjournment means that the trial dates have already been vacated. But for the first concession, however, this would be an application being made effectively on the first day of trial.

Secondly, Ms Quah accepts that at least material parts of the original case which she has maintained from November 2013 to February 2015 have never been sustainable. The original case appears never to have had the support of an expert despite the fact that, as indicated above, Ms Quah knew from at least March 2014 onwards that such support was "crucial". In her third witness statement Ms Quah states that she was not, however, aware that the original case was unsustainable until she was so advised by Mr Ruiz "sometime in late January 2015". She refers to correspondence from GS' solicitors tending to suggest that the absence of expert evidence was not fatal to the entirety of her case.

Whatever the precise position, Ms Quah was aware from a very early stage that expert evidence was required to support central parts of her claim. This is the only fair conclusion to be drawn from her own evidence as to the advice she received in March 2014, from the content of her responses to Requests for Information, from her Case Management Information Sheet dated 27^th February 2014, from the detailed directions of Popplewell J in relation to expert evidence on 6^th March 2014 and from her belated attempt to secure expert evidence.

For reasons which are not wholly clear, she nevertheless took the decision not to seek such expert advice at that very early stage (when there is no suggestion of any obstacle in doing so) or at any stage before early January 2015, just before the pre-trial review. Even then she did not do so in a manner which led to her being advised fully before the pre-trial review, which should have been a priority. In proceeding in this manner, she ignored the directions of Popplewell J as to expert evidence, just as she ignored the requirement for filing of a progress monitoring sheet.

The question is whether or not, against this general background and in all the circumstances of the case, she should nevertheless be granted an indulgence at trial wholly to abandon her existing case and to run a new one based on facts and matters of which she either was and/or should have been aware many months, if not a year or so, earlier.

Reasons for lateness and delay

Ms Quah fairly accepts that her application to amend is made very late in the day. She advances the following explanations :

a) the new case arises from disclosure and witness statements served on behalf of GS;

b) she has been under tremendous strain from other proceedings and from having been under investigation by the Commercial Affairs Department of the Singapore Police Force, ("the CAD") with the result that she was not in the right state of mind to monitor the progress of the claim;

c) lack of funding at some stage around the summer of 2014 to some stage around late December 2014.

At the outset, I am troubled by a number of deficiencies in the explanations given by Ms Quah, of which there are the following obvious examples :

a) there is no proper explanation as to why Ms Quah did not instruct an expert at the outset or at any time before her funding difficulties are said to have arisen, in circumstances when she knew that the viability of (at least central parts of) the original case depended on expert evidence;

b) Ms Quah is careful to say that there was no detailed review with her solicitors until after the pre-trial review. But she is coy about the actual scope of the review before that. She does not go so far as to suggest that GS' witness statements were not reviewed at all on exchange. GS' five witness statements are not long or difficult to follow. She chooses not to explain when and what review was carried out. It appears that both she and/or her solicitors must have reviewed GS' witness statements, not least since they wrote on 6^th November 2014 explaining the decision not to serve expert evidence by express reference to "the scope of the evidence available";

c) she gives no proper particulars of the timeline between obtaining funding "in late December 2014" and 10^thFebruary 2015. This is a significant omission in circumstances where there was a pre-trial review on 16^th January 2015. Given that, on her own case, Ms Quah was in funds in late December 2014 and there was a pre-trial review fixed for 16^th January 2015, there is no proper explanation as to why Ms Quah was not in a position to have reviewed her case in detail with her solicitors before 16^th January 2015. The situation was one of the utmost urgency.

Putting these matters aside and in any event, the proposed amendments relating to the express terms of the contract, the proper construction of Clause 15 and breach thereof could and should have been pleaded from the very outset if they were to be raised at all. There is no good reason for their lateness. At most they would appear to arise out of a fresh examination of possible arguments by fresh counsel. This is precisely the sort of reason that does not find favour with the courts (see Worldwide Corp Ltd (supra)). The one potential exception relates to Ms Quah's reliance in part on an email sent by GS to Mr Chan on 25^th June 2013 (at paragraph 19A(a) of the draft Amended Particulars of Claim). But Mr Chan was at all material times Ms Quah's agent and in any event the document was disclosed as part of standard disclosure in May 2014.

As to the remaining proposed amendments which are said to arise out of GS' disclosure and witness statements, disclosure took place in May 2014 and witness statements were exchanged on 8^th August 2014. On the most generous view to Ms Quah, the delay spans from 8^th August 2014 to 10^th February 2015 when the application to amend was issued. This was of course a critical period in the life of the litigation. Expert evidence was to be served. The matter was to be prepared for trial. A pre-trial review was fixed for 16^th January 2015 with trial in February 2015.

The fact that the delay occurred in the context of an expeditious timetable is nothing to the point. The timetable was a reasonable one and was there to be complied with. If anything, the Court's directions made it clear that inertia on the part of the parties in the conduct of the action at any stage was not an option.

That leaves the question of whether Ms Quah's frame of mind over the relevant period or a lack of funding can explain away the delay.

It is right that Ms Quah has been under investigation by the CAD since about April 2014, her passport having been impounded on 2^nd April 2014. She has been interviewed in that context on twelve occasions. It is also right that she has been the subject of margin calls and various legal proceedings following the drop in value of the Shares. She states that IPCO was also affected.

Having conceded that it cannot be said that any actions on the part of GS caused the fall, Ms Quah can no longer seek to blame GS for these matters. Moreover, it is hard to see why they would have prevented her from monitoring progress of the litigation or from complying with the Court's directions. The timetable was set in March 2014 and the trial date fixed later in the same month. She served witness statements directly by reference to the timetable. She knew that she was not complying with the directions for expert evidence, not least because of the contents of her solicitors' letter of 6^th November 2014. She was working full-time at IPCO, even if fighting fires. She was capable of engaging with the litigation had she chosen to. On her own case, she chose to prioritise other matters. Her capability to engage is demonstrated well by her re-engagement with the litigation once trial became imminent.

Thus, the matters prayed in aid by reference to other events in Ms Quah's life do not in my judgment materially assist Ms Quah in excusing her failure to progress her claim against GS properly.

As to lack of funding, Ms Quah's explanation is inadequate. In her second witness statement she states :

"27. …This was compounded by the state of my financial resources which had been drained significantly as a result of the multitude of margin calls and legal proceedings. In the light of these issues I was unable to instruct my solicitors to conduct a detailed review of the documents disclosed by the Defendant.

28. I was however able to at least work with my lawyers to file the witness statements…However, thereafter I realised that I no longer had sufficient funds to engage an expert to give evidence in support of my claim and properly pursue this claim to the end. At that stage I was prepared to just give up….

29….Due to the lack of funds I was also not in a position to discuss the Defendant's expert report with my own expert since I could not appoint one and had not done so.

30. Fortunately, sometime late December 2014, I managed to secure funding to pursue my claims against the Defendant…"

Ms Quah has had solicitors on the record for her without interruption. They were positively acting on the case on, for example, 6^th November 2014. She gives no particulars of precisely when funding first became necessary, what attempts she made to secure it and when and why it took until "sometime late December 2014" to obtain it. Ms Quah appears to be someone with substantial contacts and a variety of possible financing options. The lack of full explanation is all the more notable given that Ms Quah's funder has been identified as Mr Lim who, as indicated above, had provided a witness statement for Ms Quah in support of her claim on 8^th August 2014. Mr Lim states that he is a "business associate" of Ms Quah and the managing partner of Yangtze Investments Partners Limited. There is no evidence as to when he was first approached or explanation as to why he was not approached earlier for funding (if he was not approached earlier).

In summary, there has been no proper explanation of the reasons for delay, nor has any good reason for the delay been identified.

Strength of the new case

I turn to consider the strength of the new case. GS does not contend outright that it has no real prospect of success, rather that it is not sufficiently strong to justify permission for a very late amendment.

Both in her original and new case, Ms Quah makes very serious allegations against GS. Such allegations require strong and cogent evidence to support them. It is said that GS behaved in a manner which was capricious, arbitrary, perverse, irrational and otherwise than in good faith. For the purpose of the claim for breach of statutory duty it is said that GS acted unfairly and unprofessionally and not in Ms Quah's best interests.

GS makes it clear that a large number of defences would be raised were permission to amend to be granted, including whether or not COBS applies in circumstances where an individual is in default. But the challenge on the merits by GS for present purposes focussed on :

a) the new case on the construction of Clause 15;

b) the new case on liquidation of the Shares, including on causation.

So far as the new case based on an alleged breach of Clause 15 is concerned, this is not at odds with the original case, but rather an addition to it. By the new case Ms Quah seeks to allege that under Clause 15 she was contractually entitled to have 48 hours' notice before being put into default. Thus the default notice was unlawful.

There can be no doubt but that Ms Quah was fully aware that the loan was repayable immediately on demand which could be served at any time for any reason, as she expressly confirmed at the time of opening her account. The well established case law is that the time required to effect the mechanics of repayment before default can be declared is, in modern conditions, exceptionally short. Thus, in Bank of Baroda v Panessar [1987] 1 Ch 335 (at 346 E to 348 F) Walton J stated :

"The next question which arises is whether sufficient time for compliance with that demand had been allowed before the receiver was appointed? I take as my starting point that well known dictum of Black J in Brighty v Norton (1862) 3 B & S 305, 312:

"I agree that a debtor who is required to pay money on demand, or at a stated time, must have it ready, and is not entitled to further time in order to look for it."

This extremely strict view of the matter was refined by Lord Cockburn C.J in Toms v Wilson (1862) 4 B & S 442, 453, where he said:

"We are all of opinion that the rule should be made absolute. By the terms of the bill of sale, the plaintiff was under an obligation to pay this money immediately upon demand in writing, and if he did not then the defendants were entitled to take possession of and sell the goods. Here such a demand was made. The deed must receive a reasonable construction, and it could not have meant that the plaintiff was bound to pay the money in the very next instant of time after the demand, but he must have a reasonable time to get it from some convenient place. For instance, he might require time to get it from his desk, or to go across the street, or to his bankers for it."

That quotation was endorsed by Sir Barnes Peacock in the Privy Council in Moore v Shelley (1883) 8 App. Cas. 285, 293. These passages were cited, approved and applied by Goff J. in R.A Cripps & Son Ltd v Wickenden [1973] 1 W.L.R. 944. The interval of time in that case was approximately one hour, and the judge said that the plaintiffs could not object on the ground that they were not given time to find the money, or that the interval was too short…

English law, therefore, in my judgment, has definitely adopted the mechanics of payment test."

Blackburne J equally, when considering what time must elapse where money is payable on demand in Sheppard & Cooper v TSB Bank plc and others [1996] 2 All ER 654, stated (at 659f-j) :

"What that time is must, in my view, depend on the circumstances of the case. If the sum demanded is of an amount which the debtor, if he has it, will be likely to have in a bank account – which will be the position in 99 cases out of 100 – the time permitted must be reasonable in all the circumstances to enable the debtor to contact his bank and make the necessary arrangements for the sum in question to be transferred from his bank to the creditor. If the demand is made out of banking hours, the period of time is likely to be longer – involving waiting until banks reopen – than if the demand is made during banking hours. In so stating I do not consider that I am abandoning the mechanics of payment test in favour of some wider and less precise approach. In his unreported decision in Hawtin, referred to in Panessar's case, Walton J himself said that the debtor is not in default in making payment 'unless and until he has had a reasonable opportunity of implementing whatever reasonable mechanics of payment he may need to employ to discharge the debt'. This, I venture to suggest, is no more than the application of practical common sense…

The requirement that sufficient time be permitted to elapse to enable the debtor to effect the mechanics of payment assumes that that is the period needed if the debtor has the necessary moneys available. If, however, he has made it clear to the creditor that the necessary moneys are not available, then, provided a proper demand has been made, I cannot see that the creditor need allow any time to elapse before being at liberty to treat the debtor as in default…"

As already indicated, in support of her contention that she was entitled to 48 hours' notice, Ms Quah relies on an email of 25^th June 2013 from GS to Mr Chan which states :

"Subject : GS Margin Call Policy

Hi William,

As requested, please find below additional information of our firm's current policy with regards to margin call issuance : (Note : these are subject to changes in accordance with market conditions)

…

Time to meet calls : 48 hours (T + 2) or unless negative equity, due within 24 hours (T + 1)…"

However, the email is expressly dealing only with GS' margin call policy, not the repayment of on-demand loans, which is something quite different. Even then it states that such policy is all subject to changes in market conditions. Ms Quah is driven to argue that, by some equivalence, the same period should apply on a demand for repayment.

The other matters relied on to support an entitlement to more time are inconsistent with the case law referred to above and the nature of an on demand loan - for example, the suggestion that the last sentence of clause 15.2 indicates that a same day default notice was the exception rather than the rule. And it is difficult to see why, as Ms Quah alleges, "certain circumstances" should be read so as to mean "exceptional circumstances". That is not the ordinary or natural meaning of the words.

In my judgment the new case by reference to Clause 15 on any view faces significant hurdles. It is to be noted that original leading and junior counsel chose not to plead it, as would clearly have been possible even without the email of 25^th June 2013.

As for the new case on liquidation of the Shares, there can be no escaping the fact that the proposed amendments represent a wholesale change of case on the part of Ms Quah. Moreover, it is one diametrically at odds with the original case. In fairness, it was not suggested otherwise for Ms Quah.

What is rightly said for Ms Quah is that the fact that there has been a "volte face" is, without more, not determinative of the merits of the new case. Ms Quah has not said anything for the purpose of the original case from which she is forced directly to resile in order to maintain the new case.

But:

a) the fact that the proposed amendments raise a totally different and inconsistent case to the original case is relevant background. It heightens the need for careful scrutiny of the merits of the new case;

b) Ms Quah's evidence given for the purpose of the original case does present credibility hurdles for her on the new case, in particular where causation is concerned. On the new case, Ms Quah says that she would have acted radically differently had she known about what she says were GS' concerns and so not have feared "dumping" but, on the contrary, actively have encouraged it. But it is an uphill task for her to establish this to the necessary standard when, as a matter of fact and as set out in her witness statement for the purpose of the original case, she held out doggedly to prevent the sale of the Shares on the SGX and pushed, even beyond 4^th October 2013, for refinancing by sale to a third party. This was in circumstances where her financial position was critical and the technical difficulties in re-financing were or were becoming apparent.

As already indicated, at the heart of the new case lies the contention that GS (in New York) must have discovered that there was, or was likely to be, an imminent market correction and that Mr Lane accordingly gave an instruction to Mr Moo on 2^nd October 2013 to sell the Shares aggressively on the SGX by the weekend.

Mr Millett QC for Ms Quah carries out a detailed analysis of emails and transcripts of telephone recordings over the period in the days and hours before and shortly after Mr Lane's conversation with Mr Moo and Mr Lee at 0230 hours (Singapore time) on 2^nd October 2013. He refers in particular to an email from Mr Tan to Mr Moo, Mr Lee and Mr Sondhi (also of GS) at 0556 hours (Singapore time) headed "Re : Action Plan for Selling". This shows an aggressive selling plan for the Shares (with a day's volume for Blumont at 27%, Asisasons at 55% and Liongold at 72%).

From the analysis Mr Millett seeks to derive the following propositions :

a) there were concerns with GS in Singapore on Friday 27^th September 2013 as to the suitability of the Shares for margin purposes based on the view that the prices of the Shares were trading at multiples that seemed extreme;

b) but at this stage there was no sense of urgency. A conference call was arranged for the following Monday 30^th September 2013 and then again for 1^st October 2013;

c) in the evening of 1^st October 2013 Mr Tan speaks by telephone with Mr Chan. There is discussion about Blumont having its margins switched off, but no real threat of Liongold and Asiasons being treated in similar fashion;

d) in the evening of 1^st October 2013 GS emailed Ms Quah asking if she wished to take up her right in the Blumont shares rights issue or to subscribe for more. She indicated that she wished to redeem them;

e) at 0230 hours (Singapore time) "out of the blue" Mr Lane telephones Mr Moo from New York and indicates that GS should not be lending against (any of) the Shares and instructs Mr Moo to move the risk off GS' books, to make a demand and to start selling the next morning. Mr Moo was unaware before this that the matter had been escalated to New York. He then telephoned Mr Tan (at about 0300 hours Singapore time). Mr Tan then sent the email at 0556 hours (Singapore time) referred to above;

f) Mr Moo telephones Mr Chan at 0845 hours (Singapore time) and tells him that committee and credit control have come back with an analysis that none of the Shares are marginable;

g) Mr Lane and Mr Moo speak again by telephone in the evening of 2^nd October 2013. Mr Lane made it clear that he wanted GS to have eliminated its risk in relation to the Shares. Mr Moo states that he did not understand this to mean selling enough stocks in the market to clear the debt. This would not have been achievable while maintaining orderly selling. The expectation was that Ms Quah would have raised funds using alternative means, such as using the Shares as collateral. But Ms Quah does not accept this evidence as credible (by reference to a near contemporaneous email from Mr Moo to Messrs Lee, Tan and Sondhi timed at 1958 hours on 2^nd October 2013).