Lloyd's Maritime and Commercial Law Quarterly

Edited by Professor Francis D Rose

Document

Unjust enrichment in Asia Pacific (Brunei, Hong Kong, Malaysia and Singapore)

Man Yip *

CASES

1. Banque de Commerce et de Placements SA, DIFC Branch v China Aviation Oil (Singapore) Corp Ltd (Shandong Energy International (Singapore) Pte Ltd, third party; Golden Base Energy Pte Ltd, fourth party) [2024] SGHC 145 (SGHC (Gen Div): Goh Y J)

At the expense of—indirect enrichment

Ps were two banks. One of them (BCP (Geneva)) issued a letter of credit to finance Zenrock’s purchase of a cargo from D. Ps provided the financing on Zenrock’s representation that the cargo would be on-sold to a third party (PetroChina) and Ps therefore expected that they would be reimbursed by PetroChina. After the sale was completed, UBS Switzerland AG (UBS) paid out monies to D pursuant to the letter of credit and UBS was reimbursed for the same by BCP (Geneva). However, when Ps wrote to PetroChina for payment, they were told that the contract between PetroChina and D had been cancelled. Zenrock subsequently went into liquidation. Ps discovered during Zenrock’s insolvency proceedings that the contract between D and Zenrock was a sham or fraudulent transaction and that D allegedly did not sell the cargo to Zenrock. Ps sought to recover its losses from D on various grounds, including a claim in unjust enrichment based on mistake or failure of consideration.

Decision: The claim in unjust enrichment failed because there was no applicable unjust factor. Ps relied on D’s alleged misrepresentation (that there was a physical cargo for the contract between D and Zenrock), which was not made out on the facts.

Held: To satisfy the “at the expense of” requirement, there must be a direct transfer of enrichment from the claimant to the defendant, although this general rule has exceptions.

Obiter: Assuming the “coordinated transactions” exception (as identified in English cases) is part of Singapore law, it is arguable that the case involved coordinated transactions because Ps bore the responsibility to pay D, even though the money went through an indirect pathway via UBS to D.

* Professor of Law, V3 Group Professor in Family Entrepreneurship, Yong Pung How School of Law, Singapore Management University. I am immensely indebted to Associate Professor Rebecca Lee, Faculty of Law, University of Hong Kong, for her assistance with the Hong Kong materials.

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