TIMING LTD V TAY TOH HIN [2021] SGHC 5: GARNISHING A JOINT ACCOUNT – CAN YOU PROVE IT?
The recent decision of Timing Ltd v Tay Toh Hin [2021] SGHC 5 considered whether the provisional garnishee order granted at the show cause stage for two joint accounts in Timing Ltd v Tay Toh Hin [2020] SGHC 169 should be made final. The High Court was not satisfied that this was proven on the facts because evidence showed that the account holders intended for the bank account to be beneficially owned by both.
Background. In Timing Ltd v Tay Toh Hin [2020] 5 SLR 974; [2020] SGHC 169 (“Timing No. 1”), the High Court held that a joint bank account may be garnished under Order 49 of the Rules of Court where certain requirements are met (Timing No. 1 at [26] and [36]):
(a) There is a strong prima facie case that the whole of the moneys in the joint account belongs to the judgement debtor;
(b) Notice is served on the non-judgment-debtor joint account holder(s); and
(c) An undertaking is given by the applicant to pay for any costs and reasonably foreseeable losses of the garnishee, or non-judgment-debtor joint account holder(s), should it be shown that the moneys subject to the show cause order are not in fact payable in whole or in part to the judgment debtor.
During the examination of judgment debtor process, Mr Tay disclosed that he had four accounts with Standard Chartered Bank held jointly with his wife (Timing No.1 at [5]).
The High Court was satisfied that a strong prima facie case had been made out (Timing No.1 at [32]) that the moneys in Mr Tay’s four bank accounts belonged solely to him and a show cause order was made.
Timing Ltd v Tay Toh Hin [2021] SGHC 5 concerned developments following that order (at [3]).
The appeal. Contrary to Mr Tay’s answers, Timing Ltd realised through a letter from Standard Chartered Bank that only two of the four bank accounts were held jointly with Mr Tay’s wife, while the other two were in his sole name (at [6]).
The show cause hearing took place before an Assistant Registrar who ordered that a final garnishee order be granted in respect of the two accounts in Mr Tay’s sole name (at [7]-[8]).
In Timing Ltd v Tay Toh Hin [2021] SGHC 5, Timing Ltd appealed against the Assistant Registrar’s decision to not grant a final garnishee order in relation to the two joint accounts (at [10]).
Burden of proof. As a preliminary issue, the parties diverged on how the burden of proof should operate after a provisional garnishee order had been made (at [11]).
The High Court clarified that while the tactical or evidential burden may have shifted, this did not affect the legal burden which remained firmly on the party seeking the benefit of that garnishee order (at [17]).
Receiving a provisional garnishee order was not determinative of whether a final order will be granted (at [17]) and a holistic assessment would be made based on the entirety of the evidence adduced (at [19]).
The evidence. Timing Ltd sought to rely on three bases to argue that all the moneys in the joint accounts belonged beneficially to Mr Tay alone, but the High Court held that – even taking the evidence cumulatively – it was not satisfied that this was proven on a balance of probabilities (at [31]).
Rather than the mere use and origin of the money in the joint accounts (at [23(c)] and [27(d)]), the High Court clarified that “the fundamental question which determine[d] the beneficial ownership of moneys in the account [was] the intentions of the parties as may be discerned from the available evidence.” (at [30(c)])
Having considered the evidence, the High Court concluded that the couple intended for the bank accounts to be beneficially owned by both parties and their treatment of the joint account was consistent with “a close and long-married couple who shared their funds and pooled them accordingly.” (at [27(b)])
Observation. Timing No.1 opened the possibilities of garnishing a joint account, departing from the High Court decision of One Investment and Consultancy Ltd v Cham Poh Meng (DBS Bank Ltd, garnishee) [2016] 5 SLR 923.
In Timing No. 1, the High Court observed that it was not necessary to determine the precise shares held by each joint account holder as the evidence of the case suggested that the moneys in the joint account belonged only to Mr Tay (Timing No.1 at [34]).
In this regard, the High Court expressly left the question open on the appropriate division of a joint account where multiple account holders have made contributions (Timing No.1 at [34]).
In Timing Ltd v Tay Toh Hin [2021] SGHC 5, after having dismissed the application on the basis that the moneys in the joint accounts belonged solely to Mr Tay, the High Court then proceeded to consider the alternative argument on presumption of advancement.
In particular, the High Court in Timing Ltd v Tay Toh Hin [2021] SGHC 5 stated that “[w]hile [the Court of Appeal decision of Chan Yuen Lan v See Fong Mun [2014] 3 SLR 1048] dealt with the issue of jointly-owned real property, I saw no reason why the reasoning therein concerning the presumptions applicable to joint ownership should not also apply…” (at [38])
Nonetheless, the High Court found that “[h]aving carefully considered the circumstances of Mr and Ms Tay’s relationship, as well as the evidence placed before me, it appeared to me that a strong presumption of advancement would arise in this case…” (at [44])
While we await to see further developments in this area of law illustrating how a joint account could be garnished to the extent of the judgment debtor’s share in the said account, Timing Ltd v Tay Toh Hin [2021] SGHC 5 makes clear that even if a provisional garnishee order can be obtained over a joint account, cogent evidence would be needed to obtain a final garnishee order, especially in circumstances similar to that in Timing Ltd v Tay Toh Hin [2021] SGHC 5 where the joint account is held by a couple in a long marriage and the moneys are used to pay for shared expenses.
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