A. Summary of Case
The Plaintiffs, RBG Resources plc (“Plaintiff”) was a public limited company incorporated in England that was involved in the purchasing and trading of metals. Credit Lyonnais Rouse Derivatives (“CLRD”) was a division of the 2nd Defendants, Credit Lyonnais (“2nd Defendants”), and had entered into a metal trading agreement with the Plaintiffs in October 2001. 158 transactions between the Plaintiffs and the 2nd Defendants took place from October 2001 and April 2002. Out of these transactions, 45 transactions that related to the metals stored in warehouses were in Singapore (“Fujitrans Warehouses”).
At the material time, the Plaintiffs were already placed in liquidation in England and were ordered to wind up by the Singapore Court in 7 October 2002. Thus, the 2nd Defendants made a claim for the metals stored in the Fujitrans warehouses which was challenged by the liquidators of the Plaintiffs.
What led to the dispute was in early March 2002, 2nd Defendants had received information that the Plaintiff’s auditors had resigned on the grounds that certain transactions that were undertaken by RBG could not be justified. 2nd Defendants decided to do an inspection of the metals that they had believed they purchased from RBG. The inspection was done on 12 March 2002 by William John Harris (“Harris”) in the presence of Lim Tau Hee (“Lim”), the warehouse manager. After the inspection, English and Singapore courts ordered that RBG to be placed in liquidation.
There were other Defendants in the action; however, the Plaintiff reached a settlement before the trial with the other Defendants except for the 2nd Defendants and the 4th Defendant (who did not enter a defence). The 2nd Defendants was claiming for the metals in the Fujitrans warehouses.
The 2nd Defendants had made its claims to the metals on three bases. Firstly, the 2nd Defendants claimed that the metals were ascertained by appropriation by warehouse receipt. The receipts contained...