A yacht dealer will get to keep a €500,000 (S$774,000) pre-contract deposit paid by a late Indonesian tycoon after Singapore's top court reversed a High Court judgment to refund the money to his estate.
The Court of Appeal held that Mr Jiacipto Jiaravanon, who died suddenly in 2015 at age 40, had made the payment on the basis that two yachts would be kept out of the market for three weeks for him to decide which one he wanted to buy.
"Jiaravanon's decision not to purchase either yacht did not cause a total failure of basis because the payment was not made on the basis that a contract of purchase would be executed," said Judge of Appeal Andrew Phang in decision grounds released last month.
The court, which included Judges of Appeal Judith Prakash and Tay Yong Kwang, said yacht dealer Simpson Marine was "not unjustly enriched" when no purchase took place because the yachts were taken off the market and its offer to Mr Jiaravanon was kept open for the agreed time.
"Therefore, we are satisfied there was no failure of consideration. Accordingly, Jiaravanon is not entitled to restitution," said the court.
It cited a separate case in which claimants received an option to buy a property within an agreed period for an agreed price and the defendant was not unjustly enriched when no purchase materialised.
This is because the defendant had taken the property off the market and kept its offer to the claimants open for the agreed period.
Mr Jiaravanon, who died after the suit began, was said to be a third-generation member of the Chearavanont family, which controls the Thailand-based Charoen Pokphand Group, one of the largest Thai agribusiness conglomerates.
He was vice-president-commissioner of Charoen Pokphand Indonesia TBK, part of the Charoen Pokphand Group Indonesia, comprising over 200 companies, primarily in the agriculture business.
After his death, his widow, Anita, carried on with the proceedings as his estate's administrator.
He had sued Singapore-based Simpson Marine (SEA) in this case involving Italian-built Azimut Benetti yachts.
In April 2013, Mr Jiaravanon deposited €1 million to secure two specific 100ft-long yachts, identifiable by their hull numbers, until May 15, 2013, at which time the funds were to be used as down payment for either yacht. He paid the sum to Simpson on April 29, 2013, by which time, Azimut had sold one of the yachts to another buyer.
Simpson said at a May 2013 meeting in Hong Kong Mr Jiaravanon then agreed to use the deposit to secure two yachts identified as 100L #15 and 100G #15 until May 31, 2013, so that he could choose between them and the deposit was to help fund the sale. Mr Jiaravanon denied such a deal was reached.
On May 9, 2013, Simpson remitted the deposit to Azimut but Mr Jiaravanon later refused to buy an Azimut yacht in the 100ft series.
On July 31, 2013, a compromise was reached: Half of the €1 million deposit was used to pay for an earlier Azimut yacht purchase by Mr Jiaravanon and the remainder became the subject of the dispute.
Mr Jiaravanon, represented by lawyers Anna Oei and Deannie Yap, won restitution of the sum at the High Court in 2017. Simpson's lawyers - Mr Prem Gurbani, Mr Bazul Ashhab and Mr Lionel Chan - appealed against the ruling.
The Court of Appeal found there was sufficiently cogent evidence to show that Mr Jiaravanon had agreed on May 8, 2013, for the deposit to be used to hold the two yachts until at least May 31, 2013. This included the manner in which the parties conducted themselves, which was consistent with the alleged agreement.
While Simpson need not return the €500,000, it remained liable to pay €186,551 to Mr Jiaravanon's estate for resale costs as it did not appeal against the High Court order.
This costs referred to commission fees which Simpson charged Mr Jiaravanon in relation to a separate yacht which he did not accept and was sold to a third party instead.