What to Do If Someone Sues Your Singapore Business

Last updated on August 14, 2018

Featured image for the "What to Do If Someone Sues Your Singapore Business" article. It features a businessman looking at a lawsuit.

Doing business carries inherent risk that needs to be actively managed. This includes having a claims management plan that can be quickly activated in the event of a claim being made against your business.

If you follow the following simple steps, your business will be significantly more prepared to deal more efficiently with the disruption caused by being sued. It will also be better-placed to protect its interests from the very beginning.

1. Engage Your Legal Department or an External Counsel

If your business has a legal department, alert them immediately and let them take the lead in driving the response to the claim.

For example, your legal team will be able to first advise you on whether your business is actually being sued. If the legal document you have received is a letter of demand, your business is unlikely to have been sued yet. On the other hand, if you have received a writ of summons, this is clear indication that your business is being sued.

If you are a small or medium enterprise with no legal department, you need to:

  1. Identify a suitable external counsel as quickly as possible if you don’t already have one; and
  2. Engage them to respond to the claim.

2. Enter Appearance

Within a certain number of days of being served with a summons in a suit, your business will need to enter appearance. Failing to do so would result in a default judgment being entered against your business. In the vast majority of cases then, it is imperative that your business enter appearance before the deadline.

There are certain exceptional circumstances in which it may be strategically preferable to ignore the summons and allow default judgment to be entered. However, this is not a decision to be taken lightly and should be made with comprehensive legal advice that is specific to your business’ actual circumstances.

For this reason, the priority upon being served a summons should be to identify and obtain preliminary legal advice from external counsel within 48 hours of being served.

3. Seek Advice From Your External Counsel

Specifically ask your external counsel for advice on the way the summons was served. If your business was improperly served, it may have a procedural defence to the claim that would force the adverse party to refile the suit. This would buy you more time to start gathering evidence for your defence.

4. Conduct an Internal Investigation

In order for your instruction of counsel to be as efficient, and therefore as economical as possible, you should do your best to conduct an internal investigation to find out all the facts that are relevant to the dispute. This includes:

  1. Gathering all documentation related to the dispute; and
  2. Interviewing staff with knowledge of the facts and summarising what they know.

5. Conduct a Basic Factual Analysis

Set out briefly in writing:

  1. What actually happened that led to your business being sued
  2. If the dispute arises out of a contract, what was supposed to have happened under the terms of the contract
  3. Any defences you think your business  may have by reference to the specific claims being made by the adverse party

As far as possible at this stage, conduct a rough preliminary financial analysis that attempts to quantify the real financial impact to the adverse party of the actions taken by your business which is alleged to have caused them loss.

Armed with this information, your external counsel will be much better positioned to take swift early steps to advance your business’ interests.

6. Notify Your Insurer

Consider whether the suit triggers any insurance notification requirements. A suit in relation to certain subject matters may well be a risk that your business has insured against. If so, your insurer will want to be involved in decision making in relation to the suit.

In such circumstances, you would need to notify your insurer by a certain deadline set out in your policy. Failure to do so would entitle your insurer to refuse your claim.

Once you have done all this and actually engaged an external counsel to act for you in the matter, that external counsel should be able to take the lead on driving the case strategy thereafter.

Before Making a Claim
  1. Differences between Criminal Law and Civil Law
  2. Limitation Periods: What's the Deadline for Suing in Singapore?
  3. Mediation in Singapore
  4. Arbitration and Mediation: When They Can be Useful for Business Disputes
  5. 6 Things You Need to Know about Third-Party Funding in International Arbitration
  6. Can I Sue a Foreigner in Singapore?
  7. Should You Sue? 8 Things to Think About Before Suing
  8. What to Do If Someone Sues Your Singapore Business
  9. Arbitration: When and How to Arbitrate Business Disputes in Singapore
  10. How to Write a Cease and Desist Letter in Singapore
  11. Using Neutral Evaluation to Resolve Civil Disputes in Singapore
Making a Claim - The Beginning of a Dispute
  1. Law on Writ of Summons in Singapore
  2. Engaging a Queen’s Counsel in Singapore
  3. Letters of Demand and Their Usages in Singapore
  4. Making a Small Claim in the Small Claims Tribunals in Singapore
  5. Security of Payment Act: Claiming Progress Payments for Construction Work Done
  6. Negotiating a Settlement in a Business Dispute
  7. What if I Cannot Find the Party I Want to Sue?
  8. First Meeting With Your Business Dispute Lawyer: What to Expect
  9. Received a "Without Prejudice" Letter? Here’s What It Means
The Litigation Process
  1. Admissibility of Evidence in the Singapore Courts
  2. Civil Litigation in Singapore
  3. Gag orders – the law in Singapore
  4. Default Judgments and Summary Judgments in Singapore
  5. Memorandum of Appearance in Singapore: What It is and How to File
  6. After the Lawsuit: Who Has to Pay Whom, and How Much?
  7. Affidavits in Singapore: What Are They and How to Prepare One
  8. How to Get a Writ of Seizure and Sale to Enforce a Judgment
  9. Subpoenaed to be a Court Witness in Singapore: What You Need to Do
  10. Who is an Expert Witness and How to Use Expert Evidence in Singapore
  11. Legal DNA Test: What is It For, How It’s Conducted, Cost & More
  12. Originating Summons: What It Is and How to File in Singapore
Remedies Available for Civil Litigation
  1. Types of Injunctions in Singapore
  2. Specific Performance: Obtaining this Equitable Remedy in Singapore