Lord Warrington of Clyffe -

On the 10th June 1925 Lee Pang Seng, the assignee of whose estate is the respondent to this appeal, transferred to the appellants, to whom he was largely indebted, a quantity of rubber as security for their debt. He was then unable to pay his debts as they became due from his own money. He was adjudged bankrupt on a petition presented within three months after the date of making the transfer. The question in this appeal is whether the transfer is to be deemed fraudulent and void as against the Official Assignee in bankruptcy.

In Singapore the matter is regulated by S. 51 (1), Bankruptcy Ordinance, which is identical with the provision on the same subject in the English Bankruptcy Act.

The result depends on the answer to be given to the question : Was the transfer to the appellants made with a view of giving them a preference over the other creditors" ?

There is no doubt about the law, this has long since been settled as regards the effect of the English statute, and it is common ground that the same principles are applicable to the ordinance in Singapore.

The question to be determined is one of fact : Was the dominant motive actuating the debtor in making the transfer a desire to prefer the particular creditor or was it of a different character ? As the solution of this question involves an enquiry into the state of a man's mind, and as it must very seldom be the case that there is direct evidence on the point, the decision generally depends on the inference properly to be drawn from the circumstances attending the transfer as established by the evidence.

A word or two must be said on the onus of proof. In their Lordships' opinion, the onus is on the assignee - he has to show that the case is within the statute. A good deal was said in arguments as to the shifting of the onus at particular points in the development of the case, but when all the circumstances have been ascertained so far as the parties have thought fit to ascertain them, discussion on this point becomes immaterial and the decision must be come to on the whole of the circumstances so ascertained, and the question of onus only becomes important if the circumstances are so ambiguous that a satisfactory conclusion is impossible without resort to it : See the judgment delivered by Lord Dunedin in Robins v. National Trust Co. [1927] A. C. 515 (520).

The action in which the present appeal arises was brought by the respondent against the appellants for the purpose of recovering the goods the subject of the transfer. It was tried by Deane, J., in the Supreme Court of Singapore, who on the 18th August 1926, gave judgment for the appellants with costs. On the 10th January 1927, this judgment was reversed in the Supreme Court in its appellate jurisdiction by a majority, Sir James Murison, C. J., dissenting.

At the trial the following facts were established to the satisfaction of the learned Judge. The appellants are a company carrying on business as merchants at Singapore, Mr. John Middleton Sime being chairman of the Board of directors. They have a high reputation amongst the members of the commercial community in the city. The debtor was a Chinese merchant carrying on business under the firm name of Chin Seng and Co. The business was managed by another Chinese named Lim Soo Yan. The debtor is a son of Lu Choon Guan, now deceased, who was a shareholder in the appellant company and a director thereof. The shares form part of his estate, in which the debtor is interested. Mr. J. M. Sime was on friendly business terms with the father : but, though he knew the son, tie had no business relations with him until those which resulted in the present proceedings. In January 1925 the debtor applied to Mr. Sime for financial assistance. He told him that he was engaged in buying rubber on commission for certain firms in America, and that he wanted advances to enable him to finance these transactions. The business involved no or little risk. The debtor received ins