JUDGMENT

Chan Sek Keong J:

This appeal concerns the damages, if any, payable to the defendant by the plaintiffs on their undertaking to pay damages given to the Court when it granted a Mareva injunction on 31 March 1983 restraining the defendant from disposing of certain funds in his bank account in Singapore.

The plaintiffs were carrying on the business of travel agents in Sri Lanka. The defendant was a director of a company called Sunna Travel Ltd. ("Sunna"), who were travel agents.

This action was commenced on 29 March 1983 by the plaintiffs to recover from the defendant the sum of S$10,000 being the proceeds of a cheque which had been paid on 4 March 1983 into the defendant's joint account with his wife in the Hongkong and Shanghai Bank, Serangoon Garden Way Branch ("HKSB"). The plaintiffs alleged that the cheque had been stolen from them. The Mareva injunction was served on HKSB on 11 April 1983.

On the first return date for the continuation of the injunction, 26 May 1983, the injunction was continued until 8 July 1983 when it was again continued until 29 July 1983. The defendant then entered appearance on 19 July 1983. On the return date on 29 July 1983, the injunction was, by consent of the parties, continued until 19 August 1983.

In his defence filed on 13 August 1983, the defendant denied the allegations in the statement of claim and alleged that the cheque was made out in his name and delivered by the plaintiffs to him as a director of Sunna as security for the indebtedness of the plaintiffs to Sunna, and that it was made out in that way because Sunna had no bank account in Singapore, and that when the plaintiffs failed to settle their indebtedness, he handed the cheque to his wife to pay it into their joint account in Singapore. On 2 September 1983, two affidavits were filed on behalf of the defendant, both sworn on 24 August 1983, one by the defendant and the other by one Fonseka who was formerly employed as an accountant by Sunna. A further affidavit sworn by the defendant on 17 January 1984 was filed on 7 February 1984. After that the action went into deep slumber until 30 April 1988 when the defendant's solicitors filed a notice of motion to discharge the injunction and dismiss the action for want of prosecution. On 13 May 1988, I made an order in terms of the notice of motion which included an order that there be an inquiry as to damages.

At the inquiry held before the Assistant Registrar, the defendant gave evidence. His evidence was as follows: that as soon as he was notified of the injunction, he consulted legal advisers in Sri Lanka, England and Singapore with a view to lifting the injunction, that he was the beneficial owner of the cheque as he had already paid Sunna the amount owing by the plaintiffs, that at the material time, he had a contract ("the supply contract") to supply, by 3 April 1983, lighting equipment to the Ceylon Supply and Development Co. Ltd. ("CSD"), a Sri Lankan company, at the price of R155,000, that the supply contract provided payment of a penalty of R600 per day and liquidated damages of R25,000 per week of delay in completion, that it was his intention to use the $10,000 to buy the equipment from Hong Kong (for which he had obtained from the supplier a quotation and a pro-forma invoice dated 10 February 1983) at the price of HK$36,699.28 = R131,750.42, that he could not effect the purchase by reason of the injunction, that he had to buy the said equipment later on 18 April 1983 in Colombo at the price of R186,000 (for which he produced a delivery order and a cash memo both dated 18 April 1983), after his wife had to fly all the way to London to raise, successfully, the money he needed to perform the supply contract, that he had to pay liquidated damages to CSD for late performance and that as a result, he had suffered loss and damages and incurred considerable expenses in obtaining legal and other professional advice in preparing his defence. He produced some documents to sub