There is an interesting observation in the judgment of Mrs Justice Rose in Singularis Holdings Ltd -v- Daiwa Capital Markets Europe Ltd [2017] EWHC 257 (Ch).  It may well show much about the way in which witness statements are prepared.

“… I have relied more on the oral evidence of the witnesses than on their written evidence. That oral evidence about their reactions at the time to unfolding events is much more consistent with the contemporaneous documents, and with commercial business sense, than the more anodyne written statements.”


The claimant’s liquidators were seeking the recovery of $204 million on the basis that the defendant had  allowed company money to be paid out of  non-company accounts, subsequently that money was lost to the company. The defendant defended on the claim on the basis that it was not established that the money had been moved in breach of fiduciary duty, it had no knowledge of any fraud and it was not negligent, further the defendant’s contractual terms excluded liability for anything other than gross negligence.

    1. One of the Daiwa witnesses, Mr Blanchard, noted in his witness statement some of the differences between the culture in a Japanese company compared with that in a ‘Western’ organisation. He described a certain lack of sophistication and a tendency to treat counterparties with the utmost respect. It was not suggested, however, that some different legal test applied to Daiwa from that which would apply to any company doing business in London or that their conduct should be judged by a standard different from the standard set out in the relevant case law.
    2. Daiwa called eight witnesses. Some of them were able to give evidence primarily about the events leading up to the ending of the relationship between Daiwa and Singularis and some gave evidence about the making of the disputed payments:
a) Dominique Blanchard was Global Head of Derivatives at Daiwa between May 2008 and December 2012. He had been brought into Daiwa in London to help with the launch of a new area of business for Daiwa in selling derivatives. He now works for an Australasian banking group.
b) Charles Day was recruited to Daiwa by Mr Blanchard and occupied the post of Global Head of Equity Finance between October 2008 and November 2010. He then became European Head of Derivatives. Mr Day had previously worked at Lehman Brothers International Europe from 2007 until the insolvency of Lehman Brothers in September 2008. He reported to Mr Blanchard.
c) Akihiko Sakashita was Vice Chairman and Deputy Head of Europe and Middle East, a role he took up in April 2008. His role was to oversee or supervise the trading business and risk management function of Daiwa. He reported to Mr Kosuge. He now works for Citigroup.
d) Christopher Hudson joined Daiwa’s Compliance Department in January 2006. In February/March 2009 he was promoted to Head of the Compliance Department and still holds that position. He reported to Mr Wright. He describes the function of the Compliance Department (part of the Compliance Division) as primarily to ensure that the firm’s business is conducted in accordance with regulatory requirements. The Compliance Department is responsible for approving new client relationships and for assigning to each client a risk rating, a number from one to four with one being the least risky and four being the most risky.
e) David Wright was Daiwa’s Head of Compliance Division at the relevant time, having joined their Compliance Department in 1999. He was also the firm’s money laundering reporting officer. In May 2009 there were six other people working with him in his team. He left Daiwa in December 2014.
f) Roger Massey joined Daiwa in 1998 and at the time of these events was head of the Legal and Transaction Management Division and Company Secretary of Daiwa. He still holds the position of Company Secretary and is now Head of the Legal and Compliance Division. The main role of the Legal Department in Daiwa was negotiating transaction documents, typically agreeing the terms of one or more master agreements which are industry standard documents.
g) Jonathan Metcalfe joined Daiwa in 1998 as a credit officer in the Credit Risk Department. He became a director in that department in October 2003 and remains in that post today.
h) Eishu Kosuge was Chairman of the Board of Directors and Chief Executive Officer of Daiwa between April 2006 and September 2009. He has worked for the Daiwa Securities group of companies since graduating in 1980 and currently works for Daiwa Tokyo’s research institute.
  1. Mr Metcalfe and Mr Hudson are the employees who are alleged to have been dishonest in their authorisation of the disputed payments. I therefore deal with their credibility in more detail later. As regards the other witnesses I consider that they were all honest witnesses doing their best to assist the court when giving their oral evidence. One striking feature of the trial was that the tenor of the Daiwa witnesses’ written evidence was markedly different from their oral evidence. In their written statements they firmly downplayed the significance of the events that were unfolding at the end of May and beginning of June, whereas in cross-examination they readily agreed that the events were really very worrying indeed. For example, in his witness statement, Mr Blanchard referred to the Bloomberg article published on Sunday 31 May 2009 about the freezing of Mr Al Sanea’s bank accounts in Saudi Arabia. He says in his written evidence “This article did not make positive reading” and that although this might have signalled deeper problems for Singularis, it was difficult to draw conclusions about events. He went on “I noted however that the freeze related to [Mr Al Sanea] and not Singularis and therefore Daiwa did not have any evidence that Singularis was experiencing financial difficulties”. In cross-examination however he readily agreed that the news on 31 May was “like a bombshell” and did not attempt to minimise the gravity of what was happening so far as the future of Singularis was concerned. Similarly, some of the witnesses when describing their thoughts and concerns over the period 24 May – 1 June 2009 referred to the fact that share prices had recovered from the lows of 2008 and were on an upwards trajectory. For example, Mr Sakashita said in his written evidence that by May 2009 the value of Singularis’ stock held as collateral for the loans “had recovered materially from the lows of January 2009” so that he was “more relaxed” about the credit risk Daiwa faced from Singularis in May than he was in January. However, he and other witnesses whose written evidence referred to the recovery of stock prices as alleviating their concerns readily accepted in cross-examination that in this period of unprecedented stock market turbulence, shares were just as likely to fall dramatically again as they were to continue to rise. Other passages in the written evidence in which the witnesses described factors from which they drew comfort at the time as regards Singularis’ financial health, such as the promises of future actions given at a meeting with Mr Wetherall in March 2009 or the rosy picture appearing from Singularis financial information provided in September 2008 were also largely undermined in cross-examination when the witnesses accepted that none of the promises had been fulfilled and the September 2008 figures were hopelessly out of date by mid 2009.
  2. In light of this I have relied more on the oral evidence of the witnesses than on their written evidence. That oral evidence about their reactions at the time to unfolding events is much more consistent with the contemporaneous documents, and with commercial business sense, than the more anodyne written statements.


The judge found that:

  • The claim for dishonest assistance failed because the defendant’s employees were not dishonest when they approved the payments.
  • There was a  claim for breach of contract and negligence in the sum of  $203,741.900
  • Damages were reduced by 25% because of contributory negligence.