ARTICLES
shown, which allowed for the consideration of unconscionability.4 The Court applied a narrow conception of unconscionability and found that the assignment could be set aside.5 The first stage of the test requires the Court to consider if the purchase was made from ‘a poor and ignorant man’, secondly, at a considerable undervalue and thirdly, with no independent legal advice.6 Where the Plaintiff satisfies the test above, the burden of proof then shifts on the Respondent to show that the purchase was ‘fair, just and reasonable’.7 The doctrine is considered to be narrow as it demands a high burden of proof, effectively allowing only exceptional circumstances to qualify, such as where there was a significant imbalance of bargaining power and a claimant in a clear position of vulnerability. The test is affirmed and developed in Cresswell. Following a divorce, Cresswell signed a document of conveyance for property purchased during the marriage which effectively released all her interest in the property in return for an indemnity against liabilities. She did not have independent legal advice and claimed that she signed the conveyance believing it would merely allow the sale of the property without affecting her rights in it. Crucially, the agent sent to obtain the release did not explain the effect of the document and merely mentioned that the document was for ‘the sale of the house’.8 The Court held that the document of conveyance could be set aside and upheld the narrow test for unconscionability. Alongside the test in Fry, Megarry J recognised that ‘there may be circumstances of oppression or abuse of confidence which will invoke the aid of equity’.9 The success of Cresswell’s claim depended heavily on the unusual nature of the agreement,10 given thatthe Defendant himself had initially regarded it as incapable of giving 4 Fry (n 2) 321 (Kay J). 5 ibid 323-24. 6 ibid 322. 7 ibid. 8 Cresswell (n 3) 256 (Megarry J) 9 ibid 257. 10 ibid 259.
him any legal rights and the wording had no clear legal implications.11 Therefore, this limits the doctrine of unconscionability to a narrow interpretation. Adoption of the Narrow Doctrine in Singapore The case of BOK concerned a Deed of Trust drafted by the Wife, a former lawyer, which was signed by her Husband after he was appointed executor of his mother’s will and testamentary trust. The Deed of Trust provided that the Husband and Wife would hold all the Husband’s assets on trust for their son. Upon entering into a deed of arrangement over his mother’s will, the Husband requested that the Deed of Trust be delivered up to be destroyed. He claimed that he did not receive independent legal advice and did not understand it to be legally binding or that it would include the assets under his mother’s will and testamentary trust. The Court of Appeal held that the Deed of Trust could be set aside on grounds of mistake and misrepresentation,12 but also further narrowed down the doctrine of unconscionability applicable in Singapore. Phang JA set the test to be whether the plaintiff was poor and ignorant and whether the situation was one where the Plaintiff was suffering other forms of infirmities, whether mental or physical in nature.13 The infirmity must be of ‘sufficient gravity as to have acutely affected the plaintiff ’s ability to “conserve his own interests”’.14 This test differs from that in Fry and Crewsswell, by placing more emphasis on the presence of infirmities rather than the value of the transaction. However, the test still draws inferences from Fry and Cresswell by looking at whether the plaintiff was ignorant and had a lack of understanding the implications of the transaction. If these elements are satisfied, the Respondent is then responsible for showing that the transaction was ‘fair, just and 11 ibid. 12 BOK (n 1) [55] (Phang JA). 13 ibid [141]. 14 ibid (emphasis added).
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