Court ruled that the employee breached her employment agreement by moonlighting
A corporate secretary who moonlighted for a rival firm while still employed has been ordered to pay her former employer S$14,683.33 in damages, after the Singapore District Court found that her actions were in breach of her employment contract.
District Judge Teo Guan Kee found that Wong Suet Mei Michelle had breached her employment agreement with Korporatio Sing Pte. Ltd. by working for a rival firm, Xion AI Pte. Ltd., without her employer's knowledge or consent. Her dismissal without notice on 16 October 2023 was upheld as lawful.
From secretary to competing contractor
Wong was employed by Korporatio Sing from January 2022 under a written contract of service to provide corporate secretarial services to the firm's clients, including appointments as a local director and company secretary.
But from June 2022, she began providing services to Xion AI, a competing corporate secretarial firm which she herself acknowledged operated in the "same category" as Korporatio Sing.
Using her Singpass credentials, she carried out 811 transactions on ACRA's filing system on Xion's behalf and was named as director or company secretary for 86 companies that were not Korporatio Sing's clients.
She also issued 18 invoices to Xion between June 2022 and April 2023, charging amounts ranging from S$400 to S$3,500 for services including the provision of a named Qualified Individual and nominee directorships.
Wong said she did not want to charge Xion for her services, but the latter had asked her to begin charging because "they did not want to take any free lunch."
Breach of contract, fidelity obligation
The court described Wong's excuse as "incredible and unsubstantiated."
"It is thus abundantly clear that the services being provided to Xion by the Defendant amounted ... to the provision of 'technical, commercial or professional advice as an independent contractor' to a business concern (i.e. Xion) which was in competition with the Claimant," Teo said in the ruling.
The judge found that Wong had breached clauses 15 and 16 of her employment agreement, which prohibited conflicts of interest and providing professional services to competing businesses without written approval, as well as an implied duty of good faith and fidelity to her employer.
Wong's defence that her involvement with Xion amounted to no more than "internal operational guidance" on ACRA procedural workflow rather than substantive corporate secretarial work was also rejected.
The court also rejected the unpleaded defences raised by Wong's counsel that the claimant had consented to her working for Xion, and that clauses 15 and 16 constituted unenforceable restraint of trade provisions.
Damages claims largely dismissed
Despite the breach findings, the court dismissed the majority of Korporatio Sing's damages claims, which had totalled more than S$208,000.
The claimant's primary claim, which sought to recover up to 82% of Wong's salary during the relevant period based on models estimating the proportion of her working time diverted to Xion, was rejected.
Teo found the calculations rested on "unsupported assumptions," inconsistent time periods, and no actual evidence that Wong had failed to perform her duties for Korporatio Sing. Only nominal damages of S$100 were awarded under this head.
Claims for lost partnership opportunities with Xion worth S$112,750, reputational loss of S$22,700.25, and an account of profits were also dismissed for insufficient evidence or absence of legal basis.
The claimant succeeded only in recovering S$14,583.33 for advance fees paid to Wong for director and company secretary appointments she did not complete following her termination, plus the nominal damages of S$100 for loss of productivity.
In turn, the court ordered Korporatio Sing to pay Wong S$3,200 in outstanding salary covering the first half of October 2023.
