Interim Injunctions Explained: Insights from the CDL Boardroom Dispute

In something reminiscent of the HBO drama series “Succession”, the affairs of the publicly-listed CDL group were thrust into the spotlight when the executive chairman of CDL, Kwek Leng Beng, took legal action against his son, Sherman Kwek, and other directors over an alleged boardroom “coup”.

A closed-door court hearing took place on 26 February 2025 and it has been reported that there was an “initial legal victory”. Sherman Kwek and other board members in his faction provided undertakings which curtailed the exercise of their directors’ powers. The elder Kwek was quoted as saying: “the board committees and the management of the relevant subsidiaries are now safe from further attempts to destabilise, dismantle and reconstitute them”.

Confusingly, Sherman Kwek gave a completely different account of matters. He described the hearing as an attempt to “ambush” the directors, as they were given only two and a half hours’ notice. He also stated that this resulted in the majority directors voluntarily offering undertakings to preserve the status quo until a full hearing could take place. He also stated, “Despite the attempt to ambush us, the minority directors did not succeed in persuading the court to hear and decide the merits, and in fact ended up on the receiving end of directions themselves and unable to use CDL's name at the hearing."

So, who was right?

The Court application here was likely an application for an interim injunction without notice. To understand the statements of father and son, it is useful to know more about this legal tool.

What is an interim injunction?

An interim injunction is a court order requiring a person or entity to do something or refrain from doing something. It is a powerful weapon employed to prevent harm or maintain the status quo until a final decision is made in a case. Interim injunctions are typically sought when there is an urgent need to prevent irreparable harm that cannot be adequately remedied by monetary compensation.

Generally, there are two requirements for an interim injunction to be granted. First, there must be a serious question to be tried, i.e. the underlying claim cannot be obviously hopeless. Second, the balance of convenience must lie in favour of granting the interim relief sought. To determine where the balance of convenience lies, the Court will consider what harm each party would suffer if the interim injunction were granted or not granted, and whether damages would be an adequate remedy for such harm.

Can an injunction application be heard on short notice?

The short answer is yes. If it can be shown that the injunction is urgently needed, a party can request the application be heard urgently. Some non-exhaustive examples of when we often see injunctions being sought as follows:

• Disputes among shareholders and/or directors (where directors or shareholders may need to be restrained from passing resolutions or taking certain courses of action in relation to a company);

• Actions where property needs to be preserved (e.g. freezing injunctions to prevent assets from being dissipated or in cases of fraud, or injunctions to prevent the destruction of evidence); and

• Family disputes (e.g. to prevent a parent from taking the child out of Singapore without the consent of the other parent).

As a default rule, a party should be given notice of an urgent injunction application hearing. The Supreme Court Practice Directions 2021 stipulate that except in cases of extreme urgency, or with the permission of the Court, a party must give a minimum of 2 hours’ notice to the other parties before the hearing. However, a party need not give notice if the giving of the notice to the other parties, or some of them, would defeat the purpose of the application.

Why were undertakings given by Sherman Kwek? Does that mean that Kwek Leng Beng succeeded in his application for an urgent injunction?

While the Court can make injunction orders for urgent applications, defendants may give undertakings (effectively promises to the Court) that preserve the status quo until the matter is fully ventilated at a later hearing when the defendant has a chance to be fully heard. This removes the need for the Court to make any orders, since a defendant who breaches his undertakings to Court may be found in contempt of Court.

While Sherman Kwek and the majority directors’ giving of undertakings may have been portrayed as a ‘win’ by both sides, the race is in fact too early to call.

Since Sherman Kwek and the majority directors could not fully argue their case in court because of the short notice given to them for the hearing, the younger Kwek and his fellow directors will have the opportunity to respond and state their case in due course. As has been reported in the media, a later hearing date has been fixed by the Court to hear the matter again.

Our firm has successfully applied for and defended against interim injunctions in a variety of disputes. If you require any assistance in this regard, please feel free to contact us at office@focuslawasia.com.