Amixco Asia Pte Ltd v Bank Negara Indonesia 1946

• Jurisdiction: Singapore
• Judgment Date: 24 October 1991
• Date: 24 October 1991
• Docket Number: Civil Appeal No 53 of 1986
• Court: Court of Appeal (Singapore)

Amixco Asia Pte Ltd

Plaintiff

and

Bank Negara Indonesia 1946

Defendant

[1991] SGCA 40

Yong Pung How CJ

,

Chan Sek Keong J

and

Chao Hick Tin J

Civil Appeal No 53 of 1986

Court of Appeal

Civil Procedure–Mareva injunctions–Appeal–Original statement of claim technically incorrect–Whether failure to amend during interlocutory hearing constitutes ground for discharge–Whether good arguable case–Evidence capable of supporting conversion–Proof of likelihood of dissipation of assets–Tort–Conversion–Conspiracy to convert goods–Whether physical possession of goods necessary

The appellant (“Amixco”), the buyer of plywood (“the goods”), appealed against the High Court's order continuing until the trial of this action or further order, a Mareva injunction the respondent (“BNI”) obtained ex parte against Amixco and the freight forwarder, Kosin. BNI had become holder of shipping documents, which it presented to Amixco's banker for reimbursement pursuant to an irrevocable letter of credit issued by the said banker. However, the documents were rejected on instructions of Amixco after the discovery of various inconsistencies in the documents, including the bill of lading. The goods for which the letter of credit was issued had since been released to the ultimate buyers of the goods. The High Court had ordered the continuation of the Mareva injunction, on the ground that there was an arguable case on conversion as Kosin had issued a false bill of lading at the request of Amixco to assist the latter, and that the conduct of Amixco and Kosin showed that they had no intention of paying for the goods supplied. Amixco's appeal was based on two grounds: (a) that based on the original pleading, BNI did not have an arguable case for conversion against Amixco as the goods were released to the ultimate buyers not under the false bill of lading but in exchange for a bank guarantee; and (b) that there were no objective facts to support the finding that Amixco would remove or dissipate its assets to avoid satisfying any judgment against it.

Held, dismissing the appeal:

(1) A good arguable case for the purpose of a Mareva injunction was one which was more than barely capable of serious argument, but not necessarily one which the judge considered would have a better than 50% chance of success. While BNI's original pleading was inadequate in that on the pleaded facts Amixco could not be said to have converted the goods, this inadequacy was excusable because BNI was aware of only a few material facts when it commenced the action, upon which it naturally inferred that the goods were released against the false bill of lading as a result of the concerted acts of Amixco, Kosin and the fourth defendant, Kosin's director (“Quek”). In any event, further facts and considerations disclosed in the affidavits filed before and after the hearing in the High Court raised a seriously arguable case that BNI had been deprived of possession of the goods as a result of the concerted acts of Amixco, Kosin and Quek: at [18], [20] and [21].

(2) BNI's original cause of action was not that Amixco alone converted the said goods but that Amixco, Kosin and Quek, jointly, had converted BNI's goods. Therefore the fact that Amixco itself had never been in physical possession of the said goods was not relevant to the cause of action against it as one of three joint tortfeasors. In any case, even if Amixco had been sued alone as sole tortfeasor, that would also not have mattered as it is not necessary, in law, for a person to have physical possession of goods to be able to convert them. The question was whether Amixco's acts alone or in conjunction with those of Kosin, had deprived BNI of its right to possession or amounted to a substantial interference with that right: at [22].

(3) The evidence before the High Court was capable of supporting a claim in conversion against Amixco either as a joint or sole tortfeasor. What was amiss was that BNI thought the false bill of lading was the key to establishing the cause of action in conversion. All that was required was a formal amendment to the statement of claim to plead the various acts of Amixco, Kosin and Quek. That no amendment was requested or effected at that stage was not such a serious irregularity that the Mareva injunction should have been discharged on this ground alone. It was not that BNI had pleaded the wrong cause of action but that they had pleaded the wrong act in support of the tort of conversion. There was, on the evidence, overwhelming objective evidence of prima facie dishonest conduct on the part of Amixco, Kosin and Quek: at [26] and [27].

(4) Having regard to the amount of BNI's claim and Amixco's net assets, there was a real risk of Amixco dissipating its assets to avoid satisfying BNI's judgment: at [30], [31] and [32].

Ninemia Maritime Corporation v Trave Schiffahrtsgesellschaft mbH und Co KG [1983] 1 WLR 1412 (folld)

Helen Yeo Cheng Hoong and Loy Wee Sun (Chor Pee & Co) for the appellant

Chelva Rajah and Chuan Wee Meng (Tan Rajah & Cheah) for the respondent.

Chan Sek Keong J

(delivering the grounds of judgment of the court):

1 This was an appeal by the second defendants (“Amixco”) against the order of P Coomaraswamy J made on 18 July 1986 continuing until the trial of this action or further order, a Mareva injunction obtained ex parte by the plaintiffs (“BNI”) against Amixco and the third defendants (“Kosin”).

2 BNI were bankers of PT Harapan Papa Plywood Industries (“HP”), an Indonesian company. On 20 September 1985, HP agreed to sell a quantity of about 10,000m³ of meranti plywood (“the said goods”) to the first defendants who, earlier on 10 September 1985, had contracted to sell the said goods to Amixco, who still earlier on had contracted to sell the said goods to a North Korean state-owned corporation (“Ilban”). Ilban in turn had agreed to sell the said goods to an Egyptian state-owned corporation (“Fabbas”) under a trade clearing account pursuant to a barter agreement between North Korea and Egypt.

3 Pursuant to an agreement amongst the first defendants, Amixco and HP that Amixco would pay HP directly for the said goods, Amixco on 17 October 1985 requested their bankers, Banque Paribas (“BP”) to issue an irrevocable letter of credit (“the L/C”) in favour of HP for an amount not...