Antariksa Logistics Pte Ltd v Mc Trans Cargo (S) Pte Ltd

• Jurisdiction: Singapore
• Judgment Date: 30 July 2012
• Date: 30 July 2012
• Docket Number: Suit No 856 of 2009
• Court: High Court (Singapore)

Antariksa Logistics Pte Ltd and others

Plaintiff

and

Mc Trans Cargo (S) Pte Ltd

Defendant

[2012] SGHC 154

Belinda Ang Saw Ean J

Suit No 856 of 2009

High Court

Bailment—Bailees—Whether head bailee had right to immediate possession—Whether bailee's title superior to holder of bare possessory title

Bailment—Bailors—Rights of—Whether bailor had right to immediate possession—Whether actual possession necessary to constitute party as bailor—Bailment at will—Whether bailee and bailor had concurrent standing to sue

Civil Procedure—Parties—Joinder—Whether cause of action had to be constituted by date writ of summons was issued or by date writ of summons was amended and served

Contract—Illegality and public policy—Whether defendant proved that illegality perpetuated—Whether plaintiffs' claim founded on illegality

Credit and Security—Lien—Legal lien—Whether defendant had lawful possession to exercise lien—Whether defendant had express, implied or ostensible authority to create lien—Whether there was accrued debt to support lien

Tort—Conversion—Bailor and head bailee suing defendant for conversion of cargo—Defendant took possession of cargo as consignee named on bills of lading—Whether defendant was innocent intermediary—Whether there was demand and refusal—Whether silence could amount to refusal

This action concerned acts of conversion alleged against the defendant (‘the Defendant’), whose Indonesian principal was PT Prolink Logistics (‘Prolink’). The first three plaintiffs (‘Plaintiffs’) were appointed to provide door-to-door freight forwarding services. In this regard, the first three Plaintiffs consolidated and shipped 30 x 40' containers (‘the 30 FCL containers’) from Singapore to Jakarta. The 30 FCL containers were shipped on board Sinar Sumbar and APL Shenzhen under three bills of lading (‘the February B/Ls’) in February 2009.

The first three Plaintiffs through the second and third Plaintiffs' director, Tie Hari Mulya (‘Hari’), orally agreed with one Nurdian Cuaca (‘Cuaca’) that the first three Plaintiffs would handle the clearance of the 30 FCL containers at the Singapore end while Cuaca, through Prolink, was responsible for the receipt, customs clearance and container transport to designated warehouses in Indonesia.

It transpired that the carriers could not deliver the 30 FCL containers at the discharge port in Jakarta. Initially, the Indonesian customs authority rejected Prolink's request to ship the 30 FCL containers back to Singapore. The 30 FCL containers were eventually permitted to be returned to Singapore after the ruling of the Jakarta State Administrative Court in August 2009.

To this end, Hari and Cuaca agreed that the first Plaintiff was to be consignee on the bills of lading for the shipment of the 30 FCL containers back to Singapore (‘the September shipment’). However, the first three Plaintiffs later discovered on 18 September 2009 that the name of the consignee had been unilaterally changed to the Defendant.

The 30 FCL containers arrived in Singapore on 19 September 2009. The Defendant took possession of the 30 FCL containers at Goodway Agencies (Shipping) Pte Ltd and PSA Keppel Godown F 5 Module K.

In October 2009, Cuaca demanded that the first three Plaintiffs pay Rp45bn before the 30 FCL containers would be released to the Plaintiffs. Hari refused.

Prior to 12 October 2009, there were failed attempts to contact the Defendant for the release of the 30 FCL containers. The first three Plaintiffs then appointed lawyers who wrote to the Defendant on 12 October 2009 demanding delivery up of the 30 FCL containers by the deadline stipulated in the letter. The Defendant did not respond. The first three Plaintiffs then commenced these proceedings against the Defendant on 13 October 2009 for conversion.

Unbeknown to the first three Plaintiffs, the Defendant had received instructions from Prolink to release the cargo in the 30 FCL containers as early as the first week of October 2009. The Defendant was agreeable to the release of the goods if so authorised by the cargo owners. This condition would involve the revocation of the first three Plaintiffs' authority to deal with the 30 FCL containers. Prolink thus sought and obtained powers of attorney from some of the cargo interests revoking the first three Plaintiffs' authority and appointing Prolink Logistics and/or PT Prolink Clare as attorney to deal with the 30 FCL containers instead. The powers of attorney were only executed between 14 October 2009 and 13 November 2009.

As at 19 November 2009, some of the cargo (‘the Group A Cargo’) was released. The remaining cargo owners repeatedly asked the Defendant to provide the claim amount of charges and expenses so that they could consider payment of monies into court in lieu of the Defendant withholding their goods. No figure was forthcoming. The fourth to 16th Plaintiffs (‘the Group B Plaintiffs’) were amongst the cargo interests who had not revoked the first three Plaintiffs' authority and thus had not obtained their cargo, and they were joined to the action on 25 January 2010.

The Defendant denied liability alleging, inter alia, that (a) it was an innocent agent who acted in good faith in relation to the 30 FCL containers, and the named consignee appointed by Prolink to receive, handle customs clearance and store the 30 FCL containers; and (b) the detention of the 30 FCL containers was in lawful exercise of a possessory lien. In addition, the Defendant claimed that the Plaintiffs' claims were tainted with illegality. Relying on the discrepancy between the actual goods in the 30 FCL containers and goods as declared on the February B/Ls, the Defendant alleged from the outset that the first three Plaintiffs were engaged in an ‘unlawful adventure’ to smuggle the containers into Indonesia without paying customs duty. At the time judgment was given, the Defendant was still in possession of goods consolidated in three FCL containers (‘the Group B Cargo’).

Held, allowing the claim:

(1) To succeed in a claim for conversion, a plaintiff had to show that: (a)it had actual possession of, or the right to immediate possession of the chattel converted; and that (b)the right to sue for conversion existed at the time of the conversion; and that (c)the defendant acted in a manner inconsistent with the plaintiff's superior possessory title: at [42].

(2) The right to immediate possession arose from the existence of a legal relationship of bailor and bailee as a matter of general principle of law on bailment. The first three Plaintiffs as head bailees under the agreement with their customers were entitled, if not obliged, to protect and preserve the February shipment. By reason of the unauthorised switch of consignee to the Defendant, the sub-bailment ended and the right of possession to the bailed property re-vested in the first three Plaintiffs: at [53], [56] and [57].

(3) The Defendant had a bare possessory title. It could retain the goods until a party with a superior interest asked for the goods. Being the named consignee on a bill of lading merely gave the Defendant a contractual right to obtain delivery of the containers vis-à-vis the carrier. The first three Plaintiffs had a possessory title superior to the Defendant's bare possessory title to the 30 FCL containers: at [59], [60] and [61].

(4) The goods were paid for and the Group B Plaintiffs had proprietary title to those goods. In addition, the Group B Plaintiffs enjoyed the right to immediate possession as bailors of their respective shares in the Group B Cargo. Actual possession of the goods was not necessary to constitute a party as bailor: at [62] and [64].

(5) The relationship between the first three Plaintiffs and the Group B Plaintiffs was a bailment at will. Under a bailment at will, both the bailor and the bailee enjoyed the concurrent standing to sue third parties and sub-bailees for conversion: at [68] and [69].

(6) The Defendant was not an innocent intermediary. The Defendant was aware that the first three Plaintiffs were entitled to the 30 FCL containers and that the Defendant's principal, Prolink, had no authority to give lawful instructions in relation to the 30 FCL containers. The Defendant also assisted Prolink to interfere with and to undermine the first three Plaintiff's right to immediate possession: at [74], [83], [86], [91], [92], [94] and [95].

(7) The Defendant's detention of the 30 FCL containers and thereafter the Group B Cargo was to further its principal's interest in these proceedings. The Defendant continued to take instructions from its principal and it withheld the Group B Cargo because its principal had unspecified ‘charges in Jakarta’ to settle with the first three Plaintiffs: at [85].

(8) The Defendant's technical argument that no ‘demand or refusal’ arose before the writ of summons was issued would not affect the Group B Plaintiffs' claim in conversion at all. Upon joinder of a person as a party, that person becomes a party from the date the writ of summons was amended and served on him. The Group B Plaintiffs' cause of action was constituted by the time they were joined as parties to the action: at [99] and [100].

(9) The Defendant was unable legally and evidentially to prove that it had either a contractual lien or warehousemen's lien. The nemo dat quod non habet rule applied and the Defendant did not have lawful possession of the 30 FCL containers to assert a lien: at [105], [115] and [120].

(10) It was a non-starter to argue that Prolink Logistics had an implied or ostensible authority to create the lien, because Prolink Logistics did not have lawful possession of the 30 FCL containers. In any case, ostensible authority to create a lien was not pleaded nor particularised, nor did the Defendant explain how ostensible authority could have arisen: at [125].

(11) The debt on which the lien was founded had to have accrued at the time the lien was exercised...