Dong Yuan Hang Trading Pte Ltd v Sunko (Singapore) Co Pte Ltd

JurisdictionSingapore
JudgeKarthigesu JA
Judgment Date26 April 1994
Neutral Citation[1994] SGCA 62
Date15 September 1994
Docket NumberCivil Appeal No 180 of 1993
Year1994
Published date19 September 2003
Plaintiff CounselChristopher Chuah and Karen Looi (Drew & Napier)
Citation[1994] SGCA 62
Defendant CounselFoo Soon Yien and Benjamin KP Goh (Bernard Rada & Lee)
CourtCourt of Appeal (Singapore)
Subject MatterAnticipatory breach,Determination of time of shipment,Whether reasonable notice given,Whether appellants' acts premature,FOB contract,Contract,Appellants "accepting" purported repudiation by respondents of contract,Discharge,International sale contracts,Sale of goods,Whether appellants' conduct amounted to repudiation,Commercial Transactions

Cur Adv Vult



The facts

The appellants are importers and exporters of foodstuff, latex, beans and chemicals and the respondents are rubber and latex traders. By an agreement made on or about 26 April 1988 the appellants agreed to purchase from the respondents 191.88 tonnes of centrifuged Malaysian latex (the cargo) to be shipped by 12 x 20 ft containers on, inter alia, the following terms:

Shipment: single shipment during June 1988 in Singapore.

Unit price: S$2.98 per kilo fob Singapore.

Total value: S$571,802.40.

Payment: by irrevocable at sight LC.

Remarks: in the event no shipping instruction from buyer, seller have [sic] the right to load the cargo and accordingly draw the balance amount under LC.



The contract was concluded between the appellants` director, Miss Chee Sau Ying (Chee), and the respondents` trading clerk, Ng Kim Pheng (Ng), through a broker, Ang Kong Yew (who had since passed away).


On 3 May 1988, in response to an enquiry from the respondents for shipping instructions, the appellants sent a telex to Ng stating that they had booked space on a vessel called Majapahit of Pacific International Lines (PIL) `eta 13 June 1988` for loading from 10 to 15 June 1988, and that in the event of any revision the appellants would inform the respondents.
On the same day Chee sent a fax to Ng to advise the shipping marks for the contract. On 11 May 1988 the appellants sent to the respondents another fax to say they were prepared to make a reservation on the vessel Alligator Victory which was due to arrive on 11 June 1988. The respondents replied on 12 May 1988 to say that shipment on the Alligator Victory was not possible `as their delivery was full June 1988`, and requested a vessel arriving `around 16 June 1988`. The appellants replied by fax on the same day that they were prepared to ship on the vessel Omex Pioneer which would accept the cargo on 14 June 1988. They requested the respondents to confirm by return and to prepare the cargo in time. On 18 May 1988 the appellants sent a fax informing Ng that two vessels Omex Pioneer and America Maru were available to accept the cargo. They also requested the respondents` confirmation as to when the cargo would be ready for shipment to enable them to make the necessary reservation. It did not appear that the respondents had replied to this fax. Then, on 25 May 1988 the appellants delivered by hand to the respondents a letter, the material part of which was as follows:

In reply to your telex 3148 dated 12 May 1988, we wish to inform you that we have made the booking on the following vessel to carry the above consignment.



Hereunder are the particulars:

(1) Vessel name: Majapahit 22NB

(2) ETA Singapore: 13 June 1988

(3) Booking No: LMK 221

(4) Shipping agent: Pacific International Line

... We enclose herewith (1) 14 copies of shipping order, (2) blank bills of lading forms.

Kindly contact the shipping agent and deliver the consignment in accordance to the shipping schedule. Thank you for your kind attention.



However, on the same day the appellants sent a telex to the respondents stating that if the respondents found any inconvenience in delivering the consignment on the appointed vessel Majapahit they should inform the appellants in advance.
In that telex, the appellants also indicated that there would be another vessel, Gowa, `scheduled to arrive Singapore for accepting cargo on/about 27 June 1988`. There was no reply to this telex from the respondents. Three days later, on 28 May 1988, by another telex to the respondents, the appellants confirmed their nomination of the vessel Majapahit; the telex ended thus:

Therefore, please note that our nomination of vessel Majapahit etaSingapore 13 June 1988 is taken as final and we request you to deliver the cargo to the nominated vessel accordingly.



This is a firm nomination of vessel and requirements for your delivery.


About 10 days later, on 7 June 1988, the appellants sent yet another telex to the respondents; this telex was despatched at about 5.05pm.
As this is an important telex, we set it out below in full:

We refer to the nomination of Majapahit in our letter dated 25 May 1988. This nomination was accepted by you and you acknowledged receipt of our nomination.



In our telex of 28 May 1988, we reminded you of the nomination of Majapahit eta Singapore 13 June 1988 so that you could take steps to ensure that the goods would be ready for shipment.


Majapahit is a container vessel and PIL will be stuffing the goods in containers on our account.
We understand that PIL has contacted you to ask for the goods to be sent to PIL on Friday or Saturday, 10 or 11 June 1988. The eta for Majapahit is now 14 June 1988.

Please confirm by 12 pm, 8 June 1988, that you have sent cargo to PIL .
You are obliged under the contract to deliver the cargo to PIL for shipment to Majapahit as our nominated vessel and in accordance with our call for shipment within the shipment period of June. [Emphasis added.]

Consistent with what they had said, the appellants on the same evening despatched a telex to PIL confirming that their reservation on the Majapahit would be held until 5pm, 8 June 1988, and that, otherwise, the cargo would be loaded on the Gowa.


On 8 June 1988 the appellants sent two telexes to the respondents.
The first telex was sent in the morning, at about 9.40am, and reproduced the contents of the 7 June 1988 telex `for good order sake`. The second telex was sent after the close of business, at about 5.55pm, and stated that as there was no response from the respondents, the appellants had cancelled their booking for Majapahit and the cancellation was due to a breach of contract by the respondents in failing to supply the goods; the telex also asked the respondents how the latter proposed to compensate the appellants and whether the respondents intended `to ship the goods on a later date or at all`. On the following day, 9 June 1988, the appellants despatched a telex which, so far as material, said:

... While reserving all our rights for damages against you, we are willing to nominate a fresh vessel, Gowa, eta Singapore 27 June 1988 for you to ship the contract goods. Please confirm by the close of business tomorrow that you will be shipping the goods on Gowa eta Singapore 27 June 1988. ...



Please be informed the new booking number of vessel Gowa will be LGH-261.
Shipping company, PIL, allow to send in the goods around 23 to 24 June 1988. Please take note.

Not having heard from the respondents, the appellants, on 11 June 1988, despatched the following telex to the respondents:

We refer to our telexes of 8 and 9 June 1988. We regret we have had no response.

We regard your behaviour as a repudiation of the contract. We accept the repudiation and will sue you in damages.

We have had no choice but to buy an alternative June shipment at US$2,730 per tonne c & f Hong Kong.

As the contract is at an end, we require you to immediately return the original letter of credit No LC00134454 with all relevant amendments to us.



To this telex, the respondents replied by telex on 13 June 1988 stating as follows:

Reference your telex ref 880611(i) dated 11 June 1988. We are not in repudiation of contract but you have given us very little time to respond. We are not repudiating and we will supply you with goods as soon as possible. We will also point out that the price of US$2,730 mentioned in your 11 June 1988 telex is well above market.



Thenceforth, the appellants` solicitors took over the conduct of the correspondence.
On 14 June 1988, their solicitors telexed to the respondents alleging breach of contract and demanding the return of their clients` letter of credit. In reply, the respondents denied they were in breach and thereafter handed the matter to their solicitors. On 15 June 1988 the respondents` solicitors returned to the appellants the letter of credit as requested.

The claim

On 28 June 1988 the appellants commenced proceedings against the respondents alleging that as the respondents had failed to respond to the appellants` telex of 7 June 1988 by 12 noon on 8 June 1988, the appellants cancelled the booking on the Majapahit, and that the respondents had breached their contract by failing to deliver or arrange for delivery of the cargo to PIL for loading onto the Majapahit. They further alleged that as a result of the respondents` breach of contract the appellants entered into a contract with Zhing Zhan and purchased an alternative cargo of 191.88 tonnes of latex for shipment in June at US$2,730 per tonne c & f Hong Kong, and claimed damages for breach of contract.

In defence, the respondents denied that there was any valid nomination of the Majapahit, as the appellants` booking of the Majapahit was cancelled on 4 June 1988 and transferred to the Gowa.
They admitted that they did not respond to the appellants` telex of 7 June 1988 by...

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