Evergreen International SA v Volkswagen Group Singapore Pte Ltd and Others

• Judge: Belinda Ang Saw Ean J
• Judgment Date: 27 June 2003
• Neutral Citation: [2003] SGHC 142
• Citation: [2003] SGHC 142
• Defendant Counsel: Steven Chong SC and Adrian Tan (Rajah and Tann)
• Published date: 04 October 2003
• Plaintiff Counsel: Richard Kwek and S Mohan (Gurbani and Co)
• Date: 27 June 2003
• Docket Number: Originating Summons No 1853 of 2000
• Court: High Court (Singapore)
• Subject Matter: Civil Procedure,Jurisdiction,Limitation decree obtained and limitation fund established in Singapore,Admiralty and Shipping,Anti-suit injunction,Collision,Governing principles,Injunctions,Service out of jurisdiction,Collision in Singapore waters,Setting aside service,Whether application for injunction should be granted to restrain defendants from continuing proceedings in Belgium,Conflict of Laws,Limitation action,Significance of limitation decree and constitution of limitation fund

1 In this Originating Summons, the principal issue is whether an anti-suit injunction should be granted to restrain the Defendants as cargo interests and insurers from pursuing their action in Belgium against “Ever Reach”, a sister ship of “Ever Glory”. The Plaintiffs, Evergreen International S.A (“Evergreen”), are the registered owners of both “Ever Glory” and “Ever Reach”. The Defendants’ application to set aside the Order for service of the Originating Summons on the 4^th to 74^th Defendants out of jurisdiction and the Originating Summons were heard concurrently since the matters in issue overlap.

Background Facts

2 On 17 September 1998, there was a collision between the container vessel “Ever Glory” of the port of Panama and the car carrier “Hual Trinita” of the port of Monrovia, Liberia. It is not disputed that the collision occurred in Singapore territorial waters within the traffic separation scheme. The “Hual Trinita” with some 2,000 vehicles of different car makes such as BMW, Mercedes Benz, Audi and Peugeot, was en route to Hong Kong, Taiwan and Japan. After the collision, Semco Salvage & Marine Pte Ltd rendered salvage services to the “Hual Trinita” and her cargo, which included the Defendants’.

3 On 18 September 1998, the Plaintiffs commenced an in rem action against “Hual Trinita” in Singapore in Admiralty in Rem No. 603 of 1998. On 15 June 1999, the second day of trial, the Plaintiffs reached a settlement on liability with the owners of “Hual Trinita”. Pursuant to Order 70 r 34 of the Rules of Court, the agreement on liability was filed in the Registry on 16 June 1999 and it henceforth had the same effect as an Order of Court. Collision liability was apportioned at 50:50.

4 Owners of “Hual Trinita” also commenced an in rem action against “Ever Glory” in Singapore in Admiralty in Rem No. 575 of 1999. In November 1999, the owners of the colliding vessels settled this action.

5 On 2 October 1998, the Plaintiffs commenced a limitation action in Singapore in Admiralty In Personam No. 645 of 1998 against the owners of “Hual Trinita” and all other persons including the Defendants that have potential claims arising out of the incident. The International Convention relating to the Limitation of the Liability of Owners of Sea-Going Ships, 1957 (the “1957 Convention”) to which Singapore gave effect to are found in Part VIII of Merchant Shipping Act (Cap. 179). On 14 December 1998, the Plaintiffs’ solicitors, M/s Gurbani & Co, wrote to the representatives of the Defendants, namely M/s Clyde & Co, an English firm of lawyers, M/s Grier Olubi and cargo recovery agents, W K Webster International Pte Ltd. They were informed of the commencement of a limitation action in Singapore in Admiralty in Personam no. 645 of 1998 and notice was given to cargo claimants to participate in the limitation action. The owners of “Hual Trinita” initially contested the limitation action. Subsequently, on 11 September 1999, they withdrew their objections to challenge the Plaintiffs’ right to limit. However, they reserved their right to challenge the computation of the limitation fund.

6 On 24 September 1999, the Singapore court granted to the Plaintiffs a decree of limitation. The Defendants’ representatives were notified of the decree on the same day. Notice of the decree was advertised in the Straits Times, Business Times as well as Dutch and Belgium newspapers. Copies of the advertisements in the various newspapers were sent to the Defendants’ representatives as a matter of course.

7 The Plaintiffs applied to the Singapore court on 5 October 1999 to determine tonnage limitation. On 28 October 1999, the owners of “Hual Trinita” withdrew their objection to the tonnage calculation. The Plaintiffs obtained a declaration on 3 November 1999 that their liability is to be limited to the sum of S$2,411,227.56 plus interest thereon from the date of collision to date of payment into court. On 4 November 1999, the Plaintiffs paid into court the aforesaid sum plus interest.

8 The limitation decree obtained on 3 November 1999 was advertised in the Straits Times, Business Times and Lianhe Zaobao on 10 November 1999. The Plaintiffs also placed similar advertisements in Dutch and Belgium newspapers.

9 It is not in dispute that the Defendants were aware of the limitation action and were informed of every step in the limitation proceedings leading to the constitution of the limitation fund. The Defendants were also aware that they had two months to set aside the decree or to file their claims against the limitation fund. The Defendants did not participate in the limitation action. Neither did they challenge or set aside the decree nor prove their claims against the limitation fund. The Defendants’ preference as cargo owners and insurers of cargo lately laden on board “Hual Trinita” was to pursue their claims for damages for loss and damage arising out of the collision between the “Hual Trinita” and “Ever Glory” in a different jurisdiction that applies the Convention on Limitation of Liability for Maritime Claims, 1976 (the “1976 Convention”).

10 Before the decree of limitation was obtained, the Defendants tried, albeit unsuccessfully, on 2 July 1999 to arrest the “Ever Glory” in the Netherlands. A sister ship, the “Ever Reach”, was arrested in Belgium on 24 September 1999. The Plaintiffs furnished security in the sum of US$18.3 million to secure the release of the “Ever Reach” from arrest.

11 The Defendants’ claims against the Plaintiffs in tort for damages for loss and damage to the vehicles exceed the limit of the “Ever Glory” under either Convention. In addition, they have claims for salvage remuneration and general average contribution. It is common ground that the Belgium courts would apply a higher limit based on the 1976 Convention. Under 1976 Convention, the limit of liability would be about S$13.5 million as compared to 1957 Convention limit of S$2,411,227.56.

12 After the arrest in Belgium, the Plaintiffs filed an application to set aside the arrest. The Plaintiffs failed at first instance before the Belgium court. The decision was handed down on 15 February 2000. The Plaintiffs appealed against the decision on 3 May 2000. The appeal was dismissed by the Court of Appeal on 5 February 2002. The Plaintiffs on 23 May 2002 appealed to the final appellate court, the Cour De Cassation. That appeal is still pending.

13 Other than arresting the “Ever Reach” in Belgium, the Defendants have no connection whatsoever with Belgium. The Plaintiffs are a company incorporated in Panama. The operators of “Ever Glory” are based in Taiwan. It is common ground that there is no doctrine of forum non conveniens in Belgium law nor is there a recognised jurisdiction to grant anti-suit injunction on forum conveniens ground.

Anti-Suit Injunction

14 An application for a grant of an anti-suit injunction would require consideration of whether a Singapore court has jurisdiction over the Defendants to grant an injunction, and if so, the applicable principles upon which it acts. The principles upon which the jurisdiction to grant anti-suit injunction may be exercised were enunciated by the Privy Council in Societe Nationale Industrielle Aerospatiale v Lee Kui Jak [1987] 1 AC 871 and adopted by the Court of Appeal in Bank of America National Trust & Savings Association v Djoni Widjaja [1994] 2 SLR 816 and re-affirmed in Koh Kay Yew v Inno-Pacific Holdings Ltd [1997] 3 SLR 121.

15 I do not propose to repeat the four well-known principles here as they will be referred to in the course of my judgment. Suffice it to say that a broad principle underlying the jurisdiction to grant an anti-suit injunction is that it is to be exercised when the ends of justice require it. A requirement to attract jurisdiction in the present case, which does not concern an agreement not to sue or an agreement only to sue in the jurisdiction in which the injunction is sought, is the establishment of an equity or equities which will ground the grant of injunctive relief. See British Airways Board v Laker Airways Ltd [1985] 1 AC 58 at 81 and 95 and Adrian Briggs, Civil Jurisdiction and Judgment (3^rd ed), paragraph 5.40. This may occur when Singapore is the natural forum for the resolution of the dispute between the parties and the foreign proceedings are vexatious or oppressive. Additionally, in considering whether the Belgium action is vexatious or oppressive, account must be taken of the possible injustice to the Defendants should the injunction be granted, and the possible injustice to the Plaintiffs if it is not.

16 Accordingly, I have to consider (a) whether the Defendants are amenable to the jurisdiction of the Singapore Court; (b) the natural forum for resolution of the dispute between the parties; (c) the alleged vexation or oppression to the Plaintiffs if the Belgium proceedings are to continue and (d) the alleged injustice to the Defendants as an injunction would deprive the Defendants of the advantages sought in the foreign proceedings.

(i) Jurisdiction over the Defendants to grant an injunction

17 In Singapore, jurisdiction is founded on the presence of a defendant in the country and in certain specified instances on a power to serve the defendant with process outside the jurisdiction. Thus, a Singapore court has jurisdiction to grant an injunction against a defendant if it has personal jurisdiction over him. In order to establish personal jurisdiction, in the case of a foreign defendant, the consideration is whether Order 11 applies.

18 As the 1^st and 2^nd Defendants are not plaintiffs in the Belgium proceedings, they have been excluded from the Originating Summons after Justice Tan Lee Meng dismissed on 20 January 2003 the Plaintiffs’ claims in the Originating Summons against both of them. The 3rd Defendant is a company incorporated in the United Kingdom with a registered place of business in Singapore. The 4^th to 74^th Defendants are from United Kingdom,...