Humpuss Sea Transport Pte Ltd (in compulsory liquidation) v PT Humpuss Intermoda Transportasi TBK and another

• Judge: Steven Chong J
• Judgment Date: 29 May 2015
• Neutral Citation: [2015] SGHC 144
• Docket Number: Suit No 896 of 2014 (Summons No 5543 of 2014)
• Citation: [2015] SGHC 144
• Hearing Date: 16 March 2015
• Year: 2015
• Plaintiff Counsel: Chan Ming Onn David, Probin Stephan Dass, Tan Aik Thong, and Chan Junhao, Justin (Shook Lin & Bok LLP)
• Published date: 05 June 2015
• Court: High Court (Singapore)
• Defendant Counsel: Sushil Sukumaran Nair, Hing Shan Shan Blossom, Raymond Lam Kuo Wei, and Allen Lye Xin Ren (Drew & Napier LLC)

Steven Chong J: Introduction

Almost 30 years ago, Chan Sek Keong JC (as he then was), delivered a decision in Ong & Co Pte Ltd v Chow YL Carl [1987] SLR(R) 281 (“Ong & Co”) in which he held that “the service of the notice of the writ by means of a court process server employed by a solicitors’ firm in Kuala Lumpur was not an authorised method of service under the 1970 Rules [ie, the Rules of the Supreme Court 1970 (S 274/1970) (“the 1970 Rules”)].” In so finding, Chan JC observed that the “service of a writ is an exercise of judicial power” and that “the judicial power of one State cannot be extended or exercised in another independent State except with the consent of that State.” He went on to rule that service of the notice of the writ could only be validly carried out either through the government of that country or through the Singapore consular authority in that country under O 11 r 6(2) and, additionally in the case of Malaysia or Brunei, through the judicial authority in the area where the defendant is resident under O 11 r 5(8). Any other mode of service would not be in compliance with the 1970 Rules and was hence a nullity which could not be cured.

The decision in Ong & Co created practical difficulties in the service of process on defendants out of jurisdiction. This led a young lawyer, Sundaresh Menon, to pen a bold critique of Ong & Co which was published in the Singapore Academy of Law Journal (see Sundaresh Menon, “Effecting Service of Process Out of the Jurisdiction” (1990) 2 SAcLJ 111 (“Ong & Co case note”)). He raised a number of interesting points which were not specifically argued in Ong & Co. In particular, he stressed that although it was “undoubtedly correct” that the service of a writ is an exercise of judicial power, an important distinction should have been drawn between a writ which is a command to the defendant and a notice of a writ which is simply a notification to the defendant that an action had been commenced against him. In Ong & Co, as only the notice of the writ was served and not the writ itself, the sovereignty concerns highlighted by Chan JC were not engaged. The author expressed the hope that the High Court would revisit its decision should an opportunity arise in light of arguments and authorities which were not raised in that case.

In 1991, about a year after the publication of the article, a number of amendments were introduced to the 1970 Rules. Two should be singled out for brief mention. First, O 11 r 6(2)(c) (now O 11 r 4(2)(c) of the Rules of Court (Cap 332, R 5, 2014 Rev Ed)) (“2014 Rules” or simply “our Rules”) was introduced to provide that service of process may also be effected by a method of service authorised by the law of that country for service of any originating process issued by that country. Therefore, the same manner of service effected in Ong & Co would be valid under the post-1991 amendments given that it was common ground in that case that service via the agency of foreign solicitors was permitted by the rules of procedure applicable in Malaysia. Second, our form of writ (which until 1991 was issued as a command in the name of the President of Singapore) was amended to delete the reference to the President and restructured as a notification to the defendant of the commencement of an action against him instead of being framed as a command. Thereafter, the writ itself, and not just the notice of the writ, would be served out of jurisdiction.

The amendments to O 11 did not specifically address the correctness of the court’s nullity finding in Ong & Co. It was, however, questioned recently in two High Court decisions. In ITC Global Holdings Pte Ltd (in Liquidation) v ITC Ltd and others [2011] SGHC 150 (“ITC 2011”), Lee Seiu Kin J observed that “the currency of this view has diminished over time” and consequently Ong & Co is “no longer authoritative” for the point that improper service out of jurisdiction is a nullity. He held that improper service would constitute a mere irregularity which is capable of cure. This view was endorsed in SRS Commerce Ltd and another v Yuji Imabeppu and others [2015] 1 SLR 1 (“SRS Commerce”).

Despite the development of the law in this area over the last 30 years, O 11 continues to vex lawyers. The central question in this application is this: how many methods of service does O 11 of our Rules provide for? Even this deceptively simple question has given rise to a fundamental disagreement over the basic structure of the statutory scheme. The plaintiff argued that O 11 provided for six methods of service, which may be found in rr 3 and 4. By contrast, the defendant contended that there were only three methods of service, which may be found exclusively in r 4(2). In order to determine the dispute before me, I believe a closer examination of the legislative history of O 11 is essential. I begin first with the facts.

Facts

The plaintiff and the defendants are part of the “Humpuss” group of companies whose business interests range from shipping services to asset management.1Statement of Claim dated 18 August 2014 (“SOC”) at para 6. The plaintiff was incorporated in Singapore and it owns several oil products tankers in addition to being the majority shareholder in a number of marine companies.2SOC at paras 1 – 5. On 20 January 2012, the plaintiff was ordered to be placed in compulsory liquidation.3SOC at para 11. Both defendants were incorporated in Indonesia.

On 18 August 2014, the plaintiff, through the liquidator, commenced Suit No 896 of 2014 against the first and second defendants, seeking repayment of $110m in loans owed and a declaration that several transactions entered into between the plaintiff and the second defendant in 2009 be set aside for being transactions at an undervalue.4SOC at para 119. On 18 September 2014, the plaintiff obtained leave to serve its writ of summons and statement of claim on the defendants at their registered address in Indonesia.5SUM 4577/2014, found at the plaintiff’s Bundle of Documents (“PBOD”), Tab 2.

On 2 October 2014, Kristian Takasdo, a Junior Associate with Budijaja & Associates, a firm of solicitors practising in the Republic of Indonesia, effected service of the original as well as translated copies of (a) the writ of summons; (b) the statement of claim; and (c) the order of court granting leave to effect service out of jurisdiction (collectively, “the Court Documents”).6Affidavit of Kristian Takasdo dated 9 October 2014. Mr Takasdo effected service on both defendants by (a) personally serving the Court Documents at the respective defendants’ registered addresses;7Affidavit of Kristian Takasdo at paras 6 and 8. and (b) by arranging for copies of the same to be sent to them by way of courier service.8Affidavit of Kristian Takasdo at paras 7 and 9. The defendants do not dispute that they have received the Court Documents.9Minute sheet of Steven Chong J dated 16 March 2015 at p 1, para 8.

On 23 October 2014, M/s Drew & Napier LLC entered an appearance on behalf of both defendants.10PBOD, Tab 4. On 6 November 2014, the defendants filed Summons No 5543 of 2014, seeking a declaration that the Court Documents had not been duly served on them.11SUM 5543/2014 found at PBOD, Tab 5.

The parties’ arguments

I will first set out the relevant provisions of O 11 rr 3 and 4 for ease of reference:

Service of originating process abroad: Alternative modes (O. 11, r. 3)

3.—(1) Subject to paragraphs (2) to (8), Order 10, Rule 1 and Order 62, Rule 5 shall apply in relation to the service of an originating process out of Singapore.

(2) Nothing in this Rule or in any order or direction of the Court made by virtue of it shall authorise or require the doing of anything in a country in which service is to be effected which is contrary to the law of that country.

(3) An originating process which is to be served out of Singapore need not be served personally on the person required to be served so long as it is served on him in accordance with the law of the country in which service is effected.

…

Service of originating process abroad through foreign governments, judicial authorities and Singapore consuls or by other method of service (O. 11, r. 4)

…

(2) Where in accordance with these Rules an originating process is to be served on a defendant in any country with respect to which there does not subsist a Civil Procedure Convention providing for service in that country of process of the High Court, the originating process may be served — (a) through the government of that country, where that government is willing to effect service; (b) through a Singapore consular authority in that country, except where service through such an authority is contrary to the law of that country; or (c) by a method of service authorised by the law of that country for service of any originating process issued by that country.

The defendants’ arguments

Ms Hing, counsel for the defendants, submitted that because Indonesia is not a country with which Singapore has a Civil Procedure Convention, the only acceptable methods for service of the Court Documents were those stipulated in r 4(2).12Defendants’ written submissions at para 9. In support, she relied on the decision in Ong & Co and argued that “strict compliance” with r 4(2) was required.13Defendant’s written submissions at paras 14 and 15. She submitted that the plaintiff had failed to show that the service in the present case complied with r 4(2). For a start, it was clear that service had not been effected either through the Indonesian government or via the Singapore consular authority. This left only service under r 4(2)(c): ie, service by a method of service authorised by the law of Indonesia for the service of originating process issued by Indonesia.14Defendants’ written submissions at para 31. She argued that the service effected in the present case could not be justified...