Kings Global Services Pte Ltd v SNK Marine Pte Ltd

• Jurisdiction: Singapore
• Judge: Lewis Tan
• Judgment Date: 03 June 2022
• Neutral Citation: [2022] SGDC 120
• Court: District Court (Singapore)
• Hearing Date: 17 May 2022,31 May 2022
• Docket Number: District Court Suit No 2374 of 2021 (Summons No 268 of 2022)
• Plaintiff Counsel: Sim Jin Simm Alina (Axis Law Corporation)
• Defendant Counsel: Krishna Ramakrishna Sharma (Fleet Street Law LLC)
• Subject Matter: Civil Procedure,Summary judgment,Incorporation of terms,Whether additional terms incorporated after parties agreed on certain terms,Pleadings,Striking out,Demurrage or detention,Proper party for making claim in demurrage or detention
• Published date: 11 June 2022

Deputy Registrar Lewis Tan: Introduction

Parties to time-sensitive commercial transactions often agree to certain key terms within their immediate contemplation and leave the remaining terms to be negotiated. The failure to come to a clear agreement on such remaining terms may, as the parties in the present suit have come to realise, lead to a time-intensive dispute without an easy solution.

Facts

Kings Global Services Pte Ltd (“the Plaintiff”) is a freight forwarder, while SNK Marine Pte Ltd (“the Defendant”) is a non-vessel operating container carrier providing ship broking services.¹ In June 2021, the Defendant contacted the Plaintiff to seek a quotation for the transloading of cigarettes from Singapore. The Plaintiff promptly responded with quotations for “container clearance” and “transloading charges”, along with a caution that storage for the cargo was not recommended given the “extremely high” storage charges.²

However, the intended shipment was delayed until early July 2021, when the Defendant sent the Plaintiff another request for the transloading of 1,150 cartons of cigarettes. A quotation was then provided by the Plaintiff, with such a quotation once again excluding, amongst others, storage charges for the cigarettes.³ Following this, the 1,150 cartons of cigarettes were released to the Plaintiff in Singapore. Shortly thereafter, the Plaintiff informed the Defendant of the storage charges, which was in excess of $1,000 per day.

As the Defendant’s intention was for the cigarettes to be shipped out of Singapore promptly, the Defendant did not appear fazed by the storage charges. However, the issue of the storage charges began to surface when the carrier cancelled the Defendant’s export booking for 1,000 cartons of cigarettes.⁴ As the bulk of the cigarettes remained in the Plaintiff’s possession, the Plaintiff started reminding the Defendant of the storage charges that continued to accrue. On 30 July 2021, the Plaintiff issued an invoice seeking payment of $24,705 for about 15 days of storage.⁵

The Defendant contested such charges as exorbitant and being outside the parties’ agreement, but the Plaintiff refused to release the cartons of cigarettes until the charges, which continued to increase by the day, were paid by the Defendant. After about two months of back-and-forth between the parties’ representatives, the charges had risen to about $63,000, and the Defendant therefore instructed the Plaintiff to dispose of the cigarettes. However, the Plaintiff continued to claim for the unpaid charges, while the Defendant issued an invoice to the Plaintiff for $51,000 as “detention and demurrage” charges for withholding its cigarettes.⁶

Procedural history

In November 2021, the Plaintiff commenced the present suit, claiming the sum of $84,279.57. Much of this sum was allegedly incurred for storage charges from the time the cigarettes were in the Plaintiff’s possession until they were disposed of on 14 September 2021.

The Defendant admitted that the parties had agreed for the Plaintiff to carry out stuffing and unstuffing for the containers shipped to the Plaintiff.⁷ While the Defendant had agreed for the Plaintiff to carry out transloading of its cigarettes, it did not agree to any storage charges for the cigarettes.⁸ Hence, the Plaintiff’s refusal to release the cigarettes until payment for storage was made amounted to a breach of contract between the parties, and caused the Defendant to incur “detention and demurrage” charges⁹ in the sum of $51,100.¹⁰

Being of the view that the Defendant’s Defence and Counterclaim (“DCC”) was a concocted attempt to delay payment, and further that the counterclaim was unsustainable as the Defendant had not suffered any loss for demurrage or detention,¹¹ the Plaintiff took out the present summons, seeking: a striking out of the DCC for being scandalous, frivolous or vexatious, for tending to prejudice, embarrass or delay the fair trial of the action, or for being an abuse of the process of the Court; and final judgment against the Defendant for the sum of $84,279.57 or part thereof, along with interest at the rate of 5.33% per annum from the date of commencement of the action to the date of payment.

The summary judgment application

I begin my assessment by considering the merits of the Plaintiff’s application for a summary judgment in respect of its claim for $84,279.57.

Applicable principles

For summary judgment to be entered in a plaintiff’s favour without trial, a plaintiff has to first show that he has a prima facie case for judgment. Once that is done, the burden shifts to the defendant who, in order to obtain leave to defend, must raise an issue or question in dispute which ought to be tried, or show that there ought for some other reason to be a trial. A bare assertion does not raise a triable issue, and there must be some cogent evidence supporting the defendant’s assertions: DBS Bank Ltd v Lam Yee Shen and another [2021] 5 SLR 1202 at [13(b)], citing Calvin Klein, Inc and another v HC International Pte Ltd and others [2016] 5 SLR 1183 at [45].

Here, the Plaintiff has established a prima facie case for judgment as its claim is based on the cigarettes which were indubitably in its possession from July to September 2021. For these charges, the Plaintiff repeatedly sent invoices to the Defendant, and these invoices now provide some support for its claim.

The Defendant does not appear to directly contest the presence of such invoices. Rather, much of the Defendant’s contention boils down to the storage and removal fees, as well as the parking and chassis charges (collectively, the “Additional Charges”), which were quoted by the Plaintiff after the cigarettes were released to the Plaintiff. These charges, the Defendant maintains, are not part of the agreement between the parties as the Defendant had only agreed to the Plaintiff’s quotes for stuffing and unstuffing of the containers containing the cigarettes.¹²

To this, the Plaintiff contends that the parties came to an agreement for the Additional Charges by way of email correspondence. In this regard, reference is made to s 11(1) of the Electronic Transactions Act 2010, which provides that “an offer and the acceptance of an offer may be expressed by means of electronic communications”. Furthermore, the Defendant’s representative repeatedly “noted” the Plaintiff’s quotations, including the quotations for the Additional Charges. Given the lack of objection to these Additional Charges, any alleged dispute on these rates and the alleged lack of contract vis-à-vis these charges are “but an afterthought”, raised as a means to evade liability.¹³

The Initial Charges

The questions of whether the parties entered into an agreement and the terms that were incorporated to such an agreement “turn[s] on ascertaining the parties’ objective intentions”. This is to be “gleaned from their correspondence and conduct in light of the relevant background as disclosed by the evidence”: R1 International Pte Ltd v Lonstroff AG [2015] 1 SLR 521 (“R1 International”) at [51].

On the facts before me, it appears that the parties came to an agreement for the Plaintiff to provide transloading services for the Defendant’s cigarettes. This can be discerned from the parties’ correspondence in June 2021, when the Plaintiff provided quotations for the unstuffing, stuffing, permit, handling, and labour charges (collectively, “the Initial Charges”) for the transloading of the Defendant’s cargo.¹⁴ The Defendant did not dispute these quotations, but the intended June shipment was cancelled as Mr Upul of the Defendant informed the Plaintiff that the shipper had not confirmed the rates, and so the Plaintiff should “kindly ignore the job”.¹⁵

However, this did not spell the end of the parties’ relationship as on 7 July 2021, Mr Upul sought another quotation from Mr Kingsley Lam (“Mr Kingsley”), the Director of the Plaintiff. In response, Mr Kingsley again provided quotations for the Initial Charges. As per the June quotation, however, Mr Kingsley stressed that his quotation excluded, amongst others, “detention, demurrage, PSA storage, parking fees if incurred”.¹⁶ On 8 July 2021, Mr Upul replied that the Defendant’s intention was to transload two sets of cigarettes, with the first set consisting of 1,000 cartons of cigarettes to be sent to Jebel Ali, Dubai by a Full Container Load (“the FCL cargo”) and the second set consisting of 150 cartons of cigarettes to be re-exported by Loose Cargo Load (“the LCL cargo”).¹⁷ In shipping terms, FCL refers to the buying and selling of full container spaces (ie, the entire container), while LCL refers to the buying and selling of loose container spaces (ie, part of the container).

Mr Kingsley then provided the LCL rates, which included ocean freight, export permit and labour charges and stated that “Bonded Storage charges will be included if incur[red]”. He requested for Mr Upul to confirm such rates before proceeding. To this, Mr Upul replied “Noted”,¹⁸ and the Defendant released the 1,150 cartons of cigarettes to the Plaintiff on around 12 July 2021.¹⁹

On the evening of 12 July 2021, the Plaintiff then informed the Defendant of that its storage charges were $45 per cubic meter (“CBM”) per day for storage, and $45 per CBM per week for removal.²⁰ However, storage charges did not appear to be a significant issue at that point, and on 13 and 14 July 2021, the Defendant provided the Plaintiff with the export bookings for the 1,000 and 150 cartons of cigarettes respectively.²¹

I pause at this juncture to note that by this point, the Defendant appeared to have accepted the Plaintiff’s quotations for the Initial Charges as no objections were raised to such quotations before the Defendant released its cargo to the Plaintiff for transloading. As the Court of Appeal summarised at [53]–[54] of R1 International: 53 … [A]lthough silence by one party may not...