Sembcorp Marine Ltd v PPL Holdings Pte Ltd
Jurisdiction | Singapore |
Judge | Sundaresh Menon CJ |
Judgment Date | 25 July 2013 |
Neutral Citation | [2013] SGCA 43 |
Published date | 02 August 2013 |
Date | 25 July 2013 |
Year | 2013 |
Hearing Date | 08 November 2012 |
Plaintiff Counsel | Davinder Singh SC, Vanathi S, Jackson Eng and Isaac Lum (Drew & Napier LLC) |
Citation | [2013] SGCA 43 |
Defendant Counsel | Alvin Yeo SC, Monica Chong, Koh Swee Yen and Toor Simran (WongPartnership LLP),Lee Eng Beng SC, Disa Sim, Jonathan Lee and Fu Qui Jun (Rajah & Tann LLP) |
Court | Court of Appeal (Singapore) |
Docket Number | Civil Appeals Nos 75 and 77 of 2012 |
In this judgment, we give our decision on two related appeals, namely, Civil Appeal No 75 of 2012 (“CA 75”) and Civil Appeal No 77 of 2012 (“CA 77”) (collectively “the present appeals”). The present appeals arise out of Suit 351 of 2010 (“Suit 351”), which was an action commenced by Sembcorp Marine Ltd (“Sembcorp”) against PPL Holdings Pte Ltd (“PPL Holdings”) and E-Interface Holdings Limited (“E-Interface”) over the corporate affairs and management of their joint venture company, PPL Shipyard Pte Ltd (“PPL Shipyard”). In his judgment in
The present appeals raise a number of issues of company law and contract law. In particular, lead counsel for Sembcorp, Mr Davinder Singh SC (“Mr Singh”), and lead counsel for both PPL Holdings and E-Interface, Mr Lee Eng Beng SC (“Mr Lee”), had much to say on the proper approach to the implication of terms as well as to the interpretation of contractual terms under our law. In this judgment, we address these points raised, as well as the construction of contracts in general.
FactsMost of the relevant facts have been set out at [3] to [25] of the Judgment. We therefore only recite the facts to the extent necessary.
PartiesSembcorp is engaged in the business of constructing oil rigs and ships. In or around late 2000, one of Sembcorp’s wholly-owned subsidiaries, Jurong Shipyard Pte Ltd, submitted a tender pursuant to an invitation issued by Santa Fe International Corporation for the construction of certain drilling rigs (“the Santa Fe Projects”). PPL Shipyard, which was also carrying on the business of designing and constructing offshore drilling rigs, had likewise put in bids for the Santa Fe Projects. At some point, the management teams of Sembcorp and PPL Shipyard came to learn about their mutual interest in the same Santa Fe Projects. The idea of an alliance was mooted, and a joint venture quickly materialised with the signing of a Sale and Purchase Agreement (“the SPA”) on 29 March 2001, and a joint venture agreement (“the JVA”) on 9 April 2001. Prior to the SPA, PPL Shipyard was effectively owned by PPL Holdings as 97% of PPL Shipyard’s issued share capital was held by PPL Holdings in its own right while the remaining 3% was held by E-Interface, a wholly-owned subsidiary of PPL Holdings.
The only two directors of PPL Holdings are Dr Benety Chang (“Chang”) and Mr Anthony Aurol (“Aurol”). In addition, Aurol was the Executive Director of PPL Shipyard, as well as the Chief Operating Officer and a director of Baker Technology Ltd (“Baker”), a public company listed on the Stock Exchange of Singapore. Baker owned 100% of the shares of PPL Holdings and as will become apparent, was an important player in the background to the present dispute. Chang is the Executive Deputy Chairman of PPL Shipyard as well as a director and the Chief Executive Officer of Baker. Between them, Chang and Aurol managed the day-to-day operations of PPL Shipyard.
BackgroundThe JVAUnder the SPA, Sembcorp purchased 50% of the issued share capital in PPL Shipyard from PPL Holdings. As a result, Sembcorp and PPL Holdings (together with E-Interface) each had an equal interest in PPL Shipyard. The terms on which the joint venture between Sembcorp and PPL Holdings was to be carried out were set out in the JVA.
The key terms of the JVA which are in dispute in the present appeals include the following:
SHARE CAPITAL …
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so long as they shall hold such number of shares for the time being in the capital of [PPL Shipyard] as are not less than the proportions set out herein. Any member of the Board may appoint an alternate to attend Directors' meetings and otherwise act as a Director in his absence.
The Parties shall appoint directors to all the subsidiaries of [PPL Shipyard] on the same proportion and basis as set out above and these subsidiaries shall be operated on the same basis and in accordance with the terms as set out in this Agreement.
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