Sinwa SS (HK) Co Ltd v Nordic International Ltd and another

• Jurisdiction: Singapore
• Court: Court of Three Judges (Singapore)
• Judge: Sundaresh Menon CJ
• Judgment Date: 06 January 2015
• Neutral Citation: [2014] SGCA 63
• Citation: [2014] SGCA 63
• Subject Matter: Summary judgment,Arbitration,Civil Procedure,Leave to commence arbitration proceedings
• Date: 06 January 2015
• Published date: 07 January 2015
• Defendant Counsel: Joseph Tan Wee Kong and Joanna Poh (Legal Solutions LLC)
• Plaintiff Counsel: Andrew Ho Yew Cheng (instructed), Lim Pei Ling June (instructed) and Soh Leong Kiat Anthony (One Legal LLC)
• Docket Number: Civil Appeal No 108 of 2014 and Summons No 4987 of 2014
• Hearing Date: 25 November 2014

Steven Chong J (delivering the grounds of decision of the court): Introduction

This case concerned an interlocutory appeal against a decision of the High Court that there be “no order” on a summary judgment application filed by the appellant, Sinwa SS (HK) Co Ltd (“the Appellant”).

Previously, the statutory scheme under the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) (“SCJA”) was such that a party’s right of appeal from the High Court to the Court of Appeal in respect of interlocutory applications rested on the dichotomy between interlocutory and final orders. If an order was final, then an appeal could be brought to the Court of Appeal as of right; if the order was interlocutory in nature, then a party generally retained a right of appeal to the Court of Appeal, subject to the requirement that an application be brought within seven days for leave to present further arguments to the High Court judge, and except where the old Supreme Court of Judicature Act (Cap 322, 1999 Rev Ed) expressly provided for particular orders to be non-appealable or appealable only with leave (see Dorsey James Michael v World Sport Group Pte Ltd [2013] 3 SLR 354 (“Dorsey”) at [26]). In Wellmix Organics (International) Pte Ltd v Lau Yu Man [2006] 2 SLR(R) 525 at [14], this court held that the test of whether a given order was interlocutory or final was whether the order finally disposed of the rights of the parties.

The significance of the dichotomy between interlocutory and final orders diminished somewhat with the introduction of fixed schedules governing the right of appeal from specific types of orders pursuant to the Supreme Court of Judicature (Amendment) Act 2010 (Act 30 of 2010) (“the 2010 Amendments”). The 2010 Amendments introduced into the SCJA the Fourth and Fifth Schedules, which expressly provided for certain types of orders to be non-appealable or appealable only with leave respectively. A “calibrated approach” was thereby established to streamline and restrict appeals to the Court of Appeal, wherein interlocutory applications were categorised based on their importance to the substantive outcome of the case (see Singapore Parliamentary Debates, Official Report (18 October 2010) vol 87 (“Parliamentary Debates”) at cols 1369–1370). The rationale behind such an approach was to ensure that in general, a decision of a High Court judge in an interlocutory application is not unnecessarily taken all the way to the Court of Appeal, leading to a waste of judicial time (see OpenNet Pte Ltd v Info-communications Development Authority of Singapore [2013] 2 SLR 880 (“OpenNet”) at [18]).

Despite the 2010 Amendments, issues in relation to a party’s right of appeal on interlocutory matters have continued to arise in litigation. Recently, the cases of Nim Minimaart (suing as a firm) v Management Corporation Strata Title Plan No 1079 and others [2014] 1 SLR 108 and Citiwall Safety Glass Pte Ltd v Mansource Interior Pte Ltd [2014] SGCA 61 dealt with the question of whether leave was required to appeal to the Court of Appeal in different contexts. In the present appeal, a preliminary issue arose as to whether the Appellant had a right of appeal to this court from the High Court decision below and, accordingly, whether this court had the jurisdiction under the SCJA to hear the appeal.

At the end of the hearing, we concluded that we did not have jurisdiction to hear the appeal, as the “no order” made by the High Court below was, on a purposive interpretation, effectively one that was caught by the Fourth Schedule of the SCJA. We now give the detailed grounds for our decision.

Facts Parties to the dispute

The Appellant was a company incorporated in Hong Kong and was in the business of, inter alia, marine supply and logistics. The first respondent, Nordic International Limited (“the 1st Respondent”), was a company incorporated in the British Virgin Islands and in the business of converting and equipping ships. The second respondent, Morten Innhaug (“the 2nd Respondent”), was a Norwegian national habitually resident in Singapore.

The Appellant and the 2nd Respondent were shareholders of the 1st Respondent, each holding 50% of the 1st Respondent’s shares pursuant to a shareholders’ agreement dated 4 July 2007 (“the Agreement”). The Agreement sets out the terms of the parties’ joint venture which involved the conversion of a fishing trawler into a seismic survey vessel (“the Vessel”). The 1st Respondent was the joint venture vehicle and the owner of the Vessel. The Agreement was initially concluded between the 2nd Respondent and a Singapore company called Sinwa Limited. On 28 August 2007, Sinwa Limited’s rights and obligations under the Agreement were novated to the Appellant.

The Time Charter

On 8 June 2007, the 1st Respondent entered into a time charter (“the Time Charter”) with a Singapore company known as BGP Geoexplorer Pte Ltd (“BGP”). The Time Charter was for a three-year period at a daily rate of US$37,000. Earlier in December 2006, BGP had entered into an agreement with TGS-NOPEC Geophysical Company SA (“TGS”) for the provision of seismic acquisition services (“the Seismic Agreement”).

According to the Appellant, on 23 August 2008, BGP, TGS, and a company known as Nordic Maritime Pte Ltd (“NMPL”) entered into a memorandum of agreement (“the MOA”) wherein it was agreed that BGP would transfer and assign to NMPL its rights and obligations in the Time Charter as well as in the Seismic Agreement. On 22 September 2008, a notice of assignment of the Time Charter was signed between BGP and a company known as Nordic Geo Services Limited (“NGS”). The Appellant claimed that NGS was a wholly-owned subsidiary of NMPL, which in turn was owned and/or controlled by the 2nd Respondent. The Appellant’s position was that the assignment of the Time Charter was null and void as it had been done without any prior notice or consent from the directors of the 1st Respondent appointed by the Appellant. Alternatively, the Appellant maintained that regardless of the validity of the assignment, BGP remained responsible to the 1st Respondent for due performance of the Time Charter under its terms.

On 7 April 2009, the Appellant, on behalf of the 1st Respondent, instructed its solicitors to send a letter of demand to BGP for the outstanding charter hire fees due to the 1st Respondent. BGP’s solicitors responded on 22 April 2009 maintaining that its rights and obligations under the Time Charter had already been transferred and assigned to NMPL and consequently it owed no obligations to the 1st Respondent under the Time Charter.

Arbitration proceedings against BGP and other related proceedings

Subsequently, on 18 November 2009, the Appellant, on behalf of the 1st Respondent, commenced arbitration proceedings against BGP for the recovery of the outstanding charter hire fees due under the Time Charter (“the BGP Arbitration”). The 2nd Respondent opposed the BGP Arbitration proceedings, and on 7 January 2010, applied to the High Court vide Originating Summons No 22 of 2010 (“OS 22/2010”) to effectively restrain the BGP Arbitration. In OS 22/2010, the 2nd Respondent sought a number of reliefs including a declaration that on a proper interpretation of the Agreement, the directors of the 1st Respondent appointed by the 2nd Respondent had the sole discretion to grant consent on behalf of the 1st Respondent to assign the Time Charter from BGP to NGS, as well as to decide whether or not to commence arbitration against BGP in respect of any purported breaches of the Time Charter.

OS 22/2010 was dismissed by Lai Siu Chiu J. In her judgment issued on 24 January 2011, Lai J held that under the Agreement, the parties were obliged to come to a unanimous decision on the issue of the assignment of the Time Charter as well as the appointment of lawyers to pursue the 1st Respondent’s claim against BGP (see Morten Innhaug v Sinwa SS (HK) Co Ltd and others [2011] SGHC 20 at [44]). If the parties could not agree, they were obliged to proceed to arbitration as provided for in the Agreement.

On 1 August 2011, BGP applied to the High Court vide Originating Summons No 650 of 2011 (“OS 650/2011”) for an order that the appointed arbitrator in the BGP Arbitration did not have jurisdiction as the Appellant did not have the requisite authority to commence the...