Sun Cruises Ltd v Overseas Union Bank Ltd

• Jurisdiction: Singapore
• Judge: G P Selvam J
• Judgment Date: 31 May 1999
• Neutral Citation: [1999] SGHC 148
• Docket Number: Suit No 679 of 1998
• Date: 31 May 1999
• Published date: 19 September 2003
• Year: 1999
• Plaintiff Counsel: Bill Ricquier, Imran Khwaja and Vanessa de Souza (Tan Rajah & Cheah)
• Citation: [1999] SGHC 148
• Defendant Counsel: Davinder Singh SC, Hri Kumar and Ajay Advani (Drew & Napier)
• Court: High Court (Singapore)
• Subject Matter: Whether casinos on ships constitute common gaming houses,Whether gaming debts recoverable,Betting, Gaming and Lotteries,Gaming,Common Gaming Houses Act (Cap 49),Gaming contracts,s 6(2) Civil Law Act (Cap 43, 1994 Ed),Casino on ship

Judgment:

1.GP SELVAM J

Dismissal of the claim

The plaintiffs in this case brought this action seeking judgment for $500,000 under a cashier`s order (`CO`) issued by the defendants. The plaintiffs were named as payees. The CO was marked `non-negotiable a/c payee`. The defendants denied liability on the ground that the CO was fraudulent or that it was issued by mistake. It was not alleged that the plaintiffs were aware of the fraud or the so-called mistake. The plaintiffs, nonetheless, asserted that they were not party to the fraud and that they took the CO for value in good faith and without notice of the fraud. The defendants responded that the CO was given in exchange for gaming chips and accordingly was `illegal and/or null and void and/or did not constitute good consideration in law`.

2.At the conclusion of the trial I without any hesitation dismissed the claim with costs. I did so because the evidence made it abundantly clear that the money the plaintiffs sought to recover was part of their winnings in gaming. An action to recover that money was expressly prohibited by s 6(2) of the Civil Law Act (Cap 43). I shall now elaborate the reasons for dismissing the action.

3. Description of the plaintiffs

The plaintiffs were a corporation constituted in Bermuda. It would appear that apart from their name appearing at the Companies Registry of Bermuda and perhaps a brass-plate at 44 Church Street, Hamilton, Bermuda, one would find no other evidence of their abode or activities in that island. Singapore was the home of all their commercial and corporate activities. It was clear that a substantial part of their income was received and retained in Singapore. Their official bearers, bank accounts, account keeping and operation staff existed in Singapore. The only shareholder of the plaintiffs was a Singapore company called Sun Cruises Holding Pte Ltd.

4.There is no nexus between the plaintiffs and Star Cruise Services Ltd, the plaintiffs in Suit No 432 of 1998 [ Star Cruise Services Ltd v Overseas Union Bank Ltd [1999] 3 SLR 412 ] (the ` Star Cruise case`). As a matter of fact the plaintiffs were competitors of Star Cruise companies. Mr Roger Westwood, who had worked for Star Cruise, helped the plaintiffs to set up two floating casinos for the present plaintiffs. The plaintiffs chartered the `Sun Viva` from Sun Viva Ltd also of 44 Church Street, Hamilton and a member of the Sun cruises stable of companies. The `Sun Viva` flew the flag of the Bahamas. They had also chartered another ship, the `Sun Vista`, which also flew the flag of the Bahamas

5.The plaintiffs` principal objects were `to carry on business as cruise operators and ship charterers and to provide for tourists and travellers and promote the provision of conveniences of all kinds, places of amusement, recreation, sport and entertainment of all kinds`. That was a round-about way of saying that they operated casino-ships. All these factors show their strong nexus to the laws of Singapore and that they submitted to the general jurisdiction of Singapore.

6. Innocent passage

The plaintiffs began their operations in November 1997. The casino-ships in fact were common gaming houses within the meaning of the Common Gaming Houses Act (Cap 49) (`the Act`). Under the Act, it is an offence to advance or furnish money for the purpose of establishing or conducting the business of a common gaming house or to profit from it in Singapore unless one has a government licence for it. The plaintiffs did not have such a licence. They said that the operation of the casino did not occur before the ship was in international waters. The expression `international waters` was a misnomer for `territorial waters` meaning waters outside the port-limits. navigation in the Singapore Straits and Malacca Straits in practice, would mean navigation through the territorial waters of Singapore, Indonesia and probably Malaysia. The configuration of territorial waters of the three states is such that within a short time a ship could transit the territorial waters of all three states.

7.While passaging the territorial waters of Singapore a foreign ship is entitled to the right of innocent passage. This means that subject to certain exceptions, the ship and those on board are entitled to exemption from the general jurisdiction and the judicial process of the littoral state to which the territorial waters belong. Innocent passage, however, permits only making bona fide passage peaceably. So, if a casino ship were to anchor in Singapore`s territorial waters in order to enable those on board to gamble there would not be innocent passage. In such a situation there is neither passage and nor it is innocent. To do so is to carry on an illegal activity. In this case there was no clear evidence that the ship anchored in Singapore`s territorial waters or that any gaming activity occurred while the plaintiffs` casino ships were in the territorial waters of Singapore. So I proceeded on the basis that they were not in breach of the provisions of the Act.

8. The plaintiffs win $1m from Alan Teo

With that prelude I shall now summarise the facts leading to the filing of this action. The plaintiffs` principal witness was Mr Roger Betram Westwood. He made an affidavit in these proceedings. He was the Vice-President, Club Services of the plaintiffs. In addition to his affidavit evidence he gave oral evidence by subjecting himself to cross-examination by the defendants` counsel. He also clarified certain important and pertinent matters raised by me. He was not a difficult witness. He was open and co-operative and adhered to the oath he had taken. Witnesses of that stamp go well with the court. Mr Westwood said that one Alan Teo Choon Beng was known to him and some of his colleagues because Alan Teo had been a customer of Star Cruise Services Ltd, when they worked for Star Cruise. On that basis the plaintiffs accorded Alan Teo VIP status on board their casino-ships. According to Westwood, Alan Teo was on board the casino ship `Sun Vista` on 2 December 1997 with Ms Maggie Teng. On 6 December 1997 he appeared on board the `Sun Viva` with his wife Madam Siak Lai Chun. On 6 or 7 December 1997 Alan Teo was again on board `Sun Viva` with Ms Maggie Teng, who was known to Westwood as Alan Teo`s `second wife`. On two other occasions he showed up with a third lady companion, Ms Lu Xiao Mei. In all he patronized the plaintiffs on six or seven occasions.

9.On 9 December 1997 Alan Teo embarked on a cruise-to-nowhere on the `Sun Viva`. He was given by the plaintiffs` operators in the cashier`s section of the casino a `transfer of funds` form, which he signed in blank. He also filled in a `cheque cashing facility` application form applying for a cheque...