Swiss Singapore Overseas Enterprises Pte Ltd v Navalmar UK Ltd

• Jurisdiction: Singapore
• Judge: Woo Bih Li JC
• Judgment Date: 13 November 2002
• Neutral Citation: [2002] SGHC 267
• Docket Number: Suit No 1331 of 2002
• Date: 13 November 2002
• Published date: 19 September 2003
• Year: 2002
• Plaintiff Counsel: R Srivathsan (Haridass Ho & Partners)
• Citation: [2002] SGHC 267
• Defendant Counsel: Joseph Tan (Kenneth Tan Partnership)
• Court: High Court (Singapore)
• Subject Matter: Principles for granting mandatory injunction,Civil Procedure,Injunctions,Contract,Whether separate contract arising from correspondence,Formation

Judgment

GROUNDS OF DECISION

Introduction

1. The Plaintiff Swiss Singapore Overseas Enterprises Pte Ltd (‘Swiss Singapore’) applied for a mandatory injunction to compel the Defendant Navalmar U.K. Ltd (‘Navalmar’) whether by itself or its agents in Singapore SSC Shipping Agencies Pte Ltd (‘SSC Shipping’) to issue eight bills of lading, the drafts of which were attached to Schedule 1 of the application, in exchange for nine existing bills of lading issued by SSC Shipping for and on behalf of the Master of the vessel MV Zurbaran (‘the Vessel’). The primary difference was that the words ‘Freight To Collect’ were marked on the existing bills whereas the new bills were to have the words ‘Freight Prepaid’. There were also other differences which I shall elaborate on later. After hearing arguments, I granted the mandatory injunction, although not exactly on the terms sought by Swiss Singapore. Navalmar has appealed to the Court of Appeal against my decision.

Background

2. Swiss Singapore claims that by a contract dated 9 May 2002, it had purchased a cargo of 10,000 metric tonne of Indonesian Merbau Timber from UD Menara Mas of Indonesia (‘UDMM’) for a total value of US$1.35 million. On or about 13 August 2002, UDMM entered into a fixture note with Navalmar for the hire of the Vessel to carry the cargo from Sorong, Indonesia to Chennai, India. Swiss Singapore is not a party to the fixture note but the material terms thereof state:

‘100% freight to be remitted by telegraphic transfer by Swiss Singapore Overseas Enterprises Pte Ltd, Singapore for and behalf of Charterer into Owner’s nominated bank account within 3 banking days of completion of loading and signing/releasing freight

….

Owners to appoint a Singapore agent free of charge to Swiss Singapore Overseas Enterprises Pte Ltd to issue a second set freight prepaid BSL against an LOI as per Owner’s format which to be signed by their authorised signatory.’

3. 1,252 pieces of the cargo was loaded at Sorong between 3 September 2002 and 4 October 2002 and the nine bills of lading with the words ‘Freight To Collect’ were issued by SSC Shipping for and on behalf of the Master of the Vessel.

4. On 16 October 2002, Mary Vijay of Swiss Singapore sent an e-mail to Captain Priya of Navalmar stating:

‘WE ARE ARRANGING TO PAY THE FREIGHT TODAY. PLEASE ADVISE YOUR AGENTS IN SINGAPORE TO RELEASE SWITCH B/L TO US AGAINST FAX COPY OF TELEX REMITTANCE OF FREIGHT WITH A COPY TO US. ALSO PLEASE ADVISE THE POSITION OF VESSEL HER ETA CHENNAI ETC.’

5. This was followed by a handwritten fax to Captain Priya stating:

‘ To: Capt. Priya

Ref. our telecon today. We have still not read your confirmation on above message. Please advise your agents details to whom we have to get the B/L Switched. Due to your not receipt of your confirmation of above matter and not confirmation of ETA of the vessel the freight payment is delayed. Your urgent confirmation is awaited to pay the freight.

Thanks.

Mary.’

6. On Friday 18 October 2002, Capt Priya sent an e-mail in response stating:

‘KINDLY NOTE THAT YOU HAVE STILL NOT PAID THE OCEAN FREIGHT.

WE CANNOT SWITCH THE B/L (sic) UNTILL WE DO (sic) NOT RECEIVE THE FREIGHT INTO OUR ACCOUNT.

VESSEL SAILED FROM BINTULU THIS MORNING AND WILL CALL TUTI

FIRST TO DISCHARGE 4700 CBM LOGS AND THEN CALL AT CHENNAI.

WE EXPECT VESSEL TO ARRIVE CHENNAI ON/ABOUT THE 28/29 TH OF OCTOBER AGW WP.

KINDLY EXPEDITE FRT PAYMENT.’

7. On Monday 21 October 2002, Mary Vijay sent an e-mail to Capt Priya stating:

‘THANKS FOR YOUR BELOW MESSAGE. KINDLY SEND A MESSAGE CONFIRMING THAT SINGAPORE SHIPPING WILL BE SWITCHING THE B/L TO US AGAINST TELEX COPY CONFIRMING OF FREIGHT PAYMENT MADE TO YOU. WE NEED THIS VERY URGENTLY AS WE DO NOT WANT ANY CONFUSION OR DELAY IN GETTING THE B/L SWITCHED. WE WILL ONLY TAKE THE SWITCH B/L FROM YOUR AGENT AFTER PAYMENT OF FREIGHT. HENCE YOUR CONFIRMATION TO US REQUIRED VERY URGENTLY.’

[Emphasis added.]

8. An e-mail of the same date was sent in reply to Mary Vijay stating:

‘we confirm that bills of lading will switched by Singapore shipping upon receipt of frt remittance advise. kindly note that delay is on your account due to non payment of freight, otherwise this could have been done 10 days ago.’

[Emphasis added.]

9. On the very same day, Swiss Singapore arranged for payment of the freight of about US$258,000 and Mary Vijay sent an e-mail to Capt Priya to forward the telex confirmation of payment and eight drafts of bills of lading with an urgent request that Navalmar instruct SSC Shipping to sign and release the new bills.

10. Eight days later, on 29 October 2002, Swiss Singapore’s solicitors, Haridass Ho & Partners (‘Haridass’) sent an urgent chaser by fax to Navalmar to point out that Navalmar had confirmed in its e-mail dated 21 October 2002 that the bills of lading would be switched upon receipt of remittance for the freight and notwithstanding such remittance, Navalmar had refused to instruct SSC Shipping to issue the new bills. They also pointed out that without the new bills, Swiss Singapore would not be able to negotiate the letter of credit issued in their favour by their Indian buyers and their Indian buyers could not arrange customs and other clearance. The penultimate paragraph of the fax put Navalmar on notice that if it failed to instruct SSC Shipping to issue the new bills by close of office the next day, they would proceed to the courts in Singapore to compel Navalmar by injunction to instruct its Singapore agents (i.e SSC Shipping) to issue the new bills.

11. In response, English solicitors Michael Lloyd & Co (‘Michael Lloyd’), acting for Navalmar, sent a fax reply dated 29 October 2002 asserting that Navalmar was dismayed at the apparent indifference to an enormous demurrage debt incurred at the load port and asking what assurance Swiss Singapore could give concerning payment thereof. The demurrage and related costs was US$187,930. They also sought particulars of the contract between Navalmar and Swiss Singapore and the contract term regarding the issue of the new bills.

12. Haridass responded in a fax dated 30 October 2002 pointing out the material terms of the fixture note and Navalmar’s e-mail dated 21 October 2002 wherein it had confirmed that the bills of lading would be switched ‘upon receipt of frt remittance advice’ and stressing that Swiss Singapore had paid freight. Haridass warned that if the new bills were not issued, Swiss Singapore would be left with no alternative but to seek the remedy stated in their earlier fax and asked Michael Lloyd to revert by the opening of Haridass’ office the next day.

13. Michael Lloyd then sent a reply fax dated 30 October 2002, stating that Swiss Singapore was not a party to the fixture note and could not seek reliance on it. They also said that ‘It would appear inequitable in any event for them to take advantage of part of the document whilst ignoring other obligations of the shipper set out in it’. Mr Lloyd also asked to speak to Mr Haridass but no evidence was given as to whether Mr Lloyd managed to speak to Mr Haridass and what was said in the conversation.

The application for a mandatory injunction

14. On Friday 1 November 2002, Swiss Singapore commenced an action in Singapore and filed an ex parte application for the mandatory injunction which I have mentioned. As the application was for a mandatory injunction, I directed its Counsel, Mr R Srivathsan, to forward a copy of the Writ of Summons, the application and the supporting affidavit to Michael Lloyd and to SSC Shipping with a cover fax or letter stating that the application had been adjourned to 10.30 am of 5 November 2002 (as Monday 4 November 2002 was a public holiday in Singapore). The Vessel was expected to reach Chennai on 5 November 2002.

Arguments

15. On Tuesday 5 November 2002, Mr Joseph Tan appeared for Navalmar before me. He sought an adjournment to the following Monday i.e 11 November 2002 to file an affidavit in response although he had received instructions the previous Saturday afternoon and he had spoken to London solicitors on Sunday and Monday. He was instructed that Navalmar’s e-mail had been sent under pressure otherwise Swiss Singapore would not pay the freight. He was also instructed that the export of logs from Indonesia was...