Teras Offshore Pte Ltd v Teras Cargo Transport (America) LLC
Jurisdiction | Singapore |
Court | International Commercial Court (Singapore) |
Judge | Sir Henry Bernard Eder IJ |
Judgment Date | 04 April 2017 |
Neutral Citation | [2017] SGHC(I) 4 |
Citation | [2017] SGHC(I) 4 |
Published date | 08 April 2017 |
Plaintiff Counsel | Peter Doraisamy and Andrew Lee (Peter Doraisamy LLC) |
Defendant Counsel | Timothy Ross Lord (instructed) and Rajkumar Mannar (Peter Low LLC) |
Date | 20 March 2018 |
Hearing Date | 16 February 2017,13 February 2017,14 February 2017,15 February 2017,20 March 2017 |
Docket Number | Suit No 1 of 2016 |
Subject Matter | Contractual terms,Scope of work,Breach,Contract,Non-payment |
The Plaintiff (“TO”) is a company incorporated in Singapore. It is a wholly-owned subsidiary of Ezion Holdings Limited (“Ezion”). The Defendant (“TCT”) is a company incorporated in Delaware, United States of America and based in Gig Harbour, Washington. Ezion holds a minority indirect interest (some 19%) in TCT and to that extent TO and TCT are related companies. However, for present purposes at least, they operated at arm’s length. TO provides marine logistics and support services to the offshore oil and gas industry worldwide as did TCT at least until recently.
The present proceedings concern disputes between TO and TCT in relation to work and services provided by TO in relation to the construction of three liquefied natural gas (“LNG”) plants on Curtis Island (which is a small island with a landmass of approximately 15 square kilometres off the coast of Queensland, Australia) namely the Queensland Curtis LNG Project (“QCLNG Project”), the Australia Pacific LNG Project (“APLNG Project”) and the Gladstone LNG Project (“GLNG Project”) – collectively the “LNG Projects”.
The main contractors for the LNG Projects were Bechtel International Inc and Bechtel Oil Gas and Chemicals, Inc. For convenience only, I shall refer to these companies without distinction as “Bechtel”.
Each LNG Project was confined to its own specific area on Curtis Island with its own berthing area for loading and unloading. By three separate contracts between Bechtel and TCT as described more fully below, TCT agreed to provide tugs and barges, administrative, technical and professional services in the performance of the marine transportation operations in respect of the LNG Projects (the “Main Contracts”). This work was then sub-contracted by TCT to TO on back-to-back terms under three separate “parallel” sub-contracts (the “Sub-Contracts”). In very broad terms, the Main Contracts required TCT and, in turn, the Sub-Contracts required TO to provide tugs and barges and related services to transport modules (for the purpose of building the gas plants) to Curtis Island from Batam (Indonesia), Lamchabang (Thailand) and Batangas (the Philippines). The modules weighed between 180 tonnes to 3,800 tonnes and measured about 12 storeys high. Pursuant to the contractual arrangements referred to below, the modules were loaded on to the barges from the ports referred to above. One tug was generally required to tow a barge to the loading port at all times. Upon arrival, two tugs were required to tow the barge to be berthed at the loading port. For barges transporting modules from Batam, bunkering had to be carried out in Singapore due to the voyage distance – a single voyage could take as long as 30 days to reach Curtis Island. The unloading of the modules at Curtis Island had to be timed to be carried out during slack tide when the current was not strong. Ballasting operations were carried out to ensure that the barge remained level during unloading.
Over the course of the performance of these contracts, TO carried out approximately 87 voyages transporting 92 modules to Curtis Island for the LNG Projects. There were no reported losses or damages to any of the modules delivered to Curtis Island and all modules were delivered on time.
In summary, TO claims in debt, and alternatively by way of damages, (i) reimbursement of a total sum of US$3.5 million originally advanced by TO to TCT in or about 2012 (the “Advance Payments”); and (ii) further sums referred to as
In summary, all of TO’s claims were denied by TCT on various grounds set out in TCT’s responses to the Scott Schedule as well as a defence of set-off; and TCT advanced its own substantial counterclaim for various sums totalling approximately US$14 million also in relation to the LNG Projects.
In support of its various claims, TO served affidavits of evidence-in-chief (“AEICs”) from seven witnesses, all of whom were called to give evidence and were cross-examined on behalf of TCT, as follows:
In advance of the trial, TCT served three AEICs from the following individuals:
It is noteworthy that all three AEICs were very short. Of itself, that is not necessarily a criticism. But the AEICs of Mr Hamilton and Ms Ray consisted largely of bare assertions using formulaic language which lacked any proper detail or explanation. In my view, this was most unsatisfactory.
These three witnesses were all originally scheduled to be called by TCT to give evidence at the trial – Mr Hamilton, in person; and Mr Sanders and Ms Ray by video conference. However, the position of TCT changed dramatically in the course of the trial. After TO had called its witnesses and at the close of its case, TCT elected not to call any of its three scheduled witnesses. Notwithstanding their absence, TCT then sought to put in evidence the documents exhibited to Mr Sanders’ affidavit and over 2,000 documents originally exhibited to the affidavit of Ms Ray (i.e. ALR-1, ALR-2, ALR-3, ALR-4 and ALR-5) pursuant to s 32(1)(
The result of the above is that, in any event, TO is entitled to judgment in the total sum of US$3.5 million, as TCT conceded, plus interest (which I deal with at the end of this Judgment); and that TCT’s counterclaim should be dismissed. The issues...
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