The AA V

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 19 October 1999
• Neutral Citation: [1999] SGHC 274
• Docket Number: Admiralty in Rem No 259 of 1996 (Registrar's Appeal No 223 of 1999)
• Date: 19 October 1999
• Year: 1999
• Published date: 19 September 2003
• Plaintiff Counsel: Goh Wing Sun (WS Goh & Co)
• Citation: [1999] SGHC 274
• Defendant Counsel: Navinder Singh and Kelvin Tan (Lee Bon Leong & Co)
• Court: High Court (Singapore)
• Subject Matter: ss 3(1)(l) & 4(4)High Court (Admiralty Jurisdiction) Act (Cap 123),Admiralty and Shipping,Whether defendant liable in personam for claim,Action in rem,Wrongful arrest,Whether High Court had admiralty jurisdiction over matter,Intentional and malicious non-disclosure of material facts,Civil Procedure,Damages for wrongful arrest,Admiralty jurisdiction and arrest,Interpleader,Ex parte application,Non-disclosure of material facts,Arrest of vessel,Relevant test

: This action was started on 3 May 1999. The indorsement of claim on the writ was as follows:

The plaintiffs` claim is for the balance sum of US$77,251.74 being the price of marine gas oil supplied and delivered to the defendants` ship or vessel AA V for her operation and/or maintenance at Singapore in the months of October and December 1998, at the request of the defendants, their agents and/or servants.

The vessel concerned, the tug-boat `AA V` (`the tug`), is registered at the Port of Singapore.

Concurrently with the filing of the writ, the plaintiffs applied for and were granted the issue of a warrant of arrest against the tug. The vessel was arrested the same day.

On 11 May, the defendants entered an appearance to the action and two days later they applied for an order that the writ of summons and warrant of arrest be set aside and that the tug be released from arrest forthwith. They also asked for damages for wrongful arrest. The ground of the application was that the court did not have jurisdiction over the proceedings herein under s 3(1)(l) and s 4(4) of the High Court (Admiralty Jurisdiction) Act (Cap 123) (`the Act`).

The defendants` application was heard before the assistant registrar on 19 May. The assistant registrar set aside the writ of summons and warrant of arrest and ordered the plaintiffs to release the tug from arrest forthwith. No order, however, was made on the application for damages for wrongful arrest. Both parties appealed. At the conclusion of the hearing, I dismissed the plaintiffs` appeal but allowed that made by the defendants. The consequence was that the order setting aside the writ and warrant of arrest stood, and, in addition, the plaintiffs were ordered to pay damages for wrongful arrest to be assessed. The plaintiffs have appealed against my orders.

The course of the proceedings

The plaintiffs are a company which, inter alia, deals in the supply of marine gas oil and marine diesel oil to vessels in Singapore. The defendants, the owners of the tug, are a Singapore incorporated company called Asia America Marine (S) Pte Ltd.

The affidavit leading the warrant of arrest was affirmed by Mr Goh Wing Sun, the solicitor then having conduct of this action on behalf of the plaintiffs. Mr Goh affirmed that the plaintiffs` claim was for the price of marine gas oil supplied and delivered to the tug for her operation and maintenance at the request of the defendants, their servants or agents. Exhibited to his affidavit evidencing the supply and receipt of the fuel were copies of the invoices, bunker delivery receipts and bunker requisition forms issued by the plaintiffs. It should be noted that the two invoices were both addressed to:

Master and Owners AA VNew Acmes Trading Pte LtdBlk 6, Syed Alwi Road [num ]03-303Singapore 201006.

After stating the formal matters required to be inserted in such an affidavit, Mr Goh went on to say that he verily believed that the defendants were at the time when the cause of action arose, the owners of or in possession or control of the tug and were the persons who would be liable to the plaintiffs in an action in personam and were also, at the date of the issue of the writ, the beneficial owners of the tug as respects all the shares therein. The ground for his belief relating to the tug`s ownership was a transcript from the Singapore Register of Ships.

I should state at this junction that most of the evidence in Mr Goh`s affidavit, particularly in relation to the issue of who would be liable in personam for the claim, was hearsay. The courts have repeatedly stated that solicitors should refrain from making affidavits on the facts of their clients` cases. Whilst in some applications for arrest the urgency of the situation and the fact of acting for a foreign client might leave the solicitor concerned no choice, this was not the situation here. There was no good reason why the affidavit leading to the warrant could not have been affirmed by someone with personal knowledge of the facts.

In support of their setting aside application, the defendants filed an affidavit affirmed by their director, Mr Lee Kwan Siang. Mr Lee confirmed that Asia America Marine (S) Pte Ltd had been the owners of the tug at the time the cause of action of the plaintiffs had arisen. He went on to aver, however, that at that time, the tug was under charter to a company called Kingwood Industry Pte Ltd (`the charterers`) and that the charterparty provided that whilst the owner of the tug was to be responsible for the insurance cost and the food and salary of the crew, `[a]ll other charges including fuel will be paid by Charterer`. This charterparty was terminated on 10 March 1999. A copy of the charterparty was annexed to Mr Lee`s affidavit. It showed the charterers` address as being in Phnom Penh, Cambodia.

Mr Lee went on to allege that the plaintiffs were fully aware at the time of the arrest that when their cause of action arose, the tug had been under time charter to the charterers with fuel expenses to be borne by the charterers. He said that on 6 October 1998, New Acmes Trading Pte Ltd (`New Acmes`) had issued an invoice to another company Kingdom Wood Ind (S) Pte Ltd (`Kingdom`) for the supply of 400 metric tons of marine gas oil purportedly sent to the tug. Pursuant to this it appeared that the plaintiffs had issued their tax invoice no. 10202 to New Acmes for the self-same 400 metric tons of marine gas oil. His conclusion was that the contractual relationship for the supply of the fuel had been crystallised between the plaintiffs as supplier and New Acmes as buyer even before the plaintiffs had produced the bunker requisition form, which they had subsequently shown to the crew of the tug. Also annexed to Mr Lee`s affidavit were copies of two contracts, the first dated 7 October 1998 and the second dated 27 November 1998, between New Acmes and Kingdom for the supply of, respectively, 400 metric tons and 600 metric tons of marine gas oil. These were the parcels of fuel that also formed the subject of the plaintiffs` claim in the action.

Mr Lee exhibited technical documents, which showed the fuel capacity of the tug was only 70 metric tons. He stated that he had been informed by the charterers that they had ordered large quantities of fuel from the plaintiffs and that the excess oil had been pumped into the barge `KINGPOST` (`the barge`) which had thereafter been towed by the tug to Cambodia. Hence, Mr Lee averred, the sale of the fuel was effected to the charterers for their general use and was not supplied to the tug specifically for her operation. He stated that the plaintiffs were aware or ought to have been aware of this at the material times because they had delivered the fuel not to the tug but into the tanks of the barge. He believed that not only were the plaintiffs guilty of not making full and frank disclosure of all the aforesaid facts in their solicitor`s affidavit leading to the arrest but they were all along aware that as a result of the said facts, any arrest of the tug to secure their claim would have been wrongful.

A further affidavit affirmed by the defendants` solicitor, Mr Kelvin Tan. Among the documents it exhibited were Portnet searches on the barge and tug. The searches revealed that two vessels were both owned by the defendants and that they left Singapore for Phnom Penh in December 1998. The Portnet search on the tug also showed that the tug`s agent in Singapore was a company called QS Agency Pte Ltd.

In response, an affidavit was affirmed by the plaintiffs` director, one Mr Yeo Koon Poh. He stated that he had never heard of the charterers. On 3 October 1998 he had received a telephone call from a Mr CK Lui from New Acmes seeking to purchase marine gas oil. Mr Lui had stated that New Acmes was the agent for the owners of the tug. Mr Lui then told Mr Yeo to deliver the fuel to the tug and gave the plaintiffs the tug`s location. The plaintiffs had duly supplied the fuel to the tug on 6 October 1998 and their bunker requisition form had been signed and acknowledged by the chief engineer of the tug. The chief engineer had also acknowledged and signed the plaintiffs` bunker delivery receipt evidencing receipt of the fuel supplied by the plaintiffs to the tug.

On 28 November 1998, Mr Yeo had received another telephone call from Mr Lui who placed the second order of fuel for the tug. This order was duly fulfilled on 1 December 1998 and both the bunker requisition form and the bunker delivery receipt were signed and stamped by the chief engineer of the tug. After both transactions were completed the plaintiffs had raised their invoices and, in accordance with Mr Lui`s instructions, had sent them to the address of New Acmes.

Mr Yeo averred that he had not been informed by Mr Lui or the crew of the tug that the fuel supplied was for the charterers. There was nothing in the acknowledgement of the crew that put him or the plaintiffs on notice that they were not transacting with the defendants but rather with the charterers. As regards the allegation relating to the tug`s fuel capacity, Mr Yeo said that he had checked the position with his staff. He had been told that the plaintiffs did pump fuel into the fuel tank of the tug and, with regard to the excess, the plaintiffs` staff had been instructed by the chief engineer to pump the same into the storage tank of the barge.

The five affidavits mentioned above were before the assistant registrar when he heard the defendants` application to strike out the writ and the warrant of arrest. The defendants` argument then was that the contract for the sale and purchase of the fuel had been made between the plaintiffs and New Acmes. Since New Acmes was not the defendants` agent they were not parties to this contract and were not the persons who would be liable to the plaintiffs in an action in personam. Therefore the High Court had no jurisdiction to arrest their vessel and therefore both the writ...