The ‘Bunga Melati 5’

• Jurisdiction: Singapore
• Judgment Date: 23 August 2011
• Date: 23 August 2011
• Docket Number: Admiralty in Rem No 21 of 2010 (Registrar's Appeal No 252 of 2010)
• Court: High Court (Singapore)

The ‘Bunga Melati 5’

[2011] SGHC 195

Belinda Ang Saw Ean J

Admiralty in Rem No 21 of 2010 (Registrar's Appeal No 252 of 2010)

High Court

Admiralty and Shipping—Admiralty jurisdiction and arrest—Action in rem—Standard of proof—Bunker supplier commencing action in remagainst shipowner's vessel under s 4 (4) (b) (ii) High Court (Admiralty Jurisdiction) Act (Cap 123, 2001 Rev Ed) in respect of unpaid bunkers—Whether any jurisdiction to bring action in rem in High Court—Whether s 4 (4) satisfied—Whether shipowner ‘person who would be liable on the claim in an action in personam’ within meaning of s 4 (4) (b) —Whether necessary to show ‘good arguable case’ that shipowner ‘would be liable on the claim in an action in personam’ within meaning of s 4 (4) (b) in order to invoke admiralty jurisdiction—Whether any jurisdictional merits test independent of High Court (Admiralty Jurisdiction) Act—Section 4 (4) High Court (Admiralty Jurisdiction) Act (Cap 123, 2001 Rev Ed)

Admiralty and Shipping—Practice and procedure of action in rem—Shipowner applying to strike out bunker supplier's action in rem under O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed) or court's inherent jurisdiction—Shipowner applying to set aside bunker supplier's writ in rem under O 12 r 7—Whether proper for applications under O 18 r 19 and O 12 r 7 to be based on same arguments—Order 12 r 7 and O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed)

Civil Procedure—Jurisdiction—Distinction between jurisdiction and merits—Distinction between O 12 r 7 and O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed) or court's inherent jurisdiction

Civil Procedure—Striking out—Distinction between jurisdiction and merits—Distinction between O 12 r 7 and O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed) or court's inherent jurisdiction

Words and Phrases—Shipowner applying to strike out bunker supplier's writ in rem under O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed) or court's inherent jurisdiction—Shipowner applying to set aside bunker supplier's writ in rem under O 12 r 7—Meaning of ‘setting aside’ and ‘striking out’—Order 12 r 7 and O 18 r 19 Rules of Court (Cap 322, R 5, 2006 Rev Ed)

The plaintiff was a company in the business of supplying bunkers, while the defendant was a shipping company and owner of a number of vessels, including the MT Navig 8 Faith, the Bunga Kasturi Lima and the Bunga Melati 5.

The plaintiff alleged that the parties had entered into two fixed price contracts under which the plaintiff would supply bunkers to a number of the defendant's vessels (‘the Fixed Price Contracts’) , as well as a separate contract under which the plaintiff would supply bunkers to the MT Navig 8 Faith(‘the Navig 8 Faith Contract’) . The plaintiff claimed that all these contracts were brokered through the agency of Market Asia Link Sdn Bhd (‘MAL’) , the defendant's alleged buying agent. As the plaintiff had not been paid in respect of the alleged Fixed Price Contracts and Navig 8 Faith Contract, it commenced attachment proceedings in the United States (‘the US proceedings’) against theBunga Kasturi Lima, but the attachment order was vacated by courts in the United States, and the plaintiff subsequently withdrew the matter. The plaintiff then commenced the present action in rem against the Bunga Melati 5 under s 4 (4) (b) (ii) of the High Court (Admiralty Jurisdiction) Act (Cap 123, 2001 Rev Ed) (‘the HCAJA’) in respect of the unpaid bunkers, on the basis that the defendant was liable to it in contract and in unjust enrichment.

The defendant applied to strike out the plaintiff's action in rem pursuant to O 18 r 19 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (‘the ROC’) or the court's inherent jurisdiction, on the basis that it had not been in a contractual relationship with the plaintiff; rather, the plaintiff had contracted directly with MAL, and MAL had in turn contracted (as principal, not agent) with the defendant. As such, the defendant was not liable to the plaintiff in contract or in unjust enrichment, and the plaintiff's claim was therefore plainly unsustainable and had to be struck out as frivolous and vexatious or an abuse of process. The defendant also argued that the US proceedings operated as an issue estoppel, and the plaintiff's action in rem ought therefore to be struck out on that ground as frivolous and vexatious or an abuse of process. In addition, the defendant claimed that the plaintiff had no locus standi to bring the action, since it had assigned its receivables to another entity, viz, BNP Baribas.

The defendant also applied to set aside the plaintiff's writ in rem under O 12 r 7 of the ROC, on the basis that, since it was not liable to the plaintiff in contract or in unjust enrichment, it was not ‘the person who would be liable on the claim in an action in personam’ (‘the relevant person’) under s 4 (4) (b) of the HCAJA, and the plaintiff had therefore wrongly invoked the admiralty jurisdiction in rem of the High Court.

Held, dismissing the appeal:

(1) It should not be proper for a defendant to deploy the same arguments in respect of O 12 r 7 and O 18 r 19 of the ROC, for when an action was struck out under the latter provision, that meant the court was exercisingits jurisdiction to prevent an abuse of its process; whereas if a writ was set aside under the former, that meant the court had no jurisdiction: at [28].

(2) The court should resort to O 12 r 7 of the ROC if it could limit its inquiry to purely jurisdictional matters of fact or law, but if (as in the present case) it was required to delve into non-jurisdictional matters of fact or law (ie, the merits of the dispute) , O 18 r 19 of the ROC was the correct means of proceeding: at [30] and [33].

(3) There had been no assignment by the plaintiff of its rights, and the plaintiff's action could not be struck out under O 18 r 19 of the ROC on that ground: at [41].

(4) The plaintiff's case that there was a contractual relationship between the plaintiff and the defendant (established through the agency of MAL) for the sale of the bunkers was plainly unsustainable and ought not to be allowed to a full trial, and was to be struck out under O 18 r 19 of the ROC: at [63] and [64].

(5) The plaintiff's claim in unjust enrichment had to be struck out under O 18 r 19 of the ROC as being completely unsustainable: at [68].

(6) As the US proceedings did not result in a judgment which was final and conclusive on the merits, they were not capable of giving rise to an estoppel, and the plaintiff's action could not be struck out under O 18 r 19 of the ROC on that basis: at [74].

(7) Where a defendant applied to set aside the plaintiff's writin rem under O 12 r 7 of the ROC, the plaintiff had the onus of establishing jurisdiction under the HCAJA: at [80] and [140 (a) ].

(8) Where the court's jurisdiction in rem depended on the establishment of a factual precondition or state of affairs, the plaintiff had to establish such jurisdictional facts on a balance of probabilities: at [83], [99] to [103], [106] and [140 (b) ].

(9) Where the court's jurisdiction in rem depended on the proper characterisation of the plaintiff's claim and/or construction of the words in the relevant statutory provision, the plaintiff only had to show a good arguable case that his claim was of the type or nature required by the relevant statutory provision: at [95] and [140 (c) ].

(10) The plaintiff's writ in remcould not be set aside for lack of admiralty jurisdiction in remunder O 12 r 7 of the ROC on the basis of the defendant's argument that it was not the ‘relevant person’, because any challenge by the defendant to the identity of the ‘relevant person’ in s 4 (4) (b) of the HCAJA was not a jurisdictional matter to be dealt with under O 12 r 7 of the ROC (even if the defendant's argument was that some other entity was the ‘relevant person’) , but was properly a dispute pertaining to the defendant's liability on the merits of the claim, and was therefore to be dealt with at trial or, if the plaintiff's case was hopeless (as in the present case) , under O 18 r 19 of the ROC (or the court's inherent jurisdiction) , and only in a striking out application under O 18 r 19 of the ROC would it be appropriate to investigate whether the plaintiff had an ‘arguable case’ on the merits: at [139]and [140 (d) ].

(11) There was no merits requirement within the HCAJA that had to be satisfied before a plaintiff could invoke the court's admiralty jurisdiction in rem, and the Court of Appeal's decision in The Vasiliy Golovnin [2008] 4 SLR (R) 994 did not introduce a separate jurisdictional merits requirement independent of the provisions of the HCAJA, but was concerned with striking out an action in rem under O 18 r 19 of the ROC or the inherent jurisdiction of the court and/or discharging a warrant of arrest for material non-disclosure, and therefore did not affect the position that setting aside the writ in rem for lack of jurisdiction under O 12 r 7 of the ROC was to be governed solely by compliance with the HCAJA, under which there was no enquiry into the merits of the plaintiff's claim: at [142] and [157].

AA V, The [1999] 3 SLR (R) 664; [2001] 1 SLR 207 (not folld)

Alexandrea, The [2002] 1 SLR (R) 812; [2002] 3 SLR 56 (refd)

Andres Bonifacio, The [1991] 1 SLR (R) 523; [1991] SLR 694 (refd)

Andres Bonifacio, The [1993] 3 SLR (R) 71; [1993] 3 SLR 521 (refd)

Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55 (refd)

Art Trend Ltd v Blue Dolphin (Pte) Ltd [1981-1982] SLR (R) 633; [1982-1983] SLR 362 (refd)

Astro Exito Navegacion SA v W T Hsu (The ‘Messiniaki Tolmi’) [1984] 1 Lloyd's Rep 266 (refd)

Aventicum, The [1978] 1 Lloyd's Rep 184 (refd)

‘Avro International’ (Owners) v Arabian Marine Bunkers Sales Co Ltd [1987] SLR (R) 610; [1987] SLR 176 (refd)

Baltic Shipping Co Ltd v Pegasus Lines SA [1996] 3 NZLR 641 (refd)

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