The "Hung Vuong-2"

• Judge: Chao Hick Tin JA
• Judgment Date: 11 May 2000
• Neutral Citation: [2000] SGCA 25
• Citation: [2000] SGCA 25
• Defendant Counsel: Haridass Ajaib (Haridass Ho & Partners)
• Published date: 19 September 2003
• Plaintiff Counsel: Philip Tay and Chin Song Yeow (Rajah & Tann)
• Date: 11 May 2000
• Docket Number: Civil Appeal No 135 of 1999
• Court: Court of Appeal (Singapore)
• Subject Matter: Whether real dispute exists,Respondents suing carrier for breach of duty,Shipper indorsing bill of lading in blank to respondents,Choice of jurisdiction,Whether strong cause to disregard jurisdiction clause exists,Carrier seeking stay of action,Jurisdiction clause,Carrier delivering cargo without production of bill of lading,Exclusive,Conflict of Laws,Whether court entitled to consider conflicting opinions of experts on foreign law

When the respondents took out an application for summary judgment, the appellants applied to have the proceedings stayed on the ground that there was a jurisdiction clause in the B/L referring all disputes arising from the B/L to the country of the appellants principal place of business, which was Vietnam. The clause also stated the governing law to be that of Vietnam.

The appellants called an expert on Vietnamese law, Mr Cuong, who opined that notwithstanding the "blank" endorsement by Pacific Sugar on the B/L, the respondents were not the persons entitled to receive the cargo. Mr Cuong relied on article 84(b) of the Maritime Code of Vietnam, which reads:

" An order bill of lading is transferred by writing in its counter signing square on the back of the bill of lading the name of the person who has the right to issue an order for delivery of the cargo ".

According to Mr Cuong, this meant that the B/L could be transferred only if the name of the transferees (i.e. the respondents in this case) was written on the back of the B/L. In the present instance, this was not done as Pacific Sugar only endorsed their own name on the back of the B/L and not the name of the respondents. It was thus argued that the respondents were not entitled to sue for the loss. Mr Cuong further opined that there was no such concept as "the holder of the Bill of Lading" under Vietnamese law. This opinion was contradicted by the expert called for the respondents. The appellants however argued that the difference in expert opinion gave rise to a "dispute" between the parties for the purposes of the jurisdiction clause, which had to be referred to Vietnam for adjudication.

The stay application was dismissed by the assistant registrar. That decision was in turn affirmed by the learned judge below. The appellants appealed.

Held

, dismissing the appeal

(1) A party seeking to bring an action in a Singapore court in breach of a jurisdiction clause must show "strong cause". One of the factors which the court takes into account in determining if "strong cause" has been shown is whether the defendants genuinely desire trial in the foreign country, or are only seeking procedural advantages (10). In this regard, the question of whether there was a genuine dispute between the parties became crucial. It would be difficult for a party to contend that he seriously desired trial in the contractual forum if he was unable to show that there was a real dispute, or putting it another way, that he had a real defence to the claim. The court clearly has jurisdiction to determine whether a dispute exists (11).

(2) Questions of foreign law are questions of fact and where the opinions of experts conflict on such foreign law, the court should as a general rule refrain from making a determination on the basis of affidavit evidence. Furthermore, there is much to be said for the proposition that disputes about foreign law should more appropriately be resolved by the courts of that foreign country. But it does not follow that in every instance where there is a conflict of opinions, the Singapore courts should always shy away from examining the opinions given (16).

(3) Upon a prima facie examination of Mr Cuongs opinion and the relevant provisions of the Vietnamese Maritime Code, it was clear that there was no basis for his opinion that article 84(b) required the specific endorsement of the transferees (i.e., the respondents) name on the reverse side of the B/L (17). The critical words in article 84(b) of the Maritime Code of Vietnam are "the person who has the right to issue an order." At the point in time immediately before the execution of the transfer, the person who has the right to issue an order for delivery of the cargo cannot be the transferee. It has to be the transferor. Until the transfer is completed and effected the transferee would have no right to issue any order for delivery. Therefore, in this case, the party whose name must be endorsed on the reverse side of the B/L is Pacific Sugar. This had been done here (18).

(4) The appellants assertion that Vietnamese law did not recognise the concept of "holder of the bill of lading" also could not be sustained. What was reflected in article 84(b) was really that concept and was wholly in line with international maritime practice. Even the B/L itself provided that "the shipper, consignee and the holder of this bill of lading hereby expressly accepts all printed provisions on this bill of lading, including those on the back hereof". On the back of B/L, the term "shipper" was defined to include, inter alia, "the holder of the bill of lading". It was quite disingenuous on the appellants part to deny the existence of such a concept (19).

(5) The appellants, while submitting that the respondents were not the persons entitled to receive the cargo, volunteered the view that the legal cargo receiver were "the shippers". Presumably they meant, Pacific Sugar. However, it was absurd for the appellants to so suggest when all the three original copies of the B/L had already been transferred by Pacific Sugar to the respondents. Pacific Sugar had already been paid for the cargo and would not have any basis whatsoever to make any claim to the cargo (20).

(6) With regards to the matter of whether "strong cause" was shown, it should be remembered that the weight which the court should accord to each factor is a matter of judgment in the light of the nature of the claim and all the surrounding circumstances. However, this exercise is not just a numbers game. It does not follow that because a greater number of factors favour one approach, that approach would necessarily be adopted by the court. The weight to be given to each factor is not the same (21).

(7) In this case, once it is shown that there is no defence to the claim, and thus no dispute, then there is really nothing to go for trial at the contractual forum. In these circumstances to insist that the claim should nevertheless proceed to trial in the contractual forum would cast considerable doubt as to the bona fides of that party in wanting to have a trial in the contractual forum (21).

(8) Reverting to the instant appeal, there was really no dispute to be submitted for trial at the contractual forum. There would be no sense in staying the proceedings. The appellants were really seeking to gain a technical advantage in asking for a stay. Furthermore, any stay would only cause unnecessary delay (24).

(9) The appellants also made the point that there was a dispute as to the correct measure of damage, asserting that the loss should be based on the market value of the cargo at the discharge port and not the contract value. However, the respondents had, in their statement of claim, based their claim on the "arrived value of the cargo". The applicable principle was thus not in dispute. To insist that the mere determination of the value warranted a trial in Vietnam seemed again to indicate a desire for delay or other procedural advantages (26).

(10) In the premises, strong cause had been shown and the stay application should be refused.

(11) Various other matters raised by the respondents included: doubts as to the competence of the Vietnamese judges on maritime law; doubts as to the independence of the Vietnamese courts; and the question whether the maritime law of Vietnam was sufficiently developed. It should be pointed out that it is not for this court or any court in Singapore to pass judgment on the competence or independence of the judiciary of another country, all the more so of a friendly country. Comity between nations would be gravely undermined if such a wholly invidious pursuit is embarked upon. Equally it is not for this court to say whether the maritime law of Vietnam is sufficiently developed, especially when the parties themselves had agreed that Vietnam law would apply to the B/L (27).

Case(s) referred to

Amerco Timbers Pte Ltd v Chatsworth Timber Corp Pte Ltd

[1975-77] SLR 258 (refd)

Jag Shakti

[1986] 1 Lloyds Rep 1 (refd)

Standard Chartered Bank v Pakistan National Shipping Corp

[1995] 2 Lloyds Rep 365 (refd)

The Asian Plutus

[1990] 2 MLJ 449 (refd)

The Atlantic Song

[1983] 3 Lloyds Rep 394 (refd)

The Eleftheria

[1969] 1 Lloyds Rep 237 at 242 (folld)

The Frank Pais

[1986] 1 Lloyds Rep 529 (refd)

The Jian He

[2000] 1 SLR 8 (folld)

The Vishva Prabha

[1979] 2 Lloyds Rep 286 (refd)

JUDGMENT:

Grounds of Judgment

1. This was an appeal against the decision of Amarjeet Singh JC affirming the Assistant Registrars refusal of the appellants application for a stay of proceedings on the ground of an exclusive jurisdiction clause contained in a bill of lading (B/L). At the conclusion of the hearing, we upheld the decision of the learned judge. We now give our reasons.

The facts

2. The facts giving rise to this admiralty action were largely undisputed. The respondents claim was in respect of a cargo of 2,000 metric tons of raw sugar (the cargo) which was shipped by a Thai company, Pacific Sugar Corporation Ltd (Pacific Sugar), on board the appellants vessel, "Hung Vuong-3", at Bangkok for discharge at the main port of South China.

3. By a contract dated 19^th December 1997, the respondents agreed to sell 4,000 metric tons of raw sugar, FOB Bangkok (and/or three other Thai ports), to a company in China called Guangxi Yulin Prefecture Economic Trade Development Co (Guangxi). Shipment was to be effected during the period of 15 December 1997 to 15 February 1998. Payment was to be by way of letter of credit (LC). To fulfil in part the obligations of the respondents under this contract, they purchased the cargo from Pacific Sugar.

4. For the shipment of the cargo, the appellants issued a "to order" B/L to Pacific Sugar as the shipper. The B/L was in turn endorsed over in blank by Pacific Sugar to the respondents in this manner:

"PACIFIC SUGAR CORPORATION LTD

Sgd.

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(YONCHAILAI JATURAFIS)

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