The “Mount Apo” and The “Hanjin Ras Laffan”

• Jurisdiction: Singapore
• Judge: Pang Khang Chau JC
• Judgment Date: 08 March 2019
• Neutral Citation: [2019] SGHC 57
• Citation: [2019] SGHC 57
• Date: 2019
• Docket Number: Admiralty in Rem No 246 of 2015 and Admiralty in Rem No 195 of 2015
• Hearing Date: 14 August 2018,25 September 2018,08 May 2018,11 May 2018,09 May 2018,08 October 2018,16 August 2018,10 May 2018,15 August 2018
• Plaintiff Counsel: Chan Leng Sun SC and Muhammad Muzhaffar bin Omar (Wong & Leow LLC) (instructed) Mohamed Goush s/o Marikan and Syed Isa bin Mohamed Alhabshee (Goush Marikan Law Practice)
• Published date: 29 March 2019
• Defendant Counsel: Leong Kah Wah, Dedi Affandi bin Ahmad, and Tay Jia En (Rajah & Tann Singapore LLP)
• Court: High Court (Singapore)
• Year: 2019

Pang Khang Chau JC: Introduction

On 8 August 2015, at 9:59 am, the capesize bulk carrier, Mount Apo (“Mt Apo”) collided with a liquefied natural gas (“LNG”) carrier, Hanjin Ras Laffan.¹ The collision occurred within the westbound lane of the Traffic Separation Scheme (“TSS”) in the Singapore Strait. Hanjin Ras Laffan was transiting the Singapore Strait from east to west. Mt Apo had just left the port of Singapore and was attempting to cross the westbound lane of the TSS in order to reach the eastbound lane to continue its journey eastwards.

This case raises issues concerning the obligations of a vessel crossing traffic lanes in a TSS under Rule 10 of the International Regulations for Preventing Collisions at Sea (as amended) (1972) incorporated as a Schedule to the Merchant Shipping (Prevention of Collisions at Sea) Regulations (Cap 179, Section 208, Rg 10, 1990 Rev Ed) (the “COLREGS”). It also raises issues concerning crossing situations under Rules 15 and 17 of the COLREGS. In particular, it raises the interaction between a vessel’s duty under Rule 10(c) to cross a TSS at right angles to the general direction of the traffic flow and that same vessel’s duty under Rule 17 to keep her course and speed as a stand-on vessel in a crossing situation arising under Rule 15. Finally, it raises issues concerning the proper use of very high frequency (“VHF”) radio communications between passing vessels.

Admiralty in rem No 246 of 2015 (“ADM 246”) is an action brought by the owner of Mt Apo, Cisslow Shipping Inc. (“Cisslow”) against the owner and/or demise charterer of the Hanjin Ras Laffan in respect of the said collision. Admiralty in rem No 195 of 2015 (“ADM 195”) is an action brought by the owner of the Hanjin Ras Laffan, KSH International S.A. (“KSH”) and the demise charterer, H-Line Shipping Co. Ltd. (“H-Line”) against the owner and/or demise charterer of Mt Apo in respect of the same collision.

By an order of court dated 2 June 2016, ADM 246 and ADM 195 were consolidated as one action, with ADM 246 designated the lead action and with the plaintiffs in ADM 195 treated as counterclaiming defendants in the consolidated action. For convenience, this judgment will refer to the plaintiff in the consolidated action simply as “Mt Apo” (without italics) and the counterclaiming defendants collectively as “Hanjin Ras Laffan” (also without italics).

As both sides have prayed in their respective Preliminary Acts for a reference to the Registrar to assess the amount of damages, losses and/or expenses, the trial before me was on apportionment of liability only.

Hanjin Ras Laffan alleged that Mt Apo bore the preponderance of the blame for the collision and that liability ought to be apportioned 70% to 30% in Hanjin Ras Laffan’s favour.² Conversely, Mt Apo alleged that Hanjin Ras Laffan was “predominantly the vessel at fault for the collision”, and submitted that liability should be apportioned 80% to 20% in Mt Apo’s favour. ³

Preliminary Issue on H-Line’s Title to Sue

Mt Apo raised a preliminary issue on H-Line’s title to sue. It is common ground that, for H-Line to have title to sue, it has to show that it was the demise charterer of the Hanjin Ras Laffan at the time of collision. Mt Apo’s position is that, as H-Line has not proven that it was the demise charterer of Hanjin Ras Laffan,⁴ Mt Apo is only liable for the losses of KSH (if any, and subject to apportionment).⁵

In the recent case of NTUC Foodfare Co-operative Ltd v SIA Engineering Co Ltd and anor [2018] 2 SLR 588, the Court of Appeal decided that the law of negligence in Singapore does not require a claimant to own or have possessory title to the property to sue for loss flowing from damage to that property (at [35]). It is therefore open to question whether H-Line had correctly conceded that it needed to show that it was the demise charterer in order to have title to sue. Nevertheless, since parties had conducted the case on this basis, I shall assume (without deciding the point) that H-Line needed to do so.

H-Line’s case on its title to sue

To prove that it was the demise charterer of Hanjin Ras Laffan, H-Line relied primarily on the testimony of its deputy manager, Ms Yoo Jin Joo. (Although she had been erroneously referred to as “Ms Yoo” in submissions and some court documents, her surname is actually “Joo”.⁶) Ms Joo’s role at H-Line concerns the management of vessels. Her responsibilities in respect of Hanjin Ras Laffan include regulatory filings with Korean government agencies,⁷ liaising with the Panama ship registry,⁸ and liaising with insurers.⁹

Ms Joo testified generally, from her personal knowledge gained in the course of her duties, that H-Line and KSH are respectively the bareboat charterer and owner of Hanjin Ras Laffan.¹⁰ Her evidence is that Hanjin Ras Laffan was previously on demise charter to Hanjin Shipping Co Ltd (“Hanjin Shipping”) and the demise charterparty was novated to H-Line on 30 June 2014.¹¹

To corroborate her testimony, Ms Joo exhibited copies of the following documents to her affidavits of evidence in chief (“AEICs”): a Bareboat Charter Hire Purchase Agreement dated 27 October 1997 between KSH and Hanjin Shipping in respect of Hanjin Ras Laffan (the “BBCHP”);¹² an Amending and Restating Agreement dated 7 September 2010 between KSH and Hanjin Shipping to amend and restate the BBCHP in accordance with the requirements of a loan agreement dated 27 August 2010 between KSH and its lenders (the “2010 Agreement”);¹³ an Amending and Restating Agreement dated 9 September 2013 between KSH and Hanjin Shipping to amend and restate the BBCHP (as amended) in accordance with the requirements of a loan agreement dated 27 August 2013 between KSH and its lenders (the “2013 Agreement”);¹⁴ a Novation and Amendment Agreement dated 30 June 2014 among KSH, Hanjin Shipping and H-Line novating the rights and obligations of Hanjin Shipping under the BBCHP (as amended) in favour of H-Line (the “Novation Agreement”);¹⁵ the continuous synopsis record (“CSR”) issued on 15 January 2015 (ie, before the date of the collision) by the Panama ship registry recording that Hanjin Ras Laffan was operated by H-Line under the terms of a registered bareboat charter; ¹⁶ CSR issued on 10 March 2017 which continued to record Hanjin Ras Laffan as operated by H-Line under the terms of a registered bareboat charter; ¹⁷ and a set of invoices issued by Sembcorp Marine Repairs & Upgrades Pte Ltd to “Captain & Owners of Hanjin Ras Laffan, H-Line Shipping” for repairs carried out on Hanjin Ras Laffan.¹⁸

Originals of the documents described in (b) to (d) and (g) above were tendered by Ms Joo in court at trial. Ms Joo explained that the originals of the documents described in (e) and (f) could not be produced as they had to be kept on board the vessel at all times.¹⁹

Recital (C) of the Novation Agreement explained that the background to the Novation Agreement was the transfer of Hanjin Shipping’s bulk carrier business to H-Line. Interestingly, while cl 25.01 of the BBCHP specified KSH’s address for service of notices as “c/o Hanjin Shipping Co., Ltd.”, the Novation Agreement amended this to “c/o H-Line Shipping Co., Ltd.”.²⁰ Ms Joo explained that, as part of H-Line’s acquisition of Hanjin Shipping’s bulk carrier business, H-Line took over about 40 vessels from Hanjin Shipping and also took over Hanjin Shipping’s stake in KSH, as a result of which KSH became wholly owned by H-Line.²¹

There are also two documents in the Agreed Bundle bearing H-Line’s letterhead, the authenticity of which Mt Apo has accepted. These are Hanjin Ras Laffan’s passage plan dated 2 August 2015²² and Hanjin Ras Laffan’s record of passage planning dated 2 August 2015.²³

H-Line submitted that it had conducted itself at all material times as the demise charterer of Hanjin Ras Laffan. For example, six months before the collision, Ms Joo caused the Panama ship registry to issue a CSR listing H-Line as bareboat charterer of Hanjin Ras Laffan. H-Line expended a significant sum of US$1.2 m to repair Hanjin Ras Laffan after the collision.²⁴ Less than two weeks after the collision, solicitors representing both vessels executed a collision jurisdiction agreement which contained a warranty that H-Line was the demise charterer of Hanjin Ras Laffan.²⁵

At the material time, Hanjin Ras Laffan was in H-Line’s actual possession as the vessel was manned by H-Line. The master of Hanjin Ras Laffan testified that he was employed by H-Line.²⁶

Mt Apo’s case on H-Line’s title to sue

Mt Apo’s approach was to question the admissibility of the documents tendered by Ms Joo and to thereby seek to persuade the court that the demise charter was a sham. Although Mt Apo initially contested the admissibility of all the documents referred to at [11] above, the objections to documents (e) to (g) were dropped during oral submissions.²⁷ As for documents (a) to (d), which Mt Apo referred to in submissions collectively as the “Bareboat Contracts”, Mt Apo accepted that these were “business records” which fell within the hearsay exception under s 32(1)(b)(iv) of the Evidence Act (Cap 97, 1997 Rev Ed). However, Mt Apo submitted that I should either exclude them in the interests of justice under s 32(3) of the Evidence Act on the basis that they were unreliable²⁸ or assign them minimal weight under s 32(5) on the same basis.²⁹

Mt Apo gave the following reasons for considering the Bareboat Contracts unreliable: There was no one before the court that was familiar with the documents and could attest to the truth of their contents. Ms Joo could not possibly do so, as she had admitted that she did not sign the Novation Agreement, while the BBCHP, the 2010 Agreement and the 2013 Agreement were all signed before she joined H-Line on 2 June 2014.³⁰ Ms Joo gave inconsistent answers about the arrangement with the Korea Gas Corporation (“KOGAS”) to carry LNG on Hanjin Ras Laffan.³¹ ...