The "Orinoco Star"

• Jurisdiction: Singapore
• Judge: Delphine Ho AR
• Judgment Date: 06 August 2014
• Neutral Citation: [2014] SGHCR 19
• Citation: [2014] SGHCR 19
• Docket Number: Admiralty in Rem No 383 of 2013 (Summons No 922 of 2014)
• Published date: 13 October 2014
• Hearing Date: 02 July 2014
• Plaintiff Counsel: Jainil Bhandari & Yip Li Ming (Rajah & Tann LLP)
• Defendant Counsel: John Sze & Nicola Loh (Joseph Tan Jude Benny LLP)
• Subject Matter: Admiralty and Shipping,Maritime Conventions Act 1911,Extension of Time
• Court: High Court (Singapore)

Delphine Ho AR:

This is an application by the Plaintiff, the owners of the “MELODY”, for an extension of time up to and including 7 December 2013 for the commencement of these proceedings. The application is brought pursuant to Section 8(3)(b) of the Maritime Conventions Act 1911 (“MCA”) (“Section 8(3)(b)”).

Background

The Plaintiffs and owners of the “MELODY”, a vessel flagged in the Marshall Islands, are Gentian Shipping Inc. Gentian Shipping Inc is an entity registered in the Marshall Islands, and has its principal place of business is in Greece.

The Defendants and owners of the “ORINOCO STAR” (the “Vessel”) are Rigel Schiffahrts GmbH & Co KH, a company established in Germany. The “ORINOCO STAR” is flagged in the Isle of Man.

On 20 June 2011, the “MELODY” and the Vessel were lying alongside one another at Lagos Anchorage, Nigeria. Due to changing weather conditions, the mooring master at Lagos Anchorage first asked both the “MELODY” and the Vessel to proceed out to sea, and thereafter asked both vessels to return to Lagos Anchorage. The two vessels collided as they were turning around to return to Lagos Anchorage.

Following the collision, the parties’ respective insurers commenced negotiations in an attempt to resolve matters. Unfortunately, they were unable to do so and solicitors were eventually instructed to handle the dispute on or about 10 September 2013.

Negotiations between the parties – relating mainly to issues of security and jurisdiction – continued through the parties’ solicitors between September and November 2013. Unfortunately, parties were once again unable to arrive at a common ground.

The Plaintiffs commenced these proceedings in Singapore on 6 December 2013. A warrant of arrest for the Vessel was issued on the same day and the Vessel was arrested the afternoon of 6 December 2013 while the Vessel was dry-docked. On 9 December 2013, although no security had been furnished, the parties agreed to the release of the Vessel.

On 20 February 2014, the Plaintiff filed the present summons seeking leave to maintain the action notwithstanding that the action was not commenced within 2 years from the date of the collision, and/or for the relevant period under Section 8 of the MCA to be extended to 7 December 2013.

Section 8 of the MCA

Section 8 of the MCA relates to limitation of certain maritime action. The section states:

“Limitation of actions

8. – (1) No action shall be maintainable to enforce any claim or lien against a ship or her owners in respect of –

(a) any damage or loss to another ship, her cargo or freight, or any property on board her, or damages for loss of life or personal injuries suffered by any person on board her, caused by the fault of the former ship, whether such ship be wholly or partly in fault; or

(b) any salvage services,

unless proceedings therein are commenced within 2 years from the date when the damage, loss or injury was caused or the salvage services were rendered.

(2) An action shall not be maintainable under this Act to enforce any contribution in respect of an overpaid proportion of any damages for loss of life or personal injuries unless proceedings therein are commenced within one year from the date of payment.

(3) Notwithstanding subsections (1) and (2), any court having jurisdiction to deal with an action to which this action relates –

(a) may, in accordance with the Rules of Court, extend any such period, to such extent and on such conditions as it thinks fit; and

(b) shall, if satisfied that there has not during such period been any reasonable opportunity of arresting the defendant ship within the jurisdiction of the court, or within the territorial waters of the country to which the plaintiff’s ship belongs or in which the plaintiff resides or has his principal place of business, extend any such period to an extent sufficient to give such reasonable opportunity.”

Pursuant to Section 8(1) of the MCA, the limitation period for a claim arising out of the collision on 20 June 2011 would have expired on 20 June 2013.

Extension of the limitation period under the MCA

It bears noting that parties may agree to extend the limitation period under Section 8 of the MCA. Indeed, in the present case, there were several instances where the parties purportedly agreed to extend the limitation period, although there is some dispute between the parties as to the scope of these agreements. I shall come back to this issue later.

Historical background to Section 8 of the MCA

The MCA was enacted by the United Kingdom Parliament in 1911 to give effect to inter alia the International Convention for the Unification of Certain Rules of Law with respect to Collisions between Vessels 1910 (“1910 Convention”). The MCA was extended to Singapore in or around 1913, when Singapore was a colony of the United Kingdom. Thereafter, when Singapore became independent, the MCA continued to be part of the laws of Singapore. The MCA continues to apply today as there has been no subsequent act which has repealed its applicability in Singapore.

Section 8 of the MCA is based on and is intended to give effect to Article 7 of the 1910 Convention. The Article provides:

“Actions for the recovery of damages are barred after an interval of two years from the date of the casualty.

The period within which an action must be instituted for enforcing the right to obtain contribution permitted by paragraph 3 of Article 4, is one year from the date of payment.

The grounds upon which the said periods of limitation may be suspended or interrupted are determined by the law of the court where the case is tried.

The High Contracting Parties reserve to themselves the right to provide, by legislation in their respective countries, that the said periods shall be extended in cases where it has not been possible to arrest the defendant vessel in the territorial waters of the State in which the plaintiff has his domicile or principal place of business.”

Section 8(3) of the MCA comprises two limbs, a discretionary limb (i.e. limb (a)) and a compulsory limb (i.e. limb (b)). In The Llandovery Castle [1920] P 119, a case which concerned a claim for salvage services that was commenced more than two years after the date when the said services were rendered, the Court examined Section 8 of the MCA and observed:

“There remains the question of whether the plaintiff is entitled to an extension, or, if not, whether the Court, in its discretion, ought to grant an extension. The proviso to s.8 contains 2 branches. The first is discretionary, and the second compulsory. The second branch of the proviso is inapplicable to the present case. The power under that – the compulsory branch – can only be exercised in order to give reasonable opportunity of arresting the ship, and, as a matter of fact, in this case there is no possibility of arresting the ship because she has been lost.”

[Emphasis added.]

The parties’ positions

The Plaintiffs’ application for an extension of time is sought under Section 8(3)(b). The Plaintiffs contend that there had been no opportunity during the two-year limitation period to arrest the Vessel in any of the jurisdictions identified in Section 8(3)(b) – namely Singapore (i.e. the jurisdiction of the Court), the Marshall Islands (i.e. the country to which the ship belongs) or Greece (i.e. the country in which the Plaintiffs have their principal place of business). Accordingly, the Court is obliged to grant an extension of time so as to give the Plaintiffs reasonable opportunity to arrest the Vessel. The Plaintiffs’ case is that an extension of time to 7 December 2013 would afford a reasonable opportunity for the Plaintiffs to arrest the Vessel.

The Defendants do not dispute that the applicable provision in the present case is Section 8(3)(b). The Defendants also do not dispute that during the two-year limitation period, the Vessel did not call at either the ports of Singapore, the Marshall Islands or Greece. However, the Defendants say that the Plaintiffs’ application must fail for the following reasons: First, as the Plaintiffs had failed to commence its action before the time-bar set in, the Plaintiffs cannot be allowed to rely on Section 8(3)(b) to obtain an extension of time ex post facto. Second, even if the Plaintiffs were entitled to an extension of time, that extension can only extend to the earliest reasonable opportunity for the Plaintiffs to arrest the Vessel. The Defendants contend that the earliest reasonable opportunity was between 9 and 10 September 2013, when the Vessel was in Singapore for 16 hours.

Are the Plaintiffs entitled to rely on Section 8(3)(b) to obtain an extension of time?

The Plaintiffs’ submission in this regard is simply this: since the Vessel did not call at either Singapore, the Marshall Islands or Greece between 21 June 2011 and 20 June 2013, the Plaintiffs had no opportunity to arrest the Vessel in any of the jurisdictions set out in Section 8(3)(b). In these circumstances, Section 8(3)(b) is directly applicable and the Plaintiffs are entitled to an extension of time under this section.

The Defendants say that the Plaintiffs are not entitled to rely on Section 8(3)(b) at all, let alone obtain an extension of time under that section. A significant portion of the Defendants’ written and oral submissions was focussed on this issue and the key arguments put forward by the Defendants may be summarised as follows: The extension of time envisaged under Section 8 of the MCA is intended for situations where the injured parties are in the dark as to who the offending ships are, where the vessel’s location cannot be ascertained, or where there was no opportunity to arrest the vessel within the two-year limitation period. The Plaintiffs elected not to commence any proceedings against the Vessel in Singapore or elsewhere despite knowing the Vessel was involved in the collision. With the...