The Seaway; Shell Eastern Petroleum (Pte) Ltd v The Owners of the Ship or Vessel "Seaway"

• Jurisdiction: Singapore
• Judge: Tai Wei Shyong AR
• Judgment Date: 23 May 2003
• Neutral Citation: [2003] SGHC 115
• Citation: [2003] SGHC 115
• Court: High Court (Singapore)
• Plaintiff Counsel: Steven Chong, S.C.(Rajah & Tann),Loh Wai Yue (Rajah & Tann)
• Defendant Counsel: S Mohan (Gurbani & Co),Bernard Yee (Gurbani & Co)
• Published date: 04 June 2004

1 The plaintiffs are the owners of an oil terminal at Pulau Bukom, Singapore, including a berth known as wharf “No. 8” (“the plaintiffs’ wharf”). The defendants are the owners of the vessel “SEAWAY”, registered at the port of Papendrecht in the Netherlands.

2 On 6 May 2002, the SEAWAY was proceeding through the Sinki Fairway en route from the West Jurong Anchorage to the Ramunia Shoals when it collided into the plaintiffs’ wharf. The plaintiffs allege in the Statement of Claim that the collision was caused “by the negligence and/or breach of duty of the Defendants, their servants or agents in the navigation and management of the vessel”; and that the SEAWAY damaged, among other things, the breasting dolphins and the jetty head. They bring this action to recover their losses, which as particularised in the Statement of Claim amount to S$16,150,000.

3 For their part, the defendants deny any negligence or breach of duty. However, they also plead at paragraphs 10 to 12 of the Defence that they are entitled to limit their liability, if any, under s 136 of the Merchant Shipping Act (Cap 179, Revised Edition 1996.)(“the MSA”). The relevant part of that section states:

Limitation of shipowner’s liability in certain cases of loss of life, injury or damage.

136. —(1) The owner of a ship shall not, where all or any of the following occurrences take place without his actual fault or privity:

(a) where any loss of life or personal injury is caused to any person being carried in the ship;

(b) where any damage or loss is caused to any goods, merchandise or other things whatsoever on board the ship;

(c) where any loss of life or personal injury is caused to any person not carried in the ship through the act or omission of any person (whether on board the ship or not) in the navigation or management of the ship or in the loading, carriage or discharge of its cargo or in the embarkation, carriage or disembarkation of its passengers, or through any other act or omission of any person on board the ship; and

(d) where any loss or damage is caused to any property (other than any property mentioned in paragraph (b)) or any right is infringed through the act or omission of any person (whether on board the ship or not) in the navigation or management of the ship, or in the loading, carriage or discharge of its cargo or in the embarkation, carriage or disembarkation of its passengers, or through any other act or omission of any person on board the ship,

be liable to damages beyond the following amounts:

(i) … ; and

(ii) in respect of such loss, damage or infringement as is mentioned in paragraphs (b) and (d), whether there is loss of life or personal injury or not, an aggregate amount not exceeding in the currency of Singapore the equivalent of 1,000 gold francs for each ton of the ship’s tonnage.

[Emphasis added.]

4 The defendants aver at paragraph 12 of the Defence that in the event that they are liable for the damage done to the plaintiffs’ wharf, they are entitled to limit their liability by virtue of this provision to S$607,927.68, (calculated in accordance with the formula set out therein), plus interest.

5 This application was one brought by the plaintiffs under s O 14 r 12 of the Rules of Court (Chapter 322) for summary determination of a point of law, the question being simply whether the defendants are indeed entitled to limit their liability (if any) as they have pleaded. At the hearing, the facts as I have recited them above were not disputed and the sole issue was whether they fall within s 136 of the MSA under paragraph (d). If they do, then the defendants are entitled to limit their liability and conversely, if they do not, then no limitation of liability applies. Given the large difference in the quantum of damages that would apply with and without the statutory limitation (assuming the defendants are liable without actual fault or privity in the first place), and the corresponding likelihood that the matter would be resolved by the parties without a trial if a determination was made in the defendants’ favour, I was of the view that the matter was suitable for determination under O 14 r 12. In the event, I determined the question in favour of the defendants – that is to say, that the defendants are entitled to limit their liability under s 136 of the MSA. I now give my reasons.

Overview of the Parties’ Arguments

6 As is often the case in complex cases, the nub of the issue boils down to the proper interpretation of a single, innocuous looking, word – in this case the word “property”, happily ensconced in the first sentence of s 136 (d). Before delving into the detail of the legal arguments made by respective counsel, it would be useful to set out the general thrust of each side, so that the overall picture is not obscured by the fine, and often interwoven, legal threads running through it.

7 I begin with the defendants’ position, as it is somewhat simpler. Their primary submission before me was that “property” in s 136 (d) of the MSA, on its natural and ordinary meaning, includes the plaintiffs’ wharf. Section 136 draws a distinction between any “goods, merchandise or other things whatsoever on board the ship” (para (b) of s 136) on the one hand, and “any property other than any property mentioned in paragraph (b)” (para (d) of s 136) on the other. Apart from that, no other distinction is drawn between different types of property by the section, and the defendants submitted that none should be read into it. If support be needed that the plaintiffs’ wharf falls within the word “property” in limb (d), counsel for the defendants, Mr Mohan, drew my attention to The Sivand [1998] 2 Lloyd’s Rep 97. In that case, the plaintiffs were the owners of a marine oil terminal at Immingham in the Humber estuary, when the defendants’ tanker Sivand collided with three of their mooring dolphins and their berthing dolphin, causing extensive damage. The point in dispute before the Court of Appeal related to the proper assessment of the damages, and the reasoning in the judgment is of no relevance to the present case. Mr Mohan, quite rightly relied on The Sivand only to show that as a matter of language, the plaintiffs’ mooring and berthing dolphins was variously described as “harbour works” or “harbour installations”, which in turn was treated as a species of “property”. The description of the dolphins as “harbour works” will later take on an added significance, but at this stage, it suffices merely to set out the following passage at page 107 of the judgment of Hobhouse L.J., which illustrates Mr Mohan’s point:

The defendants negligently and in breach of the duty of care which they owed to the plaintiffs, damaged the plaintiffs’ property (the harbour works including the dolphins) thereby causing the plaintiffs loss. [Emphasis added.]

At its most fundamental level, that is the defendants’ case.

8 The argument of the plaintiffs is somewhat more complicated, and requires reference to the legislative history of the MSA. We join the tale in 1958, when on the 8^th of January that year, the UK signed the International Convention relating to the Limitation of Liability of Owners of Sea-Going Ships (Brussels, 10 October 1957)(“the Convention”). Art 1(1) of the Convention states:

Article 1

(1) The owner of a sea-going ship may limit his liability in accordance with Article 3 of this Convention in respect of claims arising from any of the following occurrences, unless the occurrence giving rise to the claim resulted from the actual fault or privity of the owner:

(a) loss of life, or personal injury to, any person being carried in the ship, and loss of, or damage to, any property on board the ship;

(b) loss of life of, or personal injury to, any other person, whether on land or on water, loss of or damage to any other property or infringement of any rights caused by the act, neglect or default of any person on board the ship for whose act, neglect or default the owner is responsible or any person not on board the ship for whose act, neglect or default the owner is responsible…

(c) any obligation or liability imposed by law relating to the removal of wreck and arising from or in connection with the raising, removal or destruction of any ship which is sunk, stranded or abandoned (including anything which may be on board such ship) and any obligation or liability arising out of damage caused to harbour works, basins and nagivable waterways.

[Emphasis added].

It was common ground between the parties that Art 1(1) of the Convention forms the basis of the current s 136 of the MSA – or to put it in plainer terms, that the purpose of s 136 of the MSA is to give effect to Art 1(1) of the Convention.

9 The Convention was eventually acceded to by the UK on Singapore’s behalf on 17 April 1963, and attained binding force in 1968. However, prior to that, on 24 December 1959, the then Merchant Shipping Ordinance (Cap 207) of Singapore was amended to give effect to Art 1(1) of the Convention. This was done by repealing the then existing s 340 of the Merchant Shipping Ordinance and substituting a new s 340 – which to this day remains in our laws virtually unchanged as s 136 of the Merchant Shipping Act[1]. A cursory comparison of Art 1(1) of the Convention and the present s 136 of the MSA shows that the transposition of the Art 1(1) provisions was far from verbatim. The English draftsman in fact transposed Article 1(1)(a) of the Convention to paragraphs (a) and (b) of s 136; and Article 1(1)(b) of the Convention to paragraphs (c) and (d) of s 136.

10 What of Article 1(1)(c) of the convention relating to the removal or wrecks and damage to “harbour works, basins and navigable waterways”? Counsel for the plaintiffs, Mr Chong SC pointed out that the new s 340 of the Merchant Shipping Ordinance inserted by the 1959 amendment dealt with wrecks and harbour works etc by way of sub-section (4) of s 340 (referred to hereafter as “ss (4)”) which stated:

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