The "URSUS" and other matters

• Jurisdiction: Singapore
• Judge: Justin Yeo AR
• Judgment Date: 06 April 2015
• Neutral Citation: [2015] SGHCR 7
• Court: High Court (Singapore)
• Docket Number: Adm No 240 of 2014 (Summons No 75 of 2015), Adm No 241 of 2014 (Summons No 79 of 2015), Adm No 242 of 2014 (Summons No 77 of 2015), Adm No 243 of 2014 (Summons No 78 of 2015), Adm No 244 of 2014 (Summons No 80 of 2015), Adm No 245 of 2014 (Summons No 83 of 2015)
• Published date: 09 April 2015
• Year: 2015
• Hearing Date: 17 March 2015
• Plaintiff Counsel: Ms Mary-Anne Chua (Joseph Tan Jude Benny LLP)
• Defendant Counsel: Mr Khoo Eu Shen (Rodyk & Davidson LLC)
• Subject Matter: Admiralty and Shipping,Admiralty Jurisdiction and Arrest,Civil Procedure,Service
• Citation: [2015] SGHCR 7

Justin Yeo AR:

These are six applications in six separate admiralty proceedings. The admiralty proceedings are Admiralty In Rem No 240, 241, 242, 243, 244 and 245 of 2014 (“the Suits”), while the relevant summonses, arranged in order of the Suits, are Summonses No 75, 79, 77, 78, 80 and 83 of 2015 (“the Summonses”). Both Ms Mary-Anne Chua (“Ms Chua”), who represented the Harms Bergung, Transport und Heavylift GmbH & Co KG (“the Plaintiff”), and Mr Khoo Eu Shen (“Mr Khoo”), who represented the Defendants in the Suits, agreed that the Summonses were similar in terms of content with only minor factual differences between them. As such, the Summonses were heard together with only a single set of submissions made by Ms Chua and Mr Khoo.

The Summonses concerned the respective Defendants applying for the Suits to be dismissed on the basis that no statement of claim had been served on the Defendants within the period fixed by the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“Rules of Court”), or alternatively, for the Suits to be stayed pursuant to s 6 of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“the IAA”).

I dismissed prayer 1 of the Summonses (viz, for the Suits to be dismissed), and granted prayer 2 (viz, for proceedings to be stayed pending arbitration) in part by ordering a stay of the in personam aspects of the Suits. I provide here the grounds for my decision.

Background

The Plaintiff had, on 20 November 2014, issued in rem writs against the Defendants’ vessels, respectively, the “URSUS”, the “URANUS”, the “TAURUS”, the “ORCUS”, the “MAGNUS” and the “JANUS” (collectively, “the Vessels”). The writs were issued with the intention of preserving the Plaintiff’s right to arrest the Vessels for security in an arbitration to be held in Hamburg.¹ The writs were issued as protective measures to preserve the Plaintiff’s interests should ownership of the respective Vessels change before and/or during the arbitration proceedings.² The writs have not been served on the Vessels.

It is undisputed that the Defendants, through their solicitors, entered appearance gratis on 15 December 2014, and that the Plaintiff has not filed any statement of claim in the Suits. The Plaintiff has also placed on record, by way of affidavits of Axel Salander dated 24 February 2015 (filed in each of the Suits), that it was never the Plaintiff’s intention to have the substance of the dispute with the Defendants heard in the Singapore courts.³ Indeed, the Plaintiff had already commenced arbitration proceedings against the “URSUS” in Hamburg,⁴ and intended to commence arbitration proceedings against the other Vessels there as well.⁵

Issues

Two issues arose for determination, namely: First, whether the Suits should be dismissed on the basis that no statement of claim had been served; and Second, in the alternative, whether the Suits should be stayed pursuant to s 6 of the IAA.

Parties’ Arguments

On the first issue, Mr Khoo argued that the Suits should be dismissed pursuant to O 19 r 1 read with O 18 r 1 of the Rules of Court. Under O 18 r 1 of the Rules of Court, a plaintiff must serve a statement of claim before expiration of 14 days after the defendant enters appearance. Under O 19 r 1 of the Rules of Court, where the plaintiff fails to serve a statement of claim within that period, the defendant may apply to court for an order to dismiss the action. The relevant rules provide:

1. Service of statement of claim (O. 18, r. 1) Unless the Court gives leave to the contrary or a statement of claim is endorsed on the writ, the plaintiff must serve a statement of claim on the defendant or, if there are 2 or more defendants, on each defendant, and must do so either when the writ is served on that defendant or at any time after service of the writ but before the expiration of 14 days after that defendant enters an appearance.

…

1. Default in service of statement of claim (O. 19, r. 1) Where the plaintiff is required by these Rules to serve a statement of claim on a defendant and he fails to serve it on him, the defendant may, after the expiration of the period fixed under these Rules for service of the statement of claim, apply to the Court for an order to dismiss the action, and the Court may by order dismiss the action or make such other order on such terms as it thinks just.

Ms Chua emphasised that the Plaintiff accepted that it has failed to serve a statement of claim, but argued that this does not lead to the conclusion that all proceedings, both in personam and in rem, should be dismissed. The Plaintiff was willing to concede that the in personam proceedings may be dismissed.⁶ However, Ms Chua argued that the in rem proceedings should not be dismissed given that there are not yet any live in rem proceedings against the Vessels.

On the second issue, Mr Khoo argued that the Suits should be stayed pursuant to s 6 of the IAA. Section 6(1) of the IAA provides:

Notwithstanding Article 8 of the Model Law, where any party to an arbitration agreement to which this Act applies institutes any proceedings in any court against any other party to the agreement in respect of any matter which is the subject of the agreement, any party to the agreement may, at any time after appearance and before delivering any pleading or taking any other step in the proceedings, apply to that court to stay the proceedings so far as the proceedings relate to that matter.

Section 6(1) of the IAA sets out the “threshold requirements” that need to be met before a court is bound to stay legal proceedings in favour of international arbitration (The “Engedi” [2010] 3 SLR 409 (“The Engedi”) at [14]). In order for a stay to be granted, the following must be demonstrated: (a) the existence of an international arbitration agreement; (b) a party to that agreement must institute court proceedings against another party to the same agreement; (c) the proceedings must be in respect of a matter which is the subject of the agreement; (d) the party seeking a stay must have entered appearance in the court proceedings; and (e) the party seeking a stay must do so before delivering any pleading or taking any other step in the proceedings (ibid).

Ms Chua emphasised that the Plaintiff accepted that based on the above principles, the in personam proceedings should be stayed.⁷ However, she argued that the in rem proceedings should...