THF Wines Pty Ltd v Far East Distribution Pte. Ltd.

• Jurisdiction: Singapore
• Judge: Jonathan Toh Jun Hian
• Judgment Date: 29 September 2022
• Neutral Citation: [2022] SGDC 227
• Court: District Court (Singapore)
• Hearing Date: 14 February 2022,16 March 2022,20 May 2022,16 June 2022
• Docket Number: District Court Suit No 1272 of 2019, District Court Appeal Nos 27 and 28 of 2022
• Plaintiff Counsel: Por Hock Sing Michael and Li Jiaxin (Michael Por Law Corporation)
• Defendant Counsel: Michael Moey Chin Woo (Moey & Yuen)
• Subject Matter: Admiralty And Shipping,Bills of lading,Bills of lading as document of title,Contract,Formation,Offer and acceptance,Contractual terms,Rules of construction,Waiver,Duty to speak
• Published date: 13 October 2022

District Judge Jonathan Toh Jun Hian: Introduction

The plaintiff is a company incorporated in Australia and the defendant is a company incorporated in Singapore. They are both in the business of trading in wines and spirits.

The plaintiff claimed that the defendant purchased 840 cases of Johnny Walker Black whisky and 368 cases of Chivas Regal whisky (the “Goods”) and instructed the plaintiff to ship them to the defendant’s nominated consignee, Fuzhou Sha Lun Trade Co., Ltd (“FZSL”), in Tianjin, China. The plaintiff duly shipped the Goods to FZSL and invoiced the defendant. The defendant failed to pay, and the plaintiff sued for the purchase price of USD 154,704.

The issues arise from the defendant’s arguments on why it was not liable to pay the contract price.

First, the defendant alleged that there was no binding contract between the parties because there was no proper offer made. This was because the plaintiff only sent a draft quotation, a pro forma invoice, and a draft bill of lading to the defendant, but none of these documents were final.¹

Second, even if there was a proper offer, the defendant alleged that it did not accept the plaintiff’s offer because it did not pay the deposit, which was a condition precedent to contract formation.²

Third, the defendant’s alternative position was that even if there was a binding contract between the parties, the defendant was not obliged to pay the purchase price because the plaintiff did not present an original bill of lading for payment.³

In response, the plaintiff argued that there was a binding contract but no requirement for the presentation of an original bill of lading against payment.⁴ Alternatively, even if there was a requirement, the defendant had waived it or is estopped from alleging that there was such a requirement.⁵

Fourth, the defendant argued that it was not obliged to pay as title and risk in the Goods never passed to it.⁶

Fifth, the defendant argued that the plaintiff failed to prove that the goods were delivered.⁷

Sixth, the defendant argued that the plaintiff failed to mitigate its loss.

On 16 June 2022, I granted judgment to the plaintiff for payment of 20% of the purchase price and dismissed its claim for the remaining 80%. In brief, I found that: There was a binding contract between the parties for the sale and purchase of the Goods. The express terms of the contract required payment of (i) a deposit of 20% of the purchase price; and (ii) the balance 80% of the purchase price against the presentation of an original bill of lading for the Goods. The original bill of lading was never presented for payment and the defendant did not waive the requirement for an original bill of lading. As such, while the Goods were shipped to Tianjin and released to the defendant’s nominated consignee, FZSL, the defendant’s obligation to pay the remainder 80% of the purchase price was not triggered.

Both parties filed their respective appeals and I now set out my full grounds of decision.

The Facts

The negotiations on the sale and purchase of the Goods took place primarily between the plaintiff’s Mr Menno Bastiaan Willem Burkunk (“Mr Menno”) and the defendant’s Mr Lee Lai Rong Daniel (“Mr Lee”) through an exchange of WhatsApp messages. Both parties relied on the transcript of the exchange of WhatsApp messages between Mr Menno, Mr Lee and the plaintiff’s Mr John Van.⁸ A separate transcript of WhatsApp messages between Mr Menno and Mr Lee was also available.⁹ The parties’ representatives also exchanged a number of emails. Mr Menno gave evidence on behalf of the plaintiff and Mr Lee gave evidence on behalf of the defendant. It was not disputed that Mr Menno and Mr Lee were duly authorised to act on behalf of the respective parties in the transaction.

Prior to 18 June 2018, the plaintiff shipped the Goods from Melbourne to Singapore. On 18 June 2018, while the Goods were in transit, the plaintiff’s Mr Menno asked the defendant’s Mr Lee on WhatsApp where he would like to divert the goods to:¹⁰

[18-06-18 08:32:58]	Menno: John what is ETA of vessel in Singapore?
[18-06-18 08:33:10]	Menno: JW Black with Chivas?
[18-06-18 08:39:55]	Van: Hi guys
[18-06-18 08:39:57]	Van: Arriving 23/06
[18-06-18 08:49:53]	Menno: so we got 5 days? Daniel if we need to divert to Tianjin or other port wee need to know ASAP.
[18-06-18 08:54:36]	Menno: 840cs of JW Black 12/700/40 @ 150 usd 368cs of Chivas 12YO 7/700/40 @ 80 usd >> will make 78 usd
[18-06-18 08:55:53]	Menno: When can you let us know where container needs to go to?
(Emphasis added.)

Inherent in Mr Menno’s request for Mr Lee’s directions on where to direct the Goods was the assumption that the defendant was purchasing the Goods.

Mr Lee did not respond and parties corresponded about other matters until 20 June 2018 when Mr Menno asked again. On 20 and 21 June 2018, Mr Lee instructed Mr Menno to send the Goods to Tianjin.¹¹

[20-06-18 11:16:23]	Menno: Sorry Daniel but container is arriving in Singapore in 3 days
[20-06-18 11:16:40]	Daniel Far east D: tj
[21-06-18 08:33:31]	Menno: Good morning. What to do Daniel?
[21-06-18 08:33:42]	Daniel Far east D: hi menno
[21-06-18 08:33:49]	Daniel Far east D: got the money?
[21-06-18 08:33:54]	Daniel Far east D: send to TJ
[21-06-18 08:55:15]	Menno: It’s a mess Daniel. How to do with the JW Black?
[21-06-18 08:58:51]	Daniel Far east D: i though u referring to jwb
[21-06-18 08:58:56]	Daniel Far east D: send to Tianjin
[21-06-18 09:01:46]	Menno: Ok john pls divert container to Tianjin
(Emphasis added.)

The plaintiff engaged JF Hillebrand Singapore Pte Ltd (“JF Hillebrand”) to ship the Goods to Tianjin. Mr Jorge Francisco Lara Rojas (“Mr Jorge”), JF Hillebrand’s business unit manager, gave evidence on the shipping of the Goods. He presented a booking confirmation dated 29 June 2018 ordering the Goods to be shipped to Tianjin on the vessel “Xin Chang Shu” with the estimated time of arrival of 7 August 2018.¹²

On 3 July 2018, the plaintiff sent a draft quotation for the Goods to the Defendant by WhatsApp¹³ and email¹⁴ (the “Draft Quotation”). The next day, on 4 July 2018, Mr Menno sent a further WhatsApp message informing Mr Lee that while the deposit was “officially” required, Mr Menno appreciated that Mr Lee kept his word and therefore it was fine for the purchase price to be paid together a week before the Goods arrived.¹⁵

On 4 July 2018 at 12.36 pm, the defendant’s Ms Doreen Goh sent an email to the plaintiff to name “Fuzhou All Yucheng Import & Export Trade Co. , Ltd” as the consignee. Shortly thereafter, at 12.55 pm, she sent a further email naming FZSL as the consignee instead.¹⁶

On 13 July 2018, the plaintiff sent a pro forma invoice for the Goods by email (the “Pro Forma Invoice”).¹⁷ A draft bill of lading dated 21 July 2018 was prepared.¹⁸

On 24 July 2018, Mr Menno asked Mr Lee for payment over WhatsApp.¹⁹ He asked again on 30 July 2018.²⁰

On 1 August 2018 at 1.37 pm, Mr Lee asked for the bill of lading over WhatsApp.²¹ At 10.14 pm, Mr Menno forwarded an email to him with the draft bill of lading (the “Draft BL”), packing list, and the Pro Forma Invoice.²² The Draft BL²³ was not the draft of an original bill of lading. It was expressly stated to be “a non-negotiable, electronic copy bill of lading for information purposes only, without contractual or legal value.” It also stated “telex release (BL surrender at S’pore)”. Mr Jorge called this a draft of an “express bill of lading” and explained that if the consignee produced a copy of an endorsed express bill of lading with an endorsed telex release confirming that the consignee was assuming responsibility for the Goods, the Goods would be released to the consignee.²⁴ On the terms of this draft bill of lading, there was no need for the presentation of an original bill of lading to obtain release of the Goods.

Thereafter, parties entered into a series of correspondence where the plaintiff demanded that the defendant pay for the Goods and the defendant assured the plaintiff that it would be responsible for and take the Goods. On 3, 6 and 7 August 2018, Mr Menno chased Mr Lee for payment over WhatsApp.²⁵ At the same time, the plaintiff’s Mr John Van sent email chasers on 6 and 7 August 2018 for payment.²⁶ In his email of 7 August 2018, Mr Van stated that if the defendant did not settle the invoice, he would be “forced to make alternative arrangements”. Mr Lee responded by email dated 8 August 2018 stating “Dear John, I assured that this will be settled. There’s no need to look for alternative… But give me a couple of days, since I promise to take it. I will take it.”²⁷ By an email dated 13 August 2018, Mr Van responded to state “Will noted. Please kindly send through remittance, as there is only limited free at Port as advised by the line…”.²⁸ By a further email dated 16 August 2018, Mr Lee replied: “Hi John, Will get that done. Give me a couple of day. I’m clearing some other JW at the time being. Sorry for this mess. The market just go bad. But we will take responsible for any container sent to us.”²⁹ On 27 to 28 Aug 2018, when Mr Menno demanded again for payment over WhatsApp, Mr Lee responded “I’m trying”.³⁰ On 12 October 2018, Mr Menno chased again for payment by a private WhatsApp message to Mr Lee, asking “Daniel any news on the first payment?\”.³¹ On 16 October 2018, on the group WhatsApp chat, Mr Lee sent a message stating “i’ll update you around 2pm today. sorry for the delay. but all seem good now”. Mr Lee then sent a further private WhatsApp message to Mr Menno on 17 October 2018 stating “hi menno, end of today i’ll update u. i have make some payment out of china. recently everything is slow. i dun want to give u empty promise....