Rapiscan Asia v Global Container: Bill of Lading, Contract Terms & Negligence in Shipping
Rapiscan Asia Pte Ltd sued Global Container Freight Pte Ltd in the High Court of Singapore on 16 April 2002, for breach of contract and negligence relating to the shipment of X-ray machines. Rapiscan claimed that Global failed to properly monitor the shipment, leading to a loss of rental income from a contract with Fei Fu. The court, presided over by Justice S Rajendran, found in favor of Rapiscan, holding that Global was liable for breach of contract due to its negligent misrepresentation regarding the whereabouts of the X-ray machines. The court awarded Rapiscan US$154,056 in damages, including lost rental income and expenses incurred in attempting to mitigate the loss.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Rapiscan Asia sues Global Container for negligence in shipping X-ray machines, leading to lost rental income. Court finds Global liable for breach of contract.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Rapiscan Asia Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff | Won | S Palaniappan, N Sreenivasan, K Gopalan |
| Global Container Freight Pte Ltd | Defendant | Corporation | Judgment against Defendant | Lost | Loo Dip Seng, Gerald Yee |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| S Rajendran | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| S Palaniappan | Straits Law Practice LLC |
| N Sreenivasan | Straits Law Practice LLC |
| K Gopalan | Straits Law Practice LLC |
| Loo Dip Seng | Ang & Partners |
| Gerald Yee | Ang & Partners |
4. Facts
- Rapiscan rented X-ray machines to Fei Fu for Macau's First Anniversary Celebrations.
- Rapiscan contracted with Global to ship the X-ray machines to Macau.
- Paul of OSM emphasized the urgency of the shipment to Jason of Global.
- Jason assured Paul he would monitor the shipment to ensure timely arrival.
- Global negligently misrepresented that the X-ray machines were on the 'Kota Perkasa'.
- The X-ray machines were actually on the 'Kota Jaya', arriving later than expected.
- Fei Fu canceled the contract due to the delayed arrival of the X-ray machines.
- Rapiscan attempted to mitigate the loss by air-freighting substitute X-ray machines.
5. Formal Citations
- Rapiscan Asia Pte Ltd v Global Container Freight Pte Ltd, Suit 202/2001, [2002] SGHC 72
6. Timeline
| Date | Event |
|---|---|
| Macau handed back to China | |
| X-ray machines shipped to Brunei by Global for APEC Meeting | |
| Contract entered into between Rapiscan and Fei Fu for rental of X-ray machines | |
| Global faxed quotation to OSM | |
| Global faxed quotation to OSM | |
| Oral contract entered into between Rapiscan and Global | |
| Global's Brunei agent responded by e-mail with vessel details | |
| Nathan faxed draft of bill of lading to Global’s agent in Brunei | |
| Paul called Jason to ascertain if the X-ray machines had reached Singapore | |
| Jason told Paul that the X-ray machines would reach Singapore | |
| Paul called Jason to enquire about the progress of the shipment | |
| Nathan spoke with Jason and was told the X-ray machines had arrived in Singapore | |
| Draft bill of lading dated | |
| Global faxed the draft bill of lading for the Singapore/Macau leg of the shipment to Nathan | |
| Paul and Selvan called Jason to enquire about the progress of the shipment | |
| Selvan received a fax from Jose Sin expressing concern about the arrival date | |
| Jason called Nathan and told him that the Kota Perkasa was delayed | |
| Sin learnt that the X-ray machines were not on the Kota Perkasa | |
| Jason called Selvan and confirmed the mistake | |
| Eight X-ray machines left Kuala Lumpur for Hong Kong | |
| Rapiscan received notification from Fei Fu that they were canceling the contract | |
| Internal e-mail of from Jason to Global’s agent in Brunei | |
| Rapiscan wrote to Global complaining about the shipment | |
| Global responded to Rapiscan's complaint | |
| Suit filed | |
| Judgment issued |
7. Legal Issues
- Breach of Contract
- Outcome: The court held that Global breached its contractual obligation to monitor the shipment and keep Rapiscan informed, resulting in damages.
- Category: Substantive
- Sub-Issues:
- Failure to monitor shipment
- Negligent misrepresentation
- Related Cases:
- [1921] LLR 170
- Incorporation of Terms
- Outcome: The court held that the terms of the bill of lading and the Singapore Freight Forwarders Association Standard Trading Conditions (SFFA Conditions) were incorporated into the contract.
- Category: Substantive
- Sub-Issues:
- Incorporation of bill of lading terms
- Incorporation of standard trading conditions
- Related Cases:
- [1954] 1 LLR 321
- Exemption Clauses
- Outcome: The court held that the exemption clauses in the SFFA Conditions and the bill of lading did not exempt Global from liability for negligence.
- Category: Substantive
- Sub-Issues:
- Construction of exemption clauses
- Application of Morton tests
- Related Cases:
- [1952] HL 192
- [1997] 3 SLR 625
- [1978] 1 ALL ER 18, 1 WLR 165
- Limitation of Liability
- Outcome: The court held that the limitation of liability clauses did not limit Global's liability for negligence in monitoring the shipment.
- Category: Substantive
- Sub-Issues:
- Construction of limitation clauses
- Application to negligence
- Related Cases:
- [1983] 1 LLR 183
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Negligence
- Negligent Misrepresentation
10. Practice Areas
- Shipping Law
- Freight Forwarding
- Commercial Litigation
- Contract Disputes
- Negligence
11. Industries
- Shipping
- Security
- Freight Forwarding
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Alisa Craig Fishing Co Ltd v Malvern Fishing Co Ltd and Anor | N/A | Yes | [1983] 1 LLR 183 | N/A | Cited for the principle that the approach towards limitation of liability clauses should not follow the approach taken in respect of exemption of liability clauses. |
| Belships (Far East) Shipping (Pte) Ltd et al v Canadian Pacific Forest Products et al | Federal Court of Appeal | No | (1999) 175 DLR (4th) 449 | Canada | Cited regarding the application of the Morton test to exemption clauses in the context of a carrier's liability. |
| Canada Steamship Lines Ltd v The King | Privy Council | Yes | [1952] HL 192 | N/A | Cited for establishing the guidelines (Morton tests) for determining whether an exemption clause encompasses liability for negligence. |
| Darwish MKF Al Gobaishi v House of Hung Pte Ltd | N/A | Yes | [1998] 3 SLR 435 | Singapore | Cited for the principle that a party who performs his contractual obligation in a negligent way is in breach of contract and should be pursued in contract even though he could also be pursued in tort for negligence. |
| E Scott (Plant Hire) Ltd v British Waterways Board | N/A | No | (1982, unreported) | N/A | Cited regarding the interpretation of exemption clauses and the requirement for express reference to negligence. |
| George Peereboom v World Transport Agency Ltd | N/A | Yes | [1921] LLR 170 | N/A | Cited for the principle that a forwarding agent is bound to give such information to his principal as is necessary for the principal to protect his interest in the goods. |
| Marina Centre Holdings Pte Ltd v Pars Carpet Gallery Pte Ltd | Court of Appeal | Yes | [1997] 3 SLR 625 | Singapore | Cited for following the guidelines enunciated in Canada Steamship Lines (the Morton tests) and the underlying reasons for that approach. |
| Pyrene Co Ltd v Scindia Steam Navigation Co Ltd | N/A | Yes | [1954] 1 LLR 321 | N/A | Cited for the principle that when parties enter into a contract of carriage in the expectation that a bill of lading will be issued to cover it, they enter into it upon those terms which they know or expect the bill of lading to contain. |
| Rutter v Palmer | N/A | No | [1922] 2 KB 87 | N/A | Cited regarding the interpretation of exemption clauses in contracts of carriage. |
| Smith & Anor v South Wales Switchgear Ltd | N/A | No | [1978] 1 ALL ER 18, 1 WLR 165 | N/A | Cited regarding the interpretation of indemnity clauses and the requirement for express reference to negligence. |
| Tai Hing Cotton Mill Ltd v Liu Chong Hing Bank | N/A | No | [1986] AC 80 | N/A | Cited for the principle that courts have expressed reservations about parties pursuing a remedy in tort when a remedy in contract was the more appropriate. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- X-ray machines
- Shipment
- Freight forwarding
- Bill of lading
- Negligence
- Monitoring
- Kota Perkasa
- Kota Jaya
- SFFA Conditions
- Exemption clause
- Limitation of liability
- Fei Fu contract
- Mitigation of loss
15.2 Keywords
- shipping
- contract
- negligence
- freight forwarding
- bill of lading
- exemption clause
- limitation of liability
16. Subjects
- Contract Law
- Shipping Law
- Commercial Law
- Negligence
- Freight Forwarding
17. Areas of Law
- Admiralty and Shipping
- Agency
- Contract Law
- Tort Law
- Freight Forwarding Law