Sinogreat v Hin Leong: Breach of Contract & Cargo Confiscation Dispute

In a dispute before the High Court of Singapore, Sinogreat International Trading Ltd sued Hin Leong Trading (Pte) Ltd for breach of contract and negligence related to a sale and purchase agreement of Vacuum Gas Oil (VGO). Hin Leong counterclaimed for damages. The court, presided over by Justice Lai Kew Chai, dismissed Sinogreat's claims, finding that the confiscation of the cargo by PRC Customs was a direct result of Sinogreat's instruction to mis-describe the cargo as Low Sulphur Waxy Residue (LSWR) on shipping documents. The court allowed Hin Leong's counterclaims with costs.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Plaintiffs' claims are dismissed with costs. Defendants' counterclaims are allowed with costs.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Sinogreat's claim against Hin Leong for breach of contract was dismissed. The court found Sinogreat responsible for the cargo confiscation due to misdescription.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Hin Leong Trading (Pte) LtdDefendantCorporationCounterclaim AllowedWon
Sinogreat International Trading LtdPlaintiffCorporationClaim DismissedLost

3. Judges

Judge NameTitleDelivered Judgment
Lai Kew ChaiJudgeYes

4. Counsels

Counsel NameOrganization
Toh Kian SingRajah and Tann
David Tan Yew BengRajah and Tann
S GunaseelanS Gunaseelan and Partners

4. Facts

  1. Sinogreat purchased cargo from Hin Leong for shipment to Xiamen, PRC.
  2. Sinogreat instructed Hin Leong to change the cargo description to LSWR on shipping documents.
  3. First two lots were delivered without issues.
  4. PRC Customs confiscated the third lot due to mis-description.
  5. Sinogreat requested Hin Leong to assist in releasing the cargo from customs.
  6. The Guangdong Province Zhuhai City Intermediate Court upheld the confiscation.
  7. The Higher People’s Court of Guangdong Province also upheld the confiscation.

5. Formal Citations

  1. , 1611/1999, Suit 1611/1999
  2. Sinogreat International Trading Ltd v Hin Leong Trading (Pte) Ltd, 91, [2003] SGHC 91

6. Timeline

DateEvent
Contract for sale of cargo signed between Hin Leong and Sinocean.
Transfer of cargo from 'Condoleezza Rice' to 'Ocean Dolphin' began.
Transfer of cargo from 'Condoleezza Rice' to 'Ocean Dolphin' completed.
Transfer of cargo from 'Condoleezza Rice' to 'Ocean Opal' began.
Transfer of cargo from 'Condoleezza Rice' to 'Ocean Opal' completed.
Sinocean acknowledged and indemnified Hin Leong for changing product name to LSWR.
First lot of cargo delivered.
Second lot of cargo delivered.
Sinogreat issued an indemnity to Hin Leong.
Final lot of cargo due for delivery at Xiamen.
'Ocean Opal' turned back from Xiamen and sailed to Hong Kong OPL.
Storage Agreement drafted.
Sinogreat confirmed instructions to release cargo to 'Min Hai You No. 5'.
Xiamen XML requested location of 'Ocean Opal'.
Ship to ship transfer of cargo started at OPL, Hong Kong.
PRC Gongbei Customs officers boarded both vessels.
Gongbei Customs issued Notice of Penalty Decision confiscating cargo.
'Ocean Opal' detained by PRC Customs for 64 days.
Plaintiffs referred to the contract in writing dated 17th day of May 1999.
Decision Date

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that the plaintiffs were in breach of contract for failing to take delivery of the final lot of cargo.
    • Category: Substantive
    • Sub-Issues:
      • Failure to take delivery
      • Causation of damages
  2. Novation
    • Outcome: The court held that there was no novation of the contract.
    • Category: Substantive
  3. Causation
    • Outcome: The court found that the plaintiffs' mis-description of the cargo was the effective cause of the confiscation.
    • Category: Substantive

8. Remedies Sought

  1. Damages for breach of contract
  2. Indemnity for demurrage or detention

9. Cause of Actions

  • Breach of Contract
  • Negligence

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Trading
  • Petroleum

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Multi-Pak Singapore Pte Ltd v Intraco LtdSingapore Court of AppealYes[1992] 2 SLR 793SingaporeCited regarding the impermissibility of asserting a case inconsistent with pleadings.
Kiaw Aik Hang v Tan Tien ChoyN/AYes(1964) 30 MLJ 99N/ACited regarding the impermissibility of asserting a case inconsistent with pleadings.
Esso Petroleum Co Ltd v Southport CorporationHouse of LordsYes[1956] H.L.(E.) 218England and WalesCited regarding the impermissibility of asserting a case inconsistent with pleadings.
The Tychy (No. 2)N/AYes[2001] 1 Lloyd’s Law Rep 10N/ACited for the principles of novation, specifically the requirement of consent from all parties involved.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Rules for Administrative Penalty of the Customs Law of the PRC Sections 4(2) and 5(1)(2)PRC

15. Key Terms and Keywords

15.1 Key Terms

  • Vacuum Gas Oil
  • Low Sulphur Waxy Residue
  • Ship to Ship Transfer
  • PRC Customs
  • Confiscation
  • Storage Agreement
  • Letter of Indemnity
  • Mis-description
  • Demurrage
  • Detention

15.2 Keywords

  • Sinogreat
  • Hin Leong
  • VGO
  • LSWR
  • Breach of Contract
  • Cargo Confiscation
  • Singapore High Court

17. Areas of Law

Area NameRelevance Score
Commercial Law90
Sale of Goods85
Contract Law80
Breach of Contract75
Commercial Litigation60
Customs Law50
Letters of Indemnity40
Evidence40
Collections30
Shipping Law30
Demurrage30
Agency Law25
Trade Finance20

16. Subjects

  • Sale of Goods
  • Breach of Contract
  • International Trade
  • Customs Law