Sun Technosystems v Federal Express: Bailment, Carrier Duties & Hijacking

Sun Technosystems Pte Ltd sued Federal Express Services (M) Sdn Bhd in the Court of Appeal of Singapore on November 8, 2006, for breach of duty as carrier and/or bailee, seeking to recover the costs of goods lost in a hijacking. The court dismissed the appeal, finding that Federal Express had discharged its burden of proof as bailee by establishing that the loss occurred without its negligence or default, and was therefore entitled to rely on the "events beyond our control" clause in the airway bill.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Sun Technosystems sued Federal Express for breach of duty as bailee/carrier after goods were hijacked. The court dismissed the appeal, finding FedEx had discharged its burden of proof.

1.7 Decision Date

7 November 2006

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Sun Technosystems Pte Ltd	Appellant	Corporation	Appeal Dismissed	Lost	Goh Kok Leong of Ang & Partners Gho Sze Kee of Ang & Partners Quah I-Lin Anna of Ang & Partners
Federal Express Services (M) Sdn Bhd	Respondent	Corporation	Appeal Dismissed	Won	Lee Sien Liang Joseph of Rodyk & Davidson Lok Vi Ming of Rodyk & Davidson Ajinderpal Singh of Rodyk & Davidson Seah Wei Hsien Mark Jerome of Rodyk & Davidson

3. Judges

Judge Name	Title	Delivered Judgment
Chan Sek Keong	Chief Justice	No
Lee Seiu Kin	Judge	No
Andrew Phang Boon Leong	Justice of the Court of Appeal	Yes

4. Counsels

Counsel Name	Organization
Goh Kok Leong	Ang & Partners
Gho Sze Kee	Ang & Partners
Quah I-Lin Anna	Ang & Partners
Lee Sien Liang Joseph	Rodyk & Davidson
Lok Vi Ming	Rodyk & Davidson
Ajinderpal Singh	Rodyk & Davidson
Seah Wei Hsien Mark Jerome	Rodyk & Davidson

4. Facts

Sun Tech ordered 1,000 memory chips from Smart for $860,000.
Smart contacted FedEx (M) to deliver the goods to Sun Tech in Singapore.
A FedEx (M) courier picked up the goods from Smart's premises in Penang.
The courier's van was allegedly hijacked en route to the shuttle point.
The courier sustained head injuries and lost consciousness.
The goods were missing from the vehicle after the courier regained consciousness.
The Malaysian police detained the courier and seven others for investigation.

5. Formal Citations

Sun Technosystems Pte Ltd v Federal Express Services (M) Sdn Bhd, CA 58/2006, [2006] SGCA 40

6. Timeline

Date	Event
2000-07-01	Sun Tech ordered 1,000 memory chips from Smart.
2000-08-28	Smart contacted FedEx (M) to deliver goods to Sun Tech.
2000-08-28	FedEx (M)’s courier, Mr Turairaj, picked up the goods from Smart’s premises.
2000-08-28	Goods were hijacked.
2006-01-01	High Court decision in Smart Modular Technologies Sdn Bhd v Federal Express Services (M) Sdn Bhd.
2006-11-08	Court of Appeal dismissed the appeal.

7. Legal Issues

Breach of Duty of Care as Bailee
- Outcome: The court found that the respondent had discharged its burden of proof as bailee by establishing that the loss occurred without its negligence or default.
- Category: Substantive
- Sub-Issues:
  - Failure to take reasonable care of goods
  - Negligence or default leading to loss
- Related Cases:
  - [2001] 1 SLR 521
Interpretation of 'Events Beyond Our Control' Clause
- Outcome: The court found that the respondent was entitled to rely on the 'events beyond our control' clause in the contract of carriage.
- Category: Substantive
- Sub-Issues:
  - Applicability of the clause to hijacking
  - Whether the event was truly beyond the bailee's control
Doctrine of Fundamental Breach
- Outcome: The court affirmed the application of the doctrine of fundamental breach as a 'rule of construction' in the Singapore context.
- Category: Substantive
- Sub-Issues:
  - Whether the breach was fundamental
  - Effect of fundamental breach on exception clauses
- Related Cases:
  - [1980] AC 827

8. Remedies Sought

Recovery of Costs of Goods

9. Cause of Actions

Breach of Duty as Carrier
Breach of Duty as Bailee

10. Practice Areas

Commercial Litigation
Transportation
Bailment

11. Industries

Logistics
Manufacturing
Technology

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Smart Modular Technologies Sdn Bhd v Federal Express Services (M) Sdn Bhd	High Court	Yes	[2006] 2 SLR 797	Singapore	The present appeal centred on the finding of the trial judge that there was a hijack and hence that the respondent had discharged its burden of proof as bailee to establish that the loss occurred without its negligence or default.
Seah Ting Soon t/a Sing Meng Co Wooden Cases Factory v Indonesian Tractors Co Pte Ltd	Court of Appeal	Yes	[2001] 1 SLR 521	Singapore	Cited for the principle that where goods on bailment are lost or destroyed, the onus is on the bailee to prove, on a balance of probabilities, that it had taken reasonable care of those goods.
Techking Enterprise Ltd v JFE Consolidators Pte Ltd	High Court	Yes	[2005] 2 SLR 744	Singapore	Applied the principle that where goods on bailment are lost or destroyed, the onus is on the bailee to prove, on a balance of probabilities, that it had taken reasonable care of those goods.
Hong Realty (Pte) Ltd v Chua Keng Mong	Court of Appeal	Yes	[1994] 3 SLR 819	Singapore	Cited as authority on the duty of care in bailment.
Port Swettenham Authority v TW Wu and Co (M) Sdn Bhd	Privy Council	Yes	[1979] AC 580	Malaysia	Cited as authority on the duty of care in bailment.
Levison v Patent Steam Carpet Cleaning Co Ltd	English Court of Appeal	Yes	[1978] QB 69	England and Wales	Discussed in relation to the duty of a bailee to establish precisely how the loss or damage occurred.
Emjay Enterprises Pte Ltd v Skylift Consolidator (Pte) Ltd (Direct Services (HK) Ltd, Third Party)	High Court	Yes	[2006] 2 SLR 268	Singapore	Discussed in relation to the doctrine of fundamental breach as a rule of construction.
Photo Production Ltd v Securicor Transport Ltd	House of Lords	Yes	[1980] AC 827	England and Wales	Cited as authority for the doctrine of fundamental breach as a rule of construction.
Sze Hai Tong Bank Ltd v Rambler Cycle Co Ltd	Privy Council	Yes	[1959] AC 576	Singapore	Discussed in relation to the doctrine of fundamental breach.
Metro (Pte) Ltd v Wormald Security (SEA) Pte Ltd	High Court	Yes	[1980–1981] SLR 539	Singapore	Cited as authority for the doctrine of fundamental breach as a rule of construction.
AA Valibhoy & Sons (1907) Pte Ltd v Banque Nationale de Paris	High Court	Yes	[1994] 2 SLR 772	Singapore	Cited as authority for the doctrine of fundamental breach as a rule of construction.
Parker Distributors (Singapore) Pte Ltd v A/S D/S Svenborg	Court of Appeal	Yes	[1982–1983] SLR 153	Singapore	Cited as authority for the doctrine of fundamental breach as a rule of construction.
Ulster-Swift Ltd v Taunton Meat Haulage Ltd	English Court of Appeal	Yes	[1977] 1 WLR 625	England and Wales	Discussed in relation to the duty of a bailee to establish precisely how the loss or damage occurred.
Swiss Bank Corporation v Brink’s MAT Ltd	English High Court	Yes	[1986] QB 853	England and Wales	Discussed in relation to the duty of a bailee to establish precisely how the loss or damage occurred.
Coopers Payen Limited v Southampton Container Terminal Limited	English Court of Appeal	Yes	[2003] EWCA Civ 1223	England and Wales	Endorsed the view that it is not necessary for a bailee to show what caused the loss or damage, but simply that he took reasonable care of the goods or that his failure to do so did not contribute to the damage.
Coopers Payen Limited v Southampton Container Terminal Limited	English Court of Appeal	Yes	[2004] 1 Lloyd’s Rep 331	England and Wales	Endorsed the view that it is not necessary for a bailee to show what caused the loss or damage, but simply that he took reasonable care of the goods or that his failure to do so did not contribute to the damage.
Bullen v The Swan Electric Engraving Company	N/A	Yes	[1887] 23 T.L.R. 258	N/A	Cited as authority that it is not necessary in order to avoid liability for breach of duty for a bailee to show what caused the loss or damage.
Glebe Island Terminals Pty Ltd v Continental Seagram Pty Ltd (The “Antwerpen”)	Supreme Court of New South Wales	Yes	[1994] 1 Lloyd’s Rep 213	Australia	Cited as a case that generated controversy regarding the burden of proof with respect to fundamental breach in the context of exception clauses.

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

Bailment
Carrier
Hijack
Events beyond our control clause
Airway bill
Standard operating procedure
Fundamental breach
Duty of care

15.2 Keywords

Bailment
Federal Express
Sun Technosystems
Hijacking
Carrier
Singapore
Contract Law

17. Areas of Law

Area Name	Relevance Score
Bailment	90
Contract Law	70
Breach of Contract	50
Contractual terms	30
Interpretation of contractual terms	30
Estoppel	10

16. Subjects

Bailment
Contract Law
Transportation Law