S E Shipping Lines v Austral Asia Line: Winding-Up Application Dispute

S E Shipping Lines Pte Ltd sought a declaration and injunction against Austral Asia Line Pte Ltd to prevent the latter from filing a winding-up application in the High Court of Singapore. The application arose from a dispute over unpaid freight for the charter of the vessel “AAL Shanghai”. Choo Han Teck J dismissed the application, finding no basis to conclude that Austral Asia Line would be abusing the process of court by commencing winding-up proceedings.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Application dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

S E Shipping Lines sought to prevent Austral Asia Line from filing a winding-up application. The court dismissed the application, finding no abuse of process.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
S E Shipping Lines Pte LtdPlaintiffCorporationApplication dismissedLostGovindarajalu Asokan
Austral Asia Line Pte LtdDefendantCorporationApplication dismissedWonKenneth Tan, Bazul Ashhab bin Abdul Kader, Mabel Leong Qing Jing, Ang Kai Li

3. Judges

Judge NameTitleDelivered Judgment
Choo Han TeckJYes

4. Counsels

Counsel NameOrganization
Govindarajalu AsokanRHTLaw Taylor Wessing LLP
Kenneth TanOon & Bazul LLP
Bazul Ashhab bin Abdul KaderOon & Bazul LLP
Mabel Leong Qing JingOon & Bazul LLP
Ang Kai LiOon & Bazul LLP

4. Facts

  1. The plaintiff chartered the vessel “AAL Shanghai” from the defendant.
  2. The plaintiff failed to pay freight to the defendant.
  3. The defendant demanded repayment of outstanding freight in excess of USD 2 million.
  4. The defendant threatened to wind up the plaintiff if payment was not made.
  5. The plaintiff's offer to pay the freight had been conditional and remains unfulfilled.
  6. The defendant exercised its lien over the cargo onboard AAL Shanghai.
  7. The defendant commenced a suit against SEL and SEEBL in Brazil.

5. Formal Citations

  1. S E Shipping Lines Pte Ltd v Austral Asia Line Pte Ltd, Originating Summons No 638 of 2012, [2012] SGHC 220

6. Timeline

DateEvent
Defendant's solicitors demanded repayment of outstanding freight.
Judgment reserved
Application dismissed

7. Legal Issues

  1. Abuse of Process
    • Outcome: The court found no basis to conclude that the defendant would be abusing the process of court by commencing winding-up proceedings.
    • Category: Substantive
    • Related Cases:
      • [2007] 2 SLR(R) 268
  2. Winding-Up
    • Outcome: The court determined that the plaintiff was entitled to challenge the winding-up petition and it lies in the jurisdiction of the winding-up court to determine whether there was any merit in the petition.
    • Category: Substantive

8. Remedies Sought

  1. Declaration
  2. Injunction

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Commercial Litigation
  • Shipping Litigation

11. Industries

  • Shipping

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Metalform Asia Pte Ltd v Holland Leedon Pte LtdHigh CourtYes[2007] 2 SLR(R) 268SingaporeCited for the principle that an injunction will be granted if the debtor is able to show that it is likely that a winding-up order would not be made if a winding-up petition is presented.
Denmark Skibstekniske Konsulenter A/S I Likvidation (formerly known as Knud E Hansen A/S) v Ultrapolis 3000 Investments Ltd (formerly known as Ultrapolis 3000 Theme Park Investments Ltd)High CourtYes[2011] 4 SLR 997SingaporeCited for the principle that a debtor asserting a genuine and substantial cross-claim must do more than merely assert the fact that a cross-claim exists.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Companies Act (Cap 50, 2006 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Winding-up
  • Charterparty
  • Freight
  • Lien
  • Abuse of process
  • Cross-claims

15.2 Keywords

  • shipping
  • winding up
  • freight
  • charterparty
  • injunction

16. Subjects

  • Shipping Dispute
  • Winding-Up Application

17. Areas of Law

  • Shipping Law
  • Civil Procedure
  • Injunctions
  • Winding-Up