Fairmacs Shipping v Harikutai: Conversion of River Sand & Damages Assessment
Fairmacs Shipping & Transport Services Pte Ltd (FSPL) sued Harikutai Engineering Pte Ltd (D1) and Marco Polo Shipping Company Pte Ltd (D2) in the High Court of Singapore for conversion of a consignment of river sand. FSPL appealed the Assistant Registrar's decision on the quantum of damages. Belinda Ang Saw Ean J allowed FSPL's appeal, awarding US$141,226 with interest, based on the market value of the river sand at Port Blair, the intended destination, less deductions for customs duty, landing charges, and unpaid freight. D2's appeal against this decision is pending.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal Allowed
1.3 Case Type
Admiralty
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding damages for conversion of river sand. The court allowed the appeal, awarding US$141,226 based on market value at delivery.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Fairmacs Shipping & Transport Services Pte Ltd | Plaintiff, Appellant | Corporation | Appeal allowed | Won | Joseph Tan, Joanna Poh |
| Harikutai Engineering Pte Ltd | Defendant | Corporation | Damages to be assessed | Lost | |
| Marco Polo Shipping Company Pte Ltd | Defendant, Respondent | Corporation | Appeal dismissed | Lost | Mathiew Christophe Rajoo, Andrew Tow |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Belinda Ang Saw Ean | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Joseph Tan | Legal Solutions LLC |
| Joanna Poh | Legal Solutions LLC |
| Mathiew Christophe Rajoo | M/s DennisMathiew |
| Andrew Tow | M/s DennisMathiew |
4. Facts
- FSPL agreed to purchase river sand from Marine Alliance Group on CNF terms.
- The action concerned the second shipment of 4,300 mt of river sand to Port Blair.
- D2's barge, Bina Marine 36, was to carry the cargo, but it did not arrive at Port Blair.
- FSPL was not aware that the cargo had been sold until D2 applied for security for costs.
- D2 sold the cargo due to D1's default in charter hire payment.
- FSPL sought damages based on the market price of river sand at Port Blair.
- The Assistant Registrar assessed damages based on the cost incurred by FSPL.
5. Formal Citations
- Fairmacs Shipping & Transport Services Pte Ltd v Harikutai Engineering Pte Ltd and another, Admiralty in Personam No 324 of 2011 (Registrar's Appeal No 290 of 2013), [2014] SGHC 262
6. Timeline
| Date | Event |
|---|---|
| Contract of sale signed for river sand purchase | |
| Bill of lading issued for the second shipment | |
| Expected date of discharge at Port Blair | |
| FSPL made inquiries about the cargo | |
| FSPL's solicitors demanded delivery of the cargo | |
| Action commenced by FSPL | |
| D2 applied for security for costs | |
| Mr Azhari's second affidavit filed | |
| FSPL filed for summary judgment | |
| FSPL obtained interlocutory judgment | |
| Appeal on liability dismissed | |
| Assessment of damages before the AR | |
| Notes of Evidence | |
| Hearing concluded, FSPL's appeal allowed | |
| Grounds of decision given |
7. Legal Issues
- Measure of Damages for Conversion
- Outcome: The court held that the proper measure of damages was the market value of the goods at the place of delivery, less deductions for customs duty, landing charges, and unpaid freight.
- Category: Substantive
- Sub-Issues:
- Market value at the time and place of conversion
- Ascertaining market value
- Replacement cost as an alternative measure
- Deductions from market value
- Related Cases:
- [1934] P 189
- [1998] 2 SLR(R) 1010
- (1849) 7CB 797
- [1985-1986] SLR(R) 448
- Existence of a Market
- Outcome: The court found that a market for river sand existed at Port Blair, despite the absence of a market price index and the time required for delivery.
- Category: Substantive
- Sub-Issues:
- Availability of willing buyers and sellers
- Absence of market price index
- Time required for delivery
- Related Cases:
- [1998] 3 SLR (R) 970
- [1937] 3 All ER 620
- [1968] 1 AC 1130
- Mitigation of Damages
- Outcome: The court dismissed the defendant's submissions on mitigation, as it was not properly pleaded and the defendant had kept the plaintiff in the dark about the sale of the cargo.
- Category: Substantive
- Sub-Issues:
- Failure to purchase equivalent volume of river sand
- Reasonableness of actions after conversion
- Pleading and proving mitigation
- Related Cases:
- [1998] 3 SLR (R) 970
- [2004] 3 SLR(R) 288
8. Remedies Sought
- Delivery up of cargo
- Monetary Damages
9. Cause of Actions
- Conversion
10. Practice Areas
- Commercial Litigation
- Shipping Litigation
- Admiralty
- Civil Litigation
11. Industries
- Shipping
- Commodities Trading
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| The Arpad | English Court of Appeal | Yes | [1934] P 189 | England and Wales | Cited for the principle that market value is the best evidence of the converted goods' value. |
| Chartered Electronics Industries Pte Ltd v Comtech IT Pte Ltd | Court of Appeal | Yes | [1998] 2 SLR(R) 1010 | Singapore | Cited for the use of market value as a way of calculating the value of goods converted and alternative ways to calculate the value of the goods where there was no market for the goods converted. |
| Mohammed Idris Jabir v H A Jordan & Co Ltd | English High Court | No | [2010] EWHC 3465 | England and Wales | Cited to illustrate that the market in rare and costly pearls was small and ultimate purchasers would be individuals both rich and discreet. |
| France v Gaudet | Queen's Bench | No | (1871) 6 QB 199 | England and Wales | Cited to illustrate a case where the plaintiff had agreed to sell champagne that could not be replaced because the champagne of like quality and description could not have been purchased in the market to enable the plaintiff to fulfil his contract. |
| Ewbank v Nutting | N/A | No | (1849) 7CB 797 | England and Wales | Cited by the defendant to support the argument that the cost price of the goods and the freight paid should be used to value the cargo. |
| The “Jag Shakti” | Privy Council | Yes | [1985-1986] SLR(R) 448 | United Kingdom | Cited for the principle that the proper measure of damages is the full market value of the goods at the time when and the place where possession of them should have been given. |
| The Endurance 1 | Court of Appeal | No | [1998] 3 SLR (R) 970 | Singapore | Cited to support a finding that there was no market for river sand in this case and that evidence must be led to show that no market existed at the relevant time and place. |
| J & E Hall Ltd v Barclay | N/A | No | [1937] 3 All ER 620 | England and Wales | Cited to support the argument that the goods have to be “readily” available. |
| Garnac Grain Company Incorporated v HMF Faure & Fairclough Ltd and others | House of Lords | No | [1968] 1 AC 1130 | United Kingdom | Cited to show that the goods in question need not be purchased immediately or delivered immediately and that immediate delivery was not a necessary condition for establishing a market. |
| Biggin & Co Ld v Permanite, Ld | N/A | Yes | [1951] 1 KB 422 | England and Wales | Cited for the principle that where precise evidence of the value of goods converted are obtainable, the court naturally expects to have it, but where it is not the court must do the best it can. |
| Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd and another | N/A | Yes | [2008] 2 SLR(R) 623 | Singapore | Cited for the principle that where precise evidence is obtainable, the court naturally expects to have it. Where it is not, the court must do the best it can. |
| Yip Holdings Ltd v Asia Link Marine Industries Pte Ltd | N/A | Yes | [2012] 1 SLR 131 | Singapore | Cited for the principle that the court can take into consideration if there is no meaningful market value. |
| Fairfax Gerrard Holdings Ltd v Capital Bank plc | N/A | No | [2007] 1 Lloyd’s Rep 171 | England and Wales | Cited by the defendant to support the proposition that a value closer to the cost price of the cargo should be adopted. |
| Chua Keng Mong v Hong Realty Pte Ltd | N/A | No | [1993] 3 SLR (R) 317 | Singapore | Cited by the defendant to support the argument that the cost of replacement of the goods lost should be awarded. |
| Schindler Lifts (Singapore) Pte Ltd v People’s Park Chinatown Development Pte Ltd (in liquidation) | N/A | Yes | [1990] 1 SLR(R) 583 | Singapore | Cited for the proposition that where a man takes goods to which he has no right and sells them, the owner may waive the tort of conversion, and recover the price for which they were sold in an indebitatus assumpsit for money had and received. |
| United Australia Ltd v Barclays Bank Ltd | House of Lords | Yes | [1941] 1 AC 1 | United Kingdom | Cited for the principle that the waiver of tort doctrine enabled recovery of the sale proceeds as a choice of two remedies against the wrongdoer in the context of proprietary torts. |
| Jia Min Building Construction Pte Ltd v Ann Lee Pte Ltd | N/A | Yes | [2004] 3 SLR(R) 288 | Singapore | Cited for the established procedural rule that an assertion that the plaintiff had failed to mitigate its loss must be pleaded and proved by the defendant relying on it. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Sale of Goods Act (Cap 393, 1999 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- River sand
- Conversion
- Market value
- Damages assessment
- Bill of lading
- Charter hire
- Mitigation of damages
- Port Blair
- Consignment
- Freight
15.2 Keywords
- Admiralty
- Shipping
- Conversion
- Damages
- River Sand
- Singapore
16. Subjects
- Admiralty
- Shipping
- Torts
- Damages
17. Areas of Law
- Admiralty Law
- Tort Law
- Contract Law
- Shipping Law
- Conversion