Big Port Service DMCC v Xin Chang Shu: Wrongful Arrest & Agency in Bunker Supply

In Big Port Service DMCC v Xin Chang Shu, the Singapore High Court addressed the issue of wrongful arrest in an admiralty claim. Big Port Service DMCC, the plaintiff, arrested the vessel Xin Chang Shu, owned by the defendant, based on an alleged contract for bunker fuel supply. The plaintiff claimed OW Singapore acted as the defendant's agent. The court, presided over by Justice Steven Chong, found the arrest wrongful due to a lack of reasonable cause of action and material non-disclosure by the plaintiff. The court allowed the defendant's appeal, set aside the warrant of arrest, and ordered the plaintiff to pay damages for the wrongful arrest.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Defendant's appeal allowed. The warrant of arrest is set aside and the plaintiff is ordered to pay the defendant damages to be assessed for the wrongful arrest of the Vessel from 2014-12-10 to 2014-12-12.

1.3 Case Type

Admiralty

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Singapore High Court finds Big Port Service DMCC liable for wrongful arrest of the Xin Chang Shu due to a factually and legally misconceived claim.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Big Port Service DMCCPlaintiff, RespondentCorporationAppeal DismissedLost
Big Port Service DMCC — Owner of the vessel(s) "Xin Chang Shu"Defendant, AppellantCorporationAppeal AllowedWon

3. Judges

Judge NameTitleDelivered Judgment
Steven ChongJusticeYes

4. Counsels

Counsel NameOrganization
Lawrence TehRodyk & Davidson LLP
Khoo Eu ShenRodyk & Davidson LLP
Toh Kian SingRajah & Tann Singapore LLP
Tan Yong Jin JonathanRajah & Tann Singapore LLP
Koh See BinRajah & Tann Singapore LLP

4. Facts

  1. Plaintiff commenced admiralty proceedings against the defendant claiming US$1,768,000 for bunker fuel supply.
  2. Plaintiff claimed OW Singapore was the defendant’s agent and entered into the contract on the defendant’s behalf.
  3. Defendant informed the plaintiff that OW Singapore was not its agent and it contracted with OW China.
  4. Plaintiff obtained a warrant of arrest and arrested the vessel on 2014-12-10.
  5. Defendant furnished security of US$2.6 million to release the vessel on 2014-12-12.
  6. Plaintiff relied on its General Terms and Conditions to support its claim that OW Singapore acted as the defendant’s agent.
  7. Plaintiff alleged OW Singapore supplied commercial details, giving the appearance it was authorized to conclude the contract.

5. Formal Citations

  1. The “Xin Chang Shu”, Admiralty in Rem No 239 of 2014 (Registrar's Appeal No 226 of 2015), [2015] SGHC 308

6. Timeline

DateEvent
Plaintiff issued Bunker Sales Confirmation
OW China and defendant entered into contract
OW Singapore and OW China entered into agreement
Contract dated between OW Singapore and plaintiff
Supply of bunkers to the Vessel
Supply of bunkers to the Vessel
Announcement of insolvency of OW Bunker Trading A/S
Plaintiff sent letter of demand to the defendant
Commencement of winding up proceedings against OW Singapore
Plaintiff's solicitors wrote to the defendant alleging agency
Plaintiff's solicitors reiterated the agency claim
Defendant's Singapore solicitors wrote to plaintiff's solicitors
Defendant's English solicitors wrote to plaintiff's solicitors
Plaintiff filed arrest affidavit
Plaintiff obtained warrant of arrest
Vessel arrested
Vessel released after security furnished
Plaintiff filed Summons No 6218 of 2014 for stay of proceedings
Defendant applied to strike out proceedings, set aside warrant of arrest, and for damages for wrongful arrest
Appeal hearing
Judgment reserved

7. Legal Issues

  1. Wrongful Arrest
    • Outcome: The court found that the arrest was wrongful due to a lack of reasonable cause of action and material non-disclosure, implying malice on the part of the plaintiff.
    • Category: Substantive
    • Sub-Issues:
      • Malice
      • Material Non-Disclosure
      • Lack of Reasonable Cause of Action
    • Related Cases:
      • [2015] SGHCR 17
      • (1858) 12 Moo PC 352; 14 ER 945
      • [2008] 4 SLR(R) 994
      • [1999] 3 SLR(R) 664
  2. Agency
    • Outcome: The court held that OW Singapore did not act as the defendant's agent, and the plaintiff's reliance on its own General Terms and Conditions to establish agency was legally misconceived.
    • Category: Substantive
    • Sub-Issues:
      • Authority of Agent
      • Representation of Agency
      • Self-Authorizing Agent
    • Related Cases:
      • [2011] 3 SLR 540
  3. Material Non-Disclosure
    • Outcome: The court found that the plaintiff failed to sufficiently disclose the defenses available to the defendant and misrepresented key facts in the arrest affidavit.
    • Category: Procedural
    • Sub-Issues:
      • Duty of Disclosure
      • Plausible Defenses
      • Relevance of Arbitration Agreement
    • Related Cases:
      • [2008] 4 SLR(R) 994
      • [2010] 3 SLR 294
      • [2012] 4 SLR 546

8. Remedies Sought

  1. Damages for Wrongful Arrest
  2. Setting Aside Warrant of Arrest
  3. Striking Out Proceedings

9. Cause of Actions

  • Wrongful Arrest
  • Breach of Contract

10. Practice Areas

  • Admiralty Litigation
  • Wrongful Arrest
  • Commercial Litigation
  • Arbitration

11. Industries

  • Shipping
  • Bunker Fuel Supply

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
The “Xin Chang Shu”High CourtYes[2015] SGHCR 17SingaporeRefers to the Assistant Registrar's judgment in the case.
Yongnam Development Pte Ltd v Somerset Development Pte LtdCourt of AppealYes[2004] SGCA 35SingaporeCited for the principle of estoppel by representation, requiring awareness of mistaken belief for acquiescence.
Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd and another and another appealCourt of AppealYes[2011] 3 SLR 540SingaporeCited for the principle that an agent cannot confer authority upon himself by representing that he has such authority.
Egyptian International Foreign Trade Co v Soplex Wholesale Supplies Ltd and PS Refson & Co Ltd (The “Raffaella”)UnknownYes[1985] 2 Lloyd’s Rep 36UnknownAddressed the exception to the self-authorising agent rule, but found to be inapplicable in this case.
First Energy (UK) Ltd v Hungarian International Bank LtdUnknownYes[1993] 2 Lloyd’s Rep 194UnknownAddressed the exception to the self-authorising agent rule, but found to be inapplicable in this case.
The Dilmun FulmarHigh CourtYes[2004] 1 SLR(R) 140SingaporeCited as an example where damages for wrongful arrest were awarded.
The “Inai Selasih” (ex “Geopotes X”)High CourtYes[2005] 4 SLR(R) 1SingaporeCited as an example where damages for wrongful arrest were awarded, but reversed on appeal.
The “Inai Selasih” (ex “Geopotes X”)Court of AppealYes[2006] 2 SLR(R) 181SingaporeCited as an example where the award of damages for wrongful arrest was reversed on appeal.
The “Vasiliy Golovnin”High CourtYes[2008] 4 SLR(R) 994SingaporeExtensively cited for principles governing wrongful arrest, including the test for malice and material non-disclosure.
The “Evmar”High CourtYes[1989] 1 SLR(R) 433SingaporeDiscusses whether a warrant of arrest must be set aside before damages for wrongful arrest may be awarded and the disclosure of arbitration clauses.
Treasure Valley Group Ltd v Saputra Teddy and another (Ultramarine Holdings Ltd, intervener)High CourtYes[2006] 1 SLR(R) 358SingaporeDiscusses whether a warrant of arrest must be set aside before damages for wrongful arrest may be awarded.
Fal Energy Company Limited v Owners of the Ship or Vessel “Kiku Pacific”High CourtYes[1998] SGHC 370SingaporeCited as an example where a claim for wrongful arrest was pursued as a counterclaim at trial.
The “Kiku Pacific”Court of AppealYes[1999] 2 SLR(R) 91SingaporeAffirmed the High Court's decision in The Kiku Pacific (HC) without commenting on the propriety of awarding damages for wrongful arrest where the warrant of arrest was not expressly set aside.
The “Trade Resolve”High CourtYes[1999] 2 SLR(R) 107SingaporeCited as an example where damages for wrongful arrest were awarded even though the in rem writ and warrant of arrest were both validly issued.
The EvangelismosPrivy CouncilYes(1858) 12 Moo PC 352; 14 ER 945United KingdomSets out the long-standing test for wrongful arrest, focusing on mala fides or gross negligence implying malice.
The “Catur Samudra”High CourtYes[2010] 2 SLR 518SingaporeIllustrates that damages for wrongful arrest are not always awarded when the writ is struck out.
The Eagle PrestigeHigh CourtYes[2010] 3 SLR 294SingaporeDiscusses the scope of the duty to disclose 'plausible defences' and the test of materiality for non-disclosure.
The “Bunga Melati 5”Court of AppealYes[2012] 4 SLR 546SingaporeConfirms that The Vasiliy Golovnin did not introduce a new merits requirement for invoking admiralty jurisdiction.
The “Damavand”High CourtYes[1993] 2 SLR(R) 136SingaporeSummarizes the test of materiality for non-disclosure.
The “Fierbinti”High CourtYes[1994] 3 SLR(R) 574SingaporeCited regarding the court's 'overriding discretion' not to set aside the warrant of arrest.
The “AA V”High CourtYes[1999] 3 SLR(R) 664SingaporeCited as an example where damages were awarded for wrongful arrest under similar circumstances.
The “Halcyon Isle”Court of AppealYes[1979–1980] SLR(R) 538SingaporeCited for the principle that a lien for necessaries is not recognised under Singapore law.
The Rena KUnknownYes[1978] 1 Lloyd’s Rep 545UnknownCited for the common law requirement that the arresting party must prove that the defendant would not be able to satisfy any eventual arbitration award.
The Andria now renamed VassoUnknownYes[1984] 2 WLR 570UnknownCited for the previous common law position regarding the court's jurisdiction to arrest a ship.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
International Arbitration Act (Cap 143A, 2002 Rev Ed)Singapore
High Court Admiralty Jurisdiction Act (Cap 123, 2001 Rev Ed)Singapore
Rules of Court (Cap 322, R 5, 2014 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Wrongful Arrest
  • Agency
  • Material Non-Disclosure
  • Bunker Supply
  • Admiralty in Rem
  • Warrant of Arrest
  • General Terms and Conditions
  • OW Singapore
  • OW China
  • Malice
  • Reasonable Cause of Action

15.2 Keywords

  • wrongful arrest
  • admiralty
  • agency
  • bunker supply
  • material non-disclosure
  • Singapore
  • High Court

17. Areas of Law

Area NameRelevance Score
Wrongful arrest95
Admiralty and Maritime Law90
Shipping Law70
Duty of Candour50
Breach of Contract40
Contract Law40
Misrepresentation30
Arbitration30
Fraud and Deceit30
Evidence20
Wrongful Death10

16. Subjects

  • Admiralty
  • Shipping
  • Agency
  • Civil Procedure
  • Arbitration