Phillips 66 v Star Quest: Bills of Lading & Title in Bunker Supply Contracts after OW Bunker Insolvency

1. Case Overview

2. Parties and Outcomes

3. Judges

4. Counsels

4. Facts

1. Phillips 66 sold marine fuel oil to OW Far East and Dynamic Oil.
2. The bunkers were shipped onboard the respondents’ vessels.
3. Vopak bills of lading were issued naming Phillips 66 as the shipper.
4. The bunkers were loaded not for the Vessels’ own use but as cargoes for onward delivery to other vessels.
5. The bunkers were delivered onwards without production of the Vopak bills of lading.
6. OW Bunker and its subsidiaries became insolvent.
7. Phillips 66 demanded delivery of the bunkers from the respondents.

5. Formal Citations

1. The “Star Quest” and others, Admiralty in Rem Nos 228–232; 235 of 2014 (Registrar’s Appeals Nos 53–58 of 2016), [2016] SGHC 100

6. Timeline

7. Legal Issues

1. Nature of Vopak Bills of Lading
   • Outcome: The court found that there was an uncomfortable degree of uncertainty over the purpose, and hence function, of the Vopak bills of lading, and granted unconditional leave to defend.
   • Category: Substantive
   • Sub-Issues:
     • Whether the Vopak bills of lading operated as documents of title
     • Whether the Vopak bills of lading operated as contractual documents
     • Whether the Vopak bills of lading were merely acknowledgments of receipt of bunkers
   • Related Cases:
     • [1959] AC 576
     • [2005] 2 AC 423
2. Breach of Contract
   • Outcome: The court found that the respondents had an arguable defence that the Vopak bills of lading were not intended to operate as either contractual documents or documents of title, and granted unconditional leave to defend.
   • Category: Substantive
   • Sub-Issues:
     • Delivery of bunkers without production of bills of lading
   • Related Cases:
     • [1959] AC 576
3. Breach of Bailment
   • Outcome: The court found that possessory interest had arguably passed to the Buyers upon loading, and granted unconditional leave to defend.
   • Category: Substantive
   • Sub-Issues:
     • Possession of bunkers
     • Right to immediate possession
4. Conversion
   • Outcome: The court found that possessory interest had arguably passed to the Buyers upon loading, and granted unconditional leave to defend.
   • Category: Substantive
   • Sub-Issues:
     • Possession of bunkers
     • Right to immediate possession
5. Estoppel
   • Outcome: The court found that this was a bona fide defence which ought to be fully canvassed at trial as it gives rise to triable issues concerning the circumstances surrounding these previous shipments, and the parties’ intentions when they were carried out.
   • Category: Substantive
   • Sub-Issues:
     • Estoppel by acquiescence
6. Custom of the Local Bunker Industry
   • Outcome: The court noted that it is unlikely that the term requiring delivery only against the bill of lading can be overcome by the force of custom simply on the basis that it is “implied”.
   • Category: Substantive
   • Sub-Issues:
     • Whether there is a custom in Singapore and Malaysia that no bills of lading are presented, or required, in exchange for the supply of bunkers by bunker barges to other vessels.
7. Want of Authority
   • Outcome: The court found that the defence of lack of authority is unarguable.
   • Category: Substantive
   • Sub-Issues:
     • Whether the Vopak bills of lading were signed without authority.

8. Remedies Sought

1. Delivery of the bunkers
2. Monetary damages

9. Cause of Actions

• Breach of Contract
• Breach of Bailment
• Conversion

10. Practice Areas

• Admiralty
• Commercial Litigation
• Shipping
• Bunker Supply

11. Industries

• Shipping

12. Cited Cases

13. Applicable Rules

14. Applicable Statutes

15. Key Terms and Keywords

17. Areas of Law

16. Subjects

• Admiralty
• Shipping
• Bills of Lading
• Contract Law
• Bunker Supply