BCBC Singapore v PT Bayan: Breach of Contract & Remedies in Joint Venture Coal Briquetting Project
In BCBC Singapore Pte Ltd and another v PT Bayan Resources TBK and another, the Singapore International Commercial Court addressed disputes arising from a joint venture between BCBC Singapore and PT Bayan Resources to upgrade sub-bituminous coal into briquettes. The court found that PT Bayan Resources repudiated the Joint Venture Deed, which BCBC Singapore accepted, bringing the joint venture to an end. The court determined that a third tranche of proceedings was necessary to determine the quantum of damages.
1. Case Overview
1.1 Court
SINGAPORE INTERNATIONAL COMMERCIAL COURT1.2 Outcome
Judgment for Plaintiffs in part. The court found that the Defendant repudiated the Joint Venture Deed.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case between BCBC Singapore and PT Bayan Resources concerning breach of contract and remedies in a joint venture.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| BCBC Singapore Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff in part | Partial | |
| Binderless Coal Briquetting Company Pty Limited | Plaintiff | Corporation | Judgment for Plaintiff in part | Partial | |
| PT Bayan Resources TBK | Defendant | Corporation | Repudiated Joint Venture Deed | Lost | |
| Bayan International Pte Ltd | Defendant | Corporation | Repudiated Joint Venture Deed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Quentin Loh | Judge | Yes |
| Vivian Ramsey | International Judge | No |
| Anselmo Reyes | International Judge | No |
4. Counsels
4. Facts
- BCBC and PT Bayan entered into a joint venture to upgrade sub-bituminous coal into briquettes.
- The joint venture was governed by a JV Deed dated 7 June 2006.
- PT Bayan was to ensure the supply of coal to KSC, the joint venture company.
- PT Bayan instructed its subsidiaries to cease supplying coal to KSC on 9 November 2011.
- PT Bayan conditioned the supply of coal on BCBC buying out its 49% stake in KSC for US$45 million.
- PT Bayan issued a termination notice for the JV Deed on 21 February 2012.
- BCBC accepted PT Bayan's repudiation of the JV Deed on 2 March 2012.
5. Formal Citations
- BCBC Singapore Pte Ltd and another v PT Bayan Resources TBK and another, Suit No 1 of 2015, [2017] SGHC(I) 06
- BCBC Singapore Pte Ltd and another v PT Bayan Resources TBK and another, , [2016] 4 SLR 1
6. Timeline
| Date | Event |
|---|---|
| Joint Venture Deed signed | |
| Funding MOU dated | |
| PLFA backdated to | |
| HBA Regulations introduced | |
| HBA Regulations came into force | |
| 2010 CSAs backdated to | |
| PLFA signed | |
| Ms Trish O’Bryan seconded to KSC | |
| 2010 CSA amended | |
| Ms O’Bryan sent Mr McLeod an email which attached a cost report from KSC for the year ending March 2011 | |
| Ms Trish O’Bryan ended secondment to KSC | |
| Ms O’Bryan sent an email to Mr McLeod’s colleague which was forwarded to Mr McLeod on the same day | |
| November 2011 Board Meeting took place | |
| November 2011 Board Meeting took place | |
| Mr McLeod sent an email to Mr Maras and Mr Chapman | |
| KSC requested that Bara and FSP deliver “2,000 tons of coal” and received 2,030.21 tonnes | |
| KSC requested for “1,000 tons of coal” and received 1,035.88 tonnes | |
| KSC requested for 2,000 tons of coal and received 809.34 tonnes | |
| KSC requested to continue the delivery to TCUP | |
| KSC received 1,594.67 tonnes of coal from Bara and FSP | |
| KSC received 1,717.1 tonnes of coal from Bara and FSP | |
| Mr Neil emailed Mr Wong Chong Keong instructing Mr Wong not to supply any more coal to KSC | |
| Mr Reilly sent an email to Mr Wong | |
| Mr Duncan and Mr Flannery met Dato Low and Mr Chin at BR’s office in Jakarta | |
| Mr Todd Rollason emailed Geared Engineering to request that all KSC-related orders be cancelled | |
| BCBCS sent a letter to BR, accusing BR of breaching cll 3.8(b)(iii) – (iv), 17.1, 17.2, 17.3 and 20.5 of the JV Deed | |
| Mr Reilly sent an email to Mr Kruger and Mr Chapman | |
| BR replied to BCBCS’ letter of 21 November 2011 | |
| WEC responded to BR’s letter of 24 November 2011 on behalf of the WEC parties | |
| BR responded to WEC’s letter of 29 November 2011 | |
| KSC held an extraordinary shareholders’ meeting | |
| Mr Neil sent an email to Mr Wong | |
| WEC sent a letter to BR on behalf of the WEC parties | |
| BR replied to WEC’s letter of 12 December 2011 by a letter with the heading: “RE: DEFAULT NOTICE” | |
| The Tabang Plant was put into care and maintenance | |
| WEC sent another letter to BR on behalf of the WEC parties | |
| BCBC sent a letter to BI demanding that BI perform BR’s obligations | |
| BR replied to WEC’s letter of 20 December 2011 | |
| WEC sent a letter to BR on behalf of WEC and BCBCS to demand that BR withdraw BR’s Default Notice | |
| The Plaintiffs commenced this action against the Defendants | |
| The last day of the “Availability Period” under the PLFA expired | |
| BR sent a letter to BCBCS (“BR’s Termination Notice”) | |
| BCBCS replied to BR’s letter of 21 February 2012 stating that BR’s Termination Notice was “misconceived” | |
| Tranche 2 hearing | |
| Tranche 2 hearing | |
| Tranche 2 hearing | |
| Tranche 2 hearing | |
| Tranche 2 hearing | |
| Oral closing submissions from the parties | |
| Judgment reserved |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that the Defendant repudiated the Joint Venture Deed by wrongfully issuing a termination notice.
- Category: Substantive
- Sub-Issues:
- Repudiation
- Failure to supply coal
- Obligation to Supply Coal
- Outcome: The court found that the Defendant was in breach of its obligation to supply coal to the Plaintiff.
- Category: Substantive
- Sub-Issues:
- Interpretation of Coal Supply Agreements
- Conditions for coal supply
- Repudiation of Contract
- Outcome: The court found that the Defendant repudiated the Joint Venture Deed by wrongfully issuing a termination notice, which the Plaintiff accepted.
- Category: Substantive
- Sub-Issues:
- Renunciation of contract
- Wrongful termination
8. Remedies Sought
- Damages for breach of contract
- Damages for repudiation of contract
9. Cause of Actions
- Breach of Contract
- Repudiation of Contract
10. Practice Areas
- Commercial Litigation
- Breach of Contract
11. Industries
- Energy
- Mining
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| BCBC Singapore Pte Ltd and another v PT Bayan Resources TBK and another | Singapore International Commercial Court | Yes | [2016] 4 SLR 1 | Singapore | Sets out the background and facts surrounding the disputes in the first tranche of the trial. |
| BCBC Singapore Pte Ltd and another v PT Bayan Resources TBK and another | Singapore International Commercial Court | Yes | [2016] 5 LRC 186 | Singapore | Sets out the background and facts surrounding the disputes in the first tranche of the trial. |
| Lucky Realty Co Pte Ltd v HSBC Trustee (Singapore) Ltd | Court of Appeal | Yes | [2016] 1 SLR 1069 | Singapore | Cited as authority for the proposition that, in interpreting a contract, the text of the contract is the first port of call. |
| Alan Auld Associates Ltd v Rick Pollard Associates and Another | Not Available | Yes | [2008] BLR 419 | Not Available | Cited in relation to the remedy for a failure to pay under the 2010 CSAs. |
| Ioannis Valilas v Valdet Januzaj | Not Available | Yes | [2015] 1 All ER (Comm) 1047 | Not Available | Cited in relation to the remedy for a failure to pay under the 2010 CSAs. |
| Morton v Lamb | Not Available | Yes | (1797) 7 TR 125 | Not Available | Cited in relation to the buyer’s obligation to pay and a seller’s obligation to deliver goods are concurrent conditions. |
| The Aktor | Not Available | Yes | [2008] All ER (Comm) 784 | Not Available | Cited in relation to the buyer’s obligation to pay and a seller’s obligation to deliver goods are concurrent conditions. |
| Tan Jin Sin and another v Lim Quee Choo | Court of Appeal | Yes | [2009] 2 SLR(R) 938 | Singapore | Cited in relation to whether clauses concerned were “dependent” or “independent” obligations. |
| RDC Concrete Pte Ltd v Sato Kogyo (S) Pte Ltd and another appeal | Court of Appeal | Yes | [2007] 4 SLR(R) 413 | Singapore | Cited in relation to the test for a condition. |
| Man Financial (S) Pte Ltd (formerly known as E D & F Man International (S) Pte Ltd) v Wong Bark Chuan David | Court of Appeal | Yes | [2008] 1 SLR(R) 663 | Singapore | Cited in relation to the inquiry into ascertaining whether a contractual term is a condition. |
| Giles v Rhind | Not Available | Yes | [2003] Ch 618 | Not Available | Cited in relation to the exception to the reflective loss principle. |
| Townsing Henry George v Jenton Overseas Investment Pte Ltd (in liquidation) | Court of Appeal | Yes | [2007] 2 SLR(R) 597 | Singapore | Cited in relation to the principle of reflective loss. |
| Waddington Ltd v Chan Chun Hoo Thomas and others | Hong Kong Court of Final Appeal | Yes | [2009] 2 BCLC 82 | Hong Kong | Cited in relation to the law relating to reflective loss. |
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
- Joint Venture Deed
- Coal Supply Agreement
- Repudiation
- Termination Notice
- Coal Briquettes
- HBA Prices
- Funding MOU
- PLFA
- Commercial Production
- Care and Maintenance
15.2 Keywords
- breach of contract
- joint venture
- coal
- briquetting
- repudiation
- termination
- damages
- singapore
- commercial court
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Breach of Contract | 90 |
| Contract Law | 85 |
| Damages | 70 |
| Joint Venture Disputes | 60 |
| Arbitration | 30 |
| International Commercial Court Practice | 25 |
| Company Law | 20 |
16. Subjects
- Contract Law
- Joint Ventures
- Coal Industry
- Breach of Contract
- Remedies