Vinmar v PTT: Exclusive Jurisdiction Clauses, Incorporation by Dealings, and Stay of Proceedings
In Vinmar Overseas (Singapore) Pte Ltd v PTT International Trading Pte Ltd, the Singapore Court of Appeal addressed the issue of whether to grant a stay of proceedings based on an exclusive jurisdiction clause (EJC). Vinmar appealed against the High Court's decision to dismiss its application for a stay in favor of the English High Court. The Court of Appeal, with Sundaresh Menon CJ, Andrew Phang Boon Leong JA, Judith Prakash JA, Tay Yong Kwang JA and Steven Chong JA presiding, allowed the appeal. The court found that there was a good arguable case that the EJC was incorporated by the parties’ course of dealings into the contract and that there was no strong cause to refuse a stay. The court departed from previous decisions, ruling that the merits of a defence are irrelevant in determining whether to grant a stay in an EJC application.
1. Case Overview
1.1 Court
Court of Appeal1.2 Outcome
Appeal Allowed
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore Court of Appeal clarifies the enforcement of exclusive jurisdiction clauses, emphasizing party autonomy and incorporation by dealings.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Vinmar Overseas (Singapore) Pte Ltd | Appellant | Corporation | Appeal Allowed | Won | |
| PTT International Trading Pte Ltd | Respondent | Corporation | Appeal Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Sundaresh Menon | Chief Justice | No |
| Andrew Phang Boon Leong | Judge of Appeal | No |
| Judith Prakash | Judge of Appeal | No |
| Tay Yong Kwang | Judge of Appeal | No |
| Steven Chong | Judge of Appeal | Yes |
4. Counsels
4. Facts
- Vinmar and PTT entered into four contracts between December 2013 and October 2014.
- The Four Contracts contained an exclusive jurisdiction clause (EJC) in favor of the English High Court.
- In November 2014, Vinmar and PTT negotiated a contract for the sale of styrene monomer.
- PTT sent Vinmar a draft contract (Written Terms) containing the EJC.
- Vinmar purported to terminate the contract, alleging PTT's failure to load the cargo by a specified date.
- PTT commenced Suit 99 in Singapore, claiming Vinmar repudiated the contract.
- Vinmar applied for a stay of Suit 99 based on the EJC.
5. Formal Citations
- Vinmar Overseas (Singapore) Pte Ltd v PTT International Trading Pte Ltd, Civil Appeal No 159 of 2017, [2018] SGCA 65
6. Timeline
| Date | Event |
|---|---|
| Vinmar entered into four contracts to purchase chemical commodities from PTT and PTT Public. | |
| The fourth contract was made for the purchase of styrene monomer. | |
| Mr. Sumit Verma of Vinmar met Mr. Bhuvarahan Krishnan of PTT to discuss terms for Vinmar to purchase styrene monomer from PTT. | |
| Mr. Krishnan sent an email to Mr. Verma setting out key terms. | |
| PTT nominated the SC Shenzhen as the vessel to ship the Cargo. | |
| PTT sent an email to Vinmar enclosing a “Styrene Monomer Spot Supply Agreement”. | |
| Vinmar informed PTT that its sub-purchaser, Visen, had rejected the Cargo. | |
| Vinmar stated conditions for shipment and pricing. | |
| PTT rejected Vinmar’s proposed conditions. | |
| PTT nominated a new vessel, the Sea Charming. | |
| The Sea Charming arrived at the port of loading. | |
| Vinmar purported to terminate the Contract. | |
| PTT rejected the Termination Notice. | |
| Vinmar reiterated that it had terminated the Contract. | |
| PTT demanded Vinmar to pay US$1,225,366.21. | |
| Vinmar stated that it had properly terminated the Contract. | |
| PTT challenged Vinmar’s reply. | |
| PTT again demanded that Vinmar pay its claim. | |
| PTT repeated its demand for US$1,225,366.21 from Vinmar. | |
| PTT commenced Suit 99 against Vinmar. | |
| Vinmar applied for a stay of Suit 99. | |
| Judgment reserved. | |
| Judgment delivered. |
7. Legal Issues
- Enforcement of Exclusive Jurisdiction Clause
- Outcome: The court held that the merits of the defence are irrelevant in determining whether to grant a stay in an EJC Application.
- Category: Substantive
- Sub-Issues:
- Incorporation of clause by course of dealings
- Relevance of merits of defence
- Incorporation of Contractual Terms by Course of Dealings
- Outcome: The court found that there was a good arguable case that the EJC was incorporated by the parties’ course of dealings into the Contract.
- Category: Substantive
- Sub-Issues:
- Number of previous contracts
- Similarity of subject matter
- Consistency of manner of contracting
8. Remedies Sought
- Stay of Proceedings
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Repudiation of Contract
10. Practice Areas
- Commercial Litigation
- International Trade
11. Industries
- Chemicals
- Commodities Trading
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| The Jian He | Singapore Court of Appeal | Yes | [1999] 3 SLR(R) 432 | Singapore | Cited as previous decision where the court held that the merits of a defence, or lack thereof, are relevant in deciding whether proceedings should be stayed to give effect to an exclusive jurisdiction clause, which the present court departs from. |
| The Hung Vuong-2 | Singapore Court of Appeal | Yes | [2000] 2 SLR(R) 11 | Singapore | Cited as previous decision where the court held that the merits of a defence, or lack thereof, are relevant in deciding whether proceedings should be stayed to give effect to an exclusive jurisdiction clause, which the present court departs from. |
| Bradley Lomas Electrolok Ltd and another v Colt Ventilation East Asia Pte Ltd and others | Singapore Court of Appeal | Yes | [1999] 3 SLR(R) 1156 | Singapore | Cited for the definition of 'good arguable case' in the context of service of originating process out of jurisdiction. |
| Canada Trust Co and Others v Stolzenberg and Others (No 2) | England and Wales Court of Appeal (Civil Division) | Yes | [1998] 1 WLR 547 | England and Wales | Cited for the 'much better argument' formulation of the 'good arguable case' test, which the court rejects. |
| Bols Distilleries BV (trading as Bols Royal Distilleries) and another v Superior Yacht Services Ltd | Privy Council | Yes | [2007] 1 WLR 12 | United Kingdom | Cited as a case where the Privy Council adopted and applied the Canada Trust gloss in holding that a party who sought to rely on an alleged jurisdiction agreement had not shown a good arguable case that it existed. |
| Joint Stock Company “Aeroflot Russian Airlines” v Berezovsky | England and Wales Court of Appeal (Civil Division) | Yes | [2013] 2 Lloyd’s Rep 242 | England and Wales | Cited as a case where the English Court of Appeal rejected the Canada Trust gloss in favour of “the better of the argument” formulation. |
| SIAT Di Del Ferro v Tradax Overseas SA | England and Wales High Court (Commercial Court) | Yes | [1978] 2 Lloyd’s Rep 470 | England and Wales | Cited for the principle that a court may consider transactions with a different company in the same group of companies in determining if terms were incorporated into the contract with the instant counterparty. |
| SIAT Di Dal Ferro v Tradax Overseas SA | England and Wales Court of Appeal (Civil Division) | Yes | [1980] 1 Lloyd’s Rep 53 | England and Wales | Cited for affirming the principle that a court may consider transactions with a different company in the same group of companies in determining if terms were incorporated into the contract with the instant counterparty. |
| Lisnave Estaleiros Navais SA v Chemikalien Seetransport GmbH | England and Wales High Court (Commercial Court) | Yes | [2013] 2 Lloyd’s Rep 203 | England and Wales | Cited for affirming the principle that a court may consider transactions with a different company in the same group of companies in determining if terms were incorporated into the contract with the instant counterparty. |
| Capes (Hatherden) Ltd v Western Arable Services Ltd | England and Wales High Court (Commercial Court) | Yes | [2010] 1 Lloyd’s Rep 477 | England and Wales | Cited for the factors relevant in determining incorporation by a course of dealings. |
| Henry Kendall & Sons (A Firm) v William Lillico & Sons Ltd and others | House of Lords | Yes | [1969] 2 AC 31 | United Kingdom | Cited as an example of a case where the number of previous contracts sufficed for incorporation by a course of dealings. |
| Circle Freight International Ltd v Medeast Gulf Exports Ltd | England and Wales Court of Appeal (Civil Division) | Yes | [1988] 2 Lloyd’s Rep 427 | England and Wales | Cited as an example of a case where the number of previous contracts sufficed for incorporation by a course of dealings. |
| Hollier v Rambler Motors (AMC) Ltd | England and Wales Court of Appeal (Civil Division) | Yes | [1972] 2 QB 71 | England and Wales | Cited as an example of a case where the number of previous contracts was insufficient for incorporation by a course of dealings. |
| Transformers & Rectifiers Ltd v Needs Ltd | England and Wales High Court (Technology and Construction Court) | Yes | [2015] EWHC 269 (TCC) | England and Wales | Cited as an example of a case where the number of previous contracts sufficed for incorporation by a course of dealings. |
| Amerco Timbers Pte Ltd v Chatsworth Timber Corp Pte Ltd | Singapore Court of Appeal | Yes | [1977–1978] SLR(R) 112 | Singapore | Cited for adopting the 'strong cause' test and endorsing the Eleftheria factors as part of Singapore law. |
| The Eleftheria | England and Wales High Court (Admiralty Court) | Yes | [1969] 1 Lloyd’s Rep 237 | England and Wales | Cited as the celebrated case from which the general principles governing the grant of a stay to give effect to an exclusive jurisdiction clause are derived. |
| Golden Shore Transportation Pte Ltd v UCO Bank and another appeal | Singapore Court of Appeal | Yes | [2004] 1 SLR(R) 6 | Singapore | Cited for the principle that factors which render proceedings in Singapore more convenient than proceedings in the agreed forum are of limited weight if they were foreseeable at the time when the parties made the jurisdiction agreement. |
| The Hyundai Fortune | Singapore Court of Appeal | Yes | [2004] 4 SLR(R) 548 | Singapore | Cited for the principle that factors which render proceedings in Singapore more convenient than proceedings in the agreed forum are of limited weight if they were foreseeable at the time when the parties made the jurisdiction agreement. |
| The Vishva Prabha | England and Wales High Court (Admiralty Court) | Yes | [1979] 2 Lloyd’s Rep 286 | England and Wales | Cited as the first case where the merits of the defence were understood to be relevant in an EJC Application. |
| The Atlantic Song | England and Wales High Court (Admiralty Court) | Yes | [1983] 2 Lloyd’s Rep 394 | England and Wales | Cited as a case where the court refused a stay on the basis of the No Desire for Trial Rationale. |
| The Frank Pais | England and Wales High Court (Admiralty Court) | Yes | [1986] 1 Lloyd’s Rep 529 | England and Wales | Cited as a case where the court refused a stay based on the No Desire for Trial Rationale. |
| Standard Chartered Bank v Pakistan National Shipping Corporation and others | England and Wales High Court (Commercial Court) | Yes | [1995] 2 Lloyd’s Rep 365 | England and Wales | Cited as a case where the court endorsed the No Dispute Rationale. |
| Xu Ziming v Ruifeng Petroleum Chemical Holdings Ltd | Hong Kong Court of First Instance | Yes | [2014] HKCU 2013 | Hong Kong | Cited as a case where the Hong Kong courts held that the lack of a genuine defence may amount to strong cause to refuse a stay in an EJC Application. |
| Xu Ziming v Ruifeng Petroleum Chemical Holdings Ltd | Hong Kong Court of First Instance | Yes | [2014] HKCU 2958 | Hong Kong | Cited as a case where the court endorsed Clarke J’s ruling in Standard Chartered Bank that the lack of an arguable defence would amount to strong reason to refuse a stay. |
| Donohue v Armco Inc and others | House of Lords | Yes | [2002] 1 Lloyd’s Rep 425 | United Kingdom | Cited as the decision of the House of Lords that represents a new dawn in English law regarding exclusive jurisdiction clauses. |
| Euromark Ltd v Smash Enterprises Pty Ltd | England and Wales High Court (Queen's Bench Division) | Yes | [2013] EWHC 1627 (QB) | England and Wales | Cited as a case where the court rejected the argument that a strong case should be heard in England, whilst a more arguable case should be heard in Australia. |
| CH Offshore Ltd v PDV Marina SA and others | England and Wales High Court (Commercial Court) | Yes | [2015] EWHC 595 (Comm) | England and Wales | Cited for approving the holding in Euromark Ltd v Smash Enterprises Pty Ltd. |
| Hyundai Engineering & Construction Co Ltd v UBAF (Hong Kong) Ltd | Hong Kong Court of First Instance | Yes | [2013] HKCU 2237 | Hong Kong | Cited as a case where the Court of First Instance applied Euromark. |
| Deltatre Spa v Hong Kong Sports Industrial Development Ltd (formerly known as LeTV Sports Culture Develop (HongKong) Co Ltd) | Hong Kong Court of First Instance | Yes | [2018] HKCU 2939 | Hong Kong | Cited as a recent decision where the Court of First Instance reviewed the conflicting lines of authority in Hong Kong and decided to follow Euromark. |
| The Rainbow Joy | Singapore Court of Appeal | Yes | [2005] 3 SLR(R) 719 | Singapore | Cited for ruling that it is irrelevant, for the purposes of a FNC Application, whether the applicant has a genuine defence. |
| Q & M Enterprises Sdn Bhd v Poh Kiat | High Court of Singapore | Yes | [2005] 4 SLR(R) 494 | Singapore | Cited for taking the view that the merits of the defence are irrelevant in a FNC Application. |
| Tjong Very Sumito and others v Antig Investments Pte Ltd | Singapore Court of Appeal | Yes | [2009] 4 SLR(R) 732 | Singapore | Cited for ruling that a merely asserted dispute suffices to warrant a stay of court proceedings without any inquiry into the genuineness or merits of the defence in an IAA Application. |
| The Asian Plutus | High Court of Singapore | Yes | [1990] 1 SLR(R) 504 | Singapore | Cited for the principle that by choosing the court, the parties have chosen the procedure. |
| The Vishva Apurva | Singapore Court of Appeal | Yes | [1992] 1 SLR(R) 912 | Singapore | Cited for the principle that there may be some very exceptional cases where trial in the agreed court would be so overwhelmingly difficult or inconvenient that a stay would effectively deny the plaintiff access to justice. |
| ZI Pompey Industrie and Others v Ecu-Line NV | Supreme Court of Canada | Yes | [2003] 224 DLR (4th) 577 | Canada | Cited for the principle that the same principles should apply to jurisdiction clauses even where the plaintiff was not in a position to negotiate. |
| Incitec Limited v Alkimos Shipping Corp and another | Federal Court of Australia | Yes | [2004] 206 ALR 558 | Australia | Cited for the principle that the overarching test remains that of whether there is 'strong cause' to refuse a stay. |
| Hayter v Nelson and Home Insurance Co | England and Wales High Court (Queen's Bench Division) | Yes | [1990] 2 Lloyd’s Rep 265 | England and Wales | Cited for the principle that a dispute exists even if one party to the dispute is clearly wrong. |
| JTrust Asia Pte Ltd v Group Lease Holdings Pte Ltd and others | Singapore Court of Appeal | Yes | [2018] 2 SLR 159 | Singapore | Cited for the observation that the concept of abuse of process pervades the whole law of civil procedure. |
| Adri Anton Kalangie v Public Prosecutor | Singapore Court of Appeal | Yes | [2018] 2 SLR 557 | Singapore | Cited for holding that prospective overruling would only apply in an exceptional case. |
| L Capital Jones Ltd and another v Maniach Pte Ltd | Singapore Court of Appeal | Yes | [2017] 1 SLR 312 | Singapore | Cited for the observation that prospective overruling should only apply where departing from the normal retroactivity of a judgment was necessary to avoid serious and demonstrable injustice to the parties or to the administration of justice. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| International Arbitration Act | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Exclusive Jurisdiction Clause
- Course of Dealings
- Strong Cause
- Good Arguable Case
- Merits of Defence
- Abuse of Process
- Denial of Justice
- Incorporation of Terms
- Stay of Proceedings
- Party Autonomy
15.2 Keywords
- exclusive jurisdiction clause
- incorporation by dealings
- stay of proceedings
- contractual terms
- Singapore Court of Appeal
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Conflict of Laws | 85 |
| Contract Law | 75 |
| Jurisdiction | 70 |
| Commercial Law | 65 |
| International Commercial Contracts | 50 |
16. Subjects
- Contract Law
- Conflict of Laws
- Civil Procedure
- International Trade