Gulf Petrochem Pte Ltd v Petrotec Pte Ltd: Contractual Terms & Guarantee Dispute
In Gulf Petrochem Pte Ltd v Petrotec Pte Ltd, the High Court of Singapore addressed a dispute over a fuel oil supply agreement and the enforceability of a guarantee. Gulf Petrochem sued Petrotec for outstanding payments and the return of surplus oil, claiming an oral agreement superseded a written contract. The court, presided over by Justice Woo Bih Li, found that the original written contract, the Net-Off Contract, applied, and the alleged oral agreement, the New Business Model, did not exist. The court ordered Petrotec to pay Gulf Petrochem US$8,123,896.43 for the purchase price of the surplus oil and US$3,447,582.87 for outstanding debts, with the guarantors jointly and severally liable. Petrotec's counterclaim was dismissed.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Judgment for Plaintiff in part; Counterclaim dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case involving Gulf Petrochem and Petrotec over a fuel oil supply contract and a guarantee. The court ruled on which contract applied.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Gulf Petrochem Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff in part | Partial | Tan Boon Yong Thomas, Ng Wei Long |
| Petrotec Pte Ltd | Defendant, Plaintiff | Corporation | Counterclaim dismissed | Dismissed | Fu Simin Charmaine, Wong Shi Yi |
| Tan Keng Huat, Dennis | Defendant | Individual | Guarantor liable | Lost | Fu Simin Charmaine, Wong Shi Yi |
| Tan Shuping (Chen Shuping) | Defendant | Individual | Guarantor liable | Lost | Fu Simin Charmaine, Wong Shi Yi |
| Soon Kok Khoon | Defendant | Individual | Guarantor liable | Lost | Fu Simin Charmaine, Wong Shi Yi |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Woo Bih Li | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Tan Boon Yong Thomas | Haridass Ho & Partners |
| Ng Wei Long | Haridass Ho & Partners |
| Fu Simin Charmaine | Ang & Partners |
| Wong Shi Yi | Ang & Partners |
4. Facts
- Gulf and Petrotec entered into a written "Payment Net-Off Contract" on 22 August 2012.
- Gulf claimed an oral "New Business Model" superseded the written contract.
- The business relationship lasted from August 2012 to November 2014.
- Gulf stopped doing business with Petrotec on 5 November 2014 due to suspected financial difficulties.
- Gulf claimed Petrotec held 15,309.248 MT of fuel oil (Surplus Oil) belonging to Gulf.
- Gulf sought US$4,253,383.94 for outstanding debit notes.
- The 2nd to 4th defendants were guarantors of Petrotec's debt.
5. Formal Citations
- Gulf Petrochem Pte Ltd v Petrotec Pte Ltd and others, Suit No 1224 of 2014, [2018] SGHC 83
6. Timeline
| Date | Event |
|---|---|
| Oasis Asia Maritime Pte Ltd incorporated | |
| Gulf and Petrotec entered into Net-Off Contract | |
| First barge loaded with fuel oil purchased by Gulf from Suppliers | |
| Steven Soon resigned as director of Oasis | |
| Aroy Tan resigned as director of Oasis | |
| Gulf stopped doing business with Petrotec | |
| Petrotec made part payment of US$580,205.25 | |
| Gulf's lawyers wrote a letter of demand to Petrotec | |
| Gulf's lawyers wrote to each of the Guarantors to demand payment | |
| Gulf issued a debit note for the Back to Back Charges | |
| Present suit commenced | |
| Gulf issued Barge Settlement DN for November 2014 | |
| Trial began | |
| Trial continued | |
| Trial continued | |
| Judgment issued |
7. Legal Issues
- Contractual Terms
- Outcome: The court held that the Net-Off Contract applied and the New Business Model did not exist.
- Category: Substantive
- Sub-Issues:
- Applicability of Net-Off Contract
- Existence of New Business Model
- Formation of Contract
- Outcome: The court found that the alleged oral agreement (New Business Model) was not proven.
- Category: Substantive
- Sub-Issues:
- Certainty of Terms
- Oral Agreement
- Consideration
- Outcome: The court found that the guarantee was supported by consideration.
- Category: Substantive
- Sub-Issues:
- Failure of Consideration
- Promissory Estoppel
- Enforceability of Guarantee
- Outcome: The court held that the Guarantee was enforceable against the Guarantors.
- Category: Substantive
- Sub-Issues:
- Certainty of Terms
- Estoppel
8. Remedies Sought
- Delivery of fuel oil
- Monetary Damages
- Declaration that Guarantee is void
9. Cause of Actions
- Breach of Contract
- Detinue
- Conversion
10. Practice Areas
- Commercial Litigation
11. Industries
- Petroleum
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd | Singapore Court of Appeal | No | [2011] 3 SLR 540 | Singapore | Cited for the requirements of a claim in unjust enrichment. |
| Rudhra Minerals Pte Ltd v MRI Trading Pte Ltd | Singapore High Court | No | [2013] 4 SLR 1023 | Singapore | Cited to distinguish between promissory estoppel and estoppel by representation of fact. |
| Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd | Singapore Court of Appeal | No | [2013] 4 SLR 409 | Singapore | Cited for the elements of promissory estoppel. |
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
- Net-Off Contract
- New Business Model
- Barge Confirmation
- Surplus Oil
- Uplift Charges
- Finance Charges
- Late Payment Interests
- Guarantee
- Purchase Margin
- Back to Back Charges
15.2 Keywords
- contract
- guarantee
- fuel oil
- payment
- singapore
- petroleum
- bunker
- marine
- debt
- litigation
16. Subjects
- Contract Law
- Commercial Dispute
- Guarantees
- Oil and Gas
17. Areas of Law
- Contract Law
- Credit and Security
- Guarantees and Indemnities