MAN Diesel v IM Skaugen: Forum Non Conveniens & Service Out of Jurisdiction

The Singapore Court of Appeal heard an appeal by MAN Diesel & Turbo SE and MAN Diesel & Turbo Norge AS against IM Skaugen SE and IM Skaugen Marine Services Pte Ltd regarding tortious claims of negligent and/or fraudulent misrepresentations. The court, delivered by Steven Chong JA, allowed the appeal, setting aside the service of the originating process on the basis that Singapore was not the appropriate forum, with Norway being a more suitable venue given parallel proceedings and other connecting factors.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeal Allowed

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore Court of Appeal addresses forum non conveniens in a tort claim, setting aside service due to a more appropriate forum in Norway.

1.7 Decision Date

3 December 2019

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
MAN Diesel & Turbo SE	Appellant	Corporation	Appeal Allowed	Won	Ong Tun Wei Danny of Rajah & Tann Singapore LLP Yam Wern-Jhien of Rajah & Tann Singapore LLP Bethel Chan Ruiyi of Rajah & Tann Singapore LLP Tay Shi Ing of Rajah & Tann Singapore LLP
MAN Diesel & Turbo Norge AS	Appellant	Corporation	Appeal Allowed	Won	Ong Tun Wei Danny of Rajah & Tann Singapore LLP Yam Wern-Jhien of Rajah & Tann Singapore LLP Bethel Chan Ruiyi of Rajah & Tann Singapore LLP Tay Shi Ing of Rajah & Tann Singapore LLP
IM Skaugen SE	Respondent	Corporation	Appeal Dismissed	Lost	Teh Kee Wee Lawrence of Dentons Rodyk & Davidson LLP Wong Yong Jing, Justin of Dentons Rodyk & Davidson LLP
IM Skaugen Marine Services Pte Ltd	Respondent	Corporation	Appeal Dismissed	Lost	Teh Kee Wee Lawrence of Dentons Rodyk & Davidson LLP Wong Yong Jing, Justin of Dentons Rodyk & Davidson LLP
Liquidator of IM Skaugen Marine Services Pte Ltd	Other	Other	Neutral	Neutral	Koh Junxiang of CLASIS LLC Charis Toh of CLASIS LLC

3. Judges

Judge Name	Title	Delivered Judgment
Steven Chong	Judge of Appeal	Yes
Woo Bih Li	Judge	No

4. Counsels

Counsel Name	Organization
Ong Tun Wei Danny	Rajah & Tann Singapore LLP
Yam Wern-Jhien	Rajah & Tann Singapore LLP
Bethel Chan Ruiyi	Rajah & Tann Singapore LLP
Tay Shi Ing	Rajah & Tann Singapore LLP
Teh Kee Wee Lawrence	Dentons Rodyk & Davidson LLP
Wong Yong Jing, Justin	Dentons Rodyk & Davidson LLP
Koh Junxiang	CLASIS LLC
Charis Toh	CLASIS LLC

4. Facts

IM Skaugen SE and IM Skaugen Marine Services Pte Ltd commenced an action against MAN Diesel & Turbo SE and MAN Diesel & Turbo Norge AS.
The claims arose from alleged negligent and/or fraudulent misrepresentations regarding the rate of fuel consumption in engines supplied to the Skaugen group.
The respondents commenced an action in Norway in respect of the same claims about seven months after commencing the action in Singapore.
The appellants applied to set aside the service and/or to stay the proceedings on the basis that Singapore is not forum conveniens.
The Judge found the misrepresentation at each FAT to be at the “core of the [respondents’] loss”.
The Judge held that the misrepresentation of the engines’ rate of fuel consumption was made in Germany, received by the respondents in Germany and relied upon in Germany.
The respondents claim damages against the appellants for, inter alia, the loss and damage suffered by Somargas HK, Somargas SG and the GATX entities by way of excessive fuel consumption.

5. Formal Citations

MAN Diesel & Turbo SE and another v IM Skaugen SE and another, Civil Appeal No 213 of 2017, [2019] SGCA 80
IM Skaugen SE and another v MAN Diesel & Turbo SE and another, , [2016] SGHCR 6

6. Timeline

Date	Event
2000-07-06	First respondent entered into four shipbuilding contracts.
2000-08-07	First four contracts were novated to Somargas Limited.
2001-05-15	Vintergas Limited entered into another two contracts with the shipbuilders.
2001-05-01	Appellants provided documents with representations concerning engine fuel consumption.
2002-03-12	Somargas Limited and Vintergas Limited entered into novation agreements with Somargas HK.
2002-10-01	Vessels were delivered by the shipbuilders to Somargas HK.
2003-10-01	Vessels were delivered by the shipbuilders to Somargas HK.
2011-02-01	Somargas HK transferred ownership of the Vessels to Somargas SG.
2011-05-01	First appellant issued a press release regarding irregularities in FATs.
2013-04-01	Somargas SG transferred ownership of three of the Vessels to the GATX entities.
2013-06-01	Three Vessels were sold to third parties.
2014-06-23	GATX agreed to transfer all possible claims to the first respondent.
2014-12-01	Three Vessels were sold to third parties.
2015-01-27	Second respondent took assignment of all claims held by Somargas SG.
2015-01-28	Respondents commenced the Singapore proceedings.
2015-08-26	Respondents commenced an action against the appellants in Norway.
2016-10-01	Norwegian Court of Appeal decided that the respondents’ claims were subject to arbitration.
2017-08-02	Judge allowed the respondents’ appeal and held that there was a good arguable case that the respondents’ claims came within Order 11 r 1(f)(ii) and Order 11 r 1(p).
2018-10-01	Hearing was scheduled to take place in Norway.
2019-11-20	Judgment reserved.
2019-12-04	Judgment date.

7. Legal Issues

Forum Non Conveniens
- Outcome: Singapore was not the more appropriate forum for the dispute.
- Category: Procedural
- Sub-Issues:
  - Appropriate forum for trial
  - Parallel proceedings
  - Availability of foreign forum
- Related Cases:
  - [1987] AC 460
Service Out of Jurisdiction
- Outcome: The respondents failed to establish a good arguable case that their claim fell within the jurisdictional gateways of Order 11.
- Category: Procedural
- Sub-Issues:
  - Jurisdictional gateways
  - Good arguable case
  - Damage suffered in Singapore
  - Cause of action arising in Singapore
- Related Cases:
  - [1971] AC 458

8. Remedies Sought

Damages

9. Cause of Actions

Negligent Misrepresentation
Fraudulent Misrepresentation

10. Practice Areas

Commercial Litigation
Cross-Border Litigation

11. Industries

Oil and Gas
Marine
Transportation

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Distillers Co (Biochemicals) Ltd v Laura Anne Thompson	Privy Council	Yes	[1971] AC 458	England and Wales	Discusses the test for determining where a cause of action arises for service out of jurisdiction, applying the substance test.
JIO Minerals FZC and others v Mineral Enterprises Ltd	Court of Appeal	Yes	[2011] 1 SLR 391	Singapore	Interprets Distillers as representing the substance test for determining the place where a cause of action arose.
Bradley Lomas Electrolok Ltd and another v Colt Ventilation East Asia Pte Ltd and others	High Court	Yes	[1999] 3 SLR(R) 1156	Singapore	Sets out the standard of proof required to show that a claim falls under Order 11.
Vinmar Overseas (Singapore) Pte Ltd v PTT International Trading Pte Ltd	Court of Appeal	Yes	[2018] 2 SLR 1271	Singapore	Clarifies the standard of proof required to show that a claim falls under Order 11.
Zoom Communications Ltd v Broadcast Solutions Pte Ltd	Court of Appeal	Yes	[2014] 4 SLR 500	Singapore	Sets out the three requirements for valid service out of jurisdiction.
Oro Negro Drilling Pte Ltd and others v Integradora de Servicios Petroleros Oro Negro SAPI de CV and others and another appeal (Jesus Angel Guerra Mendez, non-party)	Court of Appeal	Yes	[2019] SGCA 74	Singapore	Reiterates the three requirements for valid service out of jurisdiction.
IM Skaugen SE and another v MAN Diesel & Turbo SE and another	High Court	Yes	[2018] SGHC 123	Singapore	The High Court decision under appeal, which was reversed by the Court of Appeal.
Spiliada Maritime Corporation v Cansulex Ltd	House of Lords	Yes	[1987] AC 460	England and Wales	Establishes the test for determining the appropriate forum for a dispute.
Rickshaw Investments Ltd and another v Nicolai Baron von Uexkull	High Court	Yes	[2007] 1 SLR(R) 377	Singapore	States that the place where a tort occurred is prima facie the more appropriate forum.
Ladd v Marshall	Unknown	Yes	[1954] 1 WLR 1489	England and Wales	Sets out the requirements for adducing further evidence in interlocutory appeals.
Anan Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Co)	Court of Appeal	Yes	[2019] 2 SLR 341	Singapore	Clarifies the application of the Ladd v Marshall requirements in interlocutory appeals.
Rappo, Tania v Accent Delight International Ltd and another and another appeal	Court of Appeal	Yes	[2017] 2 SLR 265	Singapore	Discusses the purpose of the doctrine of forum non conveniens.
Lakshmi Anil Salgaocar v Jhaveri Darsan Jitendra	Court of Appeal	Yes	[2019] 2 SLR 372	Singapore	Allowed subsequent developments after the decision below to be taken in account in the context of an application for an anti-suit injunction.
Virsagi Management (S) Pte Ltd v Welltech Construction Pte Ltd and another appeal	Court of Appeal	Yes	[2013] 4 SLR 1097	Singapore	Explains that the presence of parallel proceedings can be considered in two situations.
Goh Chan Peng and others v Beyonics Technology Ltd and another and another appeal	Court of Appeal	Yes	[2017] 2 SLR 592	Singapore	States that the single economic entity concept is not recognised in Singapore.
Glencore International AG v Exeter Shipping Ltd and others	Unknown	Yes	[2002] CLC 1090	England and Wales	States that permission has to be obtained within the four corners of the English long-arm statute for each separate claim made against him.
Microsoft Mobile OY (Ltd) v Sony Europe Ltd and others	Unknown	Yes	[2018] All ER (Comm) 419	England and Wales	Explains that in cases involving the assignment of claims, the jurisdictional requirements are assessed from the perspective of the original assignor as the claimant and not the ultimate assignee.
Nippon Catalyst Pte Ltd v PT Trans-Pacific Petrochemical Indotama and another	High Court	Yes	[2018] SGHC 126	Singapore	Applied the substance test to Order 11 r 1(p).
Kishinchand Tiloomal Bhojwani v Sunil Kishinchand Bhojwani and another	High Court	Yes	[1997] 1 SLR(R) 518	Singapore	States that the prevailing test is to ask “where in substance did the cause of action arise”.
Karaha Bodas Co LLC v Pertamina Energy Trading Ltd and another	High Court	Yes	[2005] 2 SLR(R) 568	Singapore	States that the prevailing test is to ask “where in substance did the cause of action arise”.
Wing Hak Man v Bio-Treat Technology Ltd	High Court	Yes	[2009] 1 SLR(R) 446	Singapore	States that the prevailing test is to ask “where in substance did the cause of action arise”.
Focus Energy Ltd v Aye Aye Soe	High Court	Yes	[2009] 1 SLR(R) 1086	Singapore	States that the prevailing test is to ask “where in substance did the cause of action arise”.
Metal und Rohstoff AG v Donaldson Lufkin & Jenrette Inc	Court of Appeal	Yes	[1990] 1 QB 391	England and Wales	States that the prevailing test is to ask “where in substance did the cause of action arise”.
Sophocleous and others v Secretary of State for Foreign and Commonwealth Affairs and another	Court of Appeal	Yes	[2019] QB 949	England and Wales	The general approach of the private international law of negligence is to ask where in substance the cause of action arose.
Li Shengwu v Attorney-General	Court of Appeal	Yes	[2019] 1 SLR 1081	Singapore	The Order 11 jurisdiction is an “exorbitant” one as the foundation for a court’s jurisdiction is primarily territorial.
John Reginald Stott Kirkham and others v Trane US Inc and others	Court of Appeal	Yes	[2009] 4 SLR(R) 428	Singapore	Documentary evidence is, in this modern age, easily transportable between jurisdictions.
BC Andaman Co Ltd and others v Xie Ning Yun and another	High Court	Yes	[2017] SGHC 64	Singapore	The ends of justice are best served by a single composite trial hearing all the claims.
Donohue v Armco Inc & Others	Unknown	Yes	[2002] 1 All ER 749	England and Wales	The ends of justice are best served by a single composite trial hearing all the claims.
Zurich Insurance Co plc v Hayward	UK Supreme Court	Yes	[2016] 3 WLR 637	United Kingdom	A representee may know that the representation is false but nevertheless may be held to rely upon the misrepresentation as a matter of fact.
Wishing Star Ltd v Jurong Town Corp	Court of Appeal	Yes	[2008] 2 SLR(R) 909	Singapore	Damages for deceit include all losses flowing directly from the plaintiff’s reliance on the defendant’s fraudulent misrepresentation, whether or not such loss was foreseeable.
Smith New Court Securities Ltd v Citibank NA	Unknown	Yes	[1997] AC 254	England and Wales	Damages for deceit include all losses flowing directly from the plaintiff’s reliance on the defendant’s fraudulent misrepresentation, whether or not such loss was foreseeable.

13. Applicable Rules

Rule Name
Order 11 of the Rules of Court
Order 11 r 1(f)(ii)
Order 11 r 1(p)
Order 11 r 2(2)
Order 38 r 18(2) ROC
Order 110 r 25

14. Applicable Statutes

Statute Name	Jurisdiction
Rules of Court (Cap 322, R 5, 2014 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Forum non conveniens
Service out of jurisdiction
Substance test
Cause of complaint test
Parallel proceedings
Lugano Convention
SICC
FAT
Good arguable case

15.2 Keywords

forum non conveniens
service out of jurisdiction
tort
misrepresentation
Singapore
Norway
Germany

17. Areas of Law

Area Name	Relevance Score
Natural forum	80
Conflict of Laws	75
Civil Procedure	75
Misrepresentation	60
Fraud and Deceit	50
Contract Law	30
Breach of Contract	20
Arbitration	10

16. Subjects

Civil Procedure
Conflict of Laws
Forum Non Conveniens
Service Out of Jurisdiction