Keppel FELS Ltd v Owner of “SONGA VENUS”: Priority of Possessory Lien Costs in Admiralty
In Keppel FELS Ltd v Owner of the vessel “SONGA VENUS”, the Singapore High Court addressed the priority of costs in admiralty claims where a claimant holds a possessory lien. Keppel FELS commenced proceedings against the vessel Songa Venus for unpaid services and arrested the vessel. The court determined that costs incurred in enforcing a claim protected by a possessory lien should be accorded the same priority as the possessory lien itself. The court ordered 40% of the Costs of the Action to rank in priority together with limb (c) of [6] above, and 60% of the Costs of the Action to rank in priority together with limb (e) of [6] above.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Costs incurred in enforcing a claim protected by a possessory lien should be accorded the same priority as the possessory lien.
1.3 Case Type
Admiralty
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court judgment on prioritizing costs in admiralty claims involving possessory liens. Costs enforcing possessory lien claims share the lien's priority.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Keppel FELS Ltd | Plaintiff | Corporation | Judgment in favour of Plaintiff | Won | Tan Boon Yong Thomas, Josiah Fong |
| Owner of the vessel “SONGA VENUS” | Defendant | Other | Judgment in default of appearance | Lost | |
| Songa Offshore SE | Intervener | Corporation | Judgment in default of appearance | Neutral | Liang Junhong Daniel |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Pang Khang Chau | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Tan Boon Yong Thomas | Haridass Ho & Partners |
| Josiah Fong | Haridass Ho & Partners |
| Liang Junhong Daniel | Allen & Gledhill LLP |
4. Facts
- Keppel FELS provided services to the vessel Songa Venus, including repairs and modifications.
- Keppel FELS was not paid for the services rendered.
- Keppel FELS commenced proceedings and arrested the vessel.
- The vessel was sold pendente lite for US$3,749,463.14.
- Keppel FELS obtained a judgment in default of appearance for US$1,169,370.
- The court declared that Keppel FELS had a possessory lien for US$328,723 of the claim.
- Songa Offshore, another claimant, had a second preferred mortgage over the vessel.
5. Formal Citations
- The “Songa Venus”, Admiralty in Rem No 275 of 2016, [2020] SGHC 74
6. Timeline
| Date | Event |
|---|---|
| Keppel FELS provided services to the vessel Songa Venus. | |
| Keppel FELS commenced proceedings against the vessel. | |
| Hearing of the application. | |
| Hearing of the application. | |
| Keppel FELS filed the application for determination of the priority of the relevant claims and payment out of the proceeds of sale. | |
| Judgment delivered by Pang Khang Chau J. |
7. Legal Issues
- Priority of Claims
- Outcome: The court held that costs incurred in enforcing a claim protected by a possessory lien should be accorded the same priority as the possessory lien.
- Category: Substantive
- Sub-Issues:
- Enforcement of possessory lien
- Priority of costs
- Related Cases:
- (1835) 3 Hag Adm 238
- (1997) 144 ALR 394
- (1860) Lush 69
- [1987] SLR(R) 239
- (1883) 9 PD 37
- [1903] P 26
- Possessory Lien
- Outcome: The court clarified the scope and enforcement of possessory liens in admiralty, emphasizing the protection afforded to lien holders who surrender possession to the court.
- Category: Substantive
- Sub-Issues:
- Scope of possessory lien
- Enforcement of possessory lien in admiralty
- Related Cases:
- (1860) 8 HL Cas 338
8. Remedies Sought
- Determination of priority of claims
- Payment out of proceeds of sale
9. Cause of Actions
- Admiralty Action in Rem
- Breach of Contract
10. Practice Areas
- Admiralty
- Shipping
- Maritime
- Commercial Litigation
11. Industries
- Shipping
- Maritime
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| The “Margaret” | High Court of Admiralty of England | Yes | (1835) 3 Hag Adm 238 | England | Cited for the principle that costs of the action will normally be afforded the same priority as the substantive claim out of which they arise. |
| Patrick Stevedores No 2 Pty Ltd and others v Proceeds of Sale of the Vessel MV Skulptor Konenkov | Federal Court of Australia | Yes | (1997) 144 ALR 394 | Australia | Cited for following The Margaret and supporting the general rule that costs have the same priority as the claim in respect of which they have been incurred. |
| The “William F Safford” | High Court of Admiralty of England | Yes | (1860) Lush 69 | England | Cited for the principle that costs in each action will be paid with the principal sums in the order named. |
| The “Honey I” | Singapore | Yes | [1987] SLR(R) 239 | Singapore | Cited as a case involving possessory liens where costs were combined with the substantive claim and accorded the same priority. |
| Somes v British Empire Shipping Co | House of Lords | Yes | (1860) 8 HL Cas 338 | England | Cited to illustrate that courts have been strict about what claims come within the scope of a possessory lien. |
| The Immacolata Concezione | Not Available | Yes | (1883) 9 PD 37 | Not Available | Cited as support for the position that the existence of a possessory lien in respect of a claim would affect the priority to be given to the costs incurred in enforcing that claim in an admiralty action in rem. |
| The Tergeste | Not Available | Yes | [1903] P 26 | Not Available | Cited for the principle that the Admiralty Court undertakes to protect the possessory lien holder and put him in the same position as if he had not surrendered the ship to the marshal. |
| Hammonds v Barclay | Not Available | Yes | (1802) 2 East 227 | Not Available | Cited to define a possessory lien as a right to retain possession until certain demands are satisfied. |
| The Ruta | Not Available | Yes | [2000] 1 Lloyd’s Rep 359 | Not Available | Cited for the principle that the determination of priority is an equitable jurisdiction. |
13. Applicable Rules
| Rule Name |
|---|
| Order 29 Rule 6 of the Rules of Court |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Possessory lien
- Statutory lien
- Admiralty in rem
- Priority of claims
- Costs of action
- Enforcement costs
- Judicial sale
- Mortgagee
- Maritime claim
15.2 Keywords
- Admiralty
- Shipping
- Possessory Lien
- Priority of Claims
- Singapore
- Maritime Law
16. Subjects
- Admiralty
- Shipping
- Maritime Liens
- Civil Procedure
- Commercial Law
17. Areas of Law
- Admiralty Law
- Shipping Law
- Civil Procedure
- Maritime Law
- Lien Law