Phillips 66 v Owner of Vessel “LUNA”: Bills of Lading, Contract of Carriage, Wrongful Arrest

In Phillips 66 International Trading Pte Ltd v Owner and/or Demise Charterer of the vessel “LUNA” and others, the Court of Appeal of Singapore heard appeals regarding the nature of bills of lading in the context of bunker fuel sales. Phillips 66 brought a claim against the vessel owners for breach of contract, among other causes of action, after OW Bunker's insolvency led to non-payment for fuel. The court allowed the appeals, finding that the bills of lading did not function as contracts of carriage or documents of title, except for the appeal against the dismissal of the counterclaim for wrongful arrest.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeals allowed, except for the appeal against the dismissal of the counterclaim for wrongful arrest.

1.3 Case Type

Admiralty

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

The Court of Appeal examined the legal effect of bills of lading in sea carriage, addressing issues of contract, title, and wrongful arrest.

1.7 Decision Date

19 August 2021

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Owner and/or Demise Charterer of the vessel “LUNA”	Appellant, Defendant	Other	Appeal Allowed	Won	Bazul Ashhab bin Abdul Kader of Oon & Bazul LLP Prakaash s/o Paniar Silvam of Oon & Bazul LLP Shawn Lim Zi Xuan of Oon & Bazul LLP Tan Yu Hang of Oon & Bazul LLP Yap Ming Kwang Kelly of Oon & Bazul LLP Toh Ka-Chun Gregory (Tu Jiajun) of Oon & Bazul LLP
Phillips 66 International Trading Pte Ltd	Respondent, Plaintiff	Corporation	Appeal Lost	Lost	Toh Kian Sing of Rajah & Tann Singapore LLP Chan Qin Pei of Rajah & Tann Singapore LLP Vellayappan Balasubramaniyam of Rajah & Tann Singapore LLP Dinesh Sabapathy of Rajah & Tann Singapore LLP Ravi Dharini of Rajah & Tann Singapore LLP
Owner and/or Demise Charterer of the vessel “STAR QUEST”	Appellant, Defendant	Other	Appeal Allowed	Won	Chan Leng Sun of Chan Leng Sun LLC Lim Wei Ming Keith of Quahe Woo & Palmer LLC Teo Ke-Wei Ian of Helmsman LLC Huang Peide of Helmsman LLC Reuben Tan Wei Jer of Quahe Woo & Palmer LLC Joel Raj Moosa of Quahe Woo & Palmer LLC Chen Zhida of Helmsman LLC
Owner and/or Demise Charterer of the vessel “NEPAMORA”	Appellant, Defendant	Other	Appeal Allowed	Won	Chan Leng Sun of Chan Leng Sun LLC Lim Wei Ming Keith of Quahe Woo & Palmer LLC Teo Ke-Wei Ian of Helmsman LLC Huang Peide of Helmsman LLC Reuben Tan Wei Jer of Quahe Woo & Palmer LLC Joel Raj Moosa of Quahe Woo & Palmer LLC Chen Zhida of Helmsman LLC
Owner and/or Demise Charterer of the vessel “PETRO ASIA”	Appellant, Defendant	Other	Appeal Allowed	Won	Chan Leng Sun of Chan Leng Sun LLC Lim Wei Ming Keith of Quahe Woo & Palmer LLC Teo Ke-Wei Ian of Helmsman LLC Huang Peide of Helmsman LLC Reuben Tan Wei Jer of Quahe Woo & Palmer LLC Joel Raj Moosa of Quahe Woo & Palmer LLC Chen Zhida of Helmsman LLC
Owner and/or Demise Charterer of the vessel “ZMAGA”	Appellant, Defendant	Other	Appeal Allowed	Won	Chan Leng Sun of Chan Leng Sun LLC Lim Wei Ming Keith of Quahe Woo & Palmer LLC Teo Ke-Wei Ian of Helmsman LLC Huang Peide of Helmsman LLC Reuben Tan Wei Jer of Quahe Woo & Palmer LLC Joel Raj Moosa of Quahe Woo & Palmer LLC Chen Zhida of Helmsman LLC
Owner and/or Demise Charterer of the vessel “AROWANA MILAN”	Appellant, Defendant	Other	Appeal Allowed	Won	Chan Leng Sun of Chan Leng Sun LLC Lim Wei Ming Keith of Quahe Woo & Palmer LLC Teo Ke-Wei Ian of Helmsman LLC Huang Peide of Helmsman LLC Reuben Tan Wei Jer of Quahe Woo & Palmer LLC Joel Raj Moosa of Quahe Woo & Palmer LLC Chen Zhida of Helmsman LLC

3. Judges

Judge Name	Title	Delivered Judgment
Judith Prakash	Justice of the Court of Appeal	No
Steven Chong	Justice of the Court of Appeal	Yes
Quentin Loh	Judge of the Appellate Division	No

4. Counsels

Counsel Name	Organization
Bazul Ashhab bin Abdul Kader	Oon & Bazul LLP
Prakaash s/o Paniar Silvam	Oon & Bazul LLP
Shawn Lim Zi Xuan	Oon & Bazul LLP
Tan Yu Hang	Oon & Bazul LLP
Yap Ming Kwang Kelly	Oon & Bazul LLP
Toh Ka-Chun Gregory (Tu Jiajun)	Oon & Bazul LLP
Toh Kian Sing	Rajah & Tann Singapore LLP
Chan Qin Pei	Rajah & Tann Singapore LLP
Vellayappan Balasubramaniyam	Rajah & Tann Singapore LLP
Dinesh Sabapathy	Rajah & Tann Singapore LLP
Ravi Dharini	Rajah & Tann Singapore LLP
Chan Leng Sun	Chan Leng Sun LLC
Lim Wei Ming Keith	Quahe Woo & Palmer LLC
Teo Ke-Wei Ian	Helmsman LLC
Huang Peide	Helmsman LLC
Reuben Tan Wei Jer	Quahe Woo & Palmer LLC
Joel Raj Moosa	Quahe Woo & Palmer LLC
Chen Zhida	Helmsman LLC

4. Facts

Phillips 66 sold bunkers FOB to OW Bunker and Dynamic Oil Trading under three sale contracts.
The sale contracts incorporated Phillips 66’s General Terms and Conditions for Sales of Marine Fuel February 2013.
Payment for the bunkers was due 30 calendar days after the certificate of quantity date.
The Buyers nominated the Vessels for loading of the bunkers at Vopak Terminal.
Vopak Terminal generated documents, including a CQ and a Bill of Lading (Vopak BLs).
The Vopak BLs were required to be signed and stamped by the master of the Vessel.
The Vessels delivered the bunkers to various ocean-going vessels without production of the original Vopak BLs.

5. Formal Citations

The “Luna” and another appeal, , [2021] SGCA 84
Phillips 66 International Trading Pte Ltd v Owner and/or Demise Charterer of the vessel “LUNA”, 22 of 2020, Civil Appeal No 22 of 2020
Phillips 66 International Trading Pte Ltd v Owner and/or Demise Charterer of the vessel “STAR QUEST”, 28 of 2020, Civil Appeal No 28 of 2020
The “Star Quest” and other matters, , [2016] 3 SLR 1280

6. Timeline

Date	Event
2014-09-10	First sale contract signed
2014-09-22	Second sale contract signed
2014-10-10	Loading of bunkers at Vopak Terminal began
2014-10-13	Third sale contract signed
2014-10-29	Loading of bunkers at Vopak Terminal completed
2014-10-31	Respondent issued invoices for bunker shipments
2014-11-05	Respondent issued invoices for bunker shipments
2014-11-06	Respondent found out about OW Bunker’s insolvency
2014-11-14	Respondent demanded delivery of bunkers from the appellants
2014-11-14	Vessels were arrested by the respondent
2014-11-15	Vessels were arrested by the respondent
2014-11-17	Vessels were arrested by the respondent
2020-01-30	Judge allowed the respondent’s claim in contract and dismissed the appellants’ counterclaims for wrongful arrest
2021-06-28	Judgment reserved
2021-08-20	Judgment delivered

7. Legal Issues

Contractual Force of Bills of Lading
- Outcome: The court held that the Vopak BLs were not contracts of carriage or documents of title.
- Category: Substantive
- Sub-Issues:
  - Intention of parties
  - Functions of bill of lading
  - Independence from sale contract
Wrongful Arrest
- Outcome: The court held that the respondent was not liable for wrongful arrest.
- Category: Substantive
- Sub-Issues:
  - Malice or gross negligence
  - Material non-disclosure
  - Abuse of process

8. Remedies Sought

Monetary Damages
Delivery of bunkers

9. Cause of Actions

Breach of Contract
Conversion
Bailment
Negligent Misrepresentation
Damage to Reversionary Interest

10. Practice Areas

Admiralty
Shipping
Commercial Litigation

11. Industries

Shipping
Oil and Gas

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
JI MacWilliam Co Inc v Mediterranean Shipping Co SA (The Rafaela S)	House of Lords	Yes	[2005] 2 AC 423	England and Wales	Cited to explain the three functions of a modern bill of lading: receipt, memorandum of contract, and document of title.
Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd	Court of Appeal	Yes	[2008] 3 SLR(R) 1029	Singapore	Cited for the principles governing the admission of extrinsic evidence in contract interpretation.
Wang Choong Li v Wong Wan Chin	High Court	Yes	[2015] 4 SLR 41	Singapore	Cited for the distinction between contract formation and interpretation when considering the admissibility of evidence.
Simpson Marine (SEA) Pte Ltd v Jiacipto Jiaravanon	Court of Appeal	Yes	[2019] 1 SLR 696	Singapore	Cited in the context of considering whether evidence of subsequent conduct could be taken into consideration in formation and interpretation cases.
Homburg Houtimport BV and others v Agrosin Private Ltd and another (The Starsin)	House of Lords	Yes	[2004] 1 AC 715	England and Wales	Cited for the principle that the identity of the parties to a contract is fundamental and may be established by evidence.
Midlink Development Pte Ltd v The Stansfield Group Pte Ltd	High Court	Yes	[2004] 4 SLR(R) 258	Singapore	Cited for the objective approach in ascertaining the existence of a contract based on the established matrix of circumstances.
Sanders Brothers v Maclean & Co	Queen's Bench Division	Yes	(1883) 11 QBD 327	England and Wales	Cited for the description of a bill of lading as a key to the warehouse.
APL Co Pte Ltd v Voss Peer	High Court	Yes	[2002] 2 SLR(R) 1119	Singapore	Cited for the point that a bill of lading offers security against default by the buyer.
The “Vasiliy Golovnin”	High Court	Yes	[2008] 4 SLR(R) 994	Singapore	Cited for the principle that variation of a bill of lading requires the carrier's agreement.
The “Cherry” and others	High Court	Yes	[2003] 1 SLR(R) 471	Singapore	Cited for the point that in the event of non-payment by the Buyers, the appellants would be liable to the respondent for damages.
East West Corporation v DKBS 1912 A/S and another, Utaniko Ltd v P&O Nedlloyd BV	Court of Appeal	Yes	[2003] 2 All ER 700	England and Wales	Cited for the principle that no relationship of bailment arises if title to and possession of the goods have passed to the buyer.
Albacruz v Albazero (The Albazero)	House of Lords	Yes	[1977] AC 774	England and Wales	Cited for the point that a special agreement or special contract was made between the respondent and the appellants such that a relationship of bailment nevertheless arose despite the respondent having passed title to and possession of the goods to the Buyers.
Wing Tai Garment Manufactory (Singapore) Ltd v Port of Singapore Authority	Court of Appeal	Yes	[1971–1973] SLR(R) 324	Singapore	Cited for the point that the question whether or not there is an attornment is a question of fact.
The “Xin Chang Shu”	High Court	Yes	[2016] 1 SLR 1096	Singapore	Cited for the principles applicable to wrongful arrest.
The “Eagle Prestige”	High Court	Yes	[2010] 3 SLR 294	Singapore	Cited for the point that an arresting party is not obliged to disclose all the defences which a defendant may reasonably raise at trial.
Clearlab SG Pte Ltd v Ma Zhi and another	Court of Appeal	Yes	[2016] 3 SLR 1264	Singapore	Cited for the appropriate approach when a decision as to costs is rendered separately from and after the decision on the merits of the dispute.
Qilin World Capital Ltd v CPIT Investments Ltd and another appeal	Court of Appeal	Yes	[2019] 1 SLR 1	Singapore	Cited for the appropriate approach when a decision as to costs is rendered separately from and after the decision on the merits of the dispute.
Beyonics Asia Pacific Ltd and others v Goh Chan Peng and another	Singapore International Commercial Court	Yes	[2020] 5 SLR 235	Singapore	Cited for the appropriate approach when a decision as to costs is rendered separately from and after the decision on the merits of the dispute.
Ser Kim Koi v GTMS Construction Pte Ltd and others	High Court (Appellate Division)	Yes	[2021] 1 SLR 1319	Singapore	Cited for the appropriate approach when a decision as to costs is rendered separately from and after the decision on the merits of the dispute.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Bill of Lading
Bunker Fuel
Contract of Carriage
Document of Title
Wrongful Arrest
Vopak BLs
Ex-wharf bunkers
Presentation rule
30-day credit period
Commingling of bunkers

15.2 Keywords

Admiralty
Shipping
Bill of Lading
Contract of Carriage
Wrongful Arrest
Bunker Fuel

17. Areas of Law

Area Name	Relevance Score
Bills of Lading	95
Shipping	90
Admiralty and Maritime Law	90
Contract Law	70
Civil Procedure	50
Civil Litigation	50
Wrongful arrest	40
Torts	30

16. Subjects

Admiralty
Shipping
Contract Law
Bills of Lading