The "Ambassador": Prioritizing Claims Against Vessel Proceeds in Admiralty Dispute

In the Singapore High Court, the plaintiffs, comprising the master, officers, and crew of the vessel “Ambassador,” initiated an admiralty action for unpaid wages. After the vessel was sold, Drydocks World – Dubai LLC (“DDW”), a mortgagee, applied for determination of claim priorities. The court affirmed DDW's priority claim to the balance sale proceeds, rejecting a request for further arguments from Shipoil Ltd and Island Oil Ltd, who sought to compel DDW to first pursue other avenues of recovery. The court held that DDW was entitled to elect its preferred method of enforcement, subject to avoiding double recovery.

1. Case Overview

1.1 Court

General Division of the High Court

1.2 Outcome

Request for further arguments rejected; decision in SUM 3316 affirmed.

1.3 Case Type

Admiralty

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Singapore High Court addresses claim priorities against the vessel “Ambassador” following its sale, focusing on a mortgagee's right to elect enforcement.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Tsarkov Oleg IgorevichPlaintiffIndividual
Kravchenko Nikolay NikolaevichPlaintiffIndividual
Phatsia Archil Nugzaris-DzePlaintiffIndividual
Devadze IrakliPlaintiffIndividual
Stefanidi Evgeny VladimirovichPlaintiffIndividual
Gorodnichiy Nikolay ViktorovichPlaintiffIndividual
Mamonov Oleg BorisovichPlaintiffIndividual
Perezva Vadim ValentinovichPlaintiffIndividual
Beridze Irakli TarielPlaintiffIndividual
Timakhov Vladimir ViktorovichPlaintiffIndividual
Lavrinenko Vladimir InvanovichPlaintiffIndividual
Rodinadze MalkhazPlaintiffIndividual
Togonidze GiviPlaintiffIndividual
Kelekhsashvili Giorgi GiviPlaintiffIndividual
Lukashenia Vladimir VladimirovichPlaintiffIndividual
Metsler Vadim ViktorovichPlaintiffIndividual
Borisov Kyrylo SergiyovychPlaintiffIndividual
Tatarinov AndreiPlaintiffIndividual
Abdurakhmanov Emir-Salie EbazerovichPlaintiffIndividual
Voronin Maxim VasilevichPlaintiffIndividual
Markaryan EdgarPlaintiffIndividual
Dolzhenko Evgenii MikhaylovichPlaintiffIndividual
Kirichenko Nikolay NikolaevichPlaintiffIndividual
Khashev Sergiy AleksandrovichPlaintiffIndividual
Owner and/or Demise Charterer of the vessel “Ambassador”DefendantOther
Newton Shipping LtdIntervenerCorporation
Iships Management Pte LtdIntervenerCorporation
V.Group Manpower ServicesIntervenerCorporation
Evergreen Marine (UK) LtdIntervenerCorporation
Drydocks World – Dubai LLCIntervener, ApplicantCorporationClaim to Balance Sale Proceeds had priorityWonBazul Ashhab Bin Abdul Kader, Prakaash s/o Paniar Silvam, Ng Guang Yi
Shipoil LtdIntervenerCorporationRequest for further arguments rejectedLostTan Wee Kong, Poh Ying Ying Joanna
Island Oil LtdIntervenerCorporationRequest for further arguments rejectedLostTan Wee Kong, Poh Ying Ying Joanna
Wilhelmsen Ships Service LLCIntervenerCorporation
Chugoku Marine Paints (Singapore) Pte LtdIntervenerCorporation
Clyde & Co LLPIntervenerLaw FirmSylvia Lem Jia Li

3. Judges

Judge NameTitleDelivered Judgment
Chua Lee MingJudge of the High CourtYes

4. Counsels

Counsel NameOrganization
Bazul Ashhab Bin Abdul KaderOon & Bazul LLP
Prakaash s/o Paniar SilvamOon & Bazul LLP
Ng Guang YiOon & Bazul LLP
Tan Wee KongJLex LLC
Poh Ying Ying JoannaJLex LLC
Lim Zhi Ming MaxRajah & Tann Singapore LLP
Ng YuhuiIncisive Law LLC
Subashini d/o NarayanasamyHaridass Ho & Partners
Sylvia Lem Jia LiClasis LLC

4. Facts

  1. Plaintiffs, the vessel's crew, initiated action for unpaid wages.
  2. Defendant, the vessel owner, defaulted in appearance.
  3. The vessel “Ambassador” was sold, and proceeds paid into court.
  4. DDW held a second priority mortgage over the vessel.
  5. Evergreen held a first priority mortgage over the vessel.
  6. DDW also held an assignment of a judgment debt owed by Evergreen to the defendant.
  7. Shipoil and Island Oil supplied bunkers to the vessel.

5. Formal Citations

    6. Timeline

    DateEvent
    Collision between the Vessel and another vessel owned by Evergreen
    Gard AS issued a letter of undertaking on behalf of Evergreen to the defendant
    Defendant granted Evergreen a first priority mortgage over the Vessel
    Defendant granted DDW a second priority mortgage
    Defendant assigned to DDW the benefit of the Gard LOU
    Plaintiffs arrested the Vessel
    Plaintiffs entered judgment in default of appearance against the defendant
    DDW commenced action against the defendant in HC/ADM 51/2017
    Vessel and bunkers were sold
    Sale Proceeds were paid into court
    Newton Shipping Ltd withdrew its claim
    Payments were ordered to be made from the Sale Proceeds to various parties including the plaintiffs
    Payments were ordered to be made from the Sale Proceeds to various parties including the plaintiffs
    Defendant obtained judgment against Evergreen in England
    DDW filed SUM 3316
    Balance amount including interest was S$8,600,459.01
    Court heard SUM 3316 and decided that DDW’s claim had priority
    Consent order was entered staying the interpleader proceedings in England
    Shipoil and Island Oil requested further arguments
    Shipoil and Island Oil filed a notice of appeal
    Judgment issued

    7. Legal Issues

    1. Priorities of Claims
      • Outcome: The court held that DDW's mortgage claim had priority over the claims of Shipoil and Island Oil.
      • Category: Substantive
      • Sub-Issues:
        • Ranking of mortgage claims
        • Enforcement of maritime liens
        • Distribution of proceeds from vessel sale
      • Related Cases:
        • [1977] 2 Lloyd’s Rep 243
    2. Right to Elect Enforcement
      • Outcome: The court held that DDW was entitled to elect to enforce its remedies as far as applicable, subject to there being no double recovery.
      • Category: Substantive
      • Sub-Issues:
        • Whether a mortgagee can choose which security to enforce first
        • Whether a creditor can compel a mortgagee to enforce other securities first
      • Related Cases:
        • [1977] 2 Lloyd’s Rep 243

    8. Remedies Sought

    1. Payment of unpaid wages
    2. Determination of claim priorities
    3. Payment out of sale proceeds

    9. Cause of Actions

    • Claim for unpaid wages
    • Mortgage claim

    10. Practice Areas

    • Admiralty
    • Shipping
    • Mortgages
    • Commercial Litigation

    11. Industries

    • Shipping

    12. Cited Cases

    Case NameCourtAffirmedCitationJurisdictionSignificance
    The “Myrto”N/AYes[1977] 2 Lloyd’s Rep 243N/ACited for the principle that a party is entitled to elect to enforce its remedies as far as applicable, subject to there being no double recovery.

    13. Applicable Rules

    Rule Name
    No applicable rules

    14. Applicable Statutes

    Statute NameJurisdiction
    No applicable statutes

    15. Key Terms and Keywords

    15.1 Key Terms

    • Vessel
    • Mortgage
    • Sale Proceeds
    • Priority of Claims
    • Balance Sale Proceeds
    • Nautical Judgment Debt
    • Gard LOU
    • ADM 51 Judgment
    • Deferred Payment Agreement

    15.2 Keywords

    • Admiralty
    • Shipping
    • Mortgage
    • Priority of Claims
    • Vessel
    • Ambassador

    16. Subjects

    • Admiralty
    • Shipping
    • Mortgages
    • Civil Procedure

    17. Areas of Law

    • Admiralty Law
    • Shipping Law
    • Civil Procedure
    • Mortgage Law