Natixis v Seshadri Rajagopalan: Admiralty Actions, In Rem Writs, and Judicial Management under IRDA
Natixis, Societe Generale, and The Hongkong and Shanghai Banking Corporation Limited commenced admiralty actions in rem against the vessel "CHANG BAI SAN." The plaintiffs claimed for misdelivery and/or loss of cargo carried onboard the Vessel. The defendants, Seshadri Rajagopalan and Paresh Tribhovan Jotangia, were the judicial managers of Nan Chiau Maritime (Pte) Ltd (in liquidation), the registered owner of the Vessel. The court dismissed the plaintiffs' applications, holding that the issuance of in rem writs does not create a security interest under the Insolvency, Restructuring and Dissolution Act.
1. Case Overview
1.1 Court
General Division of the High Court1.2 Outcome
The plaintiffs’ applications are dismissed.
1.3 Case Type
Admiralty
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
The case concerns admiralty actions in rem against a vessel and whether issuing in rem writs creates a security under the Insolvency, Restructuring and Dissolution Act.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Natixis, Singapore Branch | Plaintiff | Corporation | Application Dismissed | Lost | Seah Lee Guan Collin, Jonathan Lim Shi Cao, Choi Yee Hang Ian, Tessa Lim Yong Rong, Lee Chong Jie |
| Societe Generale, Singapore Branch | Plaintiff | Corporation | Application Dismissed | Lost | Seah Lee Guan Collin, Jonathan Lim Shi Cao, Choi Yee Hang Ian, Tessa Lim Yong Rong, Lee Chong Jie |
| The Hongkong and Shanghai Banking Corporation Limited | Plaintiff | Corporation | Application Dismissed | Lost | Lin Weiwen Moses, Soong Jun De, Ryan Mark Lopez, Manvindar Kaur Sethi D/O Sarwan Singh |
| Seshadri Rajagopalan | Defendant | Individual | Judgment for Defendant | Won | Thio Shen Yi, Sze Kian Chuan, Lee Koon Foong Adam Hariz, Tan Shi Yun Jolene, Sonia Elizabeth Rajendra |
| Paresh Tribhovan Jotangia | Defendant | Individual | Judgment for Defendant | Won | Thio Shen Yi, Sze Kian Chuan, Lee Koon Foong Adam Hariz, Tan Shi Yun Jolene, Sonia Elizabeth Rajendra |
| Nan Chiau Maritime (Pte) Ltd (in liquidation) | Defendant | Corporation | Judgment for Defendant | Won | Thio Shen Yi, Sze Kian Chuan, Lee Koon Foong Adam Hariz, Tan Shi Yun Jolene, Sonia Elizabeth Rajendra |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| S Mohan | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Seah Lee Guan Collin | Resource Law LLC |
| Jonathan Lim Shi Cao | Resource Law LLC |
| Choi Yee Hang Ian | Resource Law LLC |
| Tessa Lim Yong Rong | Resource Law LLC |
| Lee Chong Jie | Resource Law LLC |
| Lin Weiwen Moses | Shook Lin & Bok LLP |
| Soong Jun De | Shook Lin & Bok LLP |
| Ryan Mark Lopez | Shook Lin & Bok LLP |
| Manvindar Kaur Sethi D/O Sarwan Singh | Shook Lin & Bok LLP |
| Thio Shen Yi | TSMP Law Corporation |
| Sze Kian Chuan | Joseph Tan Jude Benny LLP |
| Lee Koon Foong Adam Hariz | Joseph Tan Jude Benny LLP |
| Tan Shi Yun Jolene | Joseph Tan Jude Benny LLP |
| Sonia Elizabeth Rajendra | Joseph Tan Jude Benny LLP |
4. Facts
- Natixis, Societe Generale, and HSBC commenced admiralty actions in rem against the vessel "CHANG BAI SAN."
- The plaintiffs claimed for misdelivery and/or loss of cargo carried onboard the Vessel.
- Bills of lading were alleged to have been issued by Ocean Tankers (Pte) Ltd as the demise charterer of the Vessel.
- The plaintiffs claim the bills of lading were pledged to them as security for financing facilities granted to Hin Leong Trading (Pte) Ltd.
- Nan Chiau Maritime (Pte) Ltd was the registered owner of the Vessel.
- Seshadri Rajagopalan and Paresh Tribhovan Jotangia were appointed as judicial managers of Nan Chiau Maritime.
- The Vessel sailed to Gibraltar, where she was arrested by the mortgagee and sold by the Gibraltar court.
5. Formal Citations
- Natixis, Singapore Branch v Seshadri Rajagopalan and others and other matters, , [2024] SGHC 113
6. Timeline
| Date | Event |
|---|---|
| High Court (Admiralty Jurisdiction) Act 1961 | |
| Insolvency, Restructuring and Dissolution Act 2018 | |
| HSBC filed HC/ADM 93/2020 | |
| Natixis filed HC/ADM 148/2020 | |
| Societe Generale filed HC/ADM 153/2020 and HC/ADM 154/2020 | |
| Writs served for HC/ADM 148/2020, HC/ADM 153/2020 and HC/ADM 154/2020 | |
| Seshadri Rajagopalan and Paresh Tribhovan Jotangia appointed as joint and several interim judicial managers of Nan Chiau Maritime | |
| Seshadri Rajagopalan and Paresh Tribhovan Jotangia appointed as joint and several judicial managers of Nan Chiau Maritime | |
| Meeting between judicial managers and plaintiff banks | |
| Vessel redelivered to Nan Chiau Maritime | |
| Mortgagee agreed to procure the arrest of the Vessel in Gibraltar | |
| Vessel departed for the Cape of Good Hope | |
| Natixis requested information on the Vessel's voyage | |
| Societe Generale and HSBC requested information on the Vessel's voyage | |
| First defendant sent an email to the Mortgagee | |
| Judicial managers responded to the plaintiffs | |
| Employee of AlixPartners sent text messages to the Mortgagee's staff | |
| Memorandum of Agreement entered into between Nan Chiau Maritime and Genial Marine | |
| Vessel arrived in Gibraltar | |
| Natixis and Societe Generale commenced OS 902 and OS 903 | |
| Mortgagee obtained default judgment in Gibraltar | |
| Gibraltar court made further orders | |
| HSBC commenced OS 23 | |
| Judicial management of Nan Chiau Maritime expired | |
| First and second defendants, together with Ho May Kee, were appointed as the provisional liquidators of the third defendant | |
| Nan Chiau Maritime entered voluntary winding up | |
| Natixis and Societe Generale sought leave to amend OS 902 and OS 903 | |
| HSBC sought leave to amend OS 23 | |
| Judgment reserved | |
| Hearing | |
| Hearing | |
| Judgment delivered |
7. Legal Issues
- Whether the issuance of an in rem writ causes a vessel to be subject to a security under s 100(2)(a) of the IRDA
- Outcome: The court held that the issuance of an in rem writ does not cause a vessel to be subject to a security under s 100(2)(a) of the IRDA.
- Category: Substantive
- Whether the issuance of an in rem writ renders the in rem writ claimant a creditor of the owner of the vessel under s 115 of the IRDA
- Outcome: The court held that the issuance of an in rem writ does not render the in rem writ claimant a creditor of the owner of the vessel under s 115 of the IRDA.
- Category: Substantive
- Whether the Ex parte James principle affords a free-standing right to recover the net proceeds of the sale of the vessel in Gibraltar
- Outcome: The court held that the Ex parte James principle does not afford a free-standing right to recover the net proceeds of the sale of the vessel in Gibraltar.
- Category: Substantive
- Whether the conduct of the judicial managers rose to a level of opprobrium that required intervention by the court
- Outcome: The court held that the conduct of the judicial managers did not rise to a level of opprobrium that required intervention by the court.
- Category: Substantive
8. Remedies Sought
- Declaration that the plaintiffs have security in the Vessel
- Declaration that the defendants acted in breach of s 100(2) of the IRDA and/or s 115 of the IRDA
- Order for an account of expenses incurred by the defendants
- Order that the net proceeds of the sale of the Vessel be held as a separate fund
9. Cause of Actions
- Admiralty action in rem
- Breach of s 100(2) of the IRDA
- Unfairly prejudicial conduct under s 115 of the IRDA
10. Practice Areas
- Admiralty Jurisdiction
- Judicial Management
- Insolvency Administration
11. Industries
- Shipping
- Banking
- Finance
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Kuo Fen Ching and another v Dauphin Offshore Engineering & Trading Pte Ltd | Court of Appeal | Yes | [1999] 2 SLR(R) 793 | Singapore | Cited for the principle that a statutory lien is not defeated by a subsequent transfer of ownership of the ship or subsequent dissolution of the shipowning entity. |
| The “Ocean Winner” and other matters | High Court | No | [2021] 4 SLR 526 | Singapore | Cited to explain that a statutory lien creates the means to obtain security by enabling the claimant to arrest the ship. |
| In Re Aro Co Ltd | Chancery Division | No | [1980] Ch 196 | England | Cited to argue that the plaintiffs had security in the Vessel since they would have been a secured creditor upon issuance of the Admiralty Writs. |
| Diablo Fortune Inc v Duncan, Cameron Lindsay and another | Court of Appeal | No | [2018] 2 SLR 129 | Singapore | Cited to highlight that the phrase 'proprietary interest' has different meanings in different contexts. |
| The “Setia Budi” | High Court of Malaya at Kuala Lumpur | Yes | (unreported) | Malaysia | Cited for the observations made by Ong Chee Kwan J regarding the nature of the statutory right in rem. |
| Re Boonann Construction Pte Ltd | High Court | Yes | [2000] 2 SLR(R) 399 | Singapore | Cited for the principle that leave of the court is necessary in order for the judicial manager to dispose of any property which is subject to a security. |
| Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd and another and another suit | High Court | No | [2009] 4 SLR(R) 788 | Singapore | Cited for the principle that a breach of statutory duty does not, in and of itself, give rise to a private right of action. |
| X (Minors) v Bedfordshire County Council | House of Lords | No | [1995] 2 AC 633 | England | Cited for the principle that a breach of statutory duty does not, by itself, give rise to any private law cause of action. |
| DB International Trust (Singapore) Ltd v Medora Xerxes Jamshid and another | High Court | No | [2023] 5 SLR 773 | Singapore | Cited for the definition of 'creditor' in the context of a winding up. |
| Ex parte James; In re Condon | Court of Appeal | No | (1874) LR 9 Ch App 609 | England | Cited for the principle that the court will not permit its officers to act in a way which does not accord with the standards which right-thinking people would think should govern the conduct of the court or its officers. |
| Lehman Bros Australia Ltd v MacNamara and others | Court of Appeal | No | [2020] 3 WLR 147 | England | Cited for the principle established by the decision of the English Court of Appeal in Ex parte James. |
| Re PCChip Computer Manufacturer (S) Pte Ltd (in compulsory liquidation) | High Court | No | [2001] 2 SLR(R) 180 | Singapore | Cited for the observation that the court in Ex parte James appears to have relied not on any rule of law or equity in formulating the principle. |
| Re Clark (a bankrupt), ex p Trustee of the Property of the Bankrupt v Texaco | High Court | No | [1975] 1 All ER 453 | England | Cited for the four conditions distilled by Walton J providing guidance on the application of the principle in Ex parte James. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Insolvency, Restructuring and Dissolution Act 2018 | Singapore |
| High Court (Admiralty Jurisdiction) Act 1961 | Singapore |
| s 4(4) of the High Court (Admiralty Jurisdiction) Act 1961 | Singapore |
| s 100 of the Insolvency, Restructuring and Dissolution Act 2018 | Singapore |
| s 115 of the Insolvency, Restructuring and Dissolution Act 2018 | Singapore |
| Interpretation Act 1965 | Singapore |
| s 9A(3) of the Interpretation Act 1965 | Singapore |
| Companies Act (Cap 50, 1988 Rev Ed) | Singapore |
| s 218 of the IRDA | Singapore |
| s 218(2) of the IRDA | Singapore |
| s 99(2)–(3) of the IRDA | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Admiralty action in rem
- In rem writ
- Judicial management
- Insolvency, Restructuring and Dissolution Act
- Statutory lien
- Security
- Creditor
- Ex parte James principle
- Judicial sale
- Memorandum of Agreement
15.2 Keywords
- Admiralty
- Insolvency
- Judicial Management
- In Rem Writ
- Security
- IRDA
- Shipping
- Singapore
16. Subjects
- Admiralty
- Insolvency
- Restructuring
- Shipping
17. Areas of Law
- Admiralty Law
- Insolvency Law
- Shipping Law