Oghiaanous Khoroushan Shipping Lines Co. v Owner of the vessel “TINA I”: Sanctions Clause in Admiralty Action

In an admiralty action, Oghiaanous Khoroushan Shipping Lines Co. of Kish (Claimant) sued the Owner of the vessel “TINA I” (Defendant) in the General Division of the High Court of Singapore, regarding a collision. The Defendant applied for security to include a sanctions clause, allowing refusal of payment due to US sanctions. AR Navin Anand declined the application, holding that the sanctions clause was not supported by evidence, inconsistent with payment into court, and would result in inadequate security for the Claimant.

1. Case Overview

1.1 Court

General Division of the High Court of the Republic of Singapore

1.2 Outcome

Application to include a sanctions clause as a term of the security is declined.

1.3 Case Type

Admiralty

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore court declines to include a sanctions clause in security for an admiralty action, ensuring claimant receives adequate security.

1.7 Decision Date

31 October 2024

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Oghiaanous Khoroushan Shipping Lines Co. of Kish	Claimant	Corporation	Application to include sanctions clause declined	Won	Tan Boon Yong Thomas of Haridass Ho & Partners Lieu Kuok Poh of Haridass Ho & Partners
Owner of the vessel “TINA I”	Defendant	Corporation	Application to include sanctions clause declined	Lost	Loh Wai Yue of Incisive Law LLC Daniel Tan An Ye of Incisive Law LLC Glenn Tennyson Ong of Incisive Law LLC

3. Judges

Judge Name	Title	Delivered Judgment
Navin Anand	Assistant Registrar	Yes

4. Counsels

Counsel Name	Organization
Tan Boon Yong Thomas	Haridass Ho & Partners
Lieu Kuok Poh	Haridass Ho & Partners
Loh Wai Yue	Incisive Law LLC
Daniel Tan An Ye	Incisive Law LLC
Glenn Tennyson Ong	Incisive Law LLC

4. Facts

A collision occurred between the “Shahraz” and the “Tina I” on 22 November 2020.
The Claimant owned the “Shahraz”, and the Defendant owned the “Tina I”.
The Claimant and the “Shahraz” are on the US SDN List.
The parties agreed on the quantum of security at S$653,476.16.
The parties agreed that security would be furnished by payment into court.
The Defendant sought to include a Sanctions Clause in the security terms.
The Claimant resisted the inclusion of the Sanctions Clause.

5. Formal Citations

The “Tina I”, Admiralty in Rem No 87 of 2022 (Summons No 2279 of 2024), [2024] SGHCR 12

6. Timeline

Date	Event
2020-11-22	Collision between the “Shahraz” and the “Tina I” occurred.
2021-02-01	Parties began negotiating the voluntary provision of security for the Claimant’s claims.
2022-11-15	Claimant commenced HC/ADM 87/2022 against the Defendant.
2024-05-17	Collision Liability Agreement was filed in the Supreme Court Registry.
2024-10-09	Judgment reserved.
2024-11-01	Judgment date.

7. Legal Issues

Inclusion of Sanctions Clause in Security
- Outcome: The court declined to include the sanctions clause, holding that it was not supported by evidence, inconsistent with payment into court, and would result in inadequate security for the Claimant.
- Category: Substantive
- Sub-Issues:
  - Risk of secondary sanctions
  - Adequacy of security
  - Enforcement of judgment
- Related Cases:
  - [2022] 1 Lloyd’s Rep 261
  - [2022] 2 Lloyd’s Rep 448

8. Remedies Sought

Security to avoid arrest of vessel
Monetary damages

9. Cause of Actions

Negligence
Damage to vessel

10. Practice Areas

Admiralty Litigation
Commercial Litigation
International Trade
Shipping
Sanctions Compliance

11. Industries

Shipping

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Kuo Fen Ching and another v Dauphin Offshore Engineering & Trading Pte Ltd	High Court	Yes	[1999] 2 SLR(R) 793	Singapore	Cited for the principle that a claimant in an admiralty action in rem can obtain pre-judgment security through the arrest of the defendant’s vessel or the provision of security to avoid her arrest.
The “Piya Bhum”	High Court	Yes	[1993] 3 SLR(R) 905	Singapore	Cited for the court's jurisdiction to determine the form and quantum of security, and the terms on which security is provided to avoid vessel arrest.
The “Arktis Fighter”	High Court	Yes	[2001] 2 SLR(R) 157	Singapore	Cited for the principle that the court's power to control security is derived from its inherent jurisdiction to prevent the oppressive use of court procedure.
The “Benja Bhum”	Court of Appeal	Yes	[1993] 3 SLR(R) 242	Singapore	Cited for the principle that security ordered by the court must be adequate in the circumstances of the case, as it is given in exchange for the vessel.
Pacific Recreation Pte Ltd v S Y Technology Inc and another appeal	Court of Appeal	Yes	[2008] 2 SLR(R) 491	Singapore	Cited for the principle that foreign law must be proved as a question of fact.
Ang Tin Gee v Pang Teck Guan	High Court	Yes	[2015] 5 SLR 836	Singapore	Cited for the principle that monies paid into court as security become subject to the outcome of the action and any order the court may make.
Cheng Lip Kwong v Bangkok Bank Ltd	High Court	Yes	[1992] 1 SLR(R) 941	Singapore	Cited for the principle that a defendant who provides security through payment into court ceases to have full title to those monies.
The “Vasiliy Golovnin”	High Court	Yes	[2008] 4 SLR(R) 994	Singapore	Cited for the principle that a claimant may be liable for wrongful arrest if it attempts to obtain further security after security has been furnished.
The Polo II	Not specified	Yes	[1977] 2 Lloyd’s Rep 115	England	Cited for the principle that adequate security should cover the amount of the claim plus interest and costs on the basis of the plaintiff’s best arguable case, but should not normally exceed the value of the vessel arrested.
M/V Pacific Pearl Co Ltd v Osios David Shipping Inc	High Court	Yes	[2022] 1 Lloyd’s Rep 261	England	Cited as an instance where the court accepted security that included a similarly worded sanctions clause.
M/V Pacific Pearl Co Ltd v Osios David Shipping Inc	Court of Appeal	Yes	[2022] 2 Lloyd’s Rep 448	England	Cited as an instance where the court accepted security that included a similarly worded sanctions clause.

13. Applicable Rules

Rule Name
Order 33 Rule 34 of the Rules of Court 2021
Order 12 Rule 5(1) of the Rules of Court 2021
Order 12 Rule 5(2) of the Rules of Court 2021
Order 33 Rule 25(1) of the Rules of Court 2021
Order 27 Rule 4(1) of the Rules of Court 2021
Order 27 Rule 4(7) of the Rules of Court 2021
Order 33 Rules 25(2)-(3) of the Rules of Court 2021
Order 27 Rule 8 of the Rules of Court 2021

14. Applicable Statutes

Statute Name	Jurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

Sanctions Clause
Security
Payment into court
Admiralty action in rem
Collision Liability Agreement
SDN List
Secondary sanctions
OFAC
Club LOU

15.2 Keywords

Admiralty
Shipping
Sanctions
Security
Collision
Singapore
Court
Vessel
Payment into court

17. Areas of Law

Area Name	Relevance Score
Admiralty and Maritime Law	90
Sanctions Law	70
Civil Practice	60
Litigation	50
Jurisdiction	40
Contractual terms	30

16. Subjects

Admiralty
Shipping
Sanctions
Civil Procedure