The "Engedi": Stay of Admiralty Action in Rem Pending Arbitration
In The "Engedi" case before the High Court of Singapore, Judith Prakash J heard an appeal by Capital Gate Holdings Pte Ltd (“the intervener”) against the assistant registrar’s decision to stay Admiralty in Rem No 233 of 2008 in favour of arbitration in London, as sought by T.S. Lines Ltd (“the plaintiff”). The underlying dispute arose from a charterparty agreement between T.S. Lines Ltd and EP Carriers Pte Ltd (“the defendant”), concerning the vessel TS BANGKOK. The court allowed the appeal, setting aside the stay order.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal allowed in so far as the proceedings had been stayed. The stay order granted below was set aside.
1.3 Case Type
Admiralty
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding stay of admiralty action in rem in favor of arbitration. The court allowed the appeal, setting aside the stay order.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Capital Gate Holdings Pte Ltd | Appellant, Intervener | Corporation | Appeal Allowed | Won | |
| T.S. Lines Ltd | Respondent, Plaintiff | Corporation | Appeal Dismissed | Lost | |
| EP Carriers Pte Ltd | Defendant | Corporation | Neutral | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Timothy Tan | AsiaLegal LLC |
| Gho Sze Kee | AsiaLegal LLC |
| Leona Wong | Allen & Gledhill LLP |
4. Facts
- Plaintiff and defendant entered into a charterparty agreement with an arbitration clause.
- A grounding incident occurred, causing damage to the vessel.
- The plaintiff commenced proceedings in rem against a vessel belonging to the defendant.
- The defendant transferred ownership of the vessel to the intervener.
- The defendant was placed in provisional liquidation.
- The plaintiff arrested the vessel.
- The intervener applied to set aside the arrest.
5. Formal Citations
- The “Engedi”, Admiralty in Rem No 233 of 2008 (Registrar's Appeal No 296 of 2009), [2010] SGHC 95
6. Timeline
| Date | Event |
|---|---|
| Plaintiff entered into a charterparty with the defendant. | |
| Grounding incident occurred, resulting in damage to the TS BANGKOK. | |
| Defendant transferred ownership of the Vessel to the intervener. | |
| Defendant was placed in provisional liquidation. | |
| Plaintiff obtained leave of court to continue with the in rem proceedings and to arrest the Vessel and arrested the Vessel. | |
| UOB lodged a caveat against the release of the Vessel and payment out. | |
| Defendant entered appearance. | |
| Plaintiff filed an application seeking an order that the Vessel be appraised and sold pendente lite. | |
| Intervener obtained leave to intervene. | |
| Plaintiff sought an order that all further proceedings in the Action were to be stayed under s 6 of the IAA. | |
| Sale Application was heard and allowed. | |
| UOB brought an action seeking judgment against the defendant and the Vessel and a declaration that the Vessel was encumbered by the mortgage securing moneys due to it. | |
| Plaintiff intervened in UOB's proceedings. | |
| Appeal allowed in so far as the proceedings had been stayed. |
7. Legal Issues
- Stay of Proceedings
- Outcome: The court held that the stay order should be set aside, allowing the in rem action to proceed.
- Category: Procedural
- Sub-Issues:
- Application of Section 6 of the International Arbitration Act
- Effect of insolvency on arbitration proceedings
- Distinction between in rem and in personam claims
- Action in Rem vs Action in Personam
- Outcome: The court distinguished between the in rem and in personam claims, holding that the arbitration agreement did not bind the intervener in the in rem action.
- Category: Substantive
- Sub-Issues:
- Enforcement against the res
- Rights of interveners
- Impact of arbitration agreement on third parties
- Leave to Commence Proceedings Against Company in Liquidation
- Outcome: The court expressed a tentative view that foreign arbitrations are probably not caught by the provision requiring leave, but did not make a concluded decision on this issue.
- Category: Procedural
- Sub-Issues:
- Interpretation of Section 299 of the Companies Act
- Application to foreign arbitrations
- Control over foreign proceedings
8. Remedies Sought
- Stay of Proceedings
- Arbitration
- Setting Aside of Arrest
9. Cause of Actions
- Breach of Contract
- Indemnity
10. Practice Areas
- Admiralty
- Arbitration
- Commercial Litigation
- Insolvency
11. Industries
- Shipping
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| The “Damavand” | High Court | Yes | [1993] 2 SLR(R) 136 | Singapore | Cited for the principle that once the defendant enters an appearance, the action continues as an action in rem against the res and in personam against the shipowner defendant. |
| The Fierbinti | High Court | Yes | [1993] SGHC 319 | Singapore | Cited for the principle that once the defendant enters an appearance, the action continues as an action in rem against the res and in personam against the shipowner defendant. |
| The August 8 | House of Lords | Yes | [1983] 2 AC 450 | England and Wales | Cited for the principle that once the defendant enters an appearance, the action continues as an action in rem against the res and in personam against the shipowner defendant. |
| Kuo Fen Ching and Another v Dauphin Offshore Engineering & Trading Pte Ltd | Court of Appeal | Yes | [1999] 2 SLR(R) 793 | Singapore | Cited to support the principle that the defendants of the respective actions are regarded as different parties in an action in personam and an action in rem. |
| Republic of India and another v India Steamship Co Ltd (No 2) | House of Lords | Yes | [1998] 1 AC 878 | England and Wales | Cited as a proposition rejected by the Court of Appeal that in substance the owner of the res, and not the res itself, was the defendant to an action in rem. |
| The "Sin Chuen No 112" (Union Bank of Taiwan and others, interveners) | High Court | Yes | [2007] SGHC 72 | Singapore | Cited for the principle that the intervener is permitted to set up such defences as the owner of the ship could have set up had it defended the action. |
| The “Soeraya Emas” | High Court | Yes | [1991] 2 SLR(R) 479 | Singapore | Cited to support the proposition that the in rem claim could be heard separately from the in personam claim. |
| Pemunya Kapal MV Brihope & Others v Emmanuel E Okwuosa & Others | Court of Appeal | Yes | [1997] 1 MLJ 453 | Malaysia | Cited as a case that rejected the decision in The “Soeraya Emas”. |
| Korea Asset Management Corp v Daewoo Singapore Pte Ltd (in liquidation) | High Court | Yes | [2004] 1 SLR(R) 671 | Singapore | Cited for the interpretation of the words "action or proceeding" in s 299(2) of the Companies Act. |
| Re International Pulp and Paper Co | Court of Appeal | Yes | (1876) 3 Ch D 594 | England and Wales | Cited for the principle that the courts of one country have no jurisdiction over the affairs of another country. |
| Re Oriental Inland Steam Co | Court of Appeal | Yes | (1874) LR 9 Ch App 557 | England and Wales | Cited for the principle that Parliament never legislates respecting strictly foreign Courts. |
| Re Vocalion (Foreign) Ltd | High Court | Yes | [1932] 2 Ch 196 | England and Wales | Cited for the principle that provisions of the UK Companies Act 1929 had no application to actions or proceedings in foreign courts. |
| Herbert Berry Associates Ltd v Inland Revenue Commissioners | House of Lords | Yes | [1977] 1 WLR 1437 | England and Wales | Cited for the interpretation of the words “action” and “proceeding” as terms of legal art. |
| Re Taylor (A Bankrupt) | High Court | Yes | [2007] 2 WLR 148 | England and Wales | Cited for the principle that if Parliament says that proceedings may only be started if leave is obtained from a particular court the jurisdiction of any other court or of an arbitrator is thereby controlled. |
| Re Vassal Pty Ltd (receivers and managers appointed) (in liquidation) | Supreme Court | Yes | (1984) 2 ACLC 53 | Australia | Cited for the interpretation of the words “action or other legal proceeding” and “action or other civil proceeding” to include arbitration. |
| Mowbray College v Exhib Design & Construction Pty Ltd (in liquidation) | Supreme Court | Yes | (1987) 5 ACLC 478 | Australia | Cited for the interpretation of the words “civil proceedings” to encompass all processes of disputation involving a company, in an adversarial role with other legal persons, whereby its financial affairs may be affected. |
| Doran Constructions Pty Limited (in liquidation) v Beresfield Aluminuim Pty Limited | Court of Appeal | Yes | [2002] NSWCA 95 | Australia | Cited for the interpretation of the words “action or other legal proceeding” and “action or other civil proceeding” to include arbitration. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| International Arbitration Act (Cap 143A, 2002 Rev Ed) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Action in rem
- Action in personam
- Arbitration agreement
- Stay of proceedings
- Intervener
- Charterparty
- Liquidation
- Arrest of vessel
15.2 Keywords
- Admiralty
- Arbitration
- Stay of proceedings
- Action in rem
- Action in personam
- Singapore
- Shipping
- Charterparty
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Admiralty and Maritime Law | 90 |
| Arbitration | 85 |
| International Arbitration Act | 80 |
| Shipping Law | 75 |
| Charterparty Disputes | 60 |
| Jurisdiction | 50 |
| Bankruptcy | 40 |
| Contract Law | 30 |
| Company Law | 30 |
16. Subjects
- Admiralty
- Arbitration
- Civil Procedure
- Company Law
- International Arbitration