IMC Transworld Pte Ltd v Ashapura Minechem Ltd: Summary Judgment for Guarantee Payment Obligations
In IMC Transworld Pte Ltd v Ashapura Minechem Ltd, the General Division of the High Court of Singapore granted summary judgment on 6 October 2023 in favour of IMC Transworld Pte Ltd against Ashapura Minechem Limited. The case concerned a guarantee provided by Ashapura Minechem for the payment obligations of Al Rock Mining FZE under a Contract of Affreightment. After Al Rock Mining failed to satisfy arbitration awards, IMC Transworld sought recovery from Ashapura Minechem under the guarantee. The court determined that the guarantee operated as an 'on demand' guarantee, entitling IMC Transworld to summary judgment. The court ordered costs to be in the cause, with such costs awarded to the claimant on an indemnity basis under the terms of the Guarantee.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Summary judgment on the merits be entered against the defendant.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Summary judgment granted to IMC Transworld against Ashapura Minechem for failing to honor a guarantee for Al Rock Mining's debt. The court found the guarantee was an 'on demand' guarantee.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| IMC Transworld Pte Ltd | Claimant | Corporation | Judgment for Claimant | Won | |
| Ashapura Minechem Limited | Defendant | Corporation | Summary Judgment Entered Against | Lost | |
| Al Rock Mining FZE | Charterer | Corporation | Arbitration Awards Not Satisfied | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | Senior Judge | Yes |
4. Counsels
4. Facts
- IMC Transworld Pte Ltd and Ashapura Minechem Limited entered into a guarantee agreement.
- Ashapura Minechem guaranteed payment obligations of Al Rock Mining FZE to IMC Transworld under a Contract of Affreightment.
- Disputes arose under the Contract of Affreightment, leading to arbitration proceedings in London.
- IMC Transworld obtained arbitration awards in its favor against Al Rock Mining.
- Al Rock Mining failed to satisfy the arbitration awards.
- IMC Transworld sought recovery from Ashapura Minechem under the guarantee.
- The defendant refused to make payment under the Guarantee.
5. Formal Citations
- IMC Transworld Pte Ltd v Ashapura Minechem Ltd, Originating Claim No 232 of 2023 (Summons No 2359 of 2023), [2023] SGHC 357
6. Timeline
| Date | Event |
|---|---|
| Contract of Affreightment signed | |
| Guarantee entered into | |
| Disputes arose under the Contract of Affreightment | |
| Final Arbitration Award issued | |
| Costs Award issued | |
| Payment demanded under Arbitration Awards | |
| Payment demanded from defendant pursuant to Guarantee | |
| Defendant contended Arbitration Awards did not bind it | |
| Claimant obtained leave to enforce the Arbitration Awards | |
| Enforcement Order served on the Charterer | |
| Judgment served on the Charterer | |
| Another demand sent to the defendant's Indian solicitors | |
| Defendant raised objections | |
| Proceedings commenced in Originating Claim No 232 of 2023 | |
| Claimant applied for summary judgment | |
| Summary judgment granted in favour of the claimant | |
| Grounds of decision issued |
7. Legal Issues
- Enforceability of Guarantee
- Outcome: The court held that the Guarantee operated as an 'on demand' guarantee, making the defendant liable upon the claimant’s demand.
- Category: Substantive
- Sub-Issues:
- Interpretation of guarantee terms
- Whether the guarantee is an 'on demand' guarantee or a simple guarantee
- Related Cases:
- [2018] 4 SLR 1276
- [2023] SGHCR 1
- [2009] 3 SLR(R) 689
- [1973] 1 Lloyd’s Rep 21
- [2016] EWHC 2957 (Comm)
- (1935) 53 CLR 643
- [2023] SGCA 39
- Summary Judgment
- Outcome: The court granted summary judgment in favor of the claimant.
- Category: Procedural
- Related Cases:
- [2018] 4 SLR 1276
8. Remedies Sought
- Monetary Damages
- Summary Judgment
9. Cause of Actions
- Breach of Guarantee
10. Practice Areas
- Commercial Litigation
- Arbitration
11. Industries
- Shipping
- Mining
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Ma Hongjin v SCP Holdings Pte Ltd | Court of Appeal | Yes | [2018] 4 SLR 1276 | Singapore | Cited for the principles for the grant of summary judgment. |
| TA Private Capital Security Agent Ltd and another v UD Trading Group Holding Pte Ltd and another | Singapore High Court | Yes | [2023] SGHCR 1 | Singapore | Cited for the definition of an 'on demand' guarantee. |
| PT Jaya Sumpiles Indonesia and another v Kristle Trading Ltd and another appeal | Court of Appeal | Yes | [2009] 3 SLR(R) 689 | Singapore | Cited for the principle that an arbitration award against a principal debtor does not constitute evidence of a surety’s liability. |
| Re Kitchin Ex p Young | N/A | Yes | LR 17 Ch D 668 | N/A | Cited for the principle that an arbitration award obtained by a creditor against the principal debtor does not constitute evidence that may be used to establish a surety’s liability. |
| Compania Sudamericana de Fletes SA v African Continental Bank Ltd (The Rosarina) | N/A | Yes | [1973] 1 Lloyd’s Rep 21 | N/A | Cited as an example of a case where the courts have allowed a guarantee that contained an express promise by the surety to pay “up to the amount stated above in accordance with any arbitration award rendered in London (under the terms of the charterparty)”. |
| Bitumen Invest AS v Richmond Mercantile Ltd FZC | High Court of Justice | Yes | [2016] EWHC 2957 (Comm) | England and Wales | Cited for the principle that the certification of any amount as due as a consequence of non-fulfilment of the principal debtor’s obligations must go, inevitably, to liability since, otherwise, the certification of sums as due is meaningless. |
| Dobbs v National Bank of Australasia Ltd | High Court | Yes | (1935) 53 CLR 643 | Australia | Cited for the principle that a certificate signed by the Manager stating the balance of principal and interest due to you by the customer, shall be conclusive evidence of the indebtedness at such date of the customer to you. |
| Lim Siau Hing @ Lim Kim Hoe and another v Compass Consulting Pte Ltd and another appeal | Court of Appeal | Yes | [2023] SGCA 39 | Singapore | Cited for the principle that it remains an open question whether evidence of subsequent conduct may be admitted for the purposes of contractual interpretation. |
| M2B World Asia Pacific Pte Ltd v Matsumura Akihiko | High Court | Yes | [2015] 1 SLR 325 | Singapore | Cited for the principle that the court will not grant permission to defend if the defendant only provides a mere assertion, contained in an affidavit, of a given situation which forms the basis of his defence. |
| Prosperous Credit Pte Ltd v Gen Hwa Franchise International Pte Ltd | High Court | Yes | [1998] 1 SLR(R) 53 | Singapore | Cited for the principle that the court will not grant permission to defend if the defendant only provides a mere assertion, contained in an affidavit, of a given situation which forms the basis of his defence. |
| Akfel Commodities Turkey Holding Anonim Sirketi v Townsend, Adam | Court of Appeal | Yes | [2019] 2 SLR 412 | Singapore | Cited for the principle that even in the absence of a specific triable issue, there are other reasons why the matter should go to trial. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Guarantee
- Contract of Affreightment
- Arbitration Award
- On demand guarantee
- Primary obligor
- Charter party
- Summary judgment
15.2 Keywords
- guarantee
- summary judgment
- arbitration
- contract of affreightment
- shipping
- on demand guarantee
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Summary Judgement | 95 |
| Guarantee | 90 |
| Civil Procedure | 70 |
| Contract Law | 60 |
| Banking and Finance | 40 |
| Arbitration | 30 |
| Breach of Contract | 30 |
16. Subjects
- Contract Law
- Arbitration
- Guarantees
- Civil Procedure
- Shipping Law