On 17 September 1998, a collision occurred between the Panama flagged container vessel, Ever Glory, and the Liberia flagged car carrier, Hual Trinita, in Singapore territorial waters. The plaintiffs in this action were the registered owners of the Ever Glory. The defendants were the owners or insurers of the (damaged) cargo carried on the Hual Trinita. A settlement on liability was reached, and the collision liability was apportioned 50:50. On 2 October 1998, the plaintiff shipowners of Ever Glory commenced a limitation action in Singapore, against all persons, including the defendants, having potential claims arising out of the collision. Just under a year later, on 24 September 1999, the decree of limitation was granted. On 3 November 1999, the plaintiff ship owners obtained a declaration that their liability was limited to SGD 2,411,227.56 plus interest under the International Convention relating to the Limitation of the Liability of Owners of Sea-Going Ships 1957 (LLMC 1957). The plaintiffs paid the limitation fund sum into Court the next day. The defendants were aware of the limitation proceedings and were kept fully informed of every step taken in the proceedings. The defendants did not participate in the limitation action. They did not challenge the decree nor prove their claims against the limitation fund.

On 24 September 1999, the defendants proceeded to arrest the Ever Reach, a sister ship of the Ever Glory, in Belgium. They commenced an action in tort against the plaintiffs in Belgium, as the Belgian courts would apply a higher limit based on the Convention on Limitation of Liability for Maritime Claims 1976 (LLMC 1976) which limit was assessed at SGD 13.5 million. It was suggested that the Belgian courts would not recognize the Singapore decree and limitation fund. The plaintiffs applied in Belgium to set aside the arrest of the Ever Reach, which action was still pending (the plaintiffs having furnished security in order to secure the release of the Ever Reach from arrest). It was common ground that there was no doctrine of forum non conveniens in Belgian law.

The plaintiffs applied to the Singapore Court of Singapore for an anti-suit injunction to restrain the defendants from continuing their action in Belgium. Conversely, the 4^th to 74^th defendants sought the setting aside of the order for service out of the jurisdiction of the plaintiff’s originating summons.

Held: The plaintiff’s application would be allowed, and the requested anti-suit injunction granted. The 4^th to 74^th defendants’ application would be dismissed.

Ang J began by reiterating the relevant principles pertaining to the grant of anti-suit injunctions in Singapore (as enunciated by the Privy Council in Societe Nationale Industrielle Aerospatiale v Lee Kui Jak [1987] AC 871 and adopted by the Court of Appeal in Bank of America National Trust and Savings Association v Djoni Widjaja [1994] 2 SLR( R) 898). Broadly, the jurisdiction to grant an anti-suit injunction is to be exercised when the ends of justice require it, and it is the establishment of an equity or equities which will ground the grant of injunctive relief. This may occur when Singapore is the natural forum for the resolution of the dispute between the parties and the foreign proceedings are vexatious or oppressive. Account must be had of the possible injustice to the defendants should the injunction be granted, and the possible injustice to the plaintiffs if it is not. 

Ang J found that the defendant was properly served with the Singapore proceedings. Some of the other defendants either had a registered place of business in Singapore or owned assets in Singapore, and the remaining defendants were joined as necessary and proper parties to the proceedings. The Court found that when in personam jurisdiction over the defendants through service on them with process is established, the defendants become subject to the jurisdiction and hence can be restrained by an injunction granted by a Singapore court (Koh Kay Yew v Inno-Pacific Holdings Ltd [1997] 2 SLR (R) 148).

Ang J was satisfied that the plaintiffs had shown Singapore to be the natural forum for the determination of liability and quantum between the parties, primarily because the defendants’ claims against the plaintiffs were for damages in tort, the tort was committed in Singapore, and it is the law of Singapore that gave rise to a cause of action.

Ang J went on to consider the plaintiff’s reasons why the Belgium proceedings were oppressive, and the defendants’ submission that none of the reasons constituted oppressive conduct.

As to the issue of the different limitation conventions in force in Belgium and Singapore, Ang J observed that either Convention envisaged a single limitation fund against which all possible claims arising out of the collision would be brought.

The defendants accepted that the limitation decree bound the defendants in that it was ‘good against the world’ but argued that it did not compel the defendants to prove their claim against the limitation fund. Counsel for the defendants said that the defendants had elected not to participate in the limitation fund and were taking a risk by going to Belgium. In other words, the defendants decided to ‘stand or fall’ by their decision to sue and continue with proceedings in Belgium. It was said that the Belgian courts would apply the LLMC 1976 and not recognise the Singapore decree and limitation fund.

The plaintiffs argued that no authority was put forward in support of the defendants’ interpretation of the phrase ‘good against the world’, and that the meaning assigned by the defendants went against the substratum of the LLMC 1957. The whole purpose of the LLMC 1957 (and LLMC 1976) was to enable a shipowner to set up one fund against which all claimants would be required to make their claim.

The Court found that the defendants were still claimants against the limitation fund even though they chose not to make a claim against the fund.

Turning to whether the conduct of the defendants in continuing with the Belgian proceedings was vexatious or oppressive and hence unconscionable, Ang J first had regard to the following:

• That the limitation decree and thereafter the limitation fund were properly obtained and constituted in Singapore; that the limitation decree was that of a competent court having jurisdiction as the natural forum over the dispute on liability and quantum; that the decree had not been set aside or varied; that Singapore was the plaintiff’s choice of forum for commencing their limitation action; that the defendants elected not to prove their claims against the limitation fund. In summary, the constitution of a limitation fund in Singapore provided the necessary focal point for consideration of the issues at hand.  

• As explained by Longmore J in The Happy Fellow [1997] 1 Lloyd’s Rep 130, a limitation action is a special proceeding to which all potential claimants are made parties.

• A limitation decree not set aside, as is the case here, is good against the world (The Volvox Hollandia [1988] 2 Lloyd’s Rep 361 (CMI2407); also The Happy Fellow).

The court went on to hold that the conduct of the defendants in unlawfully challenging the plaintiffs’ right to choose the limitation forum, and the defendants attack on the plaintiffs’ legal rights conferred by the limitation decree and limitation fund, was vexatious or oppressive.

As to the first point, the right to claim limitation in any particular forum was a right which belonged to the shipowner alone and that choice was not to be pre-empted by a claimant. In other words, a claimant could not dictate where the limitation fund was to be constituted (the Volvox Hollandia, Caspian Basin Specialised Emergency Salvage Administration v Bouygues Offshore SA (No 4) [1997] 2 Lloyd’s Rep 507).

Ang J found that the defendants’ election to have limitation determined under Belgian law was not only inconsistent with the Volvox Hollandia principle, it also sought to obviate the need to share rateably with others the amount of the plaintiffs’ limited liability available for distribution in Singapore. That was obviously wrong, not only as between the plaintiff and defendants, but also as between the defendants and the other claimants to the limitation fund.

As to the second point, Ang J observed that the defendants did not, when they had the opportunity to do so, oppose the limitation action under a regime with a greater prospect of breaking limit to recover their full claim. The plaintiffs succeeded in discharging their burden of proving that the occurrence did not result from their fault or privity and were entitled to limit their liability based on the LLMC 1957. If the defendants had broken limit in Singapore, the matter would have ended there. Conversely, it is wrong to deprive through foreign proceedings the plaintiffs’ legal rights conferred by the decree and limitation fund and at the same time allow the defendants a second bite of the cherry in foreign proceedings.

In addition, limitation of liability is founded (in England and Singapore) on public policy reasons. As Lord Denning MR said in The Bramley Moore [1964] P 200 at 220 ‘… limitation of liability is not a matter of justice. It is a rule of public policy which has its origin in history and its justification in convenience.’

It was clear that the Belgian proceedings had the effect of undermining and interfering with the plaintiffs’ rights and the judicial process of the Singapore court.

The above reasons added up to a case of oppression. Balancing all the factors, the Court held that more injustice would be done to the plaintiffs if the defendants were allowed to proceed in Belgium rather than would be done to the defendants if they were restrained from proceeding in Belgium.

Accordingly, the Court granted the plaintiffs’ application for an injunction restraining the defendants from continuing with proceedings in Belgium. The additional security provided to the defendants as a result of the Belgian arrest was also to be returned to the plaintiffs. The defendants’ application would be dismissed.