Best Excellence Corp Ltd (Best Excellence) applied to vacate an order of ship arrest dated 1 January 2019 and for the security furnished by it to be returned. Best Excellence is the owner of the defendant vessel MV Silvia Glory. The arrest order was obtained by GP Global APAC Pte Ltd (GP) on the ground that it has a legitimate maritime claim/lien on the vessel arising out of unpaid bunkers supplied to the vessel in October 2018. GP's case is that Bulk Marine Pvt Ltd (Bulk Marine) placed an order for supply of bunkers on behalf of Best Excellence for the vessel and this debt has remained unpaid and therefore Best Excellence, being the owner of the vessel, is liable for the outstanding dues.

Best Excellence contends that Bulk Marine was the charterer of the vessel and was not acting on behalf of the defendant vessel or its owners. GP would never have been under the impression that Bulk Marine was acting on behalf of the defendant vessel or its owner. The letter of demand for the outstanding sum was issued by GP to Bulk Marine and not Best Excellence. Bulk Marine is the sub-sub-charterer of the vessel. Best Excellence chartered the vessel to Lianyi Shipping Corp (Lianyi). Lianyi in turn subchartered the vessel to Admiral Shipping, and Admiral Shipping sub-sub-chartered the vessel to Bulk Marine. It is thus clear that Bulk Marine is not the agent of Best Excellence, but hired the vessel for its own commercial purpose and there were several degrees of contractual separation between Best Excellence and Bulk Marine.

Held: Order of arrest vacated on evidence of security.

This Court has recently in the case of Admiralty Suit No 8 of 2019 (see MV Silvia Glory v Dan Bunkering (Singapore) Pte Ltd (CMI976)) decided the very issue with regard to the outstanding amount of unpaid bunkers and whether the same can be charged by the party as a maritime lien. The Admiralty (Jurisdiction and Settlement of Maritime Claims) Act 2017 (the Act) and the decision in Chrisomar Corp v MJR Steels Pvt Ltd 2017 (16) SCC 117 (CMI149) binds this Court. Earlier decisions of this Court are essentially based on the Admiralty Court Act 1861 (UK) and art 3 of the Arrest Convention 1952. The Arrest Convention 1999 was not taken into consideration by the Court, which requires in personam liability of the owner for the arrest of the vessel. Section 17(1)(b) of the Act repeals the Admiralty Court Act 1861 (UK) and s 5(1)(a) of the Act gives effect to art 3.1 of the Arrest Convention 1999.

In this case, the correspondence of GP is with Bulk Marine throughout. GP knows that the owner is Best Excellence. It also cannot depend on its own terms and conditions of supply of bunkers when there is no privity of contract with the owner, as the maritime lien will not be available unless the contract with the owner binds it for any unpaid sum of bunkers. The law being clear that the owner cannot be bound by any contractual terms which the charterer may have for the supply of bunkers with the seller, the plea of a maritime lien may not be available to GP. It would be unsafe to allow GP to continue with the arrest without putting it to strict mandatory terms. It would be also desirable to direct the expeditious proceedings of the suit in this case. GP is directed to deposit USD 150,000 security. In the event of failure to obey this direction, the amount deposited by Best Excellence as security shall be refunded.