This was an appeal against the decision of a Judicial Commissioner in the General Division of the High Court in The Sea Justice [2024] SGHC 37 (CMI2369). The case arose from a collision in 2021 between the A Symphony and the Sea Justice off the coast of Qingdao, PRC, in PRC territorial waters. The collision caused substantial damage to the A Symphony and resulted in a marine pollution incident. On 20 October 2022, the Sea Justice was arrested in Singapore by the appellant, the owner of the A Symphony.

By the time of the arrest, several proceedings had already been commenced in the Qingdao Maritime Court in the PRC. These included: (a) the appellant’s constitution of a limitation fund for oil pollution damage compensation liability under the CLC 1992; (b) the claims made by both parties in respect of collision liability; and (c) the respondent’s constitution of a limitation fund pursuant to the tonnage limitation regime in the Maritime Code of the PRC.

The Sea Justice was released on 18 November 2022 on security pegged to the maximum permissible under Singapore’s limitation regime in the Merchant Shipping Act 1995 (the Act), which adopts the limits under the LLMC 1996. These are much higher than those in the PRC limitation regime.

The respondent successfully sought a stay of Singapore proceedings and the release of the Singapore security. The appellant appealed, arguing that the Singapore security should be retained.

Held: Appeal dismissed.

The appellant’s submission for the forum non conveniens stay to be made conditional upon the retention of security is in effect a request to review the application of the second stage of the Spiliada test. The sole basis upon which this determination turns is whether the loss of the Singapore security is tantamount to a loss of a legitimate juridical advantage of such importance that it would be unjust if the appellant was deprived of it. If the answer is in the affirmative, there will be every reason to make the forum non conveniens stay conditional upon its retention.

The loss of the Singapore security is not a legitimate juridical advantage. There is already a limitation fund available for the appellant's claims, and the appellant has already lodged a claim against that fund. The limitation regime in the PRC is derived from its domestic legislation. It is not material that the PRC is not a signatory to the LLMC 1976 in a forum non conveniens contestation. The appellant did not challenge the limitation regime that is applicable in the lex fori; nor did the appellant take issue with the constitution of the limitation fund in the PRC.

The appellant's attempt to retain the Singapore security is a thinly veiled attempt to circumvent the shipowner’s choice of the PRC as the forum to limit its liability. This would contravene the overriding principle that the right to choose the forum for limitation belongs to the shipowner alone: Evergreen International SA v Volkswagen Group Singapore Pte Ltd [2004] 2 SLR(R) 457 [47] (CMI227). Having constituted a limitation fund in a forum of the owner of the Sea Justice's choice, the PRC, and the appellant having accepted the PRC as the more appropriate forum to determine the collision disputes, a retention of the Singapore security would have the effect of undermining the purpose of the overriding principle which is that a shipowner is only required to set up one limitation fund out of which all claims are paid.

By seeking to retain the Singapore security as pegged to the Singapore limits, the appellant is, in truth, arguing against the loss of access to a limitation regime with higher limits. It is trite law that the existence of different limitation regimes does not constitute a legitimate juridical advantage under the second stage of the Spiliada test. The court does not make comparisons between the laws of this country and that of another to do justice in this respect: The Reecon Wolf [2012] 2 SLR 289 [54]-[55].

The Rena K [1979] QB 377 (CMI2198) has no relevance to this case. The Rena K was a case involving a mandatory stay of proceedings in favour of arbitration under s 1(1) of the Arbitration Act 1975 (UK). In that context, the Court decided that security could be retained (or alternative security required) where it could be shown that any arbitral award made against the defendant would be unlikely to be satisfied. The juridical basis of the Rena K principle falls outside the context of a forum non conveniens stay. Even in the arbitration context, the principle has been rendered otiose in Singapore by s 7(1) of the International Arbitration Act 1994, which gives the court an express statutory power to retain security for the satisfaction of any arbitral award.