The respondent appointed the appellant 'to attend and arrange for [the] smooth operation as required at Penang Port, Malaysia' of the respondent's cruise and casino vessel, the Oriental Dragon. As a result of the Covid-19 pandemic, this vessel could no longer operate, and the appellant terminated its operation and management.

The crew filed a writ in rem with regard to wages and obtained an order from the High Court for the judicial sale of the vessel. The appellant also filed a writ in rem for reimbursement of its payments totalling MYR 8,130,181.34. The High Court dismissed the appellant's suit with costs.

The appellant appealed to the Court of Appeal.

Held: The appeal is allowed.

In substance, reality, and effect, the contract was for the appellant to operate and maintain the vessel, not only for its casino business, but also for its passenger cruise business (which was not prohibited by Malaysian law).

The relevant parts of ss 20 and 21 of the Supreme Court Act (UK) (the SCA) and s 24(b) of the Courts of Judicature Act 1964 (the CJA) set out Malaysia's admiralty jurisdiction.

The Court is unable to find any UK case which has interpreted s 20(2)(p) SCA. Giving a literal construction of s 20(2)(p) SCA, if a 'master, shipper, charterer or agent' of a vessel has incurred 'disbursements made on account' of that vessel, that master, shipper, charterer, or agent of the vessel can file an admiralty action in rem in the High Court under s 20(2)(p) SCA, read with s 24(b) CJA.

The following cases have given a wide interpretation of s 20(2)(m) SCA: in Port of Geelong Authority v. The Ship 'Bass Reefer (1992) 109 ALR 505, 518-519 (CMI703), Foster J in the Federal Court of Australia gave a broad interpretation of the term 'operation' in s 4(3)(m) of the Admiralty Act (Cth) as follows:

I am of the view that the term 'operation' should not be confined in its interpretation to matters relating to the mere movement or propulsion of the ship from one port to another. In The 'River Rima' in the Court of Appeal [1987] 2 Lloyd’s Rep 106 at 113 [CMI692], Nourse LJ said in relation to the supply of the containers under consideration that he was 'also prepared to accept that it is possible to concede of a state of affairs in which they would have been goods supplied to a ship for the operation'. He did not consider that such a state of affairs had been disclosed on the evidence. In the circumstances of the case he found that the containers had been provided to the shippers rather than to the ship. In the House of Lords, Lord Brandon was prepared to assume without deciding that 'the use of a container ... on board a ship designed to carry containers ... is a use for the operation of such a ship within the meaning of para (m)': [1988] 1 WLR 758 at 762-3.1 can see no valid reason for excluding from the concept of 'operation of a ship' considerations relating to any special characteristics of the ship, such as its being a freighter or tanker or to any special use or voyage upon which it may be engaged, at least when these latter factors were reasonably within the contemplation of the supplier of the services and the operator of the ship.

In Centro Latino Americano De Commercio Exterior SA v The Owners of the Ship 'Kommunar' [1996] CLC 1919, 1921, 1924 (CMI2436), Clarke J held:

The question is whether the plaintiffs’ claims are claims in respect of goods or materials supplied to those ships for their operation or maintenance. In my judgment, in one sense at least, they plainly are. They are claims to be repaid sums which the plaintiffs have paid to the sub-agents who have supplied the goods. However, ... it is necessary to have regard to the nature of the alleged contract and to the true nature of the plaintiffs' business.

The words 'in respect of' are wide words which should not be unduly restricted: The Kommunar [1976] 1 Lloyd’s Rep 1, 5. Section 20(2)(m) SCA contains a jurisdiction which is no narrower than the predecessor jurisdiction in respect of claims for 'necessaries': The Fairport (No 5) [1967] 2 Lloyd’s Rep 162, The Kommunar, above.

Based on The Bass Reefer and The Kommunar, the appellant's payments fell within the phrase 'any claim in respect of goods or materials supplied to [the vessel] for her operation or maintenance ' in s 20(2)(m) SCA.

Finally, the respondent entered an appearance on 16 November 2020. Thereafter, this suit continued as a hybrid action, namely, as an action in rem as well as an action in personam. This is clear from the judgment of Wee Chong Jin CJ in the Court of Appeal of Singapore in Owners of the Ship or Vessel 'Kusu Island' v Owners of Cargo Lately Laden on board the Ship or Vessel 'Brani Island' [1989] 3 MLJ 257, 261 (CMI297):

The principles that can be deduced from these authorities are briefly these. In an admiralty action in rem where a defendant enters an unconditional appearance, he submits to the jurisdiction of the court personally and from then onwards the action continues as an action in rem and in personam, and judgment may be entered and enforced against him to the full extent of the damages awarded to the plaintiff and is not limited to the value of the res or the bail which represents the res. In consequence, if judgment is entered for the plaintiff and is not fully satisfied by enforcement thereof against the res, execution proceedings for the balance may be initiated against the defendant personally: it is a judgment in rem against the res as well as in personam against the defendant personally.

Premised on The Kusu Island, the appellant can proceed with this suit against the respondent as an action in personam.