This case arose from a collision between an oil tanker, A Symphony, and a general cargo vessel, Sea Justice, off Qingdao in the PRC, within Chinese territorial waters. The respective owners brought proceedings in the Qingdao Maritime Court. The owner of the Sea Justice constituted a limitation fund there, and the owner of A Symphony registered claims against that fund. Both parties also commenced liability actions against each other. Separately, the owner of A Symphony (the plaintiff) commenced admiralty in rem proceedings in Singapore against Sea Justice (the defendant). More than a year later, Sea Justice sailed into Singapore waters and was arrested, and later released against security. The defendant applied: (a) for the Singapore action in rem to be stayed in favour of the PRC proceedings on the grounds of forum non conveniens; (b) the security it had provided in the Singapore action to be returned; and (c) the arrest to be set aside. The Assistant Registrar ordered a forum non conveniens stay and return of security, but declined to set aside the arrest. The parties filed cross-appeals.

The plaintiff argued that the Singapore security should be retained. The defendant's main argument was that the arrest should be set aside because the plaintiff failed to make full and frank disclosure of material facts in its warrant of arrest application.

Held: Cross-appeals dismissed.

The plaintiff seeks a limited stay and retention of the Singapore security to avail itself of the higher limit in Singapore (as compared to the PRC limitation regime). In these circumstances, retaining the Singapore security would be tantamount to an implicit finding that the PRC limitation regime is less adequate than that of Singapore. That would be contrary to international comity. The Court's view is reinforced by the plaintiff’s reliance on dicta in the Australian case of CMA CGM SA v The Ship Chou Shan [2014] FCAFC 90 [36] (CMI58). The forum non conveniens test in Australia is whether the Australian court is a clearly inappropriate forum. When the Australian court declines a stay, or grants a limited stay, of the local action because of the higher limit of liability available to the plaintiff in Australia, the conclusion made by the court is that Australia is not a clearly inappropriate forum. The Court in Chou Shan [58] specifically acknowledged that the Australian forum non conveniens test is not focused on whether justice can be achieved in a foreign court.

In contrast, the Singapore and English test for forum non conveniens is the Spiliada test, which concerns the staying of proceedings on the basis of the existence of a more appropriate forum. Where there is a foreign forum that is clearly or distinctly more appropriate than Singapore under the first stage of the Spiliada test, the inquiry at the second stage of the Spiliada test is whether the plaintiff can show that it will not obtain substantial justice in the foreign forum. Consequently, when the Singapore court declines a stay, or grants a limited stay, of the local action because of the higher limit of liability available to the plaintiff in Singapore, the conclusion made by the Court is that the plaintiff will be denied substantial justice in the foreign forum with a lower limit. Recognising the higher limit in Singapore as a legitimate juridical advantage is thus at odds with international comity.

Caltex Singapore Pte Ltd v BP Shipping Ltd [1996] 1 Lloyd’s Rep 286 (CMI2361) concerned an allision in Singapore between BP's vessel and a jetty owned, used, and administered by Caltex. BP set up a limitation fund in Singapore that was based on the LLMC 1957 then applied in Singapore. Caltex sued in England where the LLMC 1976 (with higher limits) applied. BP sought to stay the actions by Caltex in England. Clarke J accepted that Singapore was the natural and appropriate forum for the trial of the action. However, he was of the view that English public policy favoured applying the LLMC 1976, and that depriving Caltex of the higher limit would be depriving it of a 'legitimate juridical advantage'. He concluded that the most appropriate solution would be to stay the English action temporarily in order to enable the issues of quantum to be determined in Singapore, leaving the question whether there should be a final stay in England to be determined thereafter. Clarke J’s approach in Caltex was, however, overruled by the English Court of Appeal in The 'Herceg Novi' and 'Ming Galaxy' [1998] 2 Lloyd’s Rep 454 (CMI770), where the Court held that it was impossible to say that Singapore’s application of the LLMC 1957 instead of the LLMC 1976 meant that substantial justice was not available in Singapore. The English Court of Appeal thus ordered an unconditional stay of the English action.

This review of cases shows that the limited stay approach referenced in Chou Shan, Caltex, and Herceg Novi (QBD) was premised on treating the availability of a higher limit of liability in the local forum as the plaintiff’s legitimate juridical advantage to be preserved. In Chou Shan, the Court considered that there was room for this perspective under the Australian 'clearly inappropriate forum' test for forum non conveniens, but this is not the test that applies in Singapore. This perspective in Caltex and Herceg Novi (QBD) was rejected in Herceg Novi (CA) on the ground of international comity. There is no basis for the plaintiff to argue for a limited stay and attendant retention of the Singapore security when the Singapore courts share the view in Herceg Novi (CA) that the availability of a higher limit of liability in a particular jurisdiction is not a legitimate consideration in determining where an action should proceed. This is evident from the Singapore decisions of The Reecon Wolf [2012] 2 SLR 289 and Evergreen International SA v Volkswagen Group Singapore Pte Ltd [2004] 2 SLR(R) 457 (CMI227).

Given international comity, the Singapore courts will not be drawn into any implicit pronouncement that the limitation of liability regime in Singapore is superior to that of another jurisdiction. This is regardless of whether that other jurisdiction applies a limitation regime based on an international limitation of liability Convention or its own domestic system of limitation. As G Lam JA observed in Pusan Newport Co Ltd v The Owners and/or Demise Charterers of the Ships or Vessels 'Milano Bridge' and 'CMA CGM Musca' and 'CMA CGM Hydra' [2022] HKCA 157 [53] (CMI1736), there is great diversity in the limitation regimes implemented across the world.

With these principles in mind, the Court takes the view that allowing the plaintiff to retain the Singapore security for the purpose of satisfying any judgment would effectively be compelling the defendant to constitute a limitation fund in Singapore, despite the defendant having chosen (as was its right) to claim limitation in the PRC. This would undermine the defendant’s choice of forum for its limitation action.

In circumstances where: (a) the PRC is the natural and more appropriate forum for the plaintiff’s claims arising from the collision to be tried; (b) the defendant has the right to choose where to claim limitation and has chosen to do so in the PRC; and (c) the defendant has constituted a limitation fund in the Qingdao Maritime Court and the plaintiff has registered its claims against that fund, justice does not warrant allowing the plaintiff to retain the Singapore security following the forum non conveniens stay.

As to the second main issue, whether the arrest of the Sea Justice should be set aside, there was no material non-disclosure, as the fact of a reservation of rights clause was not relevant to the decision whether to issue the warrant of arrest.