Parbulk II as v PT Humpuss Intermoda Transportasi TBK and Others
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Gloster, DBE |
| Judgment Date | 30 November 2011 |
| Neutral Citation | [2011] EWHC 3143 (Comm) |
| Docket Number | Case No: 2010 Folios 58 and 372 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 30 November 2011 |
[2011] EWHC 3143 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs Justice Gloster, Dbe
Case No: 2010 Folios 58 and 372
2011 Folio 424
Duncan Matthew Esq, QC and Ms Charlotte Tan (instructed by Wikborg Rein LLP) for the Claimant
David Joseph Esq, QC (instructed by Lawrence Graham LLP) for the Defendants
Hearing dates: 17 th June 2011 and 24 th June 2011
Further written submissions: 5 July; 19 July; 23 and 27 July 2011
Further hearing dates: 4 th and 5 th October 2011
Introduction
On 17 June 2011, I heard three applications in this matter:
i) an application by the claimant, Parbulk II AS ("Parbulk"), for the continuation of worldwide freezing injunctions, originally granted by David Steel J on 28 May 2011, against the first respondent PT Humpuss Intermoda Transportasi TBK ("HIT"), the second respondent, Humpuss Sea Transport Pte Ltd ("HSTPL"), and the third respondent, Heritage Maritime Limited SA ("Heritage") (collectively "the Respondents"); David Steel J's order was itself a continuation of a consent order made by Field J on 18 May 2011, which was, in turn, a continuation of the ex parte order of Teare J made at an urgent ex parte hearing on 1 April 2011;
ii) Heritage's application to set aside an order of David Steel J dated 30 March 2011, granting Parbulk permission to enforce an arbitration award against Heritage dated 23 December 2010 ("the Award") as a judgment pursuant to s66 of the Arbitration Act ("the s66 Order"); and
iii) Parbulk's application for security for costs in respect of Heritage's appeal against the Award pursuant to s69 of the Arbitration Act ("the Act"), pursuant to leave granted by David Steel J on 16 May 2011.
On 17 June 2011, at the first effective inter partes hearing in this matter, I made orders:
i) continuing the freezing injunctions against all three Respondents, but ordering that there should be a further hearing on 24 June 2011 in respect of:
a) the extent of the Respondents' – and in particular HSTPL's —disclosure obligations; and
b) the amount of HSTPL's assets to be subject to the freezing orders; 1
ii) refusing Heritage's application to set aside the s66 Order save on terms that Heritage provided security for the full amount of the Award; and
iii) ordering Heritage to provide security by way of bank guarantee in the sum of £40,000 in respect of Parbulk's costs of the s69 appeal.
On 24 June 2011, I heard further short oral submissions from the parties as to the basis upon which, and the amount in which, it would be appropriate for the court to impose a freezing order against the second respondent, HSTPL. Both parties supplemented their oral arguments by further detailed written arguments dated 5 July, 19 July, 23 and 27 July 2011.
I record that, at no time during the June hearings, nor in the post-hearing written submissions lodged prior to 26 August 2011, were any arguments addressed to me on behalf of the Respondents to the effect that the court did not have personal or subject matter jurisdiction over HSTPL to make a freezing order against it. In particular, no arguments were addressed to the effect that it would not be appropriate for the court to
make a freezing order against HSTPL on the basis of the decision in TSB Private Bank International SA v Chabra [1992] 1 WLR 231 (" Chabra") by reason of the fact that:i) HSTPL was a Singapore company situate outside the jurisdiction of the English court and/or
ii) the locus of the debt which it owed the principal defendant, Heritage, was situate outside the jurisdiction of the English court; and/or
iii) HSTPL had no assets within the jurisdiction; and/or
iv) there was no relevant service gateway as set out in Practice Direction 6B of the Civil Procedure Rules.
On 26 August 2011, during the course of the vacation, I circulated a draft of my judgment which concluded that, for the reasons set out therein, I would continue the freezing order against HSTPL, restraining it from dissipating its assets worldwide, but only up to an amount of its indebtedness to Heritage and to HIT (if any). I also indicated that I would hand down the judgment on 1 September 2011, but that I would hear further argument on the form of the order and any consequential matters arising from the judgment at a date that was convenient to the parties and the court.
By letter dated 30 August 2011, Lawrence Graham LLP, solicitors for the defendants, wrote to the court, informing it of the recent decision of the Court of Appeal in the related proceedings of Linsen International Ltd and Others v Humpuss Sea Transport Plc Ltd and Others (2009 Folios 1652 and 1653 and 2010 Folios 1343 and 1346) (" Linsen (2)"). The letter also indicated that I might wish to see a transcript of the Court of Appeal's judgment and hear further submissions on jurisdiction and service in relation to HSTPL before handing down my judgment.
In the light of that development, I adjourned the handing-down of my judgment and indicated that, on 4 and 5 October 2011, I would hear further arguments on jurisdiction and service, although no submissions on those particular points had previously been made.
On 4 and 5 October 2011, I heard further submissions from counsel, and received further written submissions in relation to HSTPL's new jurisdictional arguments.
Given that the Respondents have now had, effectively, three bites at the cherry in their attempt to resist the continuation of the freezing order against HSTPL, I have decided that, rather than completely re-working my draft judgment as already circulated, I shall set out the conclusion that I would have reached in light of the submissions made in June and July 2011, and then, subsequently, set out my final conclusions in the light of the later arguments advanced in relation to HSTPL's new jurisdictional points.
Factual Background
The factual background to this dispute can be briefly summarised as follows.
Parbulk is a special purpose fund established under the laws of Norway. By a charterparty on an amended BARECON 2001 form, dated 11 December 2007, Parbulk, as owners, chartered its vessel, the Mahakam ("the Vessel"), to Heritage as charterers on a bareboat charterparty for 60 months at a rate of US$38,500 a day ("the Charterparty"). The Charterparty was subject to English law and London arbitration under LMAA terms. The Vessel had previously been owned by Heritage, prior to its purchase by Parbulk.
Heritage, which is a company incorporated under the laws of Panama, is, and was at all material times, a special purpose vehicle, a fact of which Parbulk was aware, since it retained US$ 6.75 million from the purchase price of the vessel, as security for the performance of Heritage's obligations under the Charterparty.
Heritage is a 100% subsidiary of HSTPL, a company incorporated under the laws of Singapore. HSTPL, in turn, is a 100% subsidiary of HIT. HIT, an Indonesian company, which is listed on the Indonesian stock exchange, is the ultimate holding company in the Humpuss Group. It is involved primarily in shipping transportation and the provision of ship management services. HIT is ultimately controlled by a Mr. Tommy Suharto, the youngest son of the former President of Indonesia. Mr. Suharto holds a 60% stake in an Indonesian entity, PT Humpuss, which directly owns over 60% of HIT. The remaining stake in the Humpuss Group is owned by Mr. Suharto's brother.
Heritage's obligations under the Charterparty were 100% guaranteed by HIT, pursuant to a guarantee dated 11 December 2007 ("the Guarantee"). Following Heritage's repeated failures to pay hire, various disputes arose between the parties. In June 2009 Parbulk terminated the Charter —or, according to the Respondents, wrongfully purported to do so. Pursuant to Clause 30 of the Charterparty, Parbulk commenced LMAA arbitration proceedings against Heritage seeking unpaid hire and damages. The arbitration was held in Singapore between 11 and 15 October 2010. On 20 January 2010, Parbulk commenced proceedings in the English High Court against HIT (2010 Folio 58) under the Guarantee, which was governed by English law.
On 23 December 2010, Messrs Edward Mocatta and Mark Hamsher and Dr. Colin Ong ("the Tribunal") issued the Award pursuant to which they ordered Heritage to pay Parbulk the sum of US$27,031,759.04 plus interest in unpaid hire and damages. As at the date of the hearings before this Court in June 2011, there was approximately US$28,107,045.35 outstanding in unpaid hire, damages and interest. The issue before the Tribunal was whether Parbulk was entitled to terminate the charterparty for repudiatory breach. The Tribunal held that Parbulk was entitled to do so on two grounds: first, on the grounds identified in a termination notice dated 22 June 2009, i.e. because of defined Events of Default on Heritage's in failing to pay hire from 16 April to 15 June 2009; and second, on the grounds that, at common law, and independently of any contractual right under the charterparty, Parbulk was entitled to accept the totality of Heritage's conduct in not paying the instalments of hire due for the period 1–15 June and 16–30 June 2099 as repudiatory breaches of contract.
On 17 January 2011 Teare J gave judgment for Parbulk against HIT on the Guarantee in the amount of US$27,031,759.04 plus interest. Neither the Award nor the judgment has...
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