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    09:42 PM Justin Chan and Tan Aik Thong (Associates, Shook Lin & Bok LLP)

    Clarity in Effecting Service Outside of Jurisdiction: Humpuss Sea Transport Pte Ltd v PT Humpuss Intermoda Transportasi TBK [2015] SGHC 144

        

    Introduction

    The question posed before the High Court in Humpuss Sea Transport Pte Ltd v PT Humpuss Intermoda Transportasi TBK [2015] SGHC 144 (“Humpuss”) is a simple one – was the elected mode of service of a Singaporean process on corporate defendants in Indonesia valid. Yet, arriving at an answer would require a careful navigation through the intricacies of Order 11 of the Rules of Court (Cap. 322, 2014 Rev Ed), which as the High Court correctly pointed out, continue to vex practitioners today (see Humpuss at [5]).

    A brief exposition of the facts and the procedural history leading up to Humpuss would suffice. 

    Facts

    The Plaintiff is a Singapore incorporated company whereas the Defendants were incorporated in Indonesia. The Plaintiff was placed in compulsory liquidation, and through the liquidator, commenced proceedings against the Defendants seeking repayment of loans owed and declaration that several transactions entered into between them be set aside for being transactions at an undervalue. 

    The Plaintiff obtained leave to serve its writ of summons and statement of claim on the Defendants in Indonesia. The Defendants entered an appearance and thereafter applied for a declaration that the Singaporean process had not been duly served on them.

    The Parties’ Arguments

    There was no dispute that the Singapore process was personally served, through a firm of solicitors practising in Indonesia, at the respective Defendants’ registered address (Humpuss at [8]).

    However, the crux of the Defendants’ arguments is that the abovementioned service was not permitted under the Rules of Court. This is because as a non-Civil Procedure Convention country, the only methods for service of foreign process in Indonesia are exclusively set out in O 11 r 4(2), i.e. either through the Indonesian government (r 4(2)(a)), or via the Singapore consular authority (r 4(2)(b)), or by a method of service authorised by Indonesian law for service of originating process issued by Indonesia (r 4(2)(c)). The Defendants further contended that such personal service of foreign process through a private agent was contrary to Indonesian law.

    On the other hand, the Plaintiff contended that in addition to O 11 r 4(2), O 11 r 3 provided that service of Singapore process overseas may also be effected by (i) personal service (O 11 r 3(1)); (ii) substituted service (O 11 r 3(1)); or (iii) service in accordance with Indonesian law (O 11 r 3(3)). 

    It was also not disputed that service was not effected through the Indonesian government or via the Singapore consular authority (i.e O 11 r 4(2)(a) and (b)) (Humpuss at [11]). On the materials before the Court, service of the Singapore process through a firm of solicitors in Indonesia could not be justified under O 11 r 4(2)(c) or O 11 r 3(3) either (Humpuss at [16]). Accordingly, the Plaintiff’s elected mode of service could only be justified if the Plaintiff could avail itself of O 11 r 3(1) (Humpuss at [16]).

    Was service of Singapore process overseas by way of a private agent valid under the Rules of Court?

    The High Court highlighted the core issue as this: how many methods of service does O 11 of the Rules of Court provide for (see Humpuss at [5]). Specifically, is personal service of Singapore process overseas by way of a private agent permitted under the Rules of Court? In answering this question, the High Court also had to untangle the difficulties caused by the decision in Ong & Co Pte Ltd v Chow YL Carl [1987] SLR(R) 281 (“Ong & Co”) which effectively outlawed the private service of process overseas (Humpuss at [20] and [36]).

    Having reviewed the legislative origins behind the existing O 11 rr 3 and 4 (including that in England from which our O 11 was transplanted: see Humpuss at [23]-[39]), the High Court made the following observations:

    • Private service – either personal or substituted – was and remains in our Rules of Court the default method of serving writs out of jurisdiction (Humpuss at [40] and [57]);
    • Service through official channels, i.e. under O 11 rr 4(1) and (2), was meant to supplement, but not supplant, private service (Humpuss [42] and [58]). In this regard, the High Court was cognisant that:
    • the use of the word “may” in contradistinction with the use of the mandatory “must” in O 11 r 4 strongly indicated that the provisions on the service via official channels in O 11 r 4(1) and (2) were not intended to be mandatory (Humpuss at [42]);
    • When our Rules of Court was amended in 1991, the Rules Committee amended the marginal note to O 11 r 5 (the pre-amendment equivalent of the present O 11 r 3) from “Service of notice of writ abroad: General” to “…Alternative Modes” (Humpuss at [48]); and
    • Local cases decided post Ong & Co have permitted the service of process through private means and have implicitly demonstrated that the methods of service outside of jurisdiction were not exclusively limited to that found in r 4(2) (Humpuss at [54] - [57]).

    As such, the High Court has also explicitly affirmed that Ong & Co (in relation to r 4(2) is no longer good law in Singapore (Humpuss at [54]). In any event, the High Court also observed that whatever difficulties caused by Ong & Co had already been subtly negated by amendments to the Rules of Court in 1991 (Humpuss at [51]).

    In the light of the above, the High Court outlined the various ways of serving a writ outside of jurisdiction as permitted under the Rules of Court, depending on defendant’s place of residence outside Singapore (Humpuss at [58]-[62]). For ease of reference, a table outlining the methods of service available to a Plaintiff may be accessed here.

    Therefore in the present case, the High Court held the Plaintiff can avail itself of O 11 r 3(1) as providing a method of effecting service of the Singapore process on the Defendants in Indonesia.  Having also found on the materials before the Court that personal service through a private agent was not contrary to Indonesian law, the High Court accordingly held service in the present case was valid (Humpuss at [72]).

    Curing of irregularities

    In the light of the High Court’s finding that service in the present case was valid, it was strictly unnecessary for the High Court to consider whether an irregularity in service overseas could be capable of cure. Nonetheless, the High Court went on to consider the circumstances in which irregularities in service might be cured. In this regard, the High Court observed that there are three broad categories of irregularities (Humpuss at [76]):

    • Category A: cases where service was held to be invalid because the attempted service was unsuccessful in bringing notice of the claim to the defendant. The High Court opined that these were incapable of cure.
    • Category B: cases where service was held to be invalid because the method of service employed, though successful in bringing notice of the claim to the defendant, was contrary to the law of the foreign jurisdiction. The High Court opined that these were incapable of cure.
    • Category C: cases where service was invalid because of the method of service employed – though successful in bringing notice of the claim to the defendant and not contrary to the law of the foreign jurisdiction – had nevertheless failed to comply with a procedural requirement provided for in our rules. The High Court opined that these were capable of cure.

    Category A

    The High Court considered category A cases incapable of cure. It reasoned that the essence of service is the notification to the defendant of the claims made against him. It follows, as the High Court reasoned, that if an attempt at service failed to achieve the purpose of notification, no service was effected. Accordingly, there was nothing that can be “cured” (Humpuss at [78]). 

    The High Court opined that whether an attempt at service can be characterised as non-service “is a question of fact”, and that “the inquiry is whether the defendant was notified of (i) the claims brought against him, and (ii) the appropriate legal steps he needs to take to defend the claim” (Humpuss at [82]).

    Category B

    The High Court opined that category B cases are incapable of cure for the following reasons:

    • O 11 r 3(2) categorically states “[n]othing in this Rule or in any order or direction of the court made by virtue of it shall authorise or require the doing of anything… contrary to the law of that country” excludes the possibility of a cure (Humpuss at [87]).
    • Curing an irregularity occasioned by a breach would be tacitly giving assent to such breach. International comity demands that our Courts do not sanction an attempt at service which expressly breaches the law of the foreign jurisdiction (Humpuss at [87]).
    • Allowing such irregularities to be cured may encourage litigants to serve writs in a manner which disregards the law of the foreign jurisdiction in the hope that the irregular service may be retrospectively validated by our courts (Humpuss at [91]). 

    Category C

    The High Court opined that category C cases were capable of cure and that in exercising its discretion, the court should consider, inter alia (a) the blameworthiness of the respective parties; (b) whether the plaintiff had made a good faith effort to comply with the rules; (c) whether the defendant would be prejudiced if the court’s discretion were exercised in the plaintiff’s favour; and (d) the reasons which caused the non-compliance. At the end of the day, the court seeks to determine what best does justice in all the circumstances of the case (Humpuss at [92]).

    The High Court also opined that in deciding whether to cure an irregularity in service, “it cannot be sufficient to show that the defendant now knows of the Singapore proceedings.” The mere fact that service is contested would show that the defendant was aware of the claim brought against him in Singapore, and that any application to set aside service would therefore be self-defeating (Humpuss at [95]).

    Further Observations by the High Court

    As a coda to an already illuminating judgment, the High Court sought to provide a comprehensive re-statement of the law on the procedural requirements governing the service of process outside jurisdiction, including a route-map for litigation on the validity of service of process overseas (Humpuss at [96] to [111]). This commentary will not go further to set out in detail the brief but succinct treatise by the High Court which deserves reading in its entirety. Nonetheless, some points should be highlighted:

    • The High Court reaffirmed that the issue of validity of service outside of jurisdiction is a question to be determined by Singapore law (Humpuss at [101]);
    • In the context of service of Singaporean process in a foreign jurisdiction, the provisions of foreign law may play a restrictive function, i.e. where it is explicitly provided in the Rules of Court that service may not be effected insofar as it is contrary to the law of that foreign country in which service is sought to be effected (Humpuss at [104]);
    • In addition, foreign law on service can also play a permissive function, i.e. where our Rules of Court permit service outside of jurisdiction in accordance with the law of that foreign country in which service is sought to be effected (Humpuss at [107]).

    More attention should also be given to the High Court’s interpretation of O 11 r 3(3). O 11 r 3(3) provides that “[a]n originating process which is to be served out of Singapore need not be served personally on the person required to be served so long as it is served on him in accordance with the law of the country in which service is effected”.  As regards the expression “in accordance with the law of the country in which service is effected”, the High Court considered three possible interpretations (Humpuss at [107]):

    • A reference to a method of service specifically provided for by the foreign jurisdiction for the service of foreign process (“Interpretation 1”); 
    • A reference to a method of service specifically provided for by the foreign jurisdiction for the service of domestic process (“Interpretation 2”); or
    • A reference to a method of service which is not contrary to the law of the foreign jurisdiction (“Interpretation 3”). 

    The High Court considered that an adoption of either Interpretation 2 or 3 would be inappropriate as: (i) Interpretation 2 would render O 11 r 3(3) otiose since r 4(2)(c) already specifically provides that service in a manner provided for by foreign law for their domestic process is a permitted method of service under the Rules of Court; and (ii) Interpretation 3 would effectively permit all forms of service as long as they are not prohibited by foreign law (Humpuss at [108]).

    Accordingly, the High Court concluded that Interpretation 1 was the correct interpretation. Further, the High Court considered that Interpretation 1 was consistent with the principle of international comity that we should respect the prerogative of other states to make provisions for how foreign process will be served within their jurisdiction (Humpuss at [108]).

    Conclusion

    Humpuss presented the High Court with a seemingly simple question – was the elected mode of service of Singaporean process overseas valid under the Rules of Court. In answering, the High Court provided much clarity not just in the procedure in effecting service of process overseas but also in contesting such service in Singapore. 

    * This blog entry may be cited as Justin Chan and Tan Aik Thong, "Clarity in Effecting Service Outside of Jurisdiction: Humpuss Sea Transport Pte Ltd v PT Humpuss Intermoda Transportasi TBK [2015] SGHC 144", Singapore Law Blog (18 June 2015) (http://www.singaporelawblog.sg/blog/article/120)

    ** A PDF version of this blog entry may be downloaded here

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