Malaysia Court of Appeal Civil Appeal No:B-02-171-05/2015

 

Court of Appeal Panel of Judges:

Datuk David Wong Dak Wah

Datuk Harmindar Singh Dhaliwal

Dato’ Mary Lim Thiam Suan

This is a case note on the Malaysian Court of Appeal case of Mewah Oils Sdn Bhd v Lushing Traders Pte Ltd.

This case raises issues of sales of goods, function of the bill of lading as a document of title, and conversion.

The Plaintiff Mewah Oils Sdn Bhd filed a suit against Mewah Oils Sdn Bhd [‘Mewah’] in the Shah Alam High Court after a full trial obtained judgment. Mewah Oils Sdn Bhd appealed against this decision and the appeal was heard and dismissed by the Court of Appeal on 4 July 2016. The grounds of decision was recently rendered by the Court of Appeal.

 

Lushing’s claim against the Applicant is for the conversion of Lushing’s cargo which was shipped on board the vessel ‘Suppavan 1’ and discharged into the Mewah’s tanks in  November 2003. There was a common party to both Lushing and Mewah  – Summerwind Trading Pte Ltd [‘Summerwind’]. Summerwind was Lushing’s buyer who did not pay Lushing and did not obtain the document of title by way of the original bills of lading.  Lushing was able to produce the original bills of lading at trial proving that Lushing never relinquished the title and possessory rights to the cargo. Lushing never received any payment or consideration for the cargo from its buyer Summerwind.

Mewah did not obtain any bill of lading to the cargo nor did it insist to sight the original bills of lading from Summerwind. Its defence was that it was tolling / refining the cargo for Summerwind and therefore there was no need for it to obtain the original bills of lading. Mewah also raised the fact that Lushing obtained judgment in the Singapore Courts in its recovery from the Summerwind and its directors for non-payment for several transactions including the present shipment. According to Mewah the Singapore judgment will estop Lushing from pursuing the present action against Mewah. These arguments were raised by Mewah in the trial at the High Court and at the Court of Appeal.

Held by the Court of Appeal:

  1. There was no error in the High Court decision
  2. The tolling defence by Mewah had no basis and

was not supported by documents.

  1. The Singapore Judgment created no estoppel as Lushing expressly reserved its rights and title to the goods.
  2. The Court recognises separate claims against multiple tortfeasors is possible in conversion  applying see Clerk & Lindsell on Torts 18th Edition at para 14-130 :

Successive Conversions and Satisfaction

The owner of a chattel who has been deprived of his possession may well have a remedy against more than one person. A may have wrongfully taken it and B may afterwards have wrongfully detained it. A and B are not joint tortfeasors; there is a perfectly independent right of action against each.’