A court can grant Mareva injunctions before arbitral proceedings to prevent asset dissipation, ensuring interim relief supports arbitration without presupposing case merits.

Wong Kian Kheong JC:

(Court Encl Nos 1 And 5)

A. Introduction

[1] This case discusses the Court's power to grant:-

(a) a Mareva injunction before the commencement of arbitral proceedings under s 11(1) of the Arbitration Act 2005 ( AA ). If a Mareva injunction is granted, this judgment will discuss whether the Court has the power to provide that a party whose assets have been frozen by a Mareva injunction, be allowed to use part of the party's frozen assets to pay for the party's:-

(i) reasonable and ordinary operational expense; and

(ii) legal advice and representation for the suit in question and potential arbitration; and

(b) a mandatory order under s 11(1) AA to compel a party subject to a Mareva injunction, to affirm an affidavit to disclose all information regarding the party's assets (Mandatory Disclosure Order).

B. Facts

[2] The plaintiff company (Plaintiff) owns a vessel called "MV Armada Firman 2" (Vessel).

[3] On 26 June 2014 the Plaintiff has entered into a charter party agreement (Contract) with the defendant company (Defendant) in respect of the Vessel.

[4] The Contract is in the format of "Baltic and International Maritime Council's" (BIMCO) "Time Charter Party For Offshore Service Vessels, Supplytime 2005". BIMCO is the world's largest international association of ship owners. Part 1 of the Contract (Part 1) is in the format of boxes whereby both the Plaintiff and Defendant have agreed in those boxes in Part 1, either to refer or not, to detailed clauses in Part 2 of the Contract (Part 2).

[5] The Contract provides for, among others:-

(a) the Defendant has agreed to hire the Vessel from the Plaintiff for a period of 4 months [Box 9 (Part 1) and cl 1(a) (Part 2)] at a charter hire rate of RM98,000 per day [Box 20 (Part 1) and cl 12(a) (Part 2)];

(b) the Vessel is required to be delivered by the Plaintiff to the Defendant in "Labuan Anchorage" on 7 July 2014 [Box 5 (Part 1) and cl 2(c) (Part 2)]. If the Vessel is not delivered by midnight, 14 July 2014, the Defendant is entitled to cancel the Contract [Box 6 (Part 1) and cl 2(c) (Part 2)];

(c) "any dispute arising out of or in connection with" the Contract "shall be referred to arbitration" [Box 34 (Part 1) and cl 34(c) (Part 2)] (Arbitration Clause);

(d) Part 1 states that the Contract "shall be performed" subject to, among others, "Annexure A" (Annexure A). Annexure A provides for the daily charter rate to be paid by the Defendant to the Plaintiff in 4 instalments on the following dates:-

(i) the first instalment of RM2,940,000 (1st Instalment) to be paid by the Defendant to the Plaintiff 30 days in advance and prior to the Vessel's departure from Singapore; and

(ii) the second, third and fourth instalments (2nd, 3rd and 4th Instalments), each amounting to RM2,940,000, to be paid by the Defendant to the Plaintiff on 22 August 2014, 22 September 2014 and 22 October 2014 respectively.

Annexure A provides for the Defendant to pay the Plaintiff "mobilization fees" and "demobilization fees". Box 23 (Part 1) and cl 12(a) (Part 2) provide for payments to be made by the Defendant to the Plaintiff "As per Owner's [Plaintiff] Invoice Instructions".

Part 1 provides, among others, that if there is any conflict between Part 1 and Annexure A, Part 1 "shall prevail" "to the extent of such conflict but no further"; and

(e) Clause 13(b) (Part 2) [cl 13(b)] provides as follows:-

"(b) Liability for Vessel not Working - The Owner's liability for any loss, damage or delay sustained by the Charterers as a result of the Vessel being prevented from working by any cause whatsoever shall be limited to suspension of hire, except as