Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2023 MarsdenLR 1889

HIGH COURT MALAYA KUALA LUMPUR
UNICIOUS ENERGY PTE LTD – Appellant
Versus
THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL ALPINE MATHILD.... – Respondent
[Admiralty In Rem No: WA-27NCC-49-10-2023]

Petitioner Advocates:Arunachalam Kasi,Linda Alisbert James ,Respondent Advocate: Mathew Kurien Kurien,Aaron Siva Jr Vaitilingam

The court held that a plaintiff designated as a 'U.S. Persons' under U.S. Sanctions Laws cannot invoke admiralty jurisdiction for arresting a vessel as security for arbitration, rendering the arrest an abuse of process.

Headnote:(A) Courts of Judicature Act 1964 - Section 24(b) - Arbitration Act 2005 - Section 11(1)(c) - U.S. Sanctions Laws - Designation on SDN List - Plaintiff's Writ in rem and Warrant of Arrest set aside as the Defendant is a 'U.S. Persons' and the Cargo is 'Blocked Property' under the U.S. Sanctions Laws, rendering the Plaintiff's claims and actions an abuse of process. (Paras 139, 240)

(B) Admiralty Jurisdiction - The Court's jurisdiction to arrest a vessel is limited to claims arising in rem and cannot be invoked solely for security in arbitration proceedings. (Paras 140, 172)

Facts of the case:
The Plaintiff, designated on the U.S. SDN List, sought to arrest the Defendant's vessel for breach of a charter party after claiming ownership of Cargo that became 'Blocked Property'. The Defendant, a 'U.S. Persons', contended it could not deal with the Cargo due to sanctions. (Paras 4, 24, 140)

Findings of Court:
The Plaintiff's Writ and Arrest were set aside as it had no cause of action against the Defendant, who was prohibited from delivering the Cargo. (Paras 139, 240)

Issues: Whether the Plaintiff could invoke admiralty jurisdiction for arrest as security for arbitration and if the Defendant was a 'U.S. Persons' under U.S. Sanctions Laws. (Paras 8, 24)

Ratio Decidendi: The Court ruled that the Plaintiff's designation as an SDN and the Defendant's status as a 'U.S. Persons' barred the Plaintiff from claiming delivery of the Cargo, establishing that the Writ was an abuse of process. (Paras 139, 240)

Result: Writ in rem and Warrant of Arrest set aside; Plaintiff to pay Defendant's costs.

Table of Content
1. background of the case and parties involved (Para 1 , 2 , 3 , 4 , 5 , 6)
2. issues to be determined by the court (Para 7 , 8 , 9 , 10 , 11 , 12)
3. details of the voyage charter party and related contracts (Para 13 , 14 , 15 , 16 , 17)
4. consequences of u.s. sanctions on the cargo (Para 18 , 19 , 20 , 21 , 22)
5. legal implications of the cargo being designated as blocked property (Para 23 , 24 , 25 , 26 , 27 , 28)
6. defendant's compliance with u.s. sanctions (Para 29 , 30 , 31 , 32 , 33)
7. plaintiff's claims and demands post-sanctions designation (Para 34 , 35 , 36 , 37 , 38)
8. defendant's response to plaintiff's demands (Para 39 , 40 , 41 , 42 , 43)
9. previous court actions and their outcomes (Para 44 , 45 , 46 , 47 , 48)
10. court's findings on previous claims (Para 49 , 50 , 51 , 52 , 53)
11. overview of ofac and its regulations (Para 54 , 55 , 56 , 57 , 58)
12. legal consequences of being on the sdn list (Para 59 , 60 , 61 , 62 , 63)
13. defendant's arguments regarding jurisdiction (Para 64 , 65 , 66 , 67 , 68)
14. court's observations on foreign law (Para 69 , 70 , 71 , 72 , 73)
15. definition and implications of u.s. persons (Para 74 , 75 , 76 , 77 , 78)
16. court's determination of the defendant's status (Para 79 , 80 , 81 , 82 , 83)
17. court's reasoning on ownership and control (Para 84 , 85 , 86 , 87 , 88)
18. counterarguments presented by the plaintiff (Para 89 , 90 , 91 , 92 , 93)
19. court's rejection of plaintiff's interpretation (Para 94 , 95 , 96 , 97 , 98)
20. conclusion on u.s. persons definition (Para 99 , 100 , 101 , 102 , 103)
21. court's findings on control and management (Para 104 , 105 , 106 , 107 , 108)
22. plaintiff's acknowledgment of defendant's ownership (Para 109 , 110 , 111 , 112 , 113)
23. consequences of designation as u.s. persons (Para 114 , 115 , 116 , 117 , 118)
24. implications for the plaintiff's claims (Para 119 , 120 , 121 , 122 , 123)
25. court's observations on the plaintiff's actions (Para 124 , 125 , 126 , 127 , 128)
26. court's judgment on the writ in rem (Para 129 , 130 , 131 , 132 , 133)
27. court's rejection of plaintiff's claims (Para 134 , 135 , 136 , 137 , 138)
28. court's conclusions on jurisdiction (Para 139 , 140 , 141 , 142 , 143)
29. court's observations on the writ in rem (Para 144 , 145 , 146 , 147 , 148)
30. court's findings on the arrest of the vessel (Para 149 , 150 , 151 , 152 , 153)
31. court's review of the legal precedents (Para 154 , 155 , 156 , 157 , 158)
32. court's conclusion on the arrest jurisdiction (Para 159 , 160 , 161 , 162 , 163)
33. court's observations on the arbitration process (Para 164 , 165 , 166 , 167 , 168)
34. court's reasoning on the necessity of jurisdiction (Para 169 , 170 , 171 , 172 , 173)
35. court's review of the arbitration law (Para 174 , 175 , 176 , 177 , 178)
36. court's conclusion on the arbitration jurisdiction (Para 179 , 180 , 181 , 182 , 183)
37. court's observations on the plaintiff's claims (Para 184 , 185 , 186 , 187 , 188)
38. court's final conclusions on the writ in rem (Para 189 , 190 , 191 , 192 , 193)
39. court's conclusion on the defendant's rights (Para 194 , 195 , 196 , 197 , 198)
40. court's review of the legislative framework (Para 199 , 200 , 201 , 202 , 203)
41. court's observations on the application process (Para 204 , 205 , 206 , 207 , 208)
42. court's conclusion on the interim measure (Para 209 , 210 , 211 , 212 , 213)
43. court's conclusion on the necessity of disclosure (Para 214 , 215 , 216 , 217 , 218)
44. court's conclusion on the defendant's application (Para 219 , 220 , 221 , 222 , 223)
45. court's conclusion on the cargo discharge (Para 224 , 225 , 226 , 227 , 228)
46. court's conclusion on the injunction (Para 229 , 230 , 231 , 232 , 233)
47. court's observations on damages (Para 234 , 235 , 236 , 237 , 238)
48. final judgment and orders (Para 239 , 240 , 241)

Ong Chee Kwan J:

Introduction

[1] This action is a sequel to the action in WA-27NCC-36-07/2023 ("the Desert Oasis Action" [2024] 2 MLRH 386; [2024] 1 CLJ 543) which w

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2023 MarsdenLR 1889

HIGH COURT MALAYA KUALA LUMPURUNICIOUS ENERGY PTE LTD – AppellantVersusTHE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL ALPINE MATHILD.... – Respondent[Admiralty In Rem No: WA-27NCC-49-10-2023]

The court held that a plaintiff designated as a 'U.S. Persons' under U.S. Sanctions Laws cannot invoke admiralty jurisdiction for arresting a vessel as security for arbitration, rendering the arrest an abuse of process.

Cases Referred (1)

HIGH COURT MALAYA KUALA LUMPUR
UNICIOUS ENERGY PTE LTD – Appellant
Versus
THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL ALPINE MATHILD.... – Respondent
[Admiralty In Rem No: WA-27NCC-49-10-2023]