The High Court of Singapore in the case of The Eurohope [2017] SGHC 218 (Eurohope) has held that a court in Singapore would not allow a ship arrest if the sole purpose of the arrest is to obtain security for foreign court proceedings as this amounts to an "abuse of process".

In The Eurohope there was a charterparty containing an exclusive jurisdiction clause in favour of the High Court of London. The charterer had a dispute with the ship owner and commenced a court action against the ship owner in London. When the vessel arrived at Singapore the charterer commenced an action against the Vessel and arrested the Vessel for the sole purpose of obtaining security for the London proceedings. The High Court of Singapore set aside the warrant of arrest and struck out the action in Singapore on the basis that the charterer's action in Singapore was an "abuse of process". 

The legal position in Singapore has been that an arrest of a vessel in Singapore for security in aid of foreign court proceedings is not allowed. In The Eurohope, the court appears to have elevated the arresting party's conduct attempt to arrest the vessel to an abuse of process. It is telling that on the reported facts of the case, the arresting party did not assert in the evidence supporting the arrest that they were prepared to have the substantive action determined in Singapore.

Interestingly there was an unreported case of United Endurance Adm in Rem 108/2007 (United Endurance) in which a seller of bunkers commenced a court action in Greece against a ship owner but arrested the Vessel in Singapore for the sole purpose of obtaining security for the Greek proceedings. After the arrest, the seller applied to stay the Singapore action in favour of the Greek proceedings. The High Court of Singapore allowed the stay on condition that the ship owner furnished security for the Greek proceedings. The Court in the Eurohope however did not follow the United Endurance as the earlier case was an unreported decision.  

There is clear inconsistency between United Endurance's case and The Eurohope. It is arguable in future scenarios how the court may decide if the cases were completely argued before it. 
One possible way of avoiding a striking out is for a Plaintiff to elect to have the substantive issues of his claim determined by the Singapore court and it is possible that in such instances the Plaintiff may be allowed to arrest a vessel. 

Arrest for security for foreign arbitration remains an exception. Cases such as The ICL Raja Mahendra [1998] SGHC 419 remains good law.

The Eurohope applies to cases where there is a foreign court jurisdiction clause and it does not apply to cases where there is an arbitration clause. If there is an arbitration clause, the provisions of the Arbitration Act (Cap 10) and International Arbitration Act (Cap 143A) allow for an arresting party to arrest a vessel for the sole purpose of obtaining security for arbitration proceedings. In such instances, once security is obtained to answer to the foreign arbitration, the court action may then be stayed (that is, suspended).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.