Lawyers representing Scorpio LR2 Pool Ltd (Scorpio, the Plaintiff), in the business of providing vessel chartering services, and energy trading and bunkering firm Winson Oil Trading Pte Ltd (Winson Oil, the Defendant) will be meeting at the High Court of the Republic of Singapore on 10 June.
The legal representatives will discuss, amongst others, security between Scorpio and Winson Oil due to a letter of indemnity earlier received from the latter, according to court documents obtained by Singapore bunkering publication Manifold Times.
Scorpio receives Letter of Indemnity from Winson Oil
A central topic of the meeting will be the discussion of USD 13.6 million (exact: USD 13,608,000) worth of 36,016.480 mt Gasoil 10PPM Sulphur cargo (Subject Cargo) lifted by Winson Oil in Taiwan during February 2020, when the 10,999 dwt oil tanker STI Orchard was sub chartered from Scorpio for the operation.
In March 2020, Winson Oil requested Scorpio to order the STI Orchard to proceed to and deliver (amongst others) the Subject Cargo at Tanjung Pelapas, Malaysia via ship-to-ship (STS) discharge to the 318,445 dwt VLCC Chang Bai San to Hin Leong Trading (Pte) Ltd.
Scorpio received a letter of indemnity from Winson Oil for the STS operation, though the oil transfer between 5 to 6 March 2020 to the VLCC was conducted without production of the original BL.
OCBC claims for Subject Cargo from owner of STI Orchard
Subsequently in February 2021, Oversea-Chinese Banking Corporation Limited (OCBC) wrote to STI Orchard Shipping Company Limited, the owners of the STI Orchard, claiming to be the rightful owner of the Subject Cargo as it was in possession of the full set (3 out of 3) of the original Bill of Lading.
As such, OCBC demanded delivery of the Subject Cargo and held STI Orchard Shipping fully liable and responsible for the loss and/or non-delivery of the Subject Cargo; the bank has also obtained an Admiralty in rem Writ of Summons (HC/ADM 16/2021) which allowed it to potentially arrest and detain the STI Orchard.
Responding to OCBC’s demand, STI Orchard Shipping in March 2021 informed Scorpio of the development and required the charterer to indemnify any liability while providing security and funds to defend OCBC’s claim, amongst others.
Scorpio seeking Security and Protection from Winson Oil
Scorpio, which has earlier received a letter of indemnity from Winson Oil, is now in turn seeking security from the latter in order to protect STI Orchard Shipping and itself from OCBC’s claim.
“However, the Defendant had failed and/or refused and/or neglected to provide security in the form required by OCBC despite the multiple demands by the Plaintiff for the Defendant to do so,” it states.
“The Defendant has also failed and/or refused and/or neglected to fulfil its other obligations under the LOI, including but not limited to providing the Plaintiff funds for the purposes of defending OCBC’s claim in the suit HC/ADM 16/2021 commenced by OCBC against the Owners.”
Scorpio’s P&I Club Steamship Mutual Underwriting Association (Europe) Limited, meanwhile, has issued a letter of undertaking to OCBC assuring total liability of not more than USD 17 million (exact: USD 17,009,225.60) on behalf of STI Orchard Shipping and its vessel STI Orchard.
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Source: Manifold Times
