Greatship Global Offshore Services Pte Ltd v 1. ) Vantage Marine & Logistics Sdn Bhd (WA-27NCC-12-03/2023)

VANTAGE MARINE & LOGISTICS SDN BHD [Company No.: 201701014180 (1228345-A)]

AZIZUL AZMA BIN AB MALIK [Identity Card No.: 790413065371]

ESWARAN A/L PANJARATNAM [Identity Card No.: 791105145569]

WONG CHENG PERNG [Identity Card No.: 830131075647]

MARGRATE TAMBANUN [Identity Card No.: 821025126178]

MUHAMMAD SABRI BIN AB GHANI [Identity Card No.: 720411035909]

SKOSV SDN BHD [Company No.: 201201012624 (986141-V)] …DEFENDANTS

This judgment concerns a claim arising from a contractual payment mechanism which involved the 7th Defendant who although not originally a party to the contract, had acknowledged and confirmed the payment terms and thereby assumed the obligations which the 7th Defendant later breached. The Court found that the payment mechanism which required the 7th Defendant to hold funds also gave rise to a constructive trust and a fiduciary relationship between the Plaintiff and the 7th Defendant.

The Plaintiff further claimed a conspiracy to injure by unlawful means against the common directors of the 1st Defendant and 8th Defendant but the Court found no evidence of any concerted arrangement and the existence of a predominant intention to injure holding that the set-off agreement relied upon as the means to the conspiracy, while commercially disruptive, was lawful and consequently the necessary ingredients to support the cause of action not established.

The Plaintiff, Greatship Global Offshore Services Pte Ltd (“Greatship”), is in the business of vessel chartering and related services for the oil and gas industry.

The 1st Defendant, Vantage Marine & Logistics Sdn Bhd (“Vantage Marine”) was part of the Vantage Energy Group and was in the business of providing marine services.

The 8th Defendant, Vantage Oilfield Solutions Sdn Bhd (“Vantage Oilfield”), was also part of the Vantage Energy Group and was in the business of well-testing intervention services.

The 7th Defendant, SKOSV Sdn Bhd (“SKOSV”), is primarily involved in providing offshore support vessels chartering.

On 29.4.2021, PTTEP Sabah Oil Limited and PTTEP Sarawak Oil Limited (collectively referred as “PTTEP” or “End User”) awarded to SKOSV the Deepwater Project for SKOSV to provide platform supply vessel (“the Works”).

On 21.7.2021, SKOSV subcontracted the Works to the 1st Defendant, Vantage Marine.

On 29.8.2021, Vantage Marine in turn sub-subcontracted the Works to the Greatship via the Letter of Award (“Deepwater Project LOA”), wherein Vantage Marine chartered the use of Greatship’s vessel, MV GREATSHIP MAYA (“the Vessel”).

The Deepwater Project LOA was subsequently supplemented by four addenda. Addendum No. 4 to the Deepwater Project LOA (“Addendum No. 4”) forms the crux of this dispute. The Deepwater Project LOA and its four addenda were entered into between Greatship and Vantage Marine only.

Azizul Azma bin Ab Malik (“Azizul”), Eswaran a/l Panjaratnam (“Eswaran”), Wong Cheng Perng (“Wong”), Margrate Tambanun (“Margrate”) and Muhammad Sabri bin Ab Ghani (“Sabri”) are the 2nd to 6th Defendants respectively and they were the common directors of Vantage Marine and Vantage Oilfield (collectively referred as “the Vantage Directors”).

Returning to the Deepwater Project, the 4 addenda are as follows:

Addendum No. 1: On 29.8.2021, Vantage Marine and Greatship executed Addendum No. 1 for Greatship to provide accommodation for up to thirty (30) PTTEP personnel.

Addendum No. 2: On 4.1.2022, Vantage Marine and Greatship executed Addendum No. 2 to extend the period of hire for the Vessel for an additional twenty-seven (27) days.

Addendum No. 3: On 30.1.2022, Vantage Marine and Greatship executed Addendum No. 3 to further extend the period of hire for the GREATSHIP MAYA for an additional twenty-eight (28) days.

Addendum No. 4: On 25.2.2022, Vantage Marine and Greatship executed the Addendum No. 4. Significantly, SKOSV acknowledged this addendum in a section separate from the signing portion of the addendum. Addendum No. 4 provided for a further extension of the hire period and included a payment procedure for Greatship to receive payment from Vantage Marine. The separate signing and acknowledgement portion of the Addendum No. 4 (“the Acknowledgment and Confirmation”) is reproduced below: The Payment Procedure

Prior to Addendum No. 4, the flow of funds was that the End User or PTTEP would pay SKOSV who in turn would pay Vantage Marine. Vantage Marine would thereafter pay Greatship.

However, as Greatship had not received payment of charter hire for its charter of the Vessel from Vantage Marine after October 2021, Addendum No. 4 was entered into because of Greatship’s concern on the continued nonpayment of charter hire.

A specific payment procedure which would allow Greatship to monitor and control the flow of payments from the End User of the Vessel all the way to Vantage Marine was set out in Addendum No. 4. In particular: a) All payments to be made from SKOSV to Vantage Marine requires a written confirmation from Greatship; b) Vantage Marine was obliged to obtain the written agreement and confirmation of SKOSV that on receipt of any payment from the End User, SKOSV would intimate such receipt in writing to Greatship seeking its permission for onward remittance of corresponding payment to Vantage Marine; c) Greatship would at its discretion direct SKOSV to release details of the payments to be released to Vantage Marine and the date by which such payment to be released. Such payment could be in part or full, at the discretion of Greatship; d) Vantage Marine would procure SKOSV to proceed with the payments as instructed by Greatship and to confirm the remittance immediately in writing to Greatship. (“the Payment Procedure”)

Notwithstanding Addendum No. 4, Greatship still did not receive any payments for the outstanding charter hire. This was the case even after Greatship had sent multiple chasers for payments but to no avail.

Greatship subsequently learnt that SKOSV had entered into a separate contract with Vantage Oilfield wherein SKOSV’s debt to Vantage Marine (which was the subject of Addendum No. 4 and was to be paid ultimately to Greatship) was in effect set off as against monies owed by Vantage Oilfield to SKOSV.

For context, on 21.1.2022, SKOSV had entered into a charter party with Vantage Oilfield for the provision of SKOSV’s vessel, SK Line 605, for the Hibiscus Project (“Hibiscus Project CPA”). The Hibiscus Project CPA was later supplemented by Addendum No. 1 dated 24.6.2022 (“Hibiscus Addendum No. 1”).

As at 25.6.2022, Vantage Oilfield owed SKOSV approximately RM8,786,639.45 under the Hibiscus Project CPA. At the same time, SKOSV owed sums to Vantage Marine under the PTTEP Sub-Contract for the Deepwater Project. Since both Vantage Oilfield and Vantage Marine were part of the Vantage Energy Group, on 24.6.2022, SKOSV and Vantage Oilfield entered into the Hibiscus Addendum No. 1 to offset the aforesaid mutual debts (“the Set-Off”)

On 18.9.2024, Vantage Marine was wound up. On 6.11.2023, Greatship’s claim against Vantage Marine was stayed pending arbitration. Notwithstanding the aforesaid, Greatship had not commenced arbitration against Vantage Marine.

On 2.5.2024, Vantage Oilfield was wound up. Just like how Greatship was disinterested in pursuing its claim against Vantage Marine, similarly here, Greatship did not apply leave from the winding up Court to pursue its present claim against Vantage Oilfield.

In this action, based on the pleadings, the Plaintiff’s cause of action against the Vantage Directors are for: a) the tort of conspiracy to injure by unlawful means; and b) breach of fiduciary duties as trustees.

More specifically, Greatship is essentially asserting that the Vantage Directors: a) were collectively the directing minds and or the alter egos of Vantage Marine; b) had acted in concert with Vantage Marine by deliberately not making payments of the outstanding sum owed by Vantage Marine to Greatship under the Deepwater Project LOA despite receiving payments from SKOSV; c) had willingly caused Vantage Oilfield to enter into Addendum No. 1 with SKOSV thereby procuring and or causing the set off of RM8,786,639.45 with SKOSV to Greatship’s detriment; d) had acted in conspiracy and or collusion with Vantage Marine and Vantage Oilfield to injure Greatship.

Greatship’s claims against SKOSV are three-fold.

First, for breach of contract. Greatship claims that SKOSV had breached the Addendum No. 4 by entering into Hibiscus Addendum No. 1, under which SKOSV had set-off the debts owed by Vantage Oilfield to SKOSV under the Hibiscus Project CPA with the debts owed by SKOSV to Vantage Marine under the Deepwater Project LOA.

Second, for tort of inducing breach of contract. Greatship pleaded that SKOSV is “liable to [Greatship] under the tort of inducing breach of contract” by “knowing of the existence of Addendum No. 4 and being a party to the same, and acting with the object of procuring its breach by [Vantage Marine] and [SKOSV]”. More specifically, it is contended that by the Hibiscus Addendum No. 1, SKOSV had induced Vantage Marine to breach its obligation under Addendum No. 4 not to make any agreement that would be contrary to the terms therein.

Third, for breach of duty as constructive trustee and as fiduciary. It is contended that based on the facts and circumstances of this case, namely: a) particularly Clause (c) of Addendum No. 4 and SKOSV’s obligations under the Payment Procedure stipulated in that document; b) SKOSV’s receipt of the monies; and c) SKOSV’s conduct in entering into Hibiscus Addendum No. 1 with Vantage Oilfield a constructive trust is imposed by law on SKOSV in favor of Greatship in respect of the monies that it had received from the End User. The relationship also creates a fiduciary obligation on the part of SKOSV.

Based on the aforesaid, it is therefore necessary for this Court to determine the following legal issues: a) whether SKOSV is bound by the terms of Addendum No. 4 and is a party to the same by reason of the Acknowledgement and Confirmation; b) whether SKOSV had wrongfully induced Vantage Marine to breach its contract with Greatship under the Deepwater Project LOA; c) whether SKOSV was a constructive trustee and a fiduciary of Greatship and if so, whether SKOSV had breach its duty to Greatship; d) whether the Vantage Directors had conspired to injure Greatship by unlawful means; e) whether the Vanatge Directors owed Greatship any duty as trustees and if so whether they had breached the duty.

At the outset, it must be stated that there is no dispute that Greatship and Vantage Marine had entered into Addendum No. 4 with the view to address Greatship’s concerns of the delays in the payment of charter hire by Vantage Marine under the Deepwater Project LOA. Greatship had been troubled by the fact that Vantage Marine had received payments for the charter of the Vessel but had not transmitted the same onwards but instead had used the same for their own operational expenses.

Based on the evidence disclosed, the Vantage Group was facing cash flow issues because one of its major source of income at the time which was the receivables from the Hibiscus Project had not come in as expected due to certain disputes. As a result, Vantage Marine had to apply the payments received from SKOSV under the Deepwater Project LOA to the Vantage Group operational expenses in order to keep the group afloat.

The issue before this Court is whether the Addendum No. 4 is a tripartite agreement where SKOSV was contractually obliged to Greatship to observe the terms stated therein.

In particular, Clause (b) and (c) to Addendum No. 4 read as follows: b. From the date of this Addendum, the Charterers unconditionally agree and confirm that for any payments to be made from Contract Holders to Charterers towards Greatship Maya applicable for any period prior to and from the date of this Addendum, a written confirmation from Owners to proceed with such payment would be an absolute precondition, superseding any prior agreement to the contrary. Charterers also unconditionally agree and confirm to not making any agreement to the contrary at any time and acknowledge that any such agreement would be illegal. c. The Charterers shall be under obligation to obtain the written agreement and confirmation of the Contract Holder that on receipt of any payment towards Greatship Maya contract / Work Order from the end user to the Contract Holder, the Contract Holder would immediately intimate such receipt, along with the relevant details, in writing tothe Owners, seeking Owners' permission for onward remittance of corresponding payment to Charterers. Such written agreement/ confirmation from the Contract Holder shall be shared by the Charterers with the Owners upon demand.

Clause (b) operates in this manner: i) any payments made from SKOSV to Vantage Marine must first be sanctioned by Greatship; ii) Vantage Marine would not enter into any agreement to the contrary and recognize that any such agreement to the contrary would be “illegal”

Clause (c) imposed upon Vantage Marine the obligation to secure a written agreement from SKOSV that SKOSV would, upon receipt of payments made by the End User, withhold the payments to Vantage Marine until it receives a written confirmation from Greatship. The provision also placed on SKOSV an obligation to notify Greatship once it receives the payments from the End User.

Critically, Vantage Marine is obliged to disclose to Greatship, SKOSV’s written agreement that the Payment Procedure would be adhered to by SKOSV. The purpose of this is self-evident – the Payment Procedure requires SKOSV to play an active role designed to ensure that Greatship would be aware of the movement and application of funds once received by SKOSV from the End User. Without SKOSV’s agreeing to accept its roles, the Payment Procedure would not work.

Clause (d) of Addendum No. 4 reads as follows: d. The Charterers unconditionally agree and confirm that the Owners would, at their discretion, direct the Contract Holders the details of payments to be released to Charterers and the date by which such payment to be released. Such payment could be in part or full, at the discretion of, and as directed by, the Owners. The Charterers shall procure that the Contract Holders shall proceed with payment as per Owners Instructions and confirm such remittance immediately, in writing, to Owners and Charterers in the same email.

The purpose and operation of Clause (d) is also self-evident – to give Greatship control over the disbursement and movement of funds from SKOSV to Vantage Marine. In other words, Vantage Marine could no longer represent to Greatship that the payments had not been received from SKOSV and if the payments were not forthcoming thereafter to Greatship, appropriate steps could be taken to recover the same.

Significantly, because Greatship could determine that only part of the payments that SKOSV had received from the End User was to be released to Vantage Marine, this means that Greatship was in a position to control that the balance payments received by SKOSV continued to be held by SKOSV in the event that Vantage Marine fails to release the said part payments that it had received from SKOSV to Greatship.

SKOSV however contended that it was not a party to the Addendum No. 4 at all and therefore had no obligations to Greatship in respect of the Payment Procedure. All that that it did was merely to acknowledge the existence of Addendum No.

4.

With respect, I disagree. To my mind, by its Acknowledgement and Confirmation of the Payment Procedure in the Addendum No. 4, SKOSV had effectively agreed to be bound by the same and to treat itself as a party to the Addendum No. 4.

I agree with learned counsel for Greatship that the fact that Clause 3 of the Addendum No. 4 which deals with the Payment Procedure had referred to ‘All parties…’ in contradistinction to the reference to only ‘… the Charterers (Vantage Marine) and Owners (SKOSV) …’ preceding the Clauses 1 and 2 suggests that the obligations stipulated in the Payment Procedure were intended to apply to all the parties expressly mentioned in Clause 3(a) to (f).

As alluded to above, Clause (c) expressly stipulates that “The Charterer (Vintage Marine) shall be under obligation to obtain the written agreement and confirmation of the Contract Holder (SKOSV)” with regards to Payment Procedure. To my mind, this provision was necessary because both Greatship and Vantage Marine were aware that the Payment Procedure needed SKOSV’s participation and agreement to assume its stated roles.

In this regard, I agree with learned counsel for Greatship that the Acknowledgment and Confirmation by SKOSV is the ‘written agreement and confirmation’ envisaged in Clause (c) above.

The use of the word “acknowledge” should be construed as SKOSV’s agreement to the payment terms, including its obligations as stated therein. This definition is plain and obvious in the context of the agreement itself. To my mind, the approach taken by the Singapore Court in Good Property Land Development Pte Ltd (In Liquidation) v Societe-Generale [1996] 1 SLR 457 is instructive: However, should I be wrong in taking that view and that explicit consent of the company was required before Societe-Generale could set off the surplus of sale proceeds against unsecured debts of the company, then I was of the view that such consent was given in the set-off agreement and/or the settlement agreement. The word ‘acknowledge’ in the set-off agreement should be construed to mean that the company ‘agree’. It seems to me clear that the two documents constituted a comprehensive repayment scheme by the company to Societe-Generale. They empowered Societe-Generale to do two things; (i) to set off money which was held by Societe-Generale for the company against the debts of the company to Societe-Generale (ii) to collect debts due from third parties to the company and to set them off against debts due from the company to Societe-Generale. It would be to ignore commercial reality to hold that the two agreements did not extend to or cover the surplus funds held by Societe-Generale under s(74(1))”.

Similarly, the use of the word ‘confirm’ is also significant. Clause it is in effect a declaration of SKOSV’s intent to be bound by the payment terms stipulated in Addendum No. 4. The word 'confirmed' etymologically comes from the old French and Latin "confermere" meaning thereby to make firm or strengthen. In other words, apart from acknowledging the Payment Procedure, SKOSV by its confirmation further strengthen its agreement to ‘buy-in’ into the Payment Procedure, accepting its obligations as stipulated in the Addendum No. 4 where they pertained to

In this regard, I do not at all agree with SKOSV that the Addendum No. 4 only binds Vantage Marine and merely places an obligation on Vantage Marine to procure SKOSV’s agreement to follow Greatship’s directions which it is contended had not been procured. On the contrary, by SKOSV’s express Acknowledgment and Confirmation, Vantage Marine had in effect obtained SKOSV’s agreement to be made a party to the Payment Procedure and to be bound by the terms thereto.

In fact, from a plain reading of Clause 3 (c), SKOSV had the obligation to inform Greatship the moment it receives payments from the End User for the Deepwater Project. In this regard, SKOSV candidly admitted that this is an obligation that only SKOSV would be able to perform: Yes. So, the only party who would know when the funds came in would be SKOSV, and they are the only party in this whole group of companies who could intimate receipts of funds, do you agree with that? I'm happy to wait for an answer, Mr Leong. JONATHAN Yes, sorry. I think you may be correct. Fine. Agree, yes. Now, if you look at Item (b), it says, "From the date of this addendum being 25" February, charterers unconditionally agree and confirm that any payment to be made from contract holders to charterers*, contract holders being SKOSV, to charterers towards Greatship Maya, a written confirmation from owners to proceed with such payment would be an absolute precondition, superseding any prior agreement to the contrary. Now, Mr Leong, I'm going to put it to you, this written confirmation to proceed with payment can only arise if there is notification from SKOSV that monies have been received on a back-to-back basis, from PTTER, do you agree? JONATHAN Ok.

I agree with learned counsel for Greatship that the key to the proper execution Payment Procedure under Clause 3 of Addendum No. 4 is the notification to Greatship of the receipt of monies from the End User to SKOSV. This is evident from Clause 3 (c). All the obligations of Vantage Marine under Clauses 3(b), (c) (d) and (e) can only occur once SKOSV intimate such receipt to Greatship. It can only exert control as envisaged in Clause 3 when it knows of the receipt of the funds. This is the reason why it was necessary for Vantage Marine to procure SKOSV to agree to the Payment Procedure and to abide by its terms.

Everything that Vantage Marine and Greatship can do is dependent or conditional upon the notification by SKOSV. In other words, without SKOSV agreeing to be bound, Greatship cannot direct the details of the payment to be received by Vantage Marine nor can SKOSV be required to pay as directed.

Accordingly, I agree that the Acknowledgement and Confirmation in the Addendum No. 4 has the legal effect of a tripartite agreement involving SKOSV, Greatship and Vantage Marine.

Indeed, SKOSV had a commercial reason to be made a party to the Addendum No. 4. For SKOSV, it was the continued charter of the Vessel so that SKOSV as the Contract Holder to PTTEP or the End User could continue to service their contract. The relevant extracts of Notes of Proceedings in answer to Para 82 – 86 can be seen from the extracts below: So, you needed the vessel under your contract with PTTEP, yes? JONATHAN Yes, correct. If the vessel performance was suspended or the vessel was terminated, SKOSV, apart from losing revenue under their contract, would also be inconvenienced to the extent that you would need to mobilise another vessel, pay for mobilisation costs, to bring another vessel to fulfil that contract, won't you agree? JONATHAN For which project, sorry? For the PTTEP project. If the Greatship Maya was pulled off on 25* February, you still had an ongoing contract. You needed to then mobilise another vessel, pay mobilisation fees, you will incur downtime under your contract because that vessel will take days to come back. So, it was in your interest that Addendum No.4 was signed, agree? JONATHAN I can agree that Addendum No.4 is signed with, as in beneficial to us but I think the impacts are a lot worse than that.

In the premises it is the judgment of this Court that SKOSV was contractually bound to the terms of the Addendum No. 4 and was therefore in breach of the same when SKOSV deliberately failed and or refused to notify the receipt of the partial payment of RM 2.9 million on 29.6.2022 from the End User and then when the substantial amount RM 11.9 million was paid thereafter (certainly before 20.7.2022) again keeping that information to themselves and then entering into the Hibiscus Addendum No. 1 with Vantage Oilfield which incorporated the Set Off.

Quite apart from the aforesaid, it is also the judgment of this Court that SKOSV had wrongfully interfered with Vantage Marine’s performance of the Addendum No. 4 and in fact had induced Vantage Marine to breach the same.

The law relating to the tort of inducement of breach of contract was considered by the Federal Court in Loh Holdings Sdn Bhd V Peglin Development Sdn Bhd [1984] 1 CLJ (REP) 211. The Federal Court, relying on the English case of Greig v Insole [1978] 1 WLR 302, held that at common law, it constitutes a tort for third persons to deliberately interfere in the execution of a valid contract which has been concluded between two or more parties if the following five conditions are satisfied: a) there must be direct or indirect interference, coupled with the use of unlawful means; b) the defendant must be shown to have knowledge of the relevant contract; c) the defendant must be shown to have the intent to interfere; d) the plaintiff must show that he has suffered special damages, that is, more than nominal damages; and e) so far as it is necessary, the plaintiff must successfully rebut any defence based on justification which may be put forward by the defendant.

The meaning of “interference” is not confined to the actual procurement or inducement of a breach of contract. Lord Denning in Torquay Hotel Co Ltd V Cousins [1969] 1 ALL ER 522 is of the view that it can also cover situations whereby the third person prevents or hinders one party from performing his contract.

The difference between direct interference and indirect interference is explained in Middlebrook Mushrooms Ltd v Transport and General Workers’ Union [1993] ICR 612. The essential difference lies in causation. If the person immediately responsible for bringing the procurement or inducement was the defendant or someone for whose acts, he was legally responsible, the inducement is direct.

In D.C. Thomson & Co Ltd v. Deakin [1952] CH 646 (“D.C. Thomson”) four categories of cases which could amount to a direct interference by a third party of the rights of one of the parties to a contract were set out. These four categories are as follows: a) a direct persuasion or procurement or inducement applied by the third party to the contract-breaker, with knowledge of the contract and the intention of bringing out its breach; b) dealings by the third party with the contract-breaker which to the knowledge of the third party are inconsistent with the contract between the contract-breaker and the person wronged; c)

As per Jenkins LJ in D.C Thomson (supra) it is only in respect of cases of indirect interference where it is necessary to prove the use of unlawful means if the indirect interference is to be actionable. There is no need for unlawful means to be established where there is direct interference.

In the present case, I accept the submission of learned counsel for Greatship that there was a direct interference by SKOSV here.

SKOSV had directly procured the execution of the Hibiscus Addendum No. 1 (between itself and Vantage Oilfield) wherein by the Set Off, Vantage Marine had effectively been deprived of the receipt of the payments under the Deepwater Project LOA which upon receipts of the same, Vantage Marine was to utilize the same to effect payment to Greatship under the charterparty.

In fact, under Addendum No. 4, Vantage Marine had expressly agreed unconditionally not to enter into any agreement which would be contrary to the terms of the Addendum No. 4. Yet, based on the testimony by Wong of Vantage Oilfield, SKOSV had arm twisted Vantage Marine and Vantage Oilfield into agreeing to the Set Off: The point of this clause is to make sure that Vantage does not undermine the payment procedure as stipulated in Addendum No.4, correct? Yes. Yet, knowing about this clause, as you did, you still agreed to the set-off, correct? Yes. Now, we can go back to your Witness Statement again, page 6. Your position, as I understand it, is that SKOSV twisted your arm, forced you to agree to the set-off or else they would, what, remove their vessel from use at the Hibiscus Project? Correct. That is the reason why you agreed to it? Yes. You were aware of that, yes? Yet, they were constrained to agree. We've heard the evidence from Mr Wong Cheng Perng that he felt compelled. He was basically arm-twisted into agreeing because of the need for the vessel for the Hibiscus Project. Now, you're aware that under Addendum 4, Vantage Marine were not allowed to make any agreement to the contrary to the terms of Addendum 4. So, you're aware of that? JONATHAN Yes. Thank you. Now, there is another one which is obviously a different situation, "The charterers also unconditionally agree", and I'm going to be fair to you and say this ija charterer's obligation alone, "and confirm not to make any agreement to the contrary", you see that? JONATHAN Ok. All I invite you to confirm is that by acknowledging and confirming, you are aware of this restriction? JONATHAN Yes, I was aware of this restriction.

At all material times, SKOSV was aware of its obligations to inform Greatship of the receipt of monies from the End User under Addendum No. 4. However, SKOSV deliberately withheld notification of receipt of monies (from PTTEP) from Greatship so as to preclude Greatship from acting upon the Payment Procedure as set out in Addendum No. 4.

To my mind, SKOSV by deliberately hiding receipt of funds from the End User and entering into the Set Off with Vantage Oilfield and Vantage Marine vide the Hibiscus Addendum No. 1, while in full knowledge of the terms of Addendum No. 4, SKOSV intended to stymie (and therefore interfere) in the performance of the terms of Addendum No. 4.

SKOSV contended that the true cause of Vantage Marine’s non-performance of the Addendum No. 4 was the ongoing financial issues and pressures from multiple creditors and not the Hibiscus Addendum No.

With respect, the aforesaid contention misses the point. It was because of Vantage Marine’s financial issues that Greatship had put in place the Payment Procedure stipulated in Addendum No. 4. So, let's just sit with that point first. No.1, l've taken through all the documents leading up to this. You were well aware of the financial morass that Vantage was at that material time, yes? JONATHAN That's correct, yes.

This was well within the knowledge of SKOSV who had not only acknowledged the same but confirmed its agreement to be bound by its terms. Yes. So, the only party who would know when the funds came in would be SKOSV, and they are the only party in this whole group of companies who could intimate receipts of funds, do you agree with that? I'm happy to wait for an answer, Mr Leong. JONATHAN Yes, sorry. I think you may be correct. Fine. Agree, yes. Now, there was also a second element to that. Apart from intimating receipts in writing to owners, you were required to seek the permission of owners for onward remittance of the corresponding payment to charterers. Now, again, how would Vantage be able to do that unless you informed us, the Plaintiff or Vantage, of receipt of funds from SKOSV? Because let's not forget, it was back-to-back. So, how was that portion supposed to be effected without your participation in doing so because it's a step. If you don't tell us, how are we supposed to give you instructions as to what to do with the money? JONATHAN Ok. Alright It follows as night follows day, you agree? JONATHAN Ok. Alright All I invite you to confirm is that by acknowledging and confirming, you are aware of this restriction? JONATHAN Yes, I was aware of this restriction. Thank you. You were similarly aware at (d) that "Owners would, at their discretion, direct the contract holders the details of payments to be released and the dates upon which such payments were to be released". Again, I'm going to put it to you, Mr Leong, that this portion of (d), directing the contract holders, directing SKOSV, could again only occur if SKOSV had given written notification of receipt of funds. You agree? JONATHAN Agree.

Yet, notwithstanding the same, SKOSV procured the execution of the Hibiscus Addendum No. 1 so that it would benefit from the payments received from the End User at the expense of Greatship.

The further contention that the Set Off does not identify Vantage Marine as the party to whom the Set Off apply is, with respect, disingenuous. It is incredulous to suggest that SKOSV was not aware that the monies that it would apply to set off the debts that Vantage Oilfield owed to SKOSV were the monies that SKOSV was obliged under the Addendum No. 4 to notify Greatship upon the receipt of the same from the End User.

Accordingly, it is plain and obvious to this Court that Greatship’s loss arising from the non-receipt of payment under the Payment Procedure stipulated in Addendum No. 4 is directly attributable to SKOSV’s actions in withholding notification of receipt of payments from the End User and its subsequent entry into the Hibiscus No. 1 with Vantage Oilfield.

In the premises, it is the judgment of this Court that Greatship has established on the balance of probabilities that SKOSV had wrongfully induced Vantage Marine into breaching the terms of Addendum No. 4 and interfered in the performance of the same.

It is undisputed that SKOSV was in receipt of monies of approximately RM 11.9 million from the End User which was intended to be paid to Vantage Marine for payment to Greatship. Clause (c) of Addendum No. 4 creates an obligation on the part of SKOSV to inform Greatship once it has received payments from the End User, so that Greatship may exert control over the onward application and transmission of those funds to itself.

The aforesaid Payment Procedure was set up because of Vantage Marine’s previous failure to apply the said payments towards its obligations to pay Greatship. The effectiveness of the Payment Procedure depended on SKOSV agreeing to notify Greatship once the payments are received from the End User and to pay over the same to Vantage Marine only upon the receipt of Greatship’s express instructions.

In this regard, I agree with Greatship’s contention that the circumstances in this case gives rise to a constructive trust on the part of SKOSV to ensure transmission of those monies to Greatship.

The principles of constructive trust are as set out in Datuk M Kayveas v. See Hong Chen & Sons Sdn Bhd & Ors [2013] 5 CLJ 949: “[37] From the various opinions above it may be construed that a constructive trust arises by operation of law irrespective of the intention of the parties, in circumstances where the trustee acquires property for the benefit of the beneficiary and making it unconscionable for him to assert his own beneficial interest in the property and deny the beneficial interest of another. Being bereft of any beneficial interest, and with equity fastened upon his conscience, he cannot transfer any interest to himself let alone a third party. If he does, then a constructive trust comes into existence. An aggrieved party, by equitable remedy, may demand restitution of the property if he has been deprived of his beneficial interest.”

In Takako Sakao v. Ng Pek Yuen & Anor [2010] 1 CLJ 381 at 408 - 409, the Federal Court explained the doctrine of constructive trust and tracing as follows: "[20] A constructive trust is imposed by law irrespective of the intention of the parties. And it is imposed only in certain circumstances. Two examples readily available (apart from the facts of this case and those illustrations provided by Millet LJ in Paragon Finance plc v. DB Thakerar & Co) are (i) where there is a specifically enforceable contract for the sale of property (moveable of immovable), the vendor holds the property on a constructive trust for the purchaser: see, Wong Siew Choong Sdn Bhd v. Anvest Corporation Sdn Bhd [2002] 3 CLJ 409; and (ii) where a gift made as a donation mortis causa fails, the intended beneficiary of the gift holds it in trust for the donor. As may be seen, the vendor in the first illustration and the purportedly dying donor or the beneficiary in the second did not create any trust. Nor did they intend to do so. What equity does in those circumstances is to fasten upon the conscience of the holder of the property a trust in favour of another in respect of the whole or a part thereof. [21] As earlier observed, we are of the view that the appellant at all material times was entitled to a half share in the trust property as a beneficiary under a constructive trust. She was entitled to claim it from the first respondent and to trace her half share in the property into the hands of anyone who acquired it. But equity will not assist the victim of a breach of trust to trace trust property where it will be inequitable to do so, for example because the property to be traced has gone into the hands of a bona fide acquirer for value or because it has gone into the general funds of a charity (see Re Diplock's Estate [1948] 2 All ER 429)."

In Ng Hoo Kui v. Wendy Tan Lee Peng, Administrator of the Estates of Tan Ewe Kwang, Deceased & Ors [2020] 10 CLJ 1, the doctrine of constructive trust was again applied by the Federal Court. The Federal Court held (at page 45 - 46): "[111] It is trite law that the intention to create a trust is applicable in situation of express trusts and not in constructive trusts. Constructive trust are trusts that may be implied in the absence of any declaration / intention of a trust, where the trustee has induced another to act to their detriment they would acquire a beneficial interest in the land / property. A characteristic feature of this trust does not owe its existence to the parties' intention, but by operation of law. In Takako Sakao v. Ng Pek Yuen [2010] 1 CLJ 381; [2009] 6 MLJ 751, it was held that: A constructive trust is imposed by law irrespective of the intention of the parties. And it is imposed only in certain circumstances, e.g. where there is dishonest, unconscionable or fraudulent conduct in the acquisition of property. What equity does in those circumstances is to fasten upon the conscience of the holder of the property a trust in favour of another in respect of the whole or part thereof. [112] Constructive trust is viewed as a device under which equity will intervene so as to create a trust relationship between the parties in order to make a person accountable for the trust to prevent any unfairness or injustice. Equity will impose obligation on the defendant to hold the property for the benefit of another."

To my mind, in the present case, the factors which are said to fasten upon the conscience of SKOSV such that equity would impose upon SKOSV a duty as constructive trustee in favour of Greatship are that: a) it knew that Greatship was actively chasing for payments from Vantage Marine; b) it knew of the dire financial predicament of the Vantage Group of companies, including Vantage Marine and Vantage Oilfield; c) it knew that in furtherance of this, Greatship sought the execution of the payment control mechanisms in Addendum No. 4 so secure Vantage Marine’s payment obligations to Greatship; d) it knew that the effectiveness of the Payment Procedure depends on SKOSV’s agreement to abide by the terms of the Addendum No. 4, in particular, the notification by SKOSV of the receipt of payments from the End User and SKOSV’s compliance with Greatship’s instructions on the payment of the same to Vantage Marine; e) it knew that Greatship had expressly required Vantage Marine to procure SKOSV’s written agreement to the accept and abide by the terms of the Addendum No. 4 which SKOSV did by the Acknowledgement and Confirmation; f) it knew that Greatship would rely on SKOSV’s Acknowledgment and Confirmation; g) yet, it deliberately sought to circumvent these payment procedures by failing to update Greatship once payments had been received by it from the End User and then applying such payments in a manner contrary with the spirit and purpose of Addendum No. 4 by virtue of its entry into the Hibiscus Addendum No. 1.

To my mind, the aforesaid factors above also gave rise to a relationship where SKOSV owed Greatship a fiduciary duty to ensure that the monies received from the End User would be paid to Vantage Marine and not to placed itself in any position where SKOSV’s interest would conflict with its fiduciary obligations to Greatship.

In Tengku Abdullah Ibni Sultan Abu Bakar & Ors v. Mohd Latiff Shah Mohd & Ors & Other Appeals [1997] 2 CLJ 607 at p. the Court of Appeal said: The flexible approach adopted by the Courts when according recognition to a particular relationship as being fiduciary in nature is, of course, one of judicial impression dependent upon the fact pattern of a given case. Flexibility of approach is the hall-mark of equity. For, when we deal with the principles governing equitable intervention, we enter a domain comprising, not rigid rules, but broad and liberal doctrines that are aimed at achieving a just result according to the facts of a particular case. Equity has, in keeping with the purpose of its origin, therefore, refrained from laying down any strict rules for determining whether a particular relationship is fiduciary in nature or gives rise to fiduciary obligations, leaving the development of its jurisprudence to a case by case basis. The maxim: "The categories of fiduciary relations are never closed" exemplifies the approach that a Court of Equity adopts in this sphere of human activity. See, English v.

Further, in Bristol and West Building Society v. Mothew [1998] 1 CH 1 AT P. 18, Millet LJ made the following observation on the question of who is a fiduciary: “A fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence. The distinguishing obligation of a fiduciary is the obligation of loyalty. The principal is entitled to the single-minded loyalty of his fiduciary. This core liability has several facets. A fiduciary must act in good faith; he must not make a profit out of his trust; he must not place himself in a position where his duty and his interest may conflict; he may not act for his own benefit or the benefit of a third person without the informed consent of his principal. This is not intended to be an exhaustive list, but it is sufficient to indicate the nature of fiduciary obligations. They are the defining characteristics of the fiduciary. As Dr. Finn pointed out in his classic work Fiduciary Obligations (1977), p. 2, he is not subject to fiduciary obligations because he is a fiduciary; it is because he is subject to them that he is a fiduciary”.

Courts have never attempted to formulate a comprehensive definition of who is a fiduciary, retaining the flexibility of this doctrine. Fiduciary duties may also be owed where the circumstances justify the imposition of such duties. In this connection the learned author of Snell's Equity stated at pp. and 176 as follows: “(c) Ad hoc fiduciary relationships

PRINCIPLES. The categories of fiduciary relationship are not closed. Fiduciary duties may be owed despite the fact that the relationship does not fall within one of the settled categories of fiduciary relationships, provided the circumstances justify the imposition of such duties. Identifying the kind of circumstances that justify the imposition of fiduciary duties is difficult because the courts have consistently declined to provide a definition, or even a uniform description, of a fiduciary relationship, preferring to preserve flexibility in the concept. Numerous academic commentators have offered suggestions, but none has garnered universal support. Thus, it has been said that the "fiduciary relationship is a concept in search of a principle." There is, however, growing judicial support for the view that: a fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence. The concept encaptures a situation where one person is in a relationship with another which gives rise to a legitimate expectation, which equity will recognise, that the fiduciary will not utilise his or her position in such a way which is adverse to the interests of the principal. The expectation is assessed objectively, and so it is not necessary for the principal subjectively to harbor the expectation”.

In this regard, by entering into the Hibiscus Addendum No. 1, SKOSV has clearly breached its fiduciary duty to Greatship.

Turning now to Greatship’s case against the Vantage Directors, the claims lie primarily in the tort of conspiracy to injure by unlawful means. It is contended that Greatship had put in the specific Payment Procedure to ensure its receipt of monies clearly due to it, and had placed specific guardrails to guard against circumvention of the same. The guardrail is this – Vantage Marine was not to enter into any agreement to the contrary: b. From the date of this Addendum, the Charterers unconditionally agree and confirm that for any payments to be made from Contract Holders to Charterers towards Greatship Maya applicable for any period prior to and from the date of this Addendum, a written confirmation from Owners to proceed with such payment would be an absolute precondition, superseding any prior agreement to the contrary. Charterers also unconditionally agree and confirm to not making any agreement to the contrary at any time and acknowledge that any such agreement would be illegal.

It is contended that the guardrail has been circumvented by reason of the entry of the Hibiscus No. 1 between SKOSV and Vantage Oilfield, whereby Vantage Marine’s entitlement to receiving payment from SKOSV (with those monies intended to be paid to Greatship) was set off against monies owed by Vantage Oilfield to SKOSV.

The Vantage Directors were at the material times common directors of both Vantage Marine and Vantage Oilfield. By reason of the aforesaid, it is contended that: a) the Vantage Directors had worked in concert with SKOSV to procure the signing of the Hibiscus Addendum No. 1 with the intention to injure Greatship; b) by their aforesaid action, Greatship had suffered loss and damages; c) the predominant purpose of this conspiracy was for SKOSV to keep the monies which was supposed to have been paid to Vantage Marine and thereafter to Greatship.

Now, the law on tort of conspiracy has been well ventilated in the case of Khoo Teng Chye v. Berjasa Sdn Bhd [2015] 6 CLJ 449 with reference to Section 10 of the Evidence Act 1950. a) Conspiracy is 'a secret plan by a group of people to do something harmful or illegal'; b) To support criminal or civil liability, the Evidence Act 1950 recognises the issue of conspiracy as relevant and admissible evidence based on a low threshold of 'reasonable ground to believe that two or more persons have conspired'; c) Once evidence is introduced as to the nexus of the parties involved in the subject matter of the dispute, the court is obliged to consider the facts and relevant circumstances to ascertain whether it was a genuine transaction or whether it has element of civil or criminal wrong; d) Where there is reasonable ground to believe that two or more persons have conspired together to commit an offence or an actionable wrong, anything said, done or written by any one of those persons, in reference to their common intention after the time when the intention was first entertained by any one of them, is a relevant fact as against each of the persons believed to be so conspiring, as well for the purpose of proving the existence of the conspiracy as for the purpose of showing that any such person was a party to it; e) In short, when two or more persons conspire together to commit an offence or actionable wrong, everything said, done or written by anyone of them in execution or furtherance of their common purpose is deemed to be said, done or written by everyone. f) Conspiracy is not always capable of proof by direct evidence. In the absence of an express admission of a conspiracy, an agreement to injure has to be established in the vast majority of cases by circumstantial evidence. Thus, conspiracy may be proved in most of the cases by process of inference or induction from relevant facts and circumstances.

However, in order to establish a cause of action for the tort of conspiracy to injure against the Vantage Directors, Greatship must demonstrate that each of them had committed an overt act in their capacity otherwise than as directors of Vantage Marine and or Vantage Oilfield.

In the case of Q2 Engineering Sdn Bhd v. PJI-LFGC (Vietnam) Ltd & Ors [2013] 8 MLJ 157, the High Court following the decision in Imperial Oil Ltd v. C&G Holdings Ltd [1989] 62 DLR held as follows: “[93] The case of Imperial Oil Ltd v C&G Holdings Ltd (1990) 62 DLR (4th) 261 is even more to the point and instructive. There the plaintiff sued the company for breaching a contract and sued two individual defendants who are the shareholders and directors of the company for inducing the breach of contract (similar to the plaintiff ’s case here against the third defendant). The trial judge allowed the plaintiff ’s claim against the company but dismissed the claim against the individual defendants. The plaintiff appealed to the Court of Appeal against the dismissal of its claim against the individual defendants. The Court of Appeal in upholding the trial judge’s decision held as follows at pp 264–266: Where, in the opinion of a director, the interests of the company would best be served by breaking its contractual commitments, he or she is entitled, if not obligated, to cause the company to do so. The tortious act is not considered that of the individual director but of the company against whom the aggrieved party may seek remedy for breach. Therefore, the self same act knowingly and intentionally committed, which will expose a third party who was otherwise a stranger to the contract to liability for wrongful contractual interference, may not incur liability for a director of a company. Indeed it may well be undertaken in the exercise of the director’s duty. … As noted counsel relied upon Said in support of her premise that lack of bona fides exposed directors to liability for wrongful inducement. While Said held that a director acting bona fide within the scope of his or her authority is not liable for procuring or inducing a breach of contract by the company whose affairs he or she directs, it did not hold that liability for wrongful inducement would be incurred where a servant or director acted mala fide wholly outside the range of his or her powers or duties. In fact, as counsel candidly pointed out, McCardie J explicitly noted in Said at p 506 that he was abstaining from expressing any opinion as to the law relating to procurement of a breach of contract in such circumstances. The question, therefore, remains: in what circumstances is a director who is not acting bona fide in the company’s best interests liable for inducing a breach of contract by the company? In my opinion that liability cannot be absolute. The obligation to act bona fide is a duty owed by the director to the company. The discharge or otherwise of this duty in itself is of no concern to third parties. To make the internal affairs of a company amenable to scrutiny of third parties and to require directors to justify their corporate actions to such persons in order to obtain immunity from personal suit for the company’s default would extend the concept of piercing the corporate veil beyond the limits prescribed by law, erode the established concept of separate corporate status and impair the efficacity of the corporate entity. Even when a director has not acted bona fide, therefore, there must exist some factor additional to the knowledge upon which he or she acts to justify a finding of wrongful inducement. In summary, a finding that a director is liable for wrongfully inducing breach of contract by the company, whose affairs he or she is directing, will require more than knowledge by the director that legal rights of others will be violated by his or her actions in bringing about the corporate breach. No presumption of intent can flow from that knowledge because of the director’s concomitant obligation to the company. A director will be immune from liability for procuring the breach where he or she acts bona fide within the scope of his or her authority in the best interests of the company. When not so acting, the director does not attract automatic liability unless the circumstances show that his or her dominating concern was focused upon depriving the complainant of its contractual benefits. (Emphasis added.)

In the present case, there is no dispute that Greatship was aware of the financial constraints that the Vantage Group was facing as a group and of Vantage Marine’s inability to pay the outstanding sums. WONG So, I think, for us, we always had the intention, I think it's not just out of the get-go, the first day we've entered into this contract where we have defaulted on our payments. I think the acknowledgement is yes, we do have defaults with Greatship but in a lot of circumstances, in my conversation with Ashish, not officially through email, I think Ashish is well aware of the financial constraints that we are facing within the Group. Should I continue? Yes. And Ashish is very well familiar that payments that come through to Greatship come from multiple sources or at least plans from our side. So, it's not a very straightforward, direct deal that payment comes in from SKOSV and for us to remit the same. So, there were different plans of sources of funds that at that material time we intended to pay but there are certain circumstances which did not materialise from our end

Notwithstanding the aforesaid, there is no evidence adduced to suggest that it was never Vantage Marine’s intention to not pay Greatship. On the contrary, the fact that a payment proposal was put forward to Greatship in an email dated 16.08.2022 shows this.

Similarly, the Addendum No. 4 which was agreed upon by Vantage Marine demonstrates its intention to fulfill its payment obligations to Greatship. Indeed, there is in fact no evidence adduced of any plan and or agreement between the Vantage Directors and SKOSV to injure Greatship.

In truth, the Hibiscus Addendum No. 1 was entered into as a consequence of the Vantage Group facing serious financial constraints resulting in SKOSV having to take steps to ensure that the debts due and owing from Vantage Oilfield would be paid. In turn, Vantage Oilfield and indeed the Vantage Group desperately needed SKOSV to continue to supply the vessel, SK Line 605 in order to complete the Hibiscus Project so that the Vantage Group of companies could overcome the cashflow problems by collecting the much larger sums due from the Hibiscus Project which on receipt could be channelled to pay Greatship. In this regard, the testimony of DW1 in his examination in chief reproduced below was not seriously challenged:

Q: The Plaintiff avers that the 2nd to 6th Defendant had conspired with the 1st Defendant, 7th Defendant and/or the 8th Defendant to injure the Plaintiff by unlawful means, what do you have to say about that? A: There is no conspiracy to injure the Plaintiff. We, the 2'' to 6t Defendants, as the directors of the 1st Defendant and the 8th Defendant really had no control of the 7ih Defendant's decision to do so. In the exigency of the situation, the 8th Defendant had to agree to the same in the hopes that the 7th Defendant will continue to supply the vessel SK Line 605 which the 8th Defendant needed to complete the Hibiscus Project so that the 8th Defendant could overcome their cashflow problems by collecting the much larger sums due from the Hibiscus Project and then advancing sufficient funds to the 1st Defendant to settle the Plaintiff's outstanding sums. The Plaintiff was well aware that the 1st Defendant's inability to pay the Plaintiff the charter hire was because of VEG's financial difficulties as a group with the Hibiscus Project. We, the 2nd to 6th Defendants, had been transparent about that which is why I am surprised that the Plaintiff is alleging that we somehow conspired to injure the Plaintiff. Besides, VEG's Chief Financial Officer ("CFO") at the material time had been engaging with Mr. Ashish Chandrakant Sambhus, who is the President of the Plaintiff, up to March 2023.

The aforesaid was in fact confirmed by DW6 of SKOSV when he testified as follows: Ok. Now, let me just go back to something you said first before we come back to what you just said. You said that if they go pass a certain threshold, we have no choice, we can't renew and in other words you are saying that we have to off-hire the ship, correct? If it get pass a certain threshold. JONATHAN We would not be able to renew. So, we didn't take it off current, but yes, we will not renew. Jonathan, (00:43:55, inaudible), if the term was up, if you don't get money, you are going to off-hire it. JONATHAN That one, yes, that's correct. Yes. Ok, let's get that straight. Now, I'm putting it to you, Jonathan that, I am not going to comment on who suggested the offset because my clients' says otherwise, you say otherwise. We will let the Honourable Judge decide on that, yes. I am going to put it to you that you required an offset to extend the hire on SK Line 605, and to offer any other vessels to VML, correct? Or to VOS. JONATHAN Yes.

Accordingly Hibiscus Addendum No. 1 was not entered into with the objective of injuring Greatship at all. On the contrary, the Vantage Group, in particular, Vantage Oilfield had agreed to the Set Off in the Hibiscus Addendum No. 1 with the hope to ensure the continuity of the vessel, SK Line 605 being available for the Hibiscus Project. There was also the fact that Eswaran and Wong had executed their personal guarantees in respect of the Hibiscus Project and quite naturally were motivated to ensure that their guarantees would not be called upon.

Furthermore, apart from Eswaran and Wong, there is absolutely no evidence to show that the other Vantage Directors, namely, Azizul, Margrate and Sabri even know about the Hibiscus Addendum No. 1, let alone being involved in the same.

In the case of Chen Khai Voon v. Lim Beng Guan & Ors [2020] MLRHU 2099, I had the occasion to opine as follows: “[69] The aforesaid particulars are necessary because a claim of alleged conspiracy between a company and its directors raises considerations which are different from a claim of conspiracy between natural persons. The former frequently requires clarity and involves the interplay between the following common law principles with the essential ingredients for conspiracy, namely:

where the company whose 'mind' is said to be that of its controlling director, whether it is possible for the two to have 'combined' or 'agreed' to conspire. Whilst it has been held that it is conceptually possible for a company to conspire with a director who is its 'controlling and directing mind', the primary facts relied on to support the same must be pleaded [See: Nagese Singapore Pte Ltd v. Ching Kai Huat [2007] 3 SLR 265; [2008] 1 SLR 80 and Lim Leong Huat v. Chip Hup Hup Kee Construction Pte Ltd [2009] 2 SLR 318];

The presumptive rule that a director who authorises a company's breach of contract does not thereby incur tortious liabilities for the breach unless he has conducted himself otherwise than as the company's agent. This is established in Said v. Butt [1920] 2 KB 497. Hence, the facts relied on to justify a departure from this presumptive rule must also be pleaded. [70] The current trend where only a general statement alluding to 'the company and its directors combining together to reach an agreement to injure' with the view to casting personal liability on the directors under a conspiracy claim, without more, can no longer be countenanced as this is nothing more than a device to lift the corporate veil to hold directors personally liable when in most cases these individuals were merely acting bona fide in discharge of their duties and acting within the scope of their authority. [71] The Singapore Court of Appeal in PT Sandipala Arthaputra & Ors v. ST Microelectronics Asia Pacific Pte Ltd & Ors [2018] 1 SLR 81 held that the Said v. Butt principle was also applicable in considering the liability of a director in a lawful means conspiracy. Said v. Butt principle was interpreted to exempt directors from personal liability from the contractual breaches of their company (whether through the tort of inducement of breach of contract or conspiracy) if their acts, in their capacity as directors, are not in themselves in breach of any fiduciary or other personal legal duties owed to the company. Reference was also made to the academic writing by Associate Professor Lee Pey Woan entitled "The company and its directors as co-conspirators" [2009] SAcLJ

… [89] In the Singapore High Court case of Otech Pakistan Pvt Ltd v. Clough Engineering Ltd [2005] SGHC 98 at [35], Kan Ting Chiu J held: 'Where the allegation is that the defendant had conspired to and had induced the breach qua director, that without more, must imply that the defendant had been acting bone fide and within the scope of his office. 'Bona fide' here is to be taken to mean that the defendant was acting in good faith in the discharge of his office, and not that he was acting in good faith in the action complained of; a director may believe that it is for the good of the company to breach a contract intentionally. In such a situation, the principle [in Said v. Butt] would operate to defeat the claim against the defendant as a matter of law.' [90] It is therefore necessary that facts suggesting that the directors have themselves been guilty of some unlawful act or had acted in breach of their duty to the company be pleaded if the action is to include them as coconspirators with the company.”

The said principle in Said v. Butt [1920] 3 KB 497 was also applied in the High Court case of Q2 Engineering Sdn Bhd v. PJI-LFGC (Vietnam) Ltd & Ors (No. 2) [2013] MLRHU 388 where it was held that: “[99] … in Said's case (supra) the alleged inducer was the managing director of the contracting party alleged to be in breach (the theatre), and in Imperial Oil's case (supra) the alleged inducers were the directors and shareholders of the contracting party in breach. In both cases the pleas were rejected, as the parties charged to be inducers were not 'strangers', both being the decision-makers, or in other words the controlling minds or alter egos, of the contracting parties alleged to have been in breach. [100] So too here, where the Plaintiff's case is that the 3rd Defendant is the controlling mind of the 1st Defendant. I cannot agree more with Mr Conrad that this plea is simply unsustainable in law, for like was said in Said's case (supra) if one were to accept the Plaintiff's case in this regard, then in every case of a breach of contract by a company the alleged defaulting company's directors, shareholders, parent/holding company and subsidiaries will all automatically be liable and be enjoined as parties, and that simply cannot be, and is not the law!”

Applying the cases of Chen Khai Voon (supra) and Q2 Engineering Sdn Bhd (supra), it is the judgment of this Court that it is not demonstrated that there is any overt act at all on the part of Vantage Directors acting in their personal capacity otherwise as the directors of Vantage Marine and Vantage Oilfield to support a claim for conspiracy. There is no evidence of any ‘agreement’ reached among the Vantage Directors to injure Greatship.

In any case, the conspiracy, if at all, was by means of the Hibiscus Addendum No. 1 which by itself was not an unlawful agreement. In a case where the conspiracy is by lawful means, there is a need to establish a predominant intention to injure the claimant. In this case, quite clearly, there was no evidence of such predominant intention. On the contrary, the predominant intention for entering into the Hibiscus Addendum No. 1 by the Vantage Directors was to ensure the continue use of the vessel, SK Line 605 for the Hibiscus Project.

Accordingly, the ingredients necessary to establish a cause of action for conspiracy to injure as claimed by Greatship against the Vantage Directors have not been made out.

Greatship’s alternative cause of action against the Vantage Directors is based on the breach of duty as trustees. This is premised on the assumption that the Vantage Directors were trustees to Greatship in the circumstances of this case.

It is trite law that a director owes a fiduciary duty and is a trustee to the company as regards its assets. However, a director’s fiduciary duties and duties as a trustee are owed solely to the company and not to any third party. Therefore, whilst the Vantage Directors may be regarded as the trustees of Vantage Marine and Vantage Oilfield, they cannot be considered trustees of Greatship at all who is a third party to whom they owe no such duties.

As such, there is simply no basis for Greatship’s claims against the Vantage Directors based on the cause of action for breach of fiduciary duties and breach of duties as trustees.

In the premises, it is hereby adjudged as follows: a) the Plaintiff's claim against the 7th Defendant is allowed. The 7th Defendant is ordered to pay the Plaintiff the sum of RM 9,366,741.47 as at 31.3.2023 with interests at the rate of 12% p.a. on the sum from date of Writ to judgment and thereafter 5% p.a. until full realisation; b) the 7th Defendant to pay costs of RM 60,000.00 subject to allocator; c) the Plaintiff’s claim against the 2nd, 3rd, 4th, 5th and 6th Defendants is dismissed with costs fixed at RM 45,000 subject to allocator. Dated the 22nd day of July 2025 ONG CHEE KWAN JUDGE OF THE HIGH COURT HIGH COURT (COMMERCIAL DIVISION NCC2 & ADMIRALTY) HIGH COURT OF KUALA LUMPUR IN THE FEDERAL TERRITORY, MALAYSIA Counsel for Plaintiff: Mr. Arun Krisnalingam together with Mr. Aaron Siva (Messrs. Sativale Mathew Arun) Counsel for 2nd to 6th Mr. K. Selva Kumaran together with Defendants: Mr. Tan Yew Kit (Messrs. Rose Hussin) Counsel for 7th Defendant: Mr. Lee Shih together with Ms. Lee Suan Cui and Mr. Luc Choong (Messrs. Lim Chee Wee Partnership)

Good Property Land Development Pte Ltd (In Liquidation) v Societe-Generale [1996] 1 SLR 457 2. Loh Holdings Sdn Bhd V Peglin Development Sdn Bhd [1984] 1 CLJ (REP) 211 3. Torquay Hotel Co Ltd V Cousins [1969] 1 ALL ER 522 4. Middlebrook Mushrooms Ltd v Transport and General Workers’ Union [1993] ICR 612 5. D.C. Thomson & Co Ltd v. Deakin [1952] CH 646 (“D.C.

Datuk M Kayveas v. See Hong Chen & Sons Sdn Bhd & Ors [2013] 5 CLJ 949 7. Takako Sakao v. Ng Pek Yuen & Anor [2010] 1 CLJ 381 8. Ng Hoo Kui v. Wendy Tan Lee Peng, Administrator of the Estates of Tan Ewe Kwang, Deceased & Ors [2020] 10 CLJ 1

Tengku Abdullah Ibni Sultan Abu Bakar & Ors v. Mohd Latiff Shah Mohd & Ors & Other Appeals [1997] 2 CLJ 607 10. Bristol and West Building Society v. Mothew [1998] 1 CH 1 AT P. 18 11. Khoo Teng Chye v. Berjasa Sdn Bhd [2015] 6 CLJ 449 12. Q2 Engineering Sdn Bhd v. PJI-LFGC (Vietnam) Ltd & Ors [2013] 8 MLJ 157 13. Imperial Oil Ltd v. C&G Holdings Ltd [1989] 62 DLR

Chen Khai Voon v. Lim Beng Guan & Ors [2020] MLRHU

Said v. Butt [1920] 3 KB 497 16. Q2 Engineering Sdn Bhd v. PJI-LFGC (Vietnam) Ltd & Ors (No. 2) [2013] MLRHU 388

Section 10 of the Evidence Act 1950

Snell's Equity