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Singapore Perspective on Using a Letter of Undertaking to Establish a Limitation Fund

Tan Hui Tsing

[2018] SAL Prac 11

Recent amendments to the Rules of Court which permit a party wishing to constitute a limitation fund to do so by way of P&I Club’s letter of undertaking bring us in line with the position in the UK and other jurisdictions that permit limitation funds to be constituted by way of letters of undertaking, as opposed to the traditional payment-into-court method. This article seeks to examine and discuss some of the practical consequences that have arisen as a result of this new mechanism for constitution of limitation funds.