
Case Summaries
Classic Maritime Inc. v Limbungan Makmur SDN BHD & Anor [2018]
“After the collapse of a dam in Brazil, charterers were unable to supply cargoes from a flooded iron ore mine for shipment under a COA and relied on the force majeure or exception clause to excuse their failure. The Court found that in fact charterers would not have shipped cargoes in any event, so there was no causative effect between the dam burst and the failure and the clause was inapplicable. However, owners were unable to recover substantial damages as the dam burst would have prevented the shipment of any iron ore and the compensatory principle operated to prevent owners being placed in a better position than they would otherwise have been.”
Sea Master Shipping Inc v Arab Bank (Switzerland) Ltd [2018]
“In a London arbitration involving a bank to whose order the bills of lading had been consigned, shipowners sought demurrage. The Court allowed shipowners' challenge to the Tribunal's ruling that the bank received rights but not liabilities under the bills so that claims against it were not arbitrable. The Court did not rule on the demurrage or the extent of liabilities, referring these issues back to the Tribunal.”
Sixteenth Ocean GmbH & Co Kg v Societe Generale [2018]
“After the intervention of US sanctions, a USD35.5m shipbuilding loan concluded with IRISL subsidiaries was terminated and called in by the lenders. The sums due — including a 'termination amount' demanded on 9 June 2010 — were repaid by the subsidiaries on 14 December 2010 and irretrievably distributed between lenders by 5 January 2011. On 10 January 2017 the claimant subsidiary started proceedings alleging that the 'termination amount' was never due, having been paid under economic duress, and sought damages for breach of contract or in restitution. The Court held that any breach occurred on 9 June 2010 and any unjust enrichment between 14 December 2010 and 5 January 2011, so that on any view the 6-year Limitation Act period had expired. Nor could it be extended under s.32, economic duress not constituting 'fraud' and there being no deliberate concealment of the distribution.”
Seadrill Ghana Operations Ltd v Tullow Ghana Ltd [2018]
“By a 5-year 2013 contract, Seadrill agreed to provide drilling services to Tullow by a semi-submersible tug, in specified sea areas off Ghana. In2014, an UNCLOS tribunal ordered Ghana to stop drilling with the effect that from late 2016 Tullow would not be able to exploit the relevant areas. Tullow ceased to pay hire and terminated the contract relying on a term excusing performance if fulfilment of the contract was delayed or prevented by defined 'force majeure' events. The Court found that although there was a force majeure event as defined (drilling moratorium) it had to be the sole cause of the party's failure to perform. Here however there were two concurrent causes preventing performance and the other (government failure to approve a wider plan), was held to be the effective one.”
Fehn Schiffarhts GMBH & Co KG v Romani Spa [2018]
“Owners challenged an arbitration award which held them liable to charterers in damages representing loss of value of the cargo following unauthorised fumigation. After the damage, receivers had assigned rights to charterers. If, as appeared, that assignment had been the basis of the tribunal's ruling, they had erred in law in not first making any finding that the receivers had sustained loss (an assignee not being able to acquire rights greater than those of the assignor); if charterers in their own right had suffered the loss (as alternatively argued), this too was not apparent from the award, which the Court ordered should be remitted to the tribunal for further consideration.”
Deep Sea Maritime Ltd v Monjasa A/S (The Alhani) [2018]
“In an important case relating to the Hague Rules, the High Court ruled that (i) the Art III rule 6 one year time bar applies to claims for wrongful delivery (as well as claims for failures in the carriage of the cargo); and (ii) that such time bar is not interrupted by proceedings brought in a jurisdiction other than that stipulated, even if the Claimant did not have actual knowledge of the jurisdiction provision.”