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Case Summaries
OCM Maritime Nile LLC & Anor v Courage Shipping Co. & Ors [2022] EWCA Civ 1091 – 29 July 2022 (Underhill LJ, Newey LJ, Males LJ)
Following the Commercial Court’s confirmation that Owners could terminate an amended Barecon 2001 and repossess 2 Vessels (the US having designated Charterers’ beneficial owner as a global terrorist – a C/P “Event of Default”), Charterers appealed the right to repossession and the absence of relief from forfeiture. The CA confirmed the Court below: (i) a demand for payment was a C/P option not a pre-condition to repossession, and (ii) although the US sanction regime was itself sufficient to exclude relief from forfeiture, Charterers’ misconduct (pre-litigation dishonest dealings with Owners and then misleading the Court) reinforced this conclusion.
M/V Pacific Pearl Co Ltd v Osios David Shipping Inc [2022] EWCA Civ 798 - 14 June 2022 (Lewison LJ, Males LJ, Snowden LJ)
The High Court had found the Britannia LOU, despite its inclusion of a sanctions clause potentially suspending payment, to be in a form “reasonably satisfactory to the other” as required by the agreed ASG 2 form; nevertheless it found the Respondent under no obligation to accept it. The CA disagreed. On proper construction the ASG2 was to operate instead of an arrest and there was no right of arrest once security in in satisfactory form had been provided. An opposite finding, which would have allowed a beneficiary to seek better or alternative security elsewhere, was held contrary to Admiralty practice and the “clear purpose and…language of ASG 2”. The appeal was allowed.
M/V Pacific Pearl Co Ltd v Osios David Shipping Inc [2022] EWCA Civ 798 - 14 June 2022 (Lewison LJ, Males LJ, Snowden LJ)
The High Court had found the Britannia LOU, despite its inclusion of a sanctions clause potentially suspending payment, to be in a form “reasonably satisfactory to the other” as required by the agreed ASG 2 form; nevertheless it found the Respondent under no obligation to accept it. The CA disagreed. On proper construction the ASG2 was to operate instead of an arrest and there was no right of arrest once security in in satisfactory form had been provided. An opposite finding, which would have allowed a beneficiary to seek better or alternative security elsewhere, was held contrary to Admiralty practice and the “clear purpose and…language of ASG 2”. The appeal was allowed.
Unicredit Bank AG v Euronav NV [2022] EWHC 957 – 28 April 2022 (Moulder J)
Charterers (BP), holding B/Ls at the time, novated the charterparty to cargo buyers who thereafter took delivery without production of B/Ls. BP subsequently indorsed the B/Ls in favour of the Claimant cargo financiers who claimed against Owners for misdelivery. In siding with Owners, the Court held the B/Ls did not contain the contract of carriage post-novation nor was this the parties’ intention. The Claimant’s financing scheme would in any event have permitted delivery without B/Ls, and the Claimant’s loss was found not to have been caused by the delivery without B/Ls.
SK Shipping Europe Ltd v Capital VLCC 3 Corp [2022] EWCA Civ 231 – 25 February 2022 (Males LJ, Phillips LJ, Carr LJ)
Owners made pre-contractual speed/consumption representations, which were included in the t/c warranties, save as for the statement “above…is based on..last 3 voys”. In addition to deducting for over-consumption, Charterers alleged misrepresentation, then fixed the Vessel for a considerable voyage (UK-Malaysia) before purporting to rescind/ terminate the t/c. The CA, upholding the decision below, held there was no misrepresentation; statements of past performance were not representations of future performance, nor had they induced the contract. Further, despite Charterers reserving their rights, ordering the Vessel on that long voyage had affirmed the contract.
Splitt Chartering APS, RTE Réseau de Transport d'Electricité & Ors v Saga Shipholding Norway AS & Ors [2021] EWCA Civ 1880 – 15 December 2021
The Respondent Receivers of cargo on board the unmanned Stema Barge II sought to limit their liability to RTE, owners of an underwater cable, damaged when the barge dragged anchor during a storm off Dover. The Receivers relied on their personnel’s operation of the barge’s machinery as rendering them “manager or operator”, entitling them to limit under Art.1(2) of the Limitation Convention. Reversing Teare J, the CA held the term “operator” must “entail more than mere operation of machinery” or provision of crew and a higher level of operation involving “management or control” was required for Receivers to avail themselves of the limitation. The appeal was allowed.