Jim Leighton’s Post

On 9 August 2024, the High Court handed down judgment in Orion Shipping and Trading Ltd v Great Asia Maritime Limited [2024] EWHC 2075. The dispute concerns the cancellation of a Memorandum of Agreement on the Norwegian Saleform 2012 form (the "MOA") for the sale of a Capesize bulk carrier, the MV "Lila Lisbon" (the "Vessel") by the Defendant Buyers ("Buyers").  Mrs Justice Dias allowed the Claimant Sellers’ appeal under section 69 of the Arbitration Act 1996.   This decision is an important one for both buyers and sellers of vessels on Saleform terms. Unless the parties make express provision, the judgment establishes that a buyer that becomes entitled to cancel an MOA on the 2012 form under Clause 14 following a seller’s failure to tender Notice of Readiness or be ready to validly complete a legal transfer by the Cancelling Date will only be entitled to recover market damages where a seller is in repudiatory or renunciatory breach of contract, even if that failure arises due to the seller’s proven negligence.     Alexander Wright KC acted for the successful Sellers, instructed by Ed Mills-Webb, Ross Attfield and James Stephenson of Preston Turnbull LLP. For a copy of the full judgment, please see here: https://lnkd.in/eXhyuAxi

What difference did the breach make? Commercial Court considers damages for late redelivery   In the recent case of Hapag-Lloyd AG v. Skyros Maritime Corporation and Agios Minas Shipping Company [2024] EWHC 3139, the Commercial Court considered the assessment of damages following late redelivery under time charterparties where the ships were also due to be delivered to buyers under sale contracts (MOAs). Find out more here 👇 https://lnkd.in/e7-6iRA9

#Arbitration and #Bailment: The judgment in Friday’s EuroNav Shipping NV v Black Swan Petroleum DMCC [2024] EWHC 896 (Comm) at [42]-[48] concludes at 48 there is a ‘high probability that EuroNav will make good its case… that the sub-bailment of the cargo to EuroNav was a sub-bailment on the terms of the agreement… and accordingly that in relation to its claim in Bailment against EuroNav it is bound by the arbitration agreement contained in [the agreement]’. This conclusion by Pelling KC embodies the two things I argued in the (2023) 139 LQR 592 (summary of article linked in comments) are contrary to the rule of law: duplication and discretion. The duplication is obvious. The reasoning that they are bound to the arbitration by virtue of the bailment is based on language not law. Why is the ‘consent’ binding in bailment but not contract? The only reason we are given is language ‘bailment’. But the exercise of discretion is stark. For a bailment on terms to apply as a matter of doctrine, there must be consent. Contract has a well established understanding of what consent is as a formal rule. Bailments does not because the only thing that defines its parameters is its maneoverable descriptive terms. Therefore, whether someone has ‘consented’ can be whatever the judge wants it to be. Here, at 44, Pelling does exactly that. He concludes that there was no ‘express consent’ to bail the cargo. But does this stop Pelling? No. Pelling willing accepts that the fact the bailor knew, or ought reasonably to have known, that the cargo would be bailed was enough for him to conclude that there was the high probability of proving the sub-bailment. Yet we are cited no authority for this conclusion. It is, in fact, inconsistent with other cases, including Morris v Martin. Once again a judge is moving the boundaries of bailments to get to what they perceive to be a just result. It’s a discretion, not law. This point of the case is patently wrong in law. They are not bound to the agreement by virtue of bailment on terms. #PrivateLaw #ShippingLaw #MaritimeLaw #Shipping #ContractLaw Euronav https://lnkd.in/eGQe8FqU

“Point of Law” – Post 106: The “Lord Hassan” – where a shipowner was exercising a contractual lien on grain cargo on board the vessel to secure the payment of freight, and the cargo was at risk of imminent perishment, the court was prepared to granted an order on an urgent basis to permit the sale of the cargo, to allow the shipowner to realise the value from the security conferred by the lien, where the bill of lading issued was marked “freight prepaid” (but freight had not in fact been paid at any time) and the shipowner duly retained the bill, such that no other party possessed or became the lawful holder of the bill, and the non-payment of the freight was a matter to be determined in arbitration – see National Archives @ #shipping #maritimelaw #cargo #lien #arbitration #litigation

On 13 December 2024, Mr Justice Bright handed down judgment in the case of Hapag-Lloyd AG v. Skyros Maritime Corporation and Agios Minas Shipping Company [2024] EWHC 3139 (Comm), two related arbitration appeals concerned with the assessment of damages upon late redelivery of containerships under time charters. The main issue in the appeals concerned the res inter alios acta rule and its exceptions, including the long vexed question of how, if at all, to reconcile the leading cases of Slater v. Hoyle & Smith [1920] 2 KB 11 (CA) and Wertheim v. Chicoutimi Pulp Co [1911] AC 301 (PC). Steven Berry KC and Adam Board acted for the charterers, Hapag-Lloyd AG. They were instructed by Ingolf Kaiser and Ryan Hunter of MFB Solicitors. Read more here: https://lnkd.in/eTKQqx6s

In DGJ v Ocean Tankers (Pte) Ltd (in liquidation) and another appeal [2024] SGCA 57, The Court of Appeal held that the assignment of claims against a company while that company was in judicial management, made with the purpose of asserting insolvency set-off when that company went into liquidation, was liable to be struck down on public policy grounds for subverting the regime of pari passu distribution among unsecured creditors in liquidation. The court also commented on the interpretative approach to non-assignment clauses and on whether a statutory trust arises in the judicial management of a company. Read more: go.gov.sg/2024sgca57

𝐒𝐇𝐈𝐏𝐏𝐈𝐍𝐆 𝐂𝐎𝐔𝐑𝐒𝐄 𝐈𝐍 𝐁𝐔𝐂𝐇𝐀𝐑𝐄𝐒𝐓 🇷🇴 Under the auspices of EuroGrainExchange, AGA Partners held a shipping course for 𝐬𝐡𝐢𝐩𝐨𝐰𝐧𝐞𝐫𝐬, 𝐚𝐠𝐞𝐧𝐭𝐬 𝐚𝐧𝐝 𝐜𝐨𝐦𝐦𝐨𝐝𝐢𝐭𝐢𝐞𝐬 𝐭𝐫𝐚𝐝𝐞𝐫𝐬. During this event, we have discussed: 📍‘𝐀𝐫𝐫𝐢𝐯𝐞𝐝 𝐬𝐡𝐢𝐩’ 𝐭𝐞𝐬𝐭: what is required from the vessel to tender a valid NOR? 📍𝐋𝐚𝐲𝐭𝐢𝐦𝐞 𝐜𝐚𝐥𝐜𝐮𝐥𝐚𝐭𝐢𝐨𝐧: what is the difference between the interruption of and the exclusion from laytime? 📍𝐃𝐞𝐦𝐮𝐫𝐫𝐚𝐠𝐞: what is the effect of these liquidated damages? Having covered the main rules of English law, we have shown how they work in practice through 𝐚 𝐜𝐚𝐬𝐞 𝐬𝐭𝐮𝐝𝐲 𝐨𝐟 𝐭𝐡𝐞 𝐚𝐫𝐛𝐢𝐭𝐫𝐚𝐭𝐢𝐨𝐧 relating to the tender of the NOR at the Sulina anchorage. Сredits to Petar Dimitrov for organising this seminar during your outstanding conference! #commoditieslawyer #commoditiesarbitration #shipping #fosfa #lmaa #agapartners

NUANCE: Continuing Nuisance v. Continuing a Nuisance Manchester Ship Canal v. United Utilities, [2024] UKSC 22 "(1) The tort of private nuisance 6. In general terms, the tort of private nuisance is committed where the defendant's activity, or a state of affairs for which the defendant is responsible, unduly interferes with the use and enjoyment of the claimant's land: Jalla v Shell International Trading and Shipping Co Ltd [2023] UKSC 16; [2023] 2 WLR 1085 ("Jalla"), para 2. ... 7. Nuisances may be, and often are, of a continuing nature. As was explained in Jalla, para 26, in general terms a continuing nuisance is one where there is repeated activity by the defendant, or an ongoing state of affairs for which the defendant is responsible, which causes continuing undue interference with the use and enjoyment of the claimant's land. ... 8. It is important not to confuse the concept of a continuing nuisance with the concept of continuing a nuisance. The latter concept refers to the situation where defendants are responsible (and therefore liable) for a nuisance not because they created it but because they failed, with actual or constructive knowledge of the state of affairs which resulted in the nuisance, to take reasonable steps to prevent it." #law #englishlaw #torts

A recent court ruling confirms the court’s power to order the sale of #cargo to preserve assets in urgent situations. In this case, a shipowner sought to sell perishable cargo after charterers failed to pay freight, risking deterioration. The court applied Section 44 of the Arbitration Act 1996, allowing for asset preservation in support of arbitration. This decision reaffirms the strength of shipowner liens and the court's ability to act quickly when cargo is at risk. Read this week's #Baltic feature👇 https://ow.ly/rvSK50UBLXZ #Court #Shipping #Maritime #Law #Legal

See my latest case note on the UKSC judgment in The "Giant Ace", concerning the scope of the article III, rule 6 time bar in the Hague Rules and the Hague Visby Rules to post-discharge cargo misdelivery, exclusively at DMC's CaseNotes #shipping #maritimelaw #arbitration #litigation