Q1 2022. Maritime Digest of Arbitration Awards and Court Rulings

Shagang Shipping Co Ltd v HNA Group Co Ltd (The “Dong-A Astrea”) – Supreme Court (Lord Hodge DP, Lord Briggs, Lord Hamblen, Lord Leggatt and Lord Burrows JJSC) UKSC 34 –  5 August 2020

BRIBERY - ENFORCE CHARTERPARTY AGAINST GUARANTOR - TORTURE - CONFESSION EVIDENCE OBTAINED BY TORTURE – LIABILITY OF GUARANTOR The appeal was based on whether a charterparty's guarantor (HNA) could avoid liability under the guarantee because the charterparty was allegedly obtained through bribery and so was unenforceable. The bribery charge was based on confessions made in Chinese criminal procedures by individuals who reportedly paid and received the bribe.
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Playa Shipping Corporation v Citgo Petroleum Corporation (M/T “Mambo”) – SMA 4418, 16 March 2021

DISPONENT OWNER – US SANCTIONS – TRADE SANCTIONS – ASBATANKVOY – DEMURRAGE – EXECUTIVE ORDERS – SECURITY AWARD - VENEZUELA The claim was for outstanding demurrage and port expenses from the Owner to Charterer. The Charterer did not contest the amount owed but maintained that sanctions imposed by the US Government on Venezuela prevented it from paying unless and until the Owner obtained a special license from the US Office of Foreign Assets Control (OFAC). The current arbitration was a Partial Final Award and focused on the Owner's request for an Interim Award requiring Charterer to post security for Owner's claims.
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Priminds Shipping (HK) Co Ltd v Noble Chartering Inc (The “Tai Prize”) – QBD (Comm Ct) (HHJ Pelling QC) [2020] EWHC 127 (Comm) – 31 January 2020

BILL OF LADING – DAMAGED CARGO – LIABILITY FOR DAMAGED CARGO – INDEMNITY – DISPONENT OWNERS – TIME CHARTER – HAGUE RULES When a vessel commenced unloading in China, receivers discovered the soybean cargo had heat and mold damage. The Chinese courts upheld a claim by the receivers against the shipowner for US$ 1,086,564.70. The shipowner sought arbitration in London against Noble Chartering, the head charterer/disponent owner, for fifty percent of the amount paid to the receivers. Noble then requested London arbitration against its charterer, Priminds Shipping, claiming indemnity and legal fees. Priminds appealed the arbitration ruling to the High Court.
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London Arbitration 21/21

ASBATANKVOY - FRUSTRATION – VOLGA-DON SHIPPING CANAL (VDSC) – WINTER CLOSURE – ADDITIONAL FREIGHT - DEVIATION – INTERIM PORT CLAUSE – ALTERNATIVE DISCHARGE CLAUSE – DEADFREIGHT – DEMURRAGE - DELAY A sea-river vessel was chartered on an amended Asbatankvoy to transport fuel oil. The vessel was to sail from Turkmenbashi, Turkmenistan, to OPL Kavkaz, Russia, via the Volga-Don Shipping Canal (the VDSC). The VDSC accelerated its official closing for the season, and the vessel was refused “commercial” entrance. The charter was frustrated, and the vessel was forced to retrace its route back to the Caspian Sea. Owners claimed additional freight, deadfreight, deviation, quantum meruit demurrage, and damages for detention.
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Transportacion Maritima Mexicana, SA. de C.V. v Alia Global Logistics, S.A. de C.V. (M/T “King Gregory”)  – SMA 4429, 1 November 2021

ASBATANKVOY – TERMINATION OF CHARTER – DAMAGES – NON-PAYMENT – FAILURE TO PROVIDE CARGO Owner claimed Charterer failed to present a cargo to be loaded onto the vessel. Owner and Charterer agreed to cancel the charter; however, Owner claimed damages because of the cancellation. Charterer agreed to pay damages but did not remit payment.
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K-Line Pte Ltd v Priminds Shipping (HK) Co Ltd (The “Eternal Bliss”) – Court of Appeal (Sir Geoffrey Vos, MR, Newey and Males LJJ) [2021] EWCA Civ 1712 – 18 November 2021

NORGRAIN - DEMURRAGE - DAMAGES - LIQUIDATED DAMAGES- APPEAL – IMPLIED INDEMNITY - LAYTIME The Court of Appeal has overturned the High Court's decision in K-Line Pte Limited v Priminds Shipping (HK) Co Limited (the "ETERNAL BLISS") [2021] EWCA Civ 1712, which acknowledged the long-standing question of whether a shipowner can recover damages in addition to demurrage when a charterer's only breach is failure to load/discharge the ship within the contractually agreed time. Please note this is a successful appeal of an award already recapped. Search in TANKVOYager via "Eternal Bliss" for the original award. K-Line Pte Ltd v Priminds Shipping (HK) Co Ltd (The "Eternal Bliss") – QBD (Comm Ct) (Andrew Baker J)[2020] EWHC 2373 (Comm) – 7 September 2020
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Tricon Dry Chemicals LLC v Global Petro Converge – SMA 4391, 17 Jul 2020

PURCHASE CONTRACTS – FORCE MAJEURE – TIME IS OF THE ESSENCE CLAUSE – LOSS OF PROFITS – CALCULATION OF DAMAGES
When Respondent failed to ship purchased cargoes in a timely manner, Claimant charged the Respondent failed to perform its obligations under two separate purchase contracts and sought damages, interest, legal, and arbitration fees. Respondent claimed force majeure for changes in Saudi Arabian export laws and delays due to the holy month of Ramadan and Eid holiday.

PCL (Shipping) Pte. Ltd., v Triorient LLC, (The M/V “Glorious Sawara”) – SMA 4401, 16 Sep 2020

FORCE MAJEURE – DEMURRAGE – DISPONENT OWNER – LOSS OF EARNINGS
After 46 days at load port awaiting cargo, the Claimant terminated the contract claiming breach of charterparty. The Respondent claimed force majeure due to supplier issues. Claimant sought damages plus fees, costs and interest.

Seacape Shipping and Trading, LLC v Metalex 2000 S.A. (The “MV Livadi”) – SMA 4390, 15 Jul 2020

MEDITERRANEAN IRON ORE VOYAGE CHARTER – FAILURE TO PROVIDE CARGO – DAMAGES – CALCULATION OF DAMAGES – DEMURRAGE – FORCE MAJEURE – GOVERNMENT INTERFERENCE
Seacape Shipping and Trading (Claimant) alleged Metalex 2000 (Respondent) breached the voyage charter for failing to provide cargo and subsequently claimed for damages and demurrage. The Respondent claimed government interference and force majeure but participated only minimally in the arbitration.

London Arbitration 15/21

DEMURRAGE – BERTH OPERATOR RULES (UBT) – COMMENCE OF LAYTIME – DESPATCH
Owner claimed demurrage was due to delays at the Davant, Mississippi, loading port and cited the charterparty. Charterer countered Owner owed despatch and that UBT Rules as incorporated into the fixture superseded the charterparty.