Category: Featured

Highlighted articles from each TANKVOYager issue.

BP Oil International Ltd v Glencore Energy UK Ltd – Queen’s Bench Division (Commercial Court) [2022] EWHC 499 (Comm) – Moulder J – 9 March 2022

CONTRACT OF SALE – FAILED NEGOTIATIONS – CONCLUSION OF CONTRACT – POOR QUALITY OF CRUDE OIL – DAMAGES – DEMURRAGE – SALE OF GOODS ACT 1979, SECTION 53
In an April 2019 contract of sale for Russian crude oil, Glencore agreed to sell 100,000 mt +/- ten percent to BPOI. Email correspondence between the two companies indicated the contract was confirmed; however, the parties disagreed on whether the governing terms included the Glencore Sales Contract, which specifically required the loading terminal certificate of quality to be conclusive. The cargo was sold and resold multiple times between BPOI and its affiliated companies, and upon final discharge, BPOI sample tests indicated organic chlorides contaminated the cargo. BPOI claimed damages for the loss of cargo value, storage and transportation costs of the contaminated oil, cargo volume losses, and demurrage paid on other vessels due to the delay.

Laysun Service Co Ltd v Del Monte International GmbH [2022] EWHC 699 (Comm) (Calver J) – 28 March 2022

CHARTERPARTY – CONTRACT OF AFFREIGHTMENT – COA – FORCE MAJEURE – APPEAL AGAINST ARBITRATION AWARD – ARBITRATION ACT 1996, SECTION 69
In December 2017, Del Monte entered into a contract of affreightment (COA) with Laysun to transport refrigerated bananas from the Philippines to Iran. The agreement was for 36 voyages from January 1, 2018 – December 31, 2018. After 17 shipments, Del Monte stopped providing cargos. Layson sought arbitration for Del Monte’s failure to supply the remaining shipment. Del Monte claimed force majeure due to US Sanctions against Iran and the resulting import restrictions. Laysun appealed the arbitration citing error of law under section 69 of the Arbitration Act 1996.

Nautica Marine Ltd v Trafigura Trading LLC (The “Leonidas”) – English Commercial Court: Foxton J: [2020] EWHC 1986 (Comm): 28 July 2020

VOYAGE CHARTER - APPROVAL OF A VESSEL - DAMAGES FROM BREACH OF CHARTER - PRE-CONDITION OF CHARTER - PERFORMANCE CONDITION OF CONTRACT - IMPLIED OBLIGATIONS OF CHARTERER - PUTATIVE LOSS OF PROFITS – BREACH OF CHARTER Nautica (Owner) negotiated a prospective voyage charter of the tanker "Leonidas" with Trafigura (Charterer) for a laden voyage carrying oil cargoes. The charter was subject to obtaining suppliers' approval of the vessel within a four-day deadline. When the deadline passed without Trafigura obtaining suppliers' approval, the charter was abandoned. Nautica claimed damages for the charterer's alleged breach of charter of the difference between the profit it would have gained on the prospective charter and the (lesser) profit made on the fixture entered.
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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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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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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.

Brujo Finance Company v Sea Energy Company (MT “Alkimos”) v ES Euro shipping AG (MT “Alkimos”) – SMA 4388, 3 Jul 2020

ASBATANKVOY – KOLMAR TERMS – VIOLATION OF US SANCTIONS – SANCTIONS CLAUSE – STS TRANSFER – ALTERNATIVE ORDERS – PARTIAL FINAL AWARD – SUBJECT MOTION – DISCERNABLE RISK – VENEZUELA
The consolidated arbitration between the Owner and Respondents centered on whether the owner validly invoked the Charter’s Sanctions Clause when demanding alternative orders (Subject Motion). The owner claimed a discernable risk that the ship-to-ship transfer of cargo could have violated US Sanctions against Venezuela. This partial final award is issued solely in response to the Subject Motion and does not address any other disputes between the Owner and Respondents.