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Monday, 01 April 19
FORCE MAJEURE SUCCESS NOT A SEA CHANGE - BALTIC EXCHANGE
 KNOWLEDGE TO ELEVATE
It is difficult to successfully argue that contractual performance has been prevented or delayed by force majeure. This is in part because English courts or arbitration tribunals will interpret these clauses strictly and narrowly against the party seeking to rely on them.
Recent decisions, including Triple Point Technology v PTT (2017) and Seadrill Ghana v Tullow Ghana (2018), are evidence of this approach. However, Sucden Middle-East, represented by Nick Fisher of HFW, has recently relied successfully on such a clause in the Commercial Court, on appeal from arbitration.
The case, Sucden Middle-East v Yagci Denizcilik Ve Ticaret Limited Sirketi, “The Mv Muammer Yagci”, involved a shipment of sugar to Algeria on the Sugar Charter Party 1999 form. The facts found by the arbitral tribunal were that when the cargo arrived in Algeria, the cargo-receivers submitted false import documents to local customs authorities. The local customs responded by seizing the cargo, using powers under customs laws and regulations.
A delay to discharging the cargo of four and a half months ensued. Sucden, as charterers, claimed this delay fell within the exceptions to laytime running under clause 28. Owners disagreed. At first instance, the arbitral tribunal agreed with owners.
Charterers appealed to the Commercial Court. Permission to bring the appeal was given on the basis that the question of law was one of general public importance, as it related to a standard form contract in wide commercial usage.
The judgement
The question before the Commercial Court was: “Where a cargo is seized by the local customs authorities at the discharge port causing a delay to discharge, is the time so lost caused by ‘government interferences’ within the meaning of clause 28 of the Sugar Charter Party 1999 form?” Clause 28 reads:
“Strikes and Force Majeure
In the event that whilst at or off the loading place or discharging place the loading and/or discharging of the vessel is prevented or delayed by any of the following occurrences: strikes, riots, civil commotions, lockouts of men, accidents and/or breakdowns on railways, stoppages on railway and/or river and/or canal by ice or frost, mechanical breakdowns at mechanical loading plants, government interferences, vessel being inoperative or rendered inoperative due to terms and conditions of employment of the Officers and Crew, time so lost shall not count as laytime on demurrage or detention…”
In deciding whether a force majeure event had occurred, the Court focused on the construction of “government interferences”. It was fairly straightforward to establish that a government entity acting in a sovereign capacity was involved, but owners argued that the government being involved was not enough and that there had to be “interferences”. In reaching its decision that there had been no interference, the tribunal had considered it a key point that seizure was an “ordinary” action. The Court rejected this conclusion. It held that the seizure of the cargo was not routine and did fall within the meaning of “interferences”. Seizure is a significant exercise of executive power and therefore could not be regarded as “ordinary”. Suspected or predictable consequences are not the same as ordinary actions (such as the inspection of the cargo by a government surveyor): “In the usual course of things, cargo is not seized and property rights are not invaded in that way.” The very fact that false documents were involved showed that the circumstances were not routine.
The Court emphasised that it was of “real importance” that its conclusion on the language was not difficult to apply, nor did it in any way offend commercial common sense.
The owners’ causation argument was also dismissed, as it was held that the seizure caused the delay, even if the submission of false documents caused the seizure.
Further detail
In allowing the appeal, the Court still maintained the strict and narrow approach to force majeure, stressing that “the answer given to the question is only a narrow ‘yes’. It is ‘yes’ where the circumstances are as in the present case. The answer does not address all of the circumstances that may come within or fall outside clause 28. The answer is concerned only with the seizure of a cargo and with that seizure by a customs authority that is a State revenue authority acting in a sovereign capacity”.
This judgment gives some welcome publicly-available guidance on the interpretation of a force majeure clause in a standard form widely used in sugar trading. While the charterers were successfully able to rely on the force majeure clause in this case, it does not signal a change in the strict and narrow approach typically adopted by the English courts.
Source: Baltic Exchange
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Tuesday, 19 February 19
FAST DEPLETING COAL RESERVES COULD PUSH UP ENERGY PRICES, CAUTIONS EXPERT - THE HINDU BUSINESS LINE
The fast depletion of coal, a strategic resource and India’s fuel of choice currently, has huge implications for energy costs, according to K ...
Monday, 18 February 19
INDIA'S COAL IMPORT FALLS TO 17.25 MT IN JANUARY - PTI
Coal imports saw a decline in January FY 2019 to 17.25 MT from 19.59 MT in the same month of the previous fiscal, according to a report by mjunctio ...
Monday, 18 February 19
THE ROLE OF COAL IN INDIA'S ENERGY AMBITIONS - WCA
India is the world’s second most populous country and figures among the world’s most rapidly growing economies.
The Sout ...
Saturday, 16 February 19
COALTRANS CHINA 2019, CHINA'S LARGEST COAL INDUSTRY GATHERING
Press Release: Coaltrans China 2019 | With the import ban likely to be lifted, it’s time for you to meet your potentia ...
Wednesday, 13 February 19
MALAYSIA WAS THE REGION'S LARGEST COAL IMPORTER WITH 34 MT IN 2018, UP 25% Y-O-Y
Although coal market in 2018 started with strong prices, starting in the beginning of the second half of 2018, the international spot prices for co ...
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- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Timah Investasi Mineral - Indoneisa
- Aditya Birla Group - India
- Commonwealth Bank - Australia
- Bhoruka Overseas - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The State Trading Corporation of India Ltd
- Global Coal Blending Company Limited - Australia
- New Zealand Coal & Carbon
- Ministry of Finance - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Georgia Ports Authority, United States
- Economic Council, Georgia
- Star Paper Mills Limited - India
- Kartika Selabumi Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- The University of Queensland
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Dalmia Cement Bharat India
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- Marubeni Corporation - India
- Edison Trading Spa - Italy
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Independent Power Producers Association of India
- Rashtriya Ispat Nigam Limited - India
- Interocean Group of Companies - India
- Ambuja Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- European Bulk Services B.V. - Netherlands
- Price Waterhouse Coopers - Russia
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- San Jose City I Power Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Gujarat Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- PNOC Exploration Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- ICICI Bank Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Mines - Canada
- Bhatia International Limited - India
- Alfred C Toepfer International GmbH - Germany
- Thiess Contractors Indonesia
- PowerSource Philippines DevCo
- Indika Energy - Indonesia
- Electricity Generating Authority of Thailand
- Indo Tambangraya Megah - Indonesia
- Cement Manufacturers Association - India
- Directorate Of Revenue Intelligence - India
- India Bulls Power Limited - India
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Parliament of New Zealand
- Anglo American - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Port Waratah Coal Services - Australia
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Eastern Energy - Thailand
- Agrawal Coal Company - India
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coal and Oil Company - UAE
- MS Steel International - UAE
- Siam City Cement PLC, Thailand
- Madhucon Powers Ltd - India
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Simpson Spence & Young - Indonesia
- Barasentosa Lestari - Indonesia
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Formosa Plastics Group - Taiwan
- Sindya Power Generating Company Private Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Straits Asia Resources Limited - Singapore
- Directorate General of MIneral and Coal - Indonesia
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- Thai Mozambique Logistica
- Bhushan Steel Limited - India
- Mintek Dendrill Indonesia
- Savvy Resources Ltd - HongKong
- Pendopo Energi Batubara - Indonesia
- Power Finance Corporation Ltd., India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chamber of Mines of South Africa
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Latin American Coal - Colombia
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Larsen & Toubro Limited - India
- Australian Commodity Traders Exchange
- International Coal Ventures Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Malabar Cements Ltd - India
- Medco Energi Mining Internasional
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- SMC Global Power, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Transport, Egypt
- Renaissance Capital - South Africa
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Kaltim Prima Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Mjunction Services Limited - India
- Tata Chemicals Ltd - India
- Bharathi Cement Corporation - India
- Altura Mining Limited, Indonesia
- Siam City Cement - Thailand
- Globalindo Alam Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- Xindia Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Indian Oil Corporation Limited
- GVK Power & Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- GMR Energy Limited - India
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Gujarat Sidhee Cement - India
- Kideco Jaya Agung - Indonesia
- Mercator Lines Limited - India
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- CNBM International Corporation - China
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Samtan Co., Ltd - South Korea
- Carbofer General Trading SA - India
- Indogreen Group - Indonesia
- Coastal Gujarat Power Limited - India
- Attock Cement Pakistan Limited
- Essar Steel Hazira Ltd - India
- PTC India Limited - India
- Central Electricity Authority - India
- Asmin Koalindo Tuhup - Indonesia
- Jaiprakash Power Ventures ltd
- Krishnapatnam Port Company Ltd. - India
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- Bukit Makmur.PT - Indonesia
- Africa Commodities Group - South Africa
- Holcim Trading Pte Ltd - Singapore
- Sree Jayajothi Cements Limited - India
- Kobexindo Tractors - Indoneisa
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- IHS Mccloskey Coal Group - USA
- Aboitiz Power Corporation - Philippines
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Parry Sugars Refinery, India
- Toyota Tsusho Corporation, Japan
- Grasim Industreis Ltd - India
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Karaikal Port Pvt Ltd - India
- Makarim & Taira - Indonesia
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- VISA Power Limited - India
- Global Green Power PLC Corporation, Philippines
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Petrochimia International Co. Ltd.- Taiwan
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- South Luzon Thermal Energy Corporation
- Uttam Galva Steels Limited - India
- Ind-Barath Power Infra Limited - India
- GAC Shipping (India) Pvt Ltd
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