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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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- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- Economic Council, Georgia
- Goldman Sachs - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Uttam Galva Steels Limited - India
- Ambuja Cements Ltd - India
- Indian Energy Exchange, India
- ASAPP Information Group - India
- ICICI Bank Limited - India
- Kepco SPC Power Corporation, Philippines
- Posco Energy - South Korea
- Leighton Contractors Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Agrawal Coal Company - India
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
- Xindia Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- Interocean Group of Companies - India
- Energy Development Corp, Philippines
- CNBM International Corporation - China
- Vijayanagar Sugar Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Africa Commodities Group - South Africa
- Planning Commission, India
- Billiton Holdings Pty Ltd - Australia
- Merrill Lynch Commodities Europe
- Coalindo Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- Jorong Barutama Greston.PT - Indonesia
- Trasteel International SA, Italy
- Bhatia International Limited - India
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- Australian Coal Association
- Deloitte Consulting - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Binh Thuan Hamico - Vietnam
- GMR Energy Limited - India
- Port Waratah Coal Services - Australia
- Jaiprakash Power Ventures ltd
- The State Trading Corporation of India Ltd
- White Energy Company Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Lanco Infratech Ltd - India
- Siam City Cement PLC, Thailand
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Intertek Mineral Services - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sindya Power Generating Company Private Ltd
- Standard Chartered Bank - UAE
- Larsen & Toubro Limited - India
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- Riau Bara Harum - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sarangani Energy Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Bukit Asam (Persero) Tbk - Indonesia
- Electricity Generating Authority of Thailand
- The University of Queensland
- Thiess Contractors Indonesia
- Bukit Makmur.PT - Indonesia
- Orica Mining Services - Indonesia
- Jindal Steel & Power Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Electricity Authority, New Zealand
- Mercator Lines Limited - India
- Orica Australia Pty. Ltd.
- Bulk Trading Sa - Switzerland
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- SMC Global Power, Philippines
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Savvy Resources Ltd - HongKong
- Edison Trading Spa - Italy
- Carbofer General Trading SA - India
- Power Finance Corporation Ltd., India
- AsiaOL BioFuels Corp., Philippines
- VISA Power Limited - India
- Vizag Seaport Private Limited - India
- Mintek Dendrill Indonesia
- Singapore Mercantile Exchange
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Essar Steel Hazira Ltd - India
- Makarim & Taira - Indonesia
- Manunggal Multi Energi - Indonesia
- Antam Resourcindo - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Electricity Regulatory Commission - India
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Meenaskhi Energy Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Wilmar Investment Holdings
- International Coal Ventures Pvt Ltd - India
- PowerSource Philippines DevCo
- Ceylon Electricity Board - Sri Lanka
- Romanian Commodities Exchange
- Kalimantan Lumbung Energi - Indonesia
- Madhucon Powers Ltd - India
- Samtan Co., Ltd - South Korea
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Karaikal Port Pvt Ltd - India
- Anglo American - United Kingdom
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- McConnell Dowell - Australia
- Holcim Trading Pte Ltd - Singapore
- Gujarat Sidhee Cement - India
- Mercuria Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Metalloyd Limited - United Kingdom
- Parry Sugars Refinery, India
- Price Waterhouse Coopers - Russia
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Malabar Cements Ltd - India
- Minerals Council of Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Kumho Petrochemical, South Korea
- GAC Shipping (India) Pvt Ltd
- Tata Chemicals Ltd - India
- Borneo Indobara - Indonesia
- Georgia Ports Authority, United States
- Rio Tinto Coal - Australia
- Marubeni Corporation - India
- Independent Power Producers Association of India
- Miang Besar Coal Terminal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- LBH Netherlands Bv - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Heidelberg Cement - Germany
- Ministry of Transport, Egypt
- PTC India Limited - India
- Semirara Mining Corp, Philippines
- Chamber of Mines of South Africa
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Commonwealth Bank - Australia
- PetroVietnam Power Coal Import and Supply Company
- Petron Corporation, Philippines
- Altura Mining Limited, Indonesia
- India Bulls Power Limited - India
- Parliament of New Zealand
- Alfred C Toepfer International GmbH - Germany
- Bhoruka Overseas - Indonesia
- Kartika Selabumi Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Indian Oil Corporation Limited
- Bukit Baiduri Energy - Indonesia
- Ministry of Finance - Indonesia
- Sojitz Corporation - Japan
- Meralco Power Generation, Philippines
- Star Paper Mills Limited - India
- Ministry of Mines - Canada
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Eastern Coal Council - USA
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- Directorate General of MIneral and Coal - Indonesia
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