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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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Wednesday, 12 September 18
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Showing 1626 to 1630 news of total 6871 |
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- GAC Shipping (India) Pvt Ltd
- London Commodity Brokers - England
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- Madhucon Powers Ltd - India
- ICICI Bank Limited - India
- New Zealand Coal & Carbon
- Minerals Council of Australia
- Baramulti Group, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- Indo Tambangraya Megah - Indonesia
- Orica Australia Pty. Ltd.
- Kumho Petrochemical, South Korea
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- Port Waratah Coal Services - Australia
- Jorong Barutama Greston.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- South Luzon Thermal Energy Corporation
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Indika Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- Interocean Group of Companies - India
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Cigading International Bulk Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Energy Development Corp, Philippines
- Power Finance Corporation Ltd., India
- Alfred C Toepfer International GmbH - Germany
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Bukit Makmur.PT - Indonesia
- The University of Queensland
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- Bharathi Cement Corporation - India
- MS Steel International - UAE
- Krishnapatnam Port Company Ltd. - India
- Cement Manufacturers Association - India
- Asmin Koalindo Tuhup - Indonesia
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Australian Commodity Traders Exchange
- Formosa Plastics Group - Taiwan
- Neyveli Lignite Corporation Ltd, - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- International Coal Ventures Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Indian Energy Exchange, India
- Maharashtra Electricity Regulatory Commission - India
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Xindia Steels Limited - India
- Mercator Lines Limited - India
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- TeaM Sual Corporation - Philippines
- Posco Energy - South Korea
- Deloitte Consulting - India
- Metalloyd Limited - United Kingdom
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Iligan Light & Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Kideco Jaya Agung - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coal and Oil Company - UAE
- Vedanta Resources Plc - India
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- San Jose City I Power Corp, Philippines
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Siam City Cement PLC, Thailand
- Renaissance Capital - South Africa
- Simpson Spence & Young - Indonesia
- Wilmar Investment Holdings
- SMG Consultants - Indonesia
- Trasteel International SA, Italy
- India Bulls Power Limited - India
- Salva Resources Pvt Ltd - India
- McConnell Dowell - Australia
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- Bukit Baiduri Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Singapore Mercantile Exchange
- Parliament of New Zealand
- The Treasury - Australian Government
- Electricity Authority, New Zealand
- Globalindo Alam Lestari - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Indogreen Group - Indonesia
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- Attock Cement Pakistan Limited
- Samtan Co., Ltd - South Korea
- Edison Trading Spa - Italy
- Kartika Selabumi Mining - Indonesia
- Medco Energi Mining Internasional
- Videocon Industries ltd - India
- Australian Coal Association
- Indian Oil Corporation Limited
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- Aboitiz Power Corporation - Philippines
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- Ambuja Cements Ltd - India
- Independent Power Producers Association of India
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- Vizag Seaport Private Limited - India
- Sakthi Sugars Limited - India
- Mercuria Energy - Indonesia
- GVK Power & Infra Limited - India
- Timah Investasi Mineral - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Bayan Resources Tbk. - Indonesia
- OPG Power Generation Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Karbindo Abesyapradhi - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Heidelberg Cement - Germany
- Kaltim Prima Coal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Essar Steel Hazira Ltd - India
- Ministry of Mines - Canada
- Therma Luzon, Inc, Philippines
- Anglo American - United Kingdom
- Mintek Dendrill Indonesia
- Makarim & Taira - Indonesia
- Ministry of Finance - Indonesia
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Uttam Galva Steels Limited - India
- Meralco Power Generation, Philippines
- Larsen & Toubro Limited - India
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Antam Resourcindo - Indonesia
- Commonwealth Bank - Australia
- Semirara Mining Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Petron Corporation, Philippines
- Latin American Coal - Colombia
- Kobexindo Tractors - Indoneisa
- Coalindo Energy - Indonesia
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Miang Besar Coal Terminal - Indonesia
- Tata Chemicals Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Star Paper Mills Limited - India
- VISA Power Limited - India
- Rio Tinto Coal - Australia
- Marubeni Corporation - India
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Sojitz Corporation - Japan
- Wood Mackenzie - Singapore
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- IEA Clean Coal Centre - UK
- European Bulk Services B.V. - Netherlands
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Sree Jayajothi Cements Limited - India
- GMR Energy Limited - India
- Tamil Nadu electricity Board
- Gujarat Electricity Regulatory Commission - India
- Manunggal Multi Energi - Indonesia
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