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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, 28 August 18
SUPRAMAX: A COAL TRIP VIA INDONESIA PAID $13,500 ON A 56,000DWT TO WC INDIA - BALTIC BRIEFING
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Friday, 24 August 18
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Thursday, 23 August 18
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Thursday, 23 August 18
SUPRAMAX: SOME FRESH COAL CARGOES APPEARED IN SE ASIA, GIVING A BIT PRESSURE ON RATES FOR END AUGUST SHIPMENTS - FEARNLEYS
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- Maharashtra Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- The State Trading Corporation of India Ltd
- Vedanta Resources Plc - India
- Indika Energy - Indonesia
- Coalindo Energy - Indonesia
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Latin American Coal - Colombia
- Bhushan Steel Limited - India
- White Energy Company Limited
- Kaltim Prima Coal - Indonesia
- Parry Sugars Refinery, India
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Antam Resourcindo - Indonesia
- Central Java Power - Indonesia
- Pendopo Energi Batubara - Indonesia
- Wood Mackenzie - Singapore
- Essar Steel Hazira Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Singapore Mercantile Exchange
- MS Steel International - UAE
- Dalmia Cement Bharat India
- Bukit Baiduri Energy - Indonesia
- Rio Tinto Coal - Australia
- Malabar Cements Ltd - India
- IEA Clean Coal Centre - UK
- Maheswari Brothers Coal Limited - India
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- The Treasury - Australian Government
- Parliament of New Zealand
- Therma Luzon, Inc, Philippines
- Indogreen Group - Indonesia
- Chamber of Mines of South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Electricity Authority, New Zealand
- Attock Cement Pakistan Limited
- Semirara Mining and Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Bangladesh Power Developement Board
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Finance - Indonesia
- Sree Jayajothi Cements Limited - India
- Tamil Nadu electricity Board
- Kumho Petrochemical, South Korea
- Meenaskhi Energy Private Limited - India
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- GAC Shipping (India) Pvt Ltd
- GN Power Mariveles Coal Plant, Philippines
- Holcim Trading Pte Ltd - Singapore
- Manunggal Multi Energi - Indonesia
- Carbofer General Trading SA - India
- Energy Link Ltd, New Zealand
- Makarim & Taira - Indonesia
- Coal and Oil Company - UAE
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- ICICI Bank Limited - India
- Romanian Commodities Exchange
- GMR Energy Limited - India
- Indian Energy Exchange, India
- Rashtriya Ispat Nigam Limited - India
- Toyota Tsusho Corporation, Japan
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Intertek Mineral Services - Indonesia
- Directorate Of Revenue Intelligence - India
- TeaM Sual Corporation - Philippines
- Xindia Steels Limited - India
- SMC Global Power, Philippines
- Miang Besar Coal Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Thai Mozambique Logistica
- Coastal Gujarat Power Limited - India
- Tata Chemicals Ltd - India
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- The University of Queensland
- Karaikal Port Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Central Electricity Authority - India
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Kartika Selabumi Mining - Indonesia
- Interocean Group of Companies - India
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Port Waratah Coal Services - Australia
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- SMG Consultants - Indonesia
- Jaiprakash Power Ventures ltd
- Gujarat Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kideco Jaya Agung - Indonesia
- Vizag Seaport Private Limited - India
- Georgia Ports Authority, United States
- Heidelberg Cement - Germany
- India Bulls Power Limited - India
- Australian Coal Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- Sical Logistics Limited - India
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- McConnell Dowell - Australia
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Eastern Energy - Thailand
- Edison Trading Spa - Italy
- TNB Fuel Sdn Bhd - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- CIMB Investment Bank - Malaysia
- Globalindo Alam Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Borneo Indobara - Indonesia
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Africa Commodities Group - South Africa
- Ceylon Electricity Board - Sri Lanka
- Timah Investasi Mineral - Indoneisa
- Straits Asia Resources Limited - Singapore
- Orica Australia Pty. Ltd.
- Anglo American - United Kingdom
- Economic Council, Georgia
- Leighton Contractors Pty Ltd - Australia
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- Samtan Co., Ltd - South Korea
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Goldman Sachs - Singapore
- Grasim Industreis Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- Marubeni Corporation - India
- Kepco SPC Power Corporation, Philippines
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Global Coal Blending Company Limited - Australia
- Siam City Cement - Thailand
- Ministry of Transport, Egypt
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Bayan Resources Tbk. - Indonesia
- Mercuria Energy - Indonesia
- Deloitte Consulting - India
- Uttam Galva Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Star Paper Mills Limited - India
- Alfred C Toepfer International GmbH - Germany
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Metalloyd Limited - United Kingdom
- Baramulti Group, Indonesia
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Thiess Contractors Indonesia
- Savvy Resources Ltd - HongKong
- CNBM International Corporation - China
- Wilmar Investment Holdings
- Barasentosa Lestari - Indonesia
- European Bulk Services B.V. - Netherlands
- Minerals Council of Australia
- Jindal Steel & Power Ltd - India
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- London Commodity Brokers - England
- Lanco Infratech Ltd - India
- Banpu Public Company Limited - Thailand
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
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