Americas Bulk Transport Ltd (Liberia) v Cosco Bulk Carrier Ltd (China)

JurisdictionEngland & Wales
JudgePelling
Judgment Date30 January 2020
Neutral Citation[2020] EWHC 147 (Comm)
Date30 January 2020
Docket NumberCase No: CL-2018-000832
CourtQueen's Bench Division (Commercial Court)

[2020] EWHC 147 (Comm)

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

COMMERCIAL COURT (QBD)

Royal Courts of Justice, Rolls Building

Fetter Lane, London, EC4A 1NL

Before:

HIS HONOUR JUDGE Pelling QC

SITTING AS A JUDGE OF THE HIGH COURT

Case No: CL-2018-000832

m.v. Grand Fortune

Between:
Americas Bulk Transport Limited (Liberia)
Claimant
and
Cosco Bulk Carrier Limited (China)
Defendant

Mr Mark Stiggelbout (instructed by MFB Solicitors) for the Claimant

Mr Paul Toms (instructed by Penningtons Manches Cooper LLP) for the Defendant

Hearing dates: 19 December 2020

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

HIS HONOUR JUDGE Pelling QC SITTING AS A JUDGE OF THE HIGH COURT

HH Judge Pelling QC:

Introduction

1

This is the hearing of the claimant's application under s.67 of the Arbitration Act 1996 (“AA”) challenging the award of Messrs Marshall, Aston and Raymond (dissenting) (“Tribunal”) dated 29 November 2018 (“Award”) holding that the Tribunal had substantive jurisdiction in respect of the defendant's claim for sums due alternatively damages against the claimant under a recap time charter of the Motor Vessel Grand Fortune (“Vessel”) dated 16 May 2008 (“Charterparty”) contained in or evidenced by an email of that date.

2

At all material times the defendant was the disponent owner of the Vessel. By a time charter dated 15 November 2007, the defendant chartered the Vessel to Britannia Bulkers A/S (“Bulkers”) (“Head Charter”). Bulkers' obligations under the Head Charter were guaranteed by Britannia Bulk Plc (“Bulk”). Bulkers was at all material times a wholly owned subsidiary of Bulk. Bulk was the larger of the two companies. Of the total group fleet, Bulk was the charterer and disponent owner of about 75% of the total fleet with Bulkers being the charterer and disponent owner of the remainder.

3

There is no dispute that the claimant chartered the Vessel by the Charterparty. The Charterparty was negotiated on behalf of the claimant by Mr Philip Lambert, then the claimant's exclusive broker, who is deceased, and Mr Andrew Lees, a freight trader employed by Bulk. The Charterparty was expressly fixed by reference to the Head Charter but did not state who the disponent owner was.

4

The claimant's case is that its counterparty under the Charterparty was Bulk not Bulkers. This is important to the jurisdiction of the Tribunal because the defendant's claims against the claimant in the arbitration are brought as assignee of the rights of Bulkers. If Bulk was the disponent owner under the Charterparty then the Tribunal has no jurisdiction because the defendant cannot rely on the arbitration agreement contained in the Charterparty.

5

The claimant sought a ruling from the Tribunal pursuant to AA, s.30(1)(a), declaring that the Tribunal had no jurisdiction because the true disponent owner was Bulk not Bulkers and thus there was no valid arbitration agreement between the claimant and defendant. By the Award, the Tribunal by a majority rejected the claimant's case. Following publication of the Award, the claimant commenced these proceedings under AA, s.67(1)(a) challenging the Award on the basis that the Tribunal has no substantive jurisdiction and for an order varying the Award so as to uphold the claimant's challenge to jurisdiction. The phrase “ substantive jurisdiction” within AA, s.67(1)(a) refers to the matters set out in AA, s30(1)(a) to (c) – see AA, s.82. Such a challenge proceeds by way of a re-hearing – see Dallah Real Estate and Tourism Holding Company v. Ministry of Religious Affairs of the Government of Pakistan [2011] AC 763 at paras 25–26. The evidence will usually be and in this case is that which was given before the Tribunal as recorded in the transcripts of the proceedings before the Tribunal leading to the Award.

Background

Authoritative Version of Head Charter

6

There are two versions of the Head Charter in existence. The claimant maintains that the version it adduces is the relevant version. The defendant contends that the version it has produced is the relevant version. However Mr Lees (the individual who negotiated the Charterparty on behalf of the disponent owner) accepted in the course of his oral evidence before the Tribunal that the authentic version was likely to have been the version produced by the claimant – see T1/94/5. I accept that evidence and so find because (a) there was nothing to contradict this evidence, (b) as Mr Lees accepted earlier in his cross examination the document in the possession of the claimant could only have been received by the claimant from Mr Lambert (the claimant's broker) – see T1/93/6–9 — and Mr Lambert could only have obtained it from Mr Lees – see T1/93/10–12 – and (c) the version produced by defendant has some indications within it that suggest it was likely not to have been the authoritative version. Amongst the most obvious is that the version relied on by the claimant refers to the guarantee of Bulkers' obligations by Bulk whereas the version produced by the defendant does not. The guarantee is dated the same day as the Head Charter. Since it is common ground that Bulk did guarantee Bulkers' obligations this tends to support Mr Lees' acceptance that the version produced by the claimant is the version that the parties were working to and (as I explain below) is the version to which the Charterparty refers.

7

Although it is suggested by the defendant that the stamp “ Working Copy” on the version produced by the claimant suggests it is a draft, I do not accept that to be so in the absence of any evidence that such was what was meant by the stamp. It is equally and perhaps more realistically arguably capable of meaning that the copy of the Head Charter supplied to the claimant was a copy of the Head Charter used by the defendant for trading the Vessel. I regard the stamp as essentially a neutral factor given the absence of any evidence as to its purposes and reach my conclusion by reference to the other factors mentioned earlier.

Charterparty

8

The Charterparty on which the defendant relies is evidenced by an email dated 16 May 2008 from Mr Lambert which sets out “ … a recap of fixture …” (“Recap”). The Recap describes the Vessel as being:

“mv GRAND FORTUNE

(as described in CP dated Nov. 15 2007)”

It contains a number of technical provisions typical of such a document and concludes …Otherwise as per CP dated Nov. 15, 2008 with logical alterations. It is common ground that the reference to “ 2008” is a typographical error and that it should be “ 2007” and is a reference to the Head Charter. The Recap names the claimant (described as “ ABT”) as charterer but as I have said does not identify the disponent owner. The Charterparty was extended by an agreement contained in or evidenced by an email from Mr Lambert to Mr Lees dated 20 August 2008. In so far as is material the extension was on the same terms as the original Charterparty. It does not identify the disponent owner either. The final sentence of the 20 August email is “ Were you able to draw CP”. In its context this is a question being asked by Mr Lambert (the claimant's broker) of Mr Lees.

9

By an email of 12 September 2008, the defendant sent the claimant a first draft charterparty (“Draft CP”). Although Mr Stiggelbout referred to it repeatedly as an engrossment, it was not. It is a draft that was never agreed between the parties. The Draft CP purported to be between Bulk as owner and the claimant as charterer. It is dated 16 May 2008 (the date of the recap email) and provides for signature at the end by or on behalf of Bulk as owner and the claimant as charterer. It was drafted after the date when the Recap had been sent and received and after the extension. The claimant relies very heavily on this draft in support of its case that Bulk not Bulkers was the true disponent owner.

The Underlying Dispute and Reference to Arbitration

10

On 31 October 2008, Bulk was placed in administration and on 20 November 2008, Bulkers was placed in insolvent liquidation. A dispute arose between Bulkers and the defendant concerning hire alleged to be due from Bulkers to the defendant. The detail is not relevant. However, as part of a settlement agreement between Bulkers' liquidators and the defendant, the defendant took an assignment of Bulkers' rights, which it then utilised by claiming allegedly unpaid hire from the claimant as Bulkers' assignee.

11

This led, on 12 August 2011, to the issue of Notice of Arbitration by solicitors acting on behalf of the defendant. It described Bulkers as the disponent owners of the Vessel and the claimant as charterer. It claimed that the defendants had been … assigned all legal rights in relation to a Sub-Charterparty dated 16 May 2008 between [Bulkers] and [the claimant] ….

12

The claimant's solicitors responded by an email dated 26 August 2011, in which they asserted that there … was no contract between [the claimant] and [Bulkers] as evidenced by the charter drawn up by [Bulk] … there is therefore no arbitration agreement between [Bulkers] or [the defendant] and [the claimant] and indeed no charter …. The response continued by indicating that Mr Rayment had been appointed as its arbitrator but the claimant's rights were reserved … to maintain that there was no contract between [the claimant] and [Bulkers] … and that the Tribunal has no jurisdiction in this matter …. The letter concluded by inviting the defendant to withdraw the proceedings and threatening to seek indemnity costs if it did not. This was followed by a response from the defendant's solicitors re-asserting the claim in October 2011.

13

Nothing further passed between the parties before Mr Lambert died in 2014 or thereafter until 7...

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1 firm's commentaries
  • Identifying A Party To A Contract When It Is Not Named
    • United Kingdom
    • Mondaq UK
    • 5 August 2020
    ...in the recap or engrossed charterparty. The judgment of HHJ Pelling QC in Americas Bulk Transport Ltd v Cosco Bulk Carrier Ltd [2020] EWHC 147 (Comm) considers the legal approach to be taken in such a case and, indeed, any case where a party to a written contract is not expressly In May 200......

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