Anglia Oils Ltd v Owners of the Vessel 'Marine Champion'
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE GROSS |
| Judgment Date | 10 October 2002 |
| Neutral Citation | [2002] EWHC 2407 (Admlty) |
| Court | Queen's Bench Division (Admiralty) |
| Docket Number | No: 2002/480 |
| Date | 10 October 2002 |
[2002] EWHC 2407 (Admlty)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMIRALTY COURT
Mr Justice Gross
No: 2002/480
MR S GAULT appeared on behalf of the CLAIMANT
MR N MEESON QC appeared on behalf of the DEFENDANT
Introduction:
There are before the court the following applications: (1) by the defendant for a stay of these proceedings in favour of New York arbitration pursuant to section 9 of the Arbitration Act 1996 ("the Act"); (2) by the claimant for summary judgment pursuant to CPR Part 24.
For present purposes the facts of the matter may be shortly summarised as follows. (1) By a time charterparty on the Shell Time 4 form, dated 11th October 2001 ("the time charterparty") the defendant chartered the vessel, the Marine Champion ("the vessel") to Messrs Sun Marine ("Sun Marine") on the terms and conditions set out therein. As provided by clause 41 thereof the time charterparty was governed by English law. Clause 26 of the time charterparty provided, so far as material, as follows:
"Owners shall have a lien upon all cargoes and all freights, subfreights, hires, subhires, and demurrage for any amounts due under this charter …"
(2) Subsequently it appears that Sun Marine sub-voyage chartered the vessel for the carriage of two part cargoes (i) to Sogescol SA ("Sogescol") on or about 15th March 2002 in respect of a part cargo of about 5,000 metric tonnes crude palm oil for a voyage from Belem, Brazil, to Hull; this sub-charter was governed by English law, (ii) to Retramar Ltda ("Retramar") on or about 10th April 2002 in respect of a part cargo minimum 2,000 metric tonnes up to 2,300 metric tonnes crude palm oil for a voyage from Santa Marta, Colombia, to Hull; this sub-charter was governed by New York law.
(3) For its part on 10th April 2002 Retramar sub-chartered the vessel ("the Retramar sub-charter") to Pasternak Baum ("Pasternak") for the same voyage and same cargo on back to back terms and hence again governed by New York law. It may be noted that the Retramar sub-charter provided for New York arbitration and contained a lien clause, clause 25, which provided as follows:
"The owner shall have an absolute lien on the cargo for all freight, dead freight, demurrage and costs including attorney's fees of recovering the same which lien shall continue after delivery of the cargo …"
As I understand it, the freight as such under the sub-charterparty has long since been paid.
(4) In due course the 7,000 metric tonnes of palm oil were loaded on to the vessel at Belem and Santa Marta respectively. Bills of lading came to be issued at Belem on 20th March 2002 ("the Sogescol bill of lading) in respect of the Belem parcel and, in circumstances to which I shall return, at New Orleans dated 12th April 2002 ("the Pasternak bill of lading") in respect of the Santa Marta parcel.
(5) The Sogescol bill of lading was governed by English law in consequence of its incorporation of the terms of the sub-voyage charter to Sogescol referred to above. The Pasternak bill of lading provided that:
"All terms conditions and liberties and exceptions of Vegoilvoy CP between Retramar and Pasternak … dated April 10, 2002, including arbitration clause, are herewith incorporated."
It follows that the Pasternak bill of lading (i) was governed by New York law and (ii) incorporated a New York arbitration clause.
(6) The claimant purchased the two parcels of palm oil from Sogescol and Pasternak and came to be the holder of the Sogescol and Pasternak bills of lading.
(7) On 23rd April 2002 Drew and Napier (the well-known Singapore lawyers) wrote to the claimant asserting a lien over the palm oil parcels in question. They said this:
"1. We are lawyers acting for the owners of the Marine Champion ('the vessel').
2. Our clients understand that you are the consignee named in two bills of lading. One issued at Belem on or about 20th March 2002 for about 5,005.18 metric tonnes of Brazilian crude palm oil and the other issued at Santa Marta for about 2,000.704 metric tonnes of Colombian crude palm oil, both these cargoes being loaded on board the vessel.
(3) Please be advised that the vessel has been under time charter to Sun Marine BVBA ('Sun Marine') pursuant to a time charterparty dated 11th October 2001 ('The c/p'). Please be further advised that under the CP the sum of US dollars 246.893.13 (as at 23 April 2002) plus other disbursements and/or costs and expenses presently quantified at US dollars 102190.79 are due and owing by Sun Marine to our clients.
(4) To date our clients have not been able to obtain any payment of the said outstanding sums from Sun Marine. In this respect our clients have a right of lien, including but not limited to that under clause 26 ('lien') of the CP which provides inter alia that 'owners shall have a lien upon all cargoes and all freights, subfreights, hires, subhires and demurrage for any amounts due under this charter …
(5) Please be advised that unless the said outstanding sums are paid in full our clients will exercise their rights, including but not necessarily liberty to their said right of lien. Our clients therefore require that the freight be paid over to them and the remaining outstanding sums under the CP be paid in full before they will release the cargoes at Hull.
(6) Please be further advised that in addition to the outstanding sums stated above should it transpire that for further hire which has been earned and/or which would be due but is not paid our clients would likewise be forced to exercise their rights of lien in respect of those sums as well …
(8) In the meantime all of our client's right are hereby expressly reserved."
In the event, and in order to obtain the release of their cargo, the claimant entered into an agreement dated 30th April 2002 with the defendant providing security for the defendant's claim. That agreement provided as follows:
"Whereas (1) Marine Champion Inc, the owners of the vessel Marine Champion, claim to be entitled to exercise a lien on the cargo (about 5005.180 metric tonnes of Brazilian crude palm oil and about 2000.704 metric tonnes of Colombian crude palm oil) on board the vessel.
(2) Anglia Oils Limited claim to be the holders of the original bills of lading for the cargo and dispute the entitlement to exercise a lien on the cargo.
(3) In consideration of the owners agreeing to discharge the cargo at Hull to Anglia Oils Limited against presentation of original bills of lading Anglia Oils Limited have agreed to provide security for the owner's claim in the sum of US$ 928,605.00 …
Now we, Messrs Andrew M Jacksons, solicitors in England, (a) warrant that we have the sum of US$ 928,605.00 in our US dollar clients' account and have irrevocable authority from Anglia Oils Limited to retain such sum until completion of discharge of the cargo at Hull and thereafter to apply it in accordance with our undertaking below, (b) irrevocably undertake that immediately upon completion of discharge at Hull we will hold the sum of US$ 928,605.00 as stakeholders pending final resolution of the said dispute by way of agreement, litigation or arbitration in New York, USA, and/or in England and/or elsewhere and will at any time, if called upon to do so by Marine Champion Inc, or their legal representatives, immediately transfer the aforesaid sum into a joint escrow account in a jurisdiction to be agreed between the parties, or their legal representatives, to be opened in the names of the parties respective legal representatives, (c) this undertaking shall be subject to English law and any dispute concerning the terms of the undertaking shall be determined by the High Court of England and Wales."
Reverting to the applications now before the court. (1) The claimant applies for summary judgment. Its case is that it was not a party to the time charterparty and hence that the defendant's claim to a lien on the claimant's cargo was manifestly unsustainable. The claimant seeks declaratory relief accordingly. (2) The defendant now concedes that it cannot maintain its lien, or security in lieu, over the cargo covered by the Sogescol bill of lading. However, in respect of the parcel of cargo covered by the Pasternak bill of lading the defendant submits that it is entitled to a stay of proceedings in favour of New York arbitration by reason of the incorporation of a New York arbitration clause into the Pasternak bill of lading. For its part the claimant accepts that the Pasternak bill of lading contained a New York arbitration clause, but goes on to deny that the defendant was a party to the Pasternak bill of lading, or otherwise entitled to insist on arbitration by reason of the arbitration clause contained therein.
The defendant's application for a stay in respect of the Pasternak bill of lading
The defendant's application for a stay in respect of the cargo covered by the Pasternak bill of lading is governed by section 9 of the Act which provides, so far as material, as follows:
"Stay of legal proceedings
9(1) A party to an arbitration agreement against whom legal proceedings are brought … in respect of a matter which under the agreement is to be referred to arbitration, may … apply to the court in which the proceedings have been brought to stay the proceedings so far as they concern that matter. …
(4) On an application under this section the court shall grant a stay unless satisfied that the arbitration agreement is null and void, inoperative or incapable of being formed."
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