Captain Arshad Rashid v Oil Companies International Marine Forum
| Jurisdiction | England & Wales |
| Judge | Mr Justice Martin Spencer |
| Judgment Date | 16 August 2019 |
| Neutral Citation | [2019] EWHC 2239 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ18X00935 |
| Date | 16 August 2019 |
[2019] EWHC 2239 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Martin Spencer
Case No: HQ18X00935
Mr Matthew Parker (instructed by Signature Litigation LLP) for the Claimant
Mr Richard Leiper QC and Miss Natalie Connor (instructed by Oil Companies International Marine Forum) for the Defendant
Hearing dates: 1, 2, 3, 4 and 29 July 2019
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.
Introduction
The Claimant, a qualified Master Mariner who spent 20 years at sea and captained various vessels including oil tankers, claims damages, a declaration and an injunction against the Defendant, Oil Companies International Marine Forum (“OCIMF”) for removal of his accreditation as a ship inspector pursuant to its Ship Inspection Report (“SIRE”) programme.
The removal of the Claimant's accreditation resulted from an investigation by OCIMF's compliance manager, an inquiry report submitted by him and a disciplinary hearing conducted on behalf of OCIMF on 25 October 2017. It is claimed that the procedures adopted by the Defendant, the hearing and the subsequent removal of the Claimant's accreditation was so flawed as to have amounted to a breach of natural justice entitling the Claimant to a declaration and an injunction. It is additionally claimed that a contract arose between the Claimant and the Defendant and that the removal of the Claimant's accreditation was carried out in such circumstances as to amount to a breach of contract entitling the Claimant to damages. For the Defendant, it is contended that OCIMF is equivalent to an unincorporated association and that the process which led to the removal of the Claimant's accreditation was a fair and lawful one, exercised in good faith and for the benefit of the association and that the disciplinary panel convened by OCIMF was well placed to evaluate the significance of the breaches of the rules and standards of behaviour which the panel found against the Claimant whereby removal of his accreditation was well within their discretionary area of judgment. The Defendant denies a contractual relationship with the Claimant.
The parties
The Claimant (“Captain Rashid”) was born on 27 September 1960 in Lahore, Pakistan and for the first 20 years of his working life, he served at sea progressing to Captain. For the last nine years, he sailed on oil tankers worldwide.
In 2000, he left his job as Captain and served in various positions ashore as Port Captain, an Audit and Training Superintendent and a Senior Surveyor, working in Dubai and Singapore. He lived in Singapore for six years from 2002 to 2008, working for a number of different companies between 2002 and 2005.
In 2005, Captain Rashid joined a marine consultancy called Pac Marine Services, working as a ship inspector for Pac Marine's clients. Pac Marine arranged for him to undertake the necessary training and examinations to become an accredited SIRE inspector. Captain Rashid became an accredited category 1 SIRE inspector on 15 February 2006. Thereafter, the Claimant worked principally as an accredited SIRE inspector of oil tankers and he estimates that in 12 years of practice as a SIRE inspector he carried out over 1,100 inspections on oil, chemical and gas tankers.
In 2008, the Claimant and his wife moved from Singapore to Canada where they settled. The Claimant became a Canadian citizen in 2015. He continued to work for Pac Marine until 2011 when he and his wife set-up a company called Seashore Solutions Limited (see further paragraph 8 below). This was the corporate vehicle through which the Claimant provided his services as a ship inspector: in due course, the function of Seashore was expanded to include the provision of ship inspections through other inspectors whether salaried or paid as sub-contractors. It should also be mentioned that in addition to carrying out inspections of oil tankers on behalf of OCIMF members, the Claimant also carried out inspections of vessels on behalf of the Chemical Distribution Institute (“CDI”) and the removal of his accreditation has not prevented him from continuing to carry out such inspections although he argues that the effect of the removal of his accreditation on his reputation has had a knock-on effect on his CDI work.
As part of his OCIMF accreditation, the Claimant undertook regular refresher courses including on 16 June 2011, 2 June 2014 and 17 June 2016. In addition, OCIMF carried out audited inspections of the Claimant (in common with its other accredited inspectors) on a regular basis. Audited inspections were carried out on 15 February 2006, 22 February 2009, 4 November 2011 and 18 September 2014 with no criticisms raised of the Claimant's practices.
Seashore Solutions Limited is a company incorporated in Canada with two shareholders, the Claimant and his wife Neelma with the Claimant as President and Neelma as Director. Neelma's role in the company is on the administrative side, keeping records, booking the Claimant's travel, and liaising with the oil companies and chemical companies in relation to the inspection of their vessels. From the time of Seashore's incorporation in March 2011, all money earned by the Claimant was paid to Seashore and the Claimant's own income was derived from the salary paid by Seashore and the declaration of an annual dividend agreed at the Annual “Meeting of Directors”. I have not, however, seen the minutes of those meetings.
The Claimant says that in his 12 years of practice as a SIRE inspector, to the best of his knowledge there have never been any complaints against him or his practice nor had there been any issues raised in respect of any of the ships which he had inspected, following his inspections. He claims to have built a reputation in the industry as a thorough, honest and reliable SIRE inspector.
OCIMF
OCIMF is a voluntary association of oil companies comprising around 109 companies worldwide, and includes all the oil majors and most national oil companies. It is incorporated in Bermuda and registered as a foreign company in England and Wales.
OCIMF operates the SIRE programme which comprises a database of information about oil tankers and barges that is utilised by oil majors and prospective charterers. The information in the database is based on inspection reports carried out by ship inspectors who are accredited by OCIMF. OCIMF was formed in 1970 following a number of high profile marine pollution incidents and its mission is to drive up standards in safety and environmental responsibility within the tanker branch of the shipping industry. It fulfils this mission by providing guidance and expertise to its membership and by contributing to international shipping regulation through its consultative status at the International Maritime Organisation. It operates through a series of committees and working groups and it has a small secretariat of 22 staff based in London.
The SIRE programme is one of OCIMF's longest standing programmes and, through it, information about vessels that can transport oil and other hydrocarbons is gathered and shared to enable informed vetting decisions to be made by those seeking to charter such vessels and for assurance purposes. A member of OCIMF may commission a report from an inspector on a particular vessel and the report is then published on OCIMF's database.
SIRE inspections are extremely detailed and follow a comprehensive standard form template contained in OCIMF's Vessel Inspection Questionnaire (“VIQ”). In addition, OCIMF publish SIRE Inspector Training and Accreditation Guidelines (“the Guidelines”) which contain rules and guidelines which apply to every inspection. Thus, the system is such that if an accredited inspector follows the VIQ and the Guidelines, OCIMF's members can be reassured as to the integrity and quality of the reports on each vessel and rely thereon in deciding whether to charter a vessel. Vessel owners, knowing that their vessels will be rigorously inspected in accordance with the VIQ and Guidelines, are thereby incentivised to improve and maintain the standards and quality of their vessels, including, and perhaps especially, in relation to safety. In the trial, the relationship between the various parties including the inspectors, OCIMF, the oil companies and the vessel owners and charterers was described as “symbiotic”.
It is clear that, in relation to the SIRE programme and database, the role of the inspectors is critical. As Captain McGroggan, OCIMF's Compliance Manager, told me, the SIRE inspectors are both the programme's greatest asset but also potentially its weakest link. The system depends upon their integrity, their compliance with the Guidelines and VIQ and their general ethical approach to the task of inspection. If corners are cut in relation to the inspections, or if false information is included in the VIQ, this has the potential to undermine the whole system because complete trust in the database lies at the heart of the system. Furthermore, any less than complete and rigorous inspection has the potential to compromise the safety of the vessel and its crew and the general public, with potentially disastrous environmental consequences. Thus, as it seems to me, OCIMF has the right to expect its inspectors to abide not just by the letter but also by the spirit of its Guidelines. As was submitted to me on behalf of the Defendant, one of the most important training sessions for inspectors at every stage of accreditation concerns ethics. It was said:
“This is because...
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