Carnoustie Universal SA and Others v International Transport Workers Federation and Others
| Jurisdiction | England & Wales |
| Judgment Date | 30 July 2002 |
| Neutral Citation | [2002] EWHC 1624 (Comm) |
| Docket Number | 2001 Folio Nos. 290 and 1278 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 30 July 2002 |
[2002] EWHC 1624 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Mr Richard Siberry QC, Sitting as a Deputy High Court Judge
2001 Folio Nos. 290 and 1278
Mr Dominic Kendrick QC and Mr Andrew Thomas (instructed by Ross & Co.) for the Claimants
Ms Helen Davies (instructed by Mayer Brown Rowe & Maw) for the First Defendant
Mr Mark Cran QC and Mr Michael Rollason (instructed by Mayer Brown Rowe & Maw) for the Second and Third Defendants
Hearing dates: 1 st—3 rd July 2002
Approved Judgment
Introduction
There are before the Court applications by the Defendants in two related actions, to set aside, stay or strike out proceedings in those actions on jurisdictional grounds or, in the case of one of the applications, for alleged abuse of process. I shall describe the applications in more detail below.
The actions arise out of industrial action taken by the Finnish Seamen's Union ("FSU") and the Auto-Ja Kuljetusalan Tyontekijalitto AKT RY ("AKT"—the Finnish Transport Workers Federation), respectively the Second and Third Defendants in each action, against 4 British-flagged ships in Finnish ports in March 2001. Both of these Unions are domiciled in Finland. The ships in question were the FINNREEL, FINNMASTER, FINNKRAFT and FINNHAWK (together referred to below as "the Vessels"). They were owned by, respectively, the First, Second, Fourth and Fifth Claimants, all of which are companies incorporated in the British Virgin Islands. (The Claimants are the same in each action). The Third Claimant, a company incorporated in England, has a contingent interest in the FINNMASTER, which it is in the process of acquiring under a conditional sale agreement. The Sixth Claimant ("Norbulk"), a company incorporated in Scotland, is the technical, safety and crewing manager of the vessels.
The First Defendant, the International Transport Workers' Federation ("ITF"), is domiciled in England, with offices in London. It is a trade union organisation composed of a federation of trade unions of transport workers around the world. FSU is one of its affiliates. It is the Claimant's case that the industrial action in Finland was instigated by ITF. This is denied by ITF.
The Vessels are roll-on, roll-off vessels, purpose-built for the intended trade from Finland to ports in other European Union countries such as England and Germany, carrying in particular forest products such as paper reels. In March 2001, each was operating under a 5-year time charter which granted the charterers, the Finnlines Group, the option to terminate the charter should an ITF boycott affect the vessel for more than 72 continuous hours. The Vessels are, as I have mentioned, British—flagged ships, whose crews were employed on terms which had been approved by the British Maritime and Coastguard Agency ("MCA").
On 2 nd March 2001 a Mr Simo Nurmi, who signed himself as "ITF Coordinator Finnish Seamen's Union", sent a "Notice to Shipowners" addressed to the Owners of the Vessels and Norbulk as their representative and manager, stating that he had "inspected your flag of convenience vessel…FINNHAWK today at Helsinki" and found that it was not covered by an acceptable collective bargaining agreement, and requiring Norbulk on behalf of Owners to enter into negotiations with FSU for the "ITF Standard Collective Agreement" covering all officers and ratings employed on the Vessels, and to back date wages and benefits due under such an Agreement to the beginning of each crew member's employment. He advised that if Owners failed to sign such an agreement and pay such wages, the vessels would be "open for any actions deemed necessary without any further notice."
The industrial action began on the 7 th March 2001. The dockers who were then unloading the FINNREEL, at Rauma, ceased work. Similar action was taken against the FINNKRAFT, at Hanko, later that day. On 8 th and 9 th March 2001 respectively, similar action was taken against the FINNMASTER at Hamina, and against the FINNHAWK in Helsinki.
Between 9 th and 12 th March 2001, the Claimants sought and obtained interim injunctive relief against ITF, from the Commercial Court in London. It is not necessary to describe the sequence of the various applications made, which eventually resulted in an interim injunction granted by David Steel J on 12 th March 2001, directing ITF not to interfere with the loading or discharge of the Vessels in Finnish ports or otherwise to interfere with the Claimants trading the Vessels into and out of Finland.
However this injunction did not have the desired effect. The industrial action continued, and it was apparently made clear that it would continue unless and until two agreements were signed on behalf of Owners. These two agreements were prepared by FSU, and were expressed to be between FSU and Norbulk as Owner/Agent of the Owner of the Vessels. Faxed copies were sent to London by FSU, signed in London by Mr Karlsen, the Managing Director of Norbulk, on 13 th March 2001, and faxed back to FSU in Finland. The agreements were as follows:
(1) A Settlement Agreement, which recorded that the Vessels had been boycotted by FSU, supported by AKT, was expressed to be "full and final and solves all present disputes between all parties involved," and which provided for the signature by the parties of a Collective Bargaining Agreement covering all the Vessels, in the form attached thereto;
(2) The Collective Bargaining Agreement ("CBA"), which set out the standard terms and conditions on which all seafarers serving on the Vessels were thenceforward to be employed.
Following the signature of these two Agreements, the industrial action ceased, and the dockers resumed loading or discharge of the Vessels.
The injunction applications were made in what became Claim No. 2001 Folio 290, the first of the two actions with which the present applications are concerned, and to which I shall refer as "the March Action". This action originally named only ITF as Defendant. On 14 th March 2001 the Claim Form and Particulars of Claim therein were served on ITF. In the Particulars of Claim the Claimants alleged that the industrial action was instigated by ITF, was a breach of the dockers' contracts with their employers, and constituted unlawful interference with the Claimants' business and with alleged directly effective rights of the Claimants under Community law to trade their Vessels to Finland. They pleaded that the Settlement Agreement was void or voidable for duress, but made no express reference to the CBA. They sought a permanent injunction in similar terms to those of the interim injunction granted by David Steel J, damages (together with interest), and a declaration that the Settlement Agreement was procured by duress unlawfully, and was void or voidable.
On 23 rd March 2001, following the signature of the Settlement Agreement and the CBA and the consequent cessation of the industrial action, the interim injunction was discharged by consent.
I should mentioned at this point that on 9 th March 2001, the First and Third to Fifth Claimants (and Nordic Forest Terminals Ab, not a party to the English Actions) applied without notice to the Helsinki District Court for urgent injunctive relief against FSU and AKT. This without notice application was, however, rejected by the District Court, which gave directions for service of the application on FSU and AKT, and for FSU and AKT to deliver their reply by 30 th March 2001. What would thereby have become a with notice application was overtaken by events, including the signature of the two Agreements and the resultant cessation of industrial action. The application was consequently withdrawn on 26 th March 2001, and the matter was accordingly dismissed as recorded in a decision of the District Court dated 4 th April 2001. No substantive proceedings have been commenced by any of the Claimants against FSU or AKT in Finland.
ITF served its Defence in the March Action on 10 th May 2001. Among other things it denied that it had instigated or authorised any of the industrial action, which it asserted had been taken by FSU and AKT on their own initiative. Further Information of the Particulars of Claim was requested by ITF, and provided by the Claimants in July 2001. Among other things details were provided of the alleged losses in respect of which the Claimants claimed damages. These included increased crew costs of US$100,000 per month "as a result of the purported Settlement Agreement". This clearly relates to the increased crewing costs payable as a result of the CBA. A Reply was also served in July 2001.
On 15 th November 2001, a Case Management Conference in the March Action took place before Langley J, who gave what I understand to have been agreed directions for a trial, to commence on the first available date after 1 st October 2002. The trial was subsequently fixed to start on 21 st October 2002, with an estimated length of 8 days, and that remains the current position.
However, after the directions for trial had been agreed, the Claimants informed Langley J. that they intended to apply for permission to join FSU and AKT as additional defendants to the March Action. They asked that this information be treated as confidential, so that ITF would not be allowed to pass it on to FSU and AKT;...
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