Cockett Marine OLL DMCC v ING Bank N.v
| Jurisdiction | England & Wales |
| Judge | Mr. Justice Teare |
| Judgment Date | 17 June 2019 |
| Neutral Citation | [2019] EWHC 1533 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case Nos: CL-2018-000613 and CL-2018-000614 |
| Date | 17 June 2019 |
[2019] EWHC 1533 (Comm)
Mr. Justice Teare
Case Nos: CL-2018-000613 and CL-2018-000614
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Rolls Building, 7 Rolls Buildings
Fetter Lane, London EC4A 1NL
Dominic Happé (instructed by Lewis & Co) for the Claimants
Siobán Healy QC and Clara Benn (instructed by Gibson & Co) for the Defendants
Hearing dates: 11 and 12 June 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.
This a challenge to two arbitration awards pursuant to section 67 of the Arbitration Act 1996 on the grounds that the arbitral tribunal had no jurisdiction. The tribunal held that it had jurisdiction because the terms of the contract between the parties included a London arbitration clause. The Claimants on this challenge say that the terms of the contract did not include such a clause and so the tribunal lacked the requisite jurisdiction. The Defendants to this challenge seek to uphold the decision of the tribunal that the terms of the contract included a London arbitration clause. The arbitration tribunal considered the matter in comprehensive and fully reasoned awards. But the Arbitration Act 1996 permits there to be a rehearing of the issue and so this court must consider the matter afresh.
The claims sought in the two cases are modest. In the one case the claim was for the sum of $298,526 in respect of the supply of bunkers and in the other case the claim was for the sum of $228,000, also in respect of the supply of bunkers. The bunkers were supplied without complaint and in those circumstances it is puzzling that the Claimants on this challenge wish to incur further legal costs on the question of jurisdiction. The explanation may lie in the complications caused by the collapse of the OW Bunker Group (“OWBG”), which have already engaged the attention of the Supreme Court; see PST Energy 7 ShippING LLC v OW Bunker Malta [2016] UKSC 23. But there appears to be no risk of the Claimants having to bear the costs of the bunkers twice. In the one case I have been told that they have paid the actual or physical supplier of the bunkers but if they are liable to the Defendants also they have the benefit of an indemnity from the supplier. In the other case I have been told that the Defendants have paid the actual or physical supplier. Counsel for those challenging the awards had no instructions as to there being any particular commercial or business reason for incurring the costs of this challenge.
The parties
The parties are (or were) engaged in the supply of bunkers to ships. In the first case Cockett Marine OIL DMCC (“Cockett Dubai”) purchased bunkers from OW Bunker Malta Limited (“OW Bunker Malta”) for supply to the mv ZIEMIA CIESZYNSKA. OW Bunker Malta purchased the bunkers from Eko Marine Fuels. The bunkers were actually supplied to the vessel on 10 October 2014. In the second case Cockett Marine Oil (Asia) PTE Ltd. (“Cockett Asia”) purchased bunkers from OW Bunker Middle East DMCC (“OW Bunker Middle East”) for supply to the mv MANIFESTO. OW Bunker Middle East purchased the bunkers from GS Caltex. The bunkers were actually supplied to the ship on 11 October 2014.
The issues
The issues can be shortly expressed.
i) In the first case concerning the supply of bunkers to the mv ZIEMIA CIESZYNSKA the question is whether, when the contract was made, OWBG's standard terms and conditions, which included the London arbitration clause, were part of the contract either because they were expressly incorporated or because they were incorporated by reason of a course of dealing between OW Bunker Malta and Cockett Dubai.
ii) In the second case concerning the supply of bunkers to the mv MANIFESTO the question is whether, when the contract was made, OWBG's standard terms and conditions, which included the London arbitration clause, were part of the contract because they were expressly incorporated.
iii) In both cases there is a further question, namely, whether, if the terms and conditions were incorporated, they were varied so as to exclude the London arbitration clause because the actual or physical supplier of the bunkers insisted that its terms, (which did not include a London arbitration clause), govern the contracts between the relevant OWBG entity and the relevant Cockett Marine entity.
iv) Finally, there is a question as to whether, in the event that the arbitrators had jurisdiction, Cockett Marine can challenge their finding that there was a valid assignment of OWBG's claim to ING Bank. Cockett Marine say they can because the issue goes to the arbitrator's jurisdiction to make an award against ING Bank. ING Bank and OWBG say that they cannot because the ambit of a challenge to the substantive jurisdiction of the arbitrators under the Arbitration Act 1996 does not extend to such an issue.
OWBG's 2013 Terms and Conditions
In 2013 OWBG altered their terms and conditions. Prior to 2011 their terms and conditions provided for Danish law and Danish arbitration. Their 2013 terms and conditions provide for English law and London arbitration. OWBG took steps to inform their customers of the change. In view of the number of customers involved they employed an independent company, Concep, to communicate with their customers, rather than perform the task themselves.
There was no evidence from Concep as to the steps they took to inform customers of the change in the terms and conditions. However, OWBG was able to access Concep's web page and, by use of a password, access information about the “campaign”. That was the method provided by Concep to its customers to enable them to assess the success of the campaign. Evidence of the information available on the web page was given by Mr. Hansen, OWBG's IT manager. He had had no contact with Concep or with the steps taken to inform customers of the change in terms and conditions. But he was able to access the information held on Concep's web page and was familiar with the type of technology used by Concep and so could explain the significance of the information. He gave his evidence clearly and fairly. For example, he had no hesitation in accepting the limitations to the evidence he could give. When asked to explain his answers he did so willingly and with comprehensible reasons.
From Concep's web page it was possible for Mr. Hansen to access a copy of the pro forma email sent to the customers of OWBG in August 2013. It stated as follows:
Please find attached OW Bunker Group Terms and Conditions of Sale for Marine Bunkers Edition 2013 being valid from and including 01.09.2013 and based on which our Group is selling to you.
OW Bunker Group – Terms and Conditions.pdf.
The pro-forma letter was signed by Mr. Mortensen, manager of the Quality Support Department. He also gave evidence and did so with fairness, also accepting without hesitation what he could not speak about. He had not drafted the letter and could not remember it but said that he must have approved it. He explained that OWBG operated two computer systems; one, Saleslogix, which recorded traders' contacts with customers and, two, Navision, an accounts system used by the finance team.
The information available from Concep revealed, as explained by Mr. Hansen, that the letter of August 2013 was sent to 6,985 recipients whose email addresses were in the Saleslogix system and to 6,229 recipients whose email addresses were in the Navision system. Of the former some 2,543 recipients viewed the email, 777 clicked on the attachment and 219 bounced back. Of the latter some 2,188 recipients replied, 552 clicked on the attachment and 190 bounced back. Mr. Mortensen received no complaints from customers that they could not access the terms and conditions by clicking on the attachment. Mr. Hansen gave evidence that he had (in the course of the preparation of his evidence) clicked on a test email sent to Mr. Anders Fryst of OWBG on 30 August and it gave access to the terms and conditions.
The emails in fact sent to the various Cockett Marine companies are not in evidence. It would appear that they are not available on the Concep web page; otherwise Mr. Hansen would have found them. But the information from Concep indicates that the pro forma letter was sent to the email address of Cockett Dubai and Cockett Asia (the two Cockett Marine companies in these proceedings) on 30 August 2013. The “campaign history” recorded that the Cockett Dubai email address viewed the terms and conditions 22 times and that it had been clicked on twice. Another document (“Concep Send”) indicated that it had been viewed 3 times on 30 August 2013. The campaign history for the Cockett Asia email address recorded that it had been viewed 6 times. Another document (“Stream”) showed that a person operating the Cockett Asia email address viewed it on 2 and 3 September 2013.
Cockett Marine adduced evidence from the two traders involved in this case and from Cockett Marine's solicitor that the IT department of Cockett Marine had not found a copy of the August 2013 email. However, there was no witness from the IT department and no explanation of the steps taken by the IT department to search for the email in question. There is in fact evidence from the Concep web page that a person operating the email address of Mr. Fletcher, one of those traders, viewed the email on 30 August 2013. When cross-examined he accepted that...
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