E. D. & F. Man Sugar Ltd (Claimants/ Charterers) v Unicargo Transportgesellschaft Mbh (Defendant/ Owners)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Eder |
| Judgment Date | 23 October 2012 |
| Neutral Citation | [2012] EWHC 2879 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2012 FOLIO 222 |
| Date | 23 October 2012 |
[2012] EWHC 2879 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Eder
Case No: 2012 FOLIO 222
Mr Timothy Young QC (instructed by Jackson Parton) for the Claimants
Mr Nevil Philips (instructed by Waltons & Morse LLP) for the Respondents
Hearing dates: 16 October 2012
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.
Pursuant to leave granted by Cooke J, this is an appeal under s.69 of the Arbitration Act 1996 against an arbitration award of Mr John Tsatsas and Mr Christopher Moss dated 16 January 2012 (the "Award" and the "Tribunal"). The Award arises out of a charterparty of mv Ladytramp (the "Vessel") dated 9 June 2010 on the "Sugar Charter Party 1999" form (the "Charterparty"). The underlying claim was brought by the Respondent (the "Owners") against the Claimant (the "Charterers") for demurrage during a period when the Vessel arrived at Paranagua on 20 June 2010 and thereafter waited to load a cargo of sugar. Loading was completed on 20 July 2010. In summary, the Tribunal upheld the claim for demurrage and awarded the Owners the sum of US$397,912.77 plus interest and costs.
Various issues arose in the arbitration which are no longer relevant. For present purposes, the relevant terms of the Charterparty as set out in the Award are as follows:
" Clause 3: … the said vessel…shall…sail and proceed to 1–2 safe berth(s), 1 safe port (intention Santos) but not south of Paranagua…"
" Clause 6: … The Act of God, perils of the sea, fire on board, in hulk or craft, or on shore, crew, enemies, pirates and thieves, arrests and restraints of princes, rulers and people, collisions, stranding and other accidents of navigation excepted, even when occasioned by negligence, default or error in judgement of the Pilot, Master, mariners or other servants of the Shipowners. Not answerable for any loss or damage arising from explosion, bursting of boilers, breakages of shafts, or any latent defect in the machinery or hull, not resulting from want of due diligence by the Owners of the ship, or any of them, or by the ship's Husband or Manager."
" Clause 19: … At loading port, even if loading commences earlier, laytime for loading to begin at 1400 hours if e-mailed notice of readiness to load is tendered to agents before noon and at 0800 hours next working day if e-mailed notice of readiness is tendered to agents after noon… At loading port(s) in the event of congestion Master has the right to tender notice of readiness at the customary waiting place in ordinary office hours by email to agents whether in berth or not, whether in port or not, whether in free pratique or not, whether customs cleared or not…"
" Clause 28: In the event that whilst at or off the loading place…the loading…of the vessel is prevented or delayed by any of the following occurrences: strikes, riots, civil commotions, lock outs of men, accidents and/or breakdowns on railways, stoppages on railway and/or river and/or canal by ice or frost mechanical breakdowns at mechanical loading plants, government interferences, vessel being inoperative or rendered inoperative due to the terms and conditions of appointment of the Officers and crew time so lost shall not count as laytime."
The relevant findings and conclusions reached by the Tribunal are set out in the following paragraphs of the Award:
"The factual background
10. The LADYTRAMP is described as an open-hatch, double-skin bulk carrier built in 2001 with a deadweight capacity of 24,834 metric tons ("mt") on her summer salt water draft of 9.60 meters. The vessel is registered in and flies the flag of Marshall Islands.
11. The events leading to the disputes, as evidenced by copies of contemporaneous correspondence adduced by the parties and from a written Statement made by the agent in Paranagua on 15 July 2011 at the request of the charterers are summarised below.
12. At the time of the fixture, the vessel was discharging at Abidjan in Ivory Coast from where it was due to sail (for Brazil) on 10 or 11 June 2010. On the date of the fixture (9 June 2010), the charterers declared Paranagua as the loading port.
13. In an email dated 4 June 2010, namely a week before the vessel arrived at the loadport, the local agents (MARCON) advised the parties that a fire has occurred at the Compania Brasilliera Logistica A/A terminal (CBL) which, they later said, is the terminal normally used by the charterers and where, they stated, they had initially scheduled the vessel to load. The fire had destroyed the conveyor-belt system linking the terminal to the warehouse rendering it, in the opinion of local experts, inoperable for at least 3 months. They further expressed the view that charterers would need to transfer the cargo intended for the vessel to another terminal.
14. In an email dated 15 June 2010 the agents advised the parties that they were instructed to change the vessel's berthing programme to the Pasa terminal in Paranagua. On the same day the agents emailed the owners directly to say that they had spoken to the charterers and had persuaded them to change the berthing programme to said alternative terminal where "they also have enough cargo". The agents further informed the owners that the Pasa terminal had a long line up and that the contemplated berthing programme would be revised involving a long waiting time.
15. The vessel arrived on 20 June 2010 and tendered notice of readiness to load at 2330 hours. The Statement of Facts showed that in the absence of an available berth the vessel remained off the port until 14 July 2010, when she weighed anchor and entered the inner roads of the port awaiting berthing instructions.
16. In his written statement, Mr Lemos, the agents' Operations Manager, explained that in fact, because the charterers "could not get sugar to the Pasa Terminal as quickly as hoped" yet another berth, the Centro Sul Servicos Maritimos (Centrosul) Terminal, which is adjacent, but unconnected to, the CBL warehouse, was judged to provide the charterers with the fastest option to obtain replacement sugar for loading. An application for berthing at Centrosul terminal was accordingly made to the port authority and the vessel berthed there (and not at the Pasa Terminal) on 15 July 2010. In the event, berth 212, that was ultimately used, was one of the three (212, 213 or 214) where the vessel would have berthed had the fire not taken place. Loading commenced on 18 July 2010 and was completed on 20 July 2010 at which time the vessel sailed for the discharging port in the Black Sea.
17. In accordance with the charter party terms (recital 9) the owners contended that time began to count at 1400 hours on Monday 21 June 2010 and that allowing for rain periods and permissible laytime (23,500 metric tons per weather working day = 3.91666 days) laytime expired at 2353 hours on 25 June 2010. Thereafter the vessel was on demurrage continuously up to 1300 hours on 20 July 2010, when loading was completed."
" Conclusions
60. The parties' submissions in the arbitration ranged far and wide. However, it seemed to us ultimately that there was a short answer to the defences relied on by the charterers to the owners' claim and we shall deal with that before stating our conclusions in relation to the other issues as succinctly as we can.
61. Once Paranagua was declared as the loading port the charterers' obligation was to nominate "1–2 safe berth(s)" at that port. The fact that the fire occurred whilst the vessel was on passage to Paranagua would not in our view mean that the charterers could not, in principle, rely upon an exceptions clause such as Clause 28 (see cases such as Monroe v Ryan ). However, as the owners emphasised, the charterers were entitled to nominate any safe berth in the port of Paranagua and in order for them to rely upon the exceptions in Clause 28 to exclude from laytime the time lost as a result of their inability to use the CBL terminal, the CBL terminal would have had to have been named in Clause 4 of the charterparty – so that the charterers were unable (from a legal standpoint) to nominate an alternative berth.
62. We accepted on the evidence that the cargo which the charterers had originally planned to load was stored in a warehouse which was connected by a conveyor belt to the CBL terminal and the adjacent berth. We also accepted that the evidence supported the charterers' contention that this was the berth at which the vessel's local agents had arranged for her to load. Furthermore, we accepted that the fire which broke out on or about 14 June 2010 destroyed the conveyor belt connecting the warehouse and the terminal and rendered the terminal unusable for the better part of four months. However, we could not accept that the fact that the CBL terminal and berth was unusable throughout the relevant period meant that the charterers were unable to perform their obligation to nominate any "safe berth" at the port for the loading of the contractual cargo.
63. The owners accepted that the position might well have been different if there had only been one berth for the loading of sugar cargoes in the port of Paranagua, so that if that berth became unavailable loading was then not possible at the port at the relevant time. However, that clearly did not seem to us to be the case on the available evidence.
64. The charterers argued that once the sugar to be loaded was placed in storage at the CBL terminal, it was not "practically possible" to move it to another terminal so that "to all intents...
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