Euronav N.v v. Repsol Trading S.A.
| Jurisdiction | England & Wales |
| Judge | Mr Justice Henshaw |
| Judgment Date | 24 September 2021 |
| Neutral Citation | [2021] EWHC 2565 (Comm) |
| Docket Number | Case No: CL-2020-000690 |
| Court | Queen's Bench Division (Commercial Court) |
m.t. “Maria” Voyage Charter dated 23 October 2019
[2021] EWHC 2565 (Comm)
THE HONOURABLE Mr Justice Henshaw
Case No: CL-2020-000690
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, Fetter Lane,
London, EC4A 1NL
Richard Sarll (instructed by Lax & Co LLP) for the Claimant
Michael Coburn QC (instructed by Meana Green Maura & Asociados S.L.P.) for the Defendant
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
Hearing date: 10 June 2021
Draft judgment circulated to the parties: 7 September 2021
| (A) INTRODUCTION | 2 |
| (B) THE CHARTERPARTY | 3 |
| (C) FACTS | 4 |
| (D) PRINCIPLES | 5 |
| (1) Contractual interpretation: general | 5 |
| (2) Periods of time | 8 |
| (3) Service of notices | 8 |
| (4) Time as a local concept | 10 |
| (5) The Interpretation Acts | 16 |
| (6) Professor Thomas's article | 18 |
| (7) The contra proferentem principle | 20 |
| (E) APPLICATION | 20 |
| (F) CONCLUSION | 22 |
(A) INTRODUCTION
The Claimants (“ Owners”) apply for summary judgment, alternatively the striking out of the Defendants' (“ Charterers”') defence, in respect of Owners' claim for demurrage under a voyage charterparty dated 23 October 2019 (“ the Charterparty”). The Charterparty was for the carriage of a cargo of crude oil from Brazil to a range of ports upon the US West Coast: in the event, to Long Beach, California. Charterers have taken the position that the claim is time-barred due to late notification of the claim. Owners maintain that this defence is misconceived. Owners' claim is for US$ 487,183.12 plus interest.
The parties agree that Charterers are to be treated as having issued a “mirror-image” application with the result that, if Owners should fail in their application, it is accepted that judgment should be entered against them on their claim.
It is also common ground that, for the purposes of both applications, the court should determine the legal issue between the parties applying usual trial standards, despite the fact that CPR 24 and CPR 3.4 have been invoked. As the parties point out, this in any event reflects the approach to be taken on a summary judgment application where a short point of law or construction arises, in which case the court should “ grasp the nettle and decide it” (see, e.g., Easyair Ltd (t/a Openair) v Opal Telecom [2009] EWHC 339 (Ch) § 15).
The essential issue between the parties is whether Owners' claim for demurrage is barred by clause 15(3) of the Shellvoy 6 form, which requires notification to be made of a demurrage claim “within 30 days after completion of discharge” failing which the claim becomes time-barred.
The dispute between the parties is about which time zone should be used to determine the date of completion of discharge for these purposes. In particular:
i) should the date be ascertained according to local time in California, where discharge took place, in which case the claim is time-barred?
ii) or should one instead ascertain the date of completion of discharge according to either (a) the time zone of the recipient of the required notice (here, Spanish time, that of Charterers), (b) the time zone of the giver of the required notice (here, Belgian time, that of Owners) or (c) GMT, given that the contract applied English law? On each of these approaches the claim is not time-barred.
Owners submit that the correct approach is the one outlined by Professor D. Rhidian Thomas in a commentary on the proper operation of anti-technicality clauses in time charterparties (by which owners must first send notices to charterers to alert them to their non-payment of hire, affording them a prescribed ‘grace period’ before the vessel may be withdrawn). On that approach, Owners say, the right approach is to (a) apply a single time zone to both the beginning and end of the period, and (b) use the time zone which has the closest and most real connection with the provision in question. Owners' primary submission is that the time zone with the closest and most real connection is not Californian time, where neither Owners' nor Charterers' administrative staff (by whom and to whom the notice was due to be given) were located, but a European time zone.
Charterers submit that the date of completion of discharge should be determined using local time at the place where discharge took place. The use of local time is, they say, the natural approach, reflects the information stated in the Statement of Facts and Owners' laytime statement, and provides a clear, single date of discharge for use not only for clause 15(3) purposes but also in other contexts where the date of discharge is material, e.g. the Hague-Visby Rules limitation period for cargo claims.
As set out below, I conclude that Charterers are correct: the date of completion of discharge is to be determined according to the time zone applicable at the place where discharge occurred. The demurrage claim was therefore notified out of time.
(B) THE CHARTERPARTY
The charterparty is evidenced by a recap made by email on 23 October 2019, based on an amended Shellvoy 6 form, for the carriage of crude oil from Brazil (intention Santos) to 1 or 2 ports on the West Coast of the USA, from Los Angeles to San Francisco.
The Charterers are identified as such in the recap and as having their address in Madrid, Spain. The Owners are identified as the commercial operators of the ship, but it is common ground that they were also the contracting owners. They are stated as having their address in Antwerp, Belgium. The broker is stated to be Brazilship/ScanBrasil.
Clause 15(3) provides for two distinct time bars, as follows:
“Owners shall notify Charterers within 60 30 days after completion of discharge if demurrage has been incurred and any demurrage claim shall be fully and correctly documented and received by Charterers, within 90 days after completion. If Owners fail to give notice of or to submit any such claim with Documentation provided available, as required herein, within the limits aforesaid, Charterers' liability for such demurrage shall be extinguished.”
The Charterparty is governed by English law and provides for the exclusive jurisdiction of the English High Court (clause 54). It also includes the following provisions:
i) There are specific provisions governing how demurrage notices and supporting documents are to be sent. It is contemplated that supporting documents will be served on brokers (“…SUPPORTING DOCUMENTS TO BE PRESENTED AS IS CUSTOMARY WITH THE USUAL RULES OF AGENCY TO APPLY. I.E. CHARTERER'S BROKER TO BE SERVED WITH THE DOCUMENTS SUPPORTING THE DEMURRAGE CLAIM…”)
ii) Pursuant to clause 6 of Part II, there is a further 90-day time-limit for claims other than demurrage, running again from the date of the completion of discharge.
iii) By clause 32(3)(b), cargo claims (including such claims made by the Charterers) are subject to the Hague-Visby or Hague Rules. Article III.6 of those rules discharges the owner from liability in respect of the goods:
“…unless suit is brought within one year of their delivery or of the date when they should have been delivered.”
The charterparty contains no general provision regarding dates and times.
(C) FACTS
The Vessel spent a total amount of time on demurrage at Santos, Brazil, and Long Beach, California, of 151 hours 48 minutes. This equates to the sum of USD487,183.12, as per Owners' demurrage invoice.
The Vessel discharged at Long Beach and disconnected hoses at 21:54 local time (PST – Pacific Standard Time) on 24 December 2019, as noted in the Statement of Facts and laytime statement. Both documents give a slightly earlier time of 20:54 for “completion of discharge”, but the difference is immaterial for present purposes.
At the time of disconnection of hoses, it was 21:54 on 24 December 2019 in Long Beach. It was 25 December 2019 in Europe, by reference to:
i) Central European Time (CET), being PST + 9, in which time zone both Owners and Charterers are based, and
ii) GMT/UTC, being PST + 8.
Applying CET, discharge occurred at 06:54 on 25 December 2019 and applying GMT, it occurred at 05:54 on 25 December 2019.
On 24 January 2020, the Charterers received (from brokers rather than the Owners themselves) an email stating that:
“According to owners, demurrage has incurred on above [subject] voyage.
Hence, please take this email as demurrage notice”.
This is the email on which Owners rely as constituting the notification required by clause 15(3). It is timed at 12:42 CET, and in any conceivably relevant time zone the email was sent and received on 24 January 2020. For example, it was received by Charterers in Spain at 12:42 on 24 January 2020 CET.
A dispute then arose about whether the notice had been sent in time. Charterers' position was and is that:
i) discharge was completed on 24 December 2019;
ii) the last day for notification was therefore 23 January 2020, being ‘day 30’, counting from 25 December 2019 as ‘day 1’; and
iii) the notification made on 24 January 2020 was thus out of time.
In Owners' submission, step (1) above is incorrect. They say that:
(1) discharge was completed on 25 December 2019;
(2) the last day for notification was therefore 24 January 2020, that being ‘day 30’, counting from 26 December 2019 as ‘day 1’; and
(3) the notification made on 24 January 2020 was therefore in time.
(D) PRINCIPLES
(1) Contractual interpretation: general
As a commercial agreement between two enterprises, the charterparty falls to be construed in accordance with the principles...
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