Globalink Transportation and Logistics Worldwide LLP v DHL Project & Chartering Ltd
| Jurisdiction | England & Wales |
| Judge | Nicholas Vineall |
| Judgment Date | 19 February 2019 |
| Neutral Citation | [2019] EWHC 225 (Comm) |
| Docket Number | Case No: CL-2017-000498 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 19 February 2019 |
[2019] EWHC 225 (Comm)
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, EC4A 1NL
Nicholas Vineall QC
SITTING AS A DEPUTY JUDGE OF THE HIGH COURT
Case No: CL-2017-000498
Arshad Ghaffar (instructed by Mitchell Simmonds) for the Claimant
Emmet Coldrick (instructed by Barrett Solicitors Limited) for the Defendant
Hearing dates: 29 January 2019
Approved Judgment
Nicholas Vineall QC:
This is an application by the claimant, Globalink Transportation and Logistics Worldwide LLP (“Globalink”), for summary judgment against the defendant, DHL Project & Chartering Ltd (“DHL”) pursuant to CPR Part 24. The dispute between the parties relates to the transport of large units of refinery plant between Novorossiysk in Russia and Atyrau in Kazakhstan.
DHL admits Globalink's claim, but contends that it has a cross claim of greater value, which is at least arguable, and which, if it succeeds, will provide it with a defence by way of set-off. Globalink says in riposte that its claim is a claim for freight, and that the rule of law which says that a carrier's claim for freight must be paid without set-off should apply to its claim, so that it is entitled to summary judgment even though there is an arguable cross claim. The parties' submissions raise other points, but the main issue is the extent of the no set-off against freight rule.
Procedural History
Globalink made its application for summary judgment on 9 February 2018, following DHL's acknowledgement of service, but before it filed a defence. On 12 March 2018 DHL served evidence in response. On 29 June 2018 Globalink served its reply evidence, which was late. The parties therefore agreed to adjourn the application hearing until 05 November 2018. On 17 October 2018 DHL sought to adduce further evidence, but Globalink objected. At a hearing on 5 November 2018, Teare J granted DHL permission to rely on the additional evidence and adjourned the hearing until today in order to allow Globalink to adduce further evidence in reply. So it is that this summary judgment application came on for hearing almost a year after it was issued.
Facts
In 2014 one of DHL's clients, Sinopec, was engaged in a construction project at a refinery near Atyrau. Sinopec engaged DHL to arrange the transport of various units of refinery plant from China to the refinery.
All the units were carried by sea from China to Novorossiysk. DHL engaged Globalink in relation to the transport from Novorossiysk to the refinery. As eventually planned, 14 of the heaviest units were to be loaded onto two barges and towed through the Volga-Don Canal from the Black Sea to the Caspian Sea, towed across the Caspian for customs clearance in Bautino, and then to Atyrau. Finally the barges were to be towed up the Ural-Caspian Canal to Atyrau River Port, with the units then being discharged there and taken by truck to the refinery.
By a contract dated 10 September 2014 (“the Agreement”), DHL engaged Globalink to carry out or arrange forwarding services from Novorossiysk to Atyrau. The Agreement was entitled “Freight-Forwarding Services Contract” and Globalink was referred to as the “Forwarding Agent”. The Agreement provided as follows:
1. Subject of the Contract
1.1 The Forwarding Agent shall carry out or arrange the forwarding services of the Client's cargo for remuneration and to the cost of the Client, related to the Client's cargo transportation by truck, railway, sea, air shipment and/or any other kind of transport, hereinafter referred to as the “Forwarding Service”, and the Client shall pay the cost for Cargo Transportation according to the Section 3 hereof.
(…)
1.3 The list of Services, settlement procedure rendered by the Forwarding Agent to the Client shall be specified in the respective Appendix.
1.4 Request for Transportation and the Appendix constitute an integral part of this Contract.
1.5 During implementation of the obligations hereunder the Forwarding Agent shall act on behalf and at the expense of the Client, the Forwarding Agent shall have the right to involve the third Parties to fulfil its obligations under this Contract.
2. Rights and Obligations of the Parties.
2.1 The Forwarding Agent shall be obliged to:
2.1.1 arrange the transportation of Client's cargo according to the Request for Transportation and respective Appendix;
(…)
2.1.6 use all reasonable endeavours to inform the Client in written form about all and any circumstances that adversely affect or could affect the integrity of cargo, timely delivery of cargo and/or the proper fulfilment of the obligations by the Forwarding Agent.
(…)
Appendix 1, which is also dated 10 September 2014 provides that the transport of the cargo was to be by “SEA/ROAD”. The appendix also provides:
6. List of rendered services:
Barge (two units including all fees by channels and ports from Novo[rossiysk] to Atyrau.
Discharging from the vessel by ship's cranes to the barges to the berth, loading on the barge by floating cranes.
Lashing on the barges and vessels.
Calculation of the voyage project by authorized Maritime Center, documentation and formality.
Shifting of the barge alongside of the ocean vessel/ inside of the port.
Cutting and welding barge's bulwark and rail.
Inland transport charges from Atyrau river port.
Customs transit formalities at all transit points.
Road permits, police escort.
(…)
14. Term of delivery: LI Novorosijsk, Russian – FOT Atyrau
17. Costs of services included to quotation:
Barge (two units including all fees by channels and ports from Novo to Atyrau — $950,000.00.
Discharging from the vessel by ship's cranes to the barges to the berth, loading on the barge by floating cranes — $158,000.00.
Lashing on the barges and vessels — $68,350.00.
Calculation of the voyage project by authorized Maritime Center, documentation and formality — $12,000.00.
Shifting of the barge alongside of the ocean vessel/ inside of the port — $30,000.00.
Cutting and welding barge's bulwark and rail — $30,000.00.
Inland transport charges from Atyrau river port and from Novorossijsk port to DOOR Atyrau refinery — $1,175,391.00
TOTAL NET/NET: $2,423,741.00
Proposed profit share for Globalink Transportation & Logistics Worldwide LLC is 7% (seven per cent) equal to $155,000.00 (One Hundred and Fifty Five Thousand US Dollars, 00 cents)
Total cost of services — $2,578,741.00 (Two Million Five Hundred Seventy Eight Thousand Seven Hundred and Forty One US Dollars, 00 cents).
(…)
19. Special Notes:
Load/Discharge free time: 5 (five) total days shinc
Demurrage for the barge and tug in port of loading and discharging USD 5,500.00 per day or prorate for each convoy (1 Barge + 1 tug)
Voyage duration Novorossiysk/Atyrau 22–24 days wp agw”
(“wp agw” means weather permitting, all going well.)
At Novorossiysk, 10 units of cargo were discharged onto barge ARK-1. The remaining 4 units were discharged onto barge SPA- 2. ARK-1 arrived at Atyrau on 29 October 2014, within the agreed voyage duration of 22 to 24 days. SPA-2 only reached Atyrau at the mouth of the Ural Canal on 15 November 2014. Critically, barge SPA-2 could not then proceed to Atyrau because the water level in the Ural-Caspian canal was too low for the draught of the loaded barge.
On 17 November 2014, the parties met at Atyrau to discuss the best way to proceed. Both parties signed a document entitled “Protocol of the meeting”. The document set out the attendees and provided as follows:
AGENDA:
The project cargo carried jointly by DHL Global Forwarding (hereinafter referred to as “Customer”) and Globalink Transportation and Logistics Worldwide herein referred to as “Forwarder” and taking into account the following force majeure situations described as “low water level in Ural-Caspian Canal”, which does not permit the SPA-2 barge carrying the following 4 x project cargo units, decided to:
1. Relocate the barge SPA-2 + Tug Boat MB-1202 from its current position, i.e. in the Caspian Sea Buoy to Kuryk for the following activities:
a. Offloading all 4 x items from SPA-2 barge;
b. Arrange 2 (two) or 3 (three) flat barges to enable them to enter Ural-Caspian Canal for further sailing into Atyrau river port.
c. the C-0701 unit to be arrange for by road transport from Kuryk to
Above activities shall all be subject to temperature being above Zero centigrade and open navigation through Ural Caspian Canal
2. All costs pertaining to the activities as described above shall be absorbed fully by DHL Global Forwarding.
(…)
Following the meeting, on 19 November 2011 an “Appendix 3”, which was a new draft appendix to the Agreement, was sent by Globalink to DHL and signed by Mr Huang of DHL. The appendix provided that the 4 units loaded onto SPA-2 would be re-directed to Kuryk and loaded onto two barges. The appendix was not signed by Globalink.
As events transpired, on 23 November 2014 the Ural-Caspian canal closed to navigation for the winter. On 24 November 2014, SPA-2 arrived at Kuryk and the four cargo units were offloaded. The smallest of the units was arranged to be carried to Atyrau by road. The remaining three units were stored at Kuryk over winter until the canal was re-opened. DHL consented to this process, and to the storage of the units at Kuryk.
In early 2015, the parties commenced negotiations to arrange the transport of the remaining units from Kuryk to Atyrau. The parties agreed estimated costs and formalised this in an agreement signed by both parties dated 27 April 2015 (“The Supplementary Agreement”). The Supplementary Agreement provided:
WHEREAS: continuing services of the...
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