IMT Shipping and Chartering GmbH v Chansung Shipping Company Ltd, Owners of the Zenovia [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | THE HON. MR JUSTICE TOMLINSON,Mr Justice Tomlinson |
| Judgment Date | 08 April 2009 |
| Neutral Citation | [2009] EWHC 739 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2008 Folio 999 |
| Date | 08 April 2009 |
[2009] EWHC 739 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Before: The Hon. Mr Justice Tomlinson
Case No: 2008 Folio 999
In The matter of the Arbitration Act 1996
And in The matter of an Arbitration
Charles Priday (instructed by Messrs Sach Solicitors) for the Claimant
Philip Edey QC (instructed by Messrs Reed Smith) for the Defendant
Hearing date: 4 March 2009
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.
Mr Justice Tomlinson:
This is an appeal brought with permission of Flaux J granted pursuant to section 69 of the Arbitration Act 1996 against an arbitration award made in London by two arbitrators appointed to resolve a shipping dispute. The arbitrators were Mr Michael N. Howard QC and Mr Christopher Moss. Since they agreed upon their award they had no need to appoint an umpire. The case concerns the status and effect of a notice of approximate redelivery date and intended port given by a time charterer to an owner pursuant to the requirements of a time charter in amended New York Produce Exchange Form. In essence, the question raised is whether the charterers may subsequent to the giving of such notice revise their plans, consistent nonetheless with redelivery of the vessel within the contractually agreed period. In reality, the question is which of the charterers and the owners may here take advantage of an unexpected opportunity to fix the vessel in a rising market.
The Zenovia is a self-trimming bulk carrier. The owners, Chansung Shipping Company Limited, time chartered the vessel to COSCO Bulk Carrier Co. Ltd on 28 July 2006 for a “period of minimum 11/about 13 months (abt mean + 15 days)” from delivery.
COSCO sub-time chartered the vessel to Western Bulk Carriers KS. The date and precise terms of this charter party are not revealed in the award or in evidence before me.
Western Bulk Carriers KS sub-sub-time chartered the vessel to IMT Shipping and Chartering GmbH on 23 March 2007 for a “period up to minimum 20 September 2007/maximum 22 November 2007”.
These three period charters were treated by the parties and by the arbitrators as being, for all practical purposes, on back-to-back terms. The latest permissible redelivery date was treated as being 22 November 2007. The redelivery range was wide –“… one safe port Aden/Japan range (in case of Persian Gulf, to be passing Muscat Outbound) including Indonesia, Thailand, PR China, Philippines, Boston/Bahia Blanca range (including Caribbeans/North Coast South America/US Gulf), Vancouver/Valparaiso range, Skaw/Cape Passero range (including Mediterranean Sea/Black Sea), Capetown/Mombasa range, port in Charterers option, at any time day or night Sundays and Holidays included…”
The arbitrators record that as the period of these charters was approaching its conclusion IMT chartered the vessel to Noble Chartering Inc BVI for a time-charter trip. As it happens this is incorrect. IMT in fact sub-chartered to Oldendorff Carriers, who in turn sub-chartered her to Noble for a time charter trip. Nobody suggests that anything turns on this misapprehension, although it is as well to bear in mind that (i) there is no finding, nor is it in evidence, on what terms IMT chartered to Oldendorff and (ii) there was in fact no contractual relationship between IMT and Noble. The arbitrators make no findings as to the terms of the charter to Noble. They proceeded upon the basis that IMT had sub-chartered the vessel to Noble for a time charter trip, and so shall I.
The arbitrators proceeded therefore on the basis that the three “back-to-back” period charters all provided for redelivery “minimum 20 September 2007/maximum 22 November 2007” and that each provided, by clause 4:
“… hire to continue until the day of her redelivery … on dropping last outward sea pilot one safe port ADEN/JAPAN range … charterers are to give Owners not less than 30 days followed by 20/15/10/7 days notice of approximate redelivery date and intended port thereafter 5/3/2/1 days definite notice of redelivery date and port.”
The arbitrators then set out the events which gave rise to the dispute:
“5. On 5 th October 2007, Noble gave:
'approximate notice of redelivery for the MV Zenovia at DLOSP 1 sp China on about 04 Nov 2007 basis agw, wp, wog, uce …'
This message was passed up the broking chain, and the version which was eventually given to the Owners gave 6 th November as the redelivery date.
6. It later became clear that the Vessel's performance was such that an extra voyage could be squeezed in before the contractual redelivery date. On 15 th October, therefore, the Charterers sent a further notice to the Owners which read:
'Plse note that we hereby have to revise the date of redelivery to owners to abt Nov 20 th within the range of redelivery.'
In this arbitration, nothing turns on the fact that in the first notice reference was made to six reservations as to its certainty and in the second only to one.
7. The owners did not accept that the Charterers were entitled to change the expected redelivery date in this way. They wrote on 16 th October, asserting that they had already fixed the Vessel for her next employment, and insisted that the Vessel had to be redelivered at the end of the voyage to China. The Charterers replied that they were acting within their legal rights, and that they had the right to use the full period given by the contract. The Owners are not English lawyers, and it is not surprising that their first reaction was expressed in terms which are technically unjustified and rather muddied the waters. They asserted that the Charterers had exercised a contractual option by giving their 30 days' notice, and that
'under English law … when the option has been exercised, the option should be a contract as if it has been written into the charter from the beginning.'
This had the result that the Charterers first set of submissions were directed at rebutting this proposition, which in the event was never advanced in the arbitration.
8. The Owners withdrew the Vessel from the Chartered service on 2 nd November at 1624 UTC. The Charterers contended that this was a wrongful withdrawal, and claimed damages for repudiation.
9. Given the number of parties in the chain, it is not surprising that there was an Agreement as to the way in which the dispute was to be resolved. The parties entered into an (undated) quadripartite agreement whereby all four of them entered into the same dispute resolution process. We refer to this Agreement as 'the Joint Submission'. …”
The arbitrators then set out relevant terms of the Joint Submission. This is an agreement which recites that each party thereto was represented by solicitors and it was plainly intended to lead to an expeditious and economical disposal of what was thought to be a relatively straightforward dispute. Indeed it was no doubt in that spirit that the arbitrators were not invited to convene an oral hearing but were asked to deal with the matter on the basis of written submissions drafted by counsel for sub-charterers IMT and head owners Chansung respectively. In their opening submissions, as the arbitrators record, IMT sought to rebut the case which they reasonably understood owners to be advancing, viz that the giving of the 30 day notice amounted to the exercise of a contractual option which, once made, could not be resiled from. However the owners in their Defence Submissions put forward “a different analysis altogether”. Reliance upon the “option” analysis was abandoned.
The consequence of the owners putting their case in a manner not anticipated by IMT was that it gave rise to a subsidiary dispute as to the admissibility of certain material which had not emanated from IMT and which they had never seen. In particular, owners sought to rely upon a provisional Final Hire Statement sent to them by COSCO and the form of the hire payment made by COSCO pursuant thereto on 10 October. This statement and payment included a deduction for the value of the bunkers expected to be remaining on board on conclusion of the then anticipated Noble voyage which, as the arbitrators found, “revealed an assumption that the Noble voyage was the last voyage”. It was in the light thereof that owners refixed the vessel, as the arbitrators found in paragraph 23 of their Reasons in these terms:
“On the basis of their understanding, the Owners now refixed their vessel for a time charter trip with STX Pan Ocean Co with a laycan of 1–11 November. It was only shortly after this fixture was entered into, on 15 October, that the Charterers notified the Owners that there was a revised date for redelivery, namely about 20 November.”
The owners sought also to rely upon what the arbitrators describe as “communications passing directly from Noble to the owners”. The arbitrators found that these messages “by-passed” IMT although they do not set out in terms what was their content. However they included “the voyage orders emanating from Noble”– Reasons paragraph 38. The critical content of those orders can be gleaned from what the arbitrators said at paragraph 22 of their Reasons:
“The Noble notice was given in the context of a single voyage from Chennai in South East India to Xingang in China.”
By “the Noble notice” the arbitrators meant the Noble notice of 5 October giving the approximate date of redelivery as 4 November, which by the time it reached the head owners gave a date of 6 November. The Zenovia was at that time in...
To continue reading
Request your trial
-
Steven Goodman v Dawn Cummings and DMS Governance Ltd
...Power, Son & Co [1920] 1 K.B. 868, 899, O'Brien v Associated Fire Alarms Ltd. [1968] 1 W.L.R. 1916, 1923, 1925, and The “Zenovia” [2009] EWHC 739 (Comm) at 67 Further, that there is no question of the Articles being implied into Ms. Cummings’ contract in law (for example under statute). ......
-
Goodman v Cummings and Dms Governance Ltd (Tangerine Investment Management Ltd (in Official Liquidation) as Third Party)
...Ltd. v. Webster, [2016] UKPC 3, referred to. (12)IMT Shipping & Chartering GmbH v. Chansung Shipping Co. Ltd. (“The Zenovia”), [2009] EWHC 739 (Comm); [2009] 2 All E.R. (Comm) 177; [2009] 2 Lloyd’s Rep. 139, referred to. (13)John v. Price Waterhouse, [2002] 1 W.L.R. 953, followed. (14)Liver......
-
Sealegend Holdings Ltd v China Taiping Insurance (Hk) Co Ltd And Others
...that did not lead to an agreement could not found a waiver or estoppel: IMT Shipping and Chartering GmbH v Chansung Shipping Co Ltd [2009] 1 CLC 582, at §18, per Tomlinson J. 73. The use of the words “without prejudice” in its email dated 9 March 2012 to CIBL plainly showed that the 1st def......