Mur Shipping B.v v. Louis Dreyfus Company Suisse S.A.

JurisdictionEngland & Wales
JudgeMrs. Justice Cockerill
Judgment Date13 November 2019
Neutral Citation[2019] EWHC 3240 (Comm)
Date13 November 2019
Docket NumberCase No: CL-2019-000209
CourtQueen's Bench Division (Commercial Court)

[2019] EWHC 3240 (Comm)

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

IN THE MATTER OF THE ARBITRATION ACT 1996

The Rolls Building

7 Rolls Buildings

Fetter Lane

London EC4A 1NL

Before:

Mrs. Justice Cockerill

Case No: CL-2019-000209

Between:
Mur Shipping B.V.
Claimant
and
Louis Dreyfus Company Suisse S.A.
Defendant

Mr. Timothy Young QC (instructed by Lax & Co) for the Claimant

Mr. Nicholas Vineall QC (instructed by Holman Fenwick Willan LLP) for the Defendant

Approved Judgment

Mrs. Justice Cockerill
1

This is an appeal by the Claimant, MUR Shipping BV, “MUR”, against a Declaratory Arbitration Award dated 5 th March 2019 of Ms. Elizabeth Birch and Mr. Robert Gaisford, with Mr. Mark Hamsher dissenting “the Award”. MUR are both Claimants and Respondents throughout the counterclaim in the arbitration. By a majority the Tribunal held and declared that “ the claimants' claim in this arbitration is time barred and totally extinguished”.

2

The Award arises in the context of a clause in a NYPE time-charterparty for the TIGER SHANGHAI between MUR, as “Charterers”, and Louis Dreyfus Company Suisse (“Louis Dreyfus”), as “Owners”. The clause in question, Clause 119, is set out at paragraph 12 of the Award and reads, so far as relevant:

“[Owners] shall be discharged and released from all liability in respect of any claim or claims which [Charterers] may have under Charter Party and such claims shall be totally extinguished unless such claims have been notified in detail to [Owners] in writing accompanied by all available supporting documents (whether relating to liability or quantum or both) and arbitrator appointed within 12 months from completion of charter”.”

3

This clause which is in the Additional Clauses and thus not part of the NYPE standard form, is on the evidence one which either in this exact form or in very similar form is not uncommon. This appeal, therefore, falls within the category of raising a point of law of general public importance.

4

This is not the usual case, however, about the time of making of the claim in writing or the appointment of an arbitrator. It is common ground that both the claim letter and the appointment happened well within time. The case rather concerns the question of what is meant by the phrase “ all available supporting documents”. It is not an issue that the claim letter sent was comprehensible and was adequately supported for the purposes of the Owners understanding the amount of the claim made against them. The point is that at the time the letter was sent, MUR had a document which it later relied on, but which it did not send with the claim letter. It was not until nearly a year after the commencement of the arbitration and the provision of the pleadings that Louis Dreyfus raised the issue of the time bar when a document was appended to claim submissions.

5

The majority of the Tribunal found that this document was a “supporting document”, that it was not privileged; and that the claim was consequently time barred. The dissenting arbitrator took the view that the document plainly was privileged and thus reached the opposite conclusion.

6

The legal issues for which permission was given are:

“[Does] … a time bar clause … barring claims if ‘… all available supporting documents…’ are not provided within a specified period, operates when the only document found to be not provided is arguably privileged and/or not of relevance to either the identification of, or support for, a relevant claim as referred to arbitration at least at the time of commencement of the arbitration.”

7

This effectively subdivides into two questions, for the purposes of this clause;

i) Is a document which would otherwise be a supporting document one which should not be counted as such if it was arguably privileged?

ii) Is a document which is not at least at the time of commencement of the arbitration of relevance to either the identification of or support for a relevant claim as referred to arbitration, a “supporting document”.

Factual background

8

The Charterparty for the TIGER SHANGHAI (“the Vessel”) dated 9 th August 2016 was made between MUR as Charterers and Louis Dreyfus as disponent Owners. The Charter was for two laden legs, the first of which involved loading of a cement clinker cargo at the port of Carbenaros in Spain. The Vessel was delivered into the service of MUR on 14 th August 2016 and advance hire and delivery bunkers were paid.

9

Under clause 46 of the Charterparty:

“46. The Charterers, subject to the Owners' and Master's approval which is not to be unreasonably withheld, shall be at liberty to fit/weld any additional equipment and fittings for loading … cargo. Such work shall be done at the Charterer's expense and time, and the Charterers shall remove such equipment and fittings at their expense and time prior to redelivery, if so required by the Owners …”

10

The feeder holes in the hatch covers were positioned so that the loading crane at Carbenaros was not quite long enough to reach those on the starboard side of the Vessels. The Charterers, therefore, wanted to cut new cement feeder holes into the hatch covers. On 11 th August the Master advised Charterers' agents for permission to cut new holes that would have to be sought from Owners.

11

On 12 th August 2016, MUR made the request to cut holes in the hatch covers in addition to those which were already there and upon delivery the vessel was dispatched to the loading port, Carbenaros where the facilities required the cement feeder holes but on and after 13 th August 2016 Louis Dreyfus refused to approve the required work. That refusal was maintained when the Vessel arrived on 15 th August.

12

Mr. Baeza (of CSS Control Systems Survey “CSS”), attended on board the Vessel on 18 th August 2016 at MUR's request and issued a report on 19 th August 2016 on the cutting of new cement holes in the hatch covers (“the CSS Report)”. On 19 th August 2016, after Louis Dreyfus had stated that their refusal was “ final and non-negotiable” MUR terminated the Charter. Although I have not seen the correspondence, the Award records that the express basis for that termination was that the cutting of additional feeder holes fell within the ambit of Clause 46 and Owners' refusal for permission to cut such holes had been unreasonably withheld, so that Owners were in repudiatory breach and Charterers were entitled to terminate.

13

On 22 nd August 2016, Louis Dreyfus themselves purported to accept that termination as a repudiation by MUR. On any view, therefore, the Charter was at an end by no later than 22 nd August 2016.

14

A claim letter was then sent by MUR to Louis Dreyfus. By it MUR claimed the return of hire paid in advance.

15

On 8 th August 2017, MUR appointed their arbitrator in respect of “ all disputes connected with the Charterparty” which was stated to include claims for:

i) The return of hire and value of delivery bunkers paid in advance,

ii) costs incurred on the Owners' behalf;

iii) damages in respect of claim from the sub Charters for the termination of the Charter; and

iv) the Owners' failure to obey instructions/ breach of Clause 46 of the Charter.

16

A Final Hire Statement (“FHS”) was attached, which was described later in the view of the Tribunal as being “quite sufficient”. Correspondence between MUR and the Vessel's head Owners was not attached and at a later stage the Tribunal concluded that that correspondence was “ not necessary for the purposes of claimant notification.

17

In response, Louis Dreyfus appointed their chosen arbitrator. MUR served claim submissions nearly a year later, on 2 nd July 2018. They attached the CSS Report dealing with the feasibility of drilling cement holes in the hatch covers. It was referred to in the following passage from the claimants' submissions:

“14. Charterers contend that there were no justifiable reasons for Head Owners to refuse to allow Charterers to install temporary new cement holes in the hatchcovers and Charterers rely in this regard upon the survey report of Control System Survey of 19th August 2016. [The report was attached]. As the tribunal will note from this report, the attending surveyor advised “we did not find any technicality to prevent the cutting and creating of new cement tubes to the hatch covers” and advised that upon completion of the welding works the welds would be tested … and approved by Class… Head Owners simply did not want the works to go ahead so unreasonably refused to consent to same. 15. Disponent Owners refusal to abide by the terms of the Charter was a repudiatory breach which entitled Charterers to terminate. Upon Charterers termination of the Charter Disponent Owners were obliged to account to charterers for the value of the redelivery bunkers and all funds paid in advance for hire that would no longer be payable to Owners. Charterers seek an Award for USD100,931.41 plus interest and costs”

18

The CSS Report had not been one of the documents previously provided by MUR and it was...

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2 firm's commentaries
  • Documentary Time-Bar Clauses - Will We Ever Tire Of Debating The Meaning Of "[all]
    • United Kingdom
    • Mondaq UK
    • 5 Agosto 2020
    ...all conspiring to make this a rich source of litigation. The last few months have brought (at least) three more: the Tiger Shanghai [2019] EWHC 3240 (Comm), the Amalie Essberger [2019] 3402 (Comm), and the MTM Hong Kong [2020] WHC 700 The Tiger Shanghai concerned a disputed termination by t......
  • Marine News - January 2020
    • United Kingdom
    • Mondaq UK
    • 10 Enero 2020
    ...Charter Claim: Submit All Supporting Documents or Risk Time Bar MUR Shipping BV v Louis Dreyfus Company Suisse SA "TIGER SHANGHAI" [2019] EWHC 3240 (Comm) highlights the importance of carefully assessing all available evidence at the time of presenting a claim where there is a time bar clau......

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