National Bank of Fujairah (Dubai Branch) v Times Trading Corporation
| Jurisdiction | England & Wales |
| Judge | Mr Justice Foxton |
| Judgment Date | 23 July 2020 |
| Neutral Citation | [2020] EWHC 1983 (Comm) |
| Docket Number | Case No: CL-2020-000136 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 23 July 2020 |
[2020] EWHC 1983 (Comm)
IN THE HIGH COURT OF JUSTICE
OF ENGLAND AND WALES
COMMERCIAL COURT
QUEEN'S BENCH DIVISION
Royal Courts of Justice,
Rolls Building
Fetter Lane,
London, EC4A 1NL
Mr Justice Foxton
Case No: CL-2020-000136
Steven Berry QC and John Robb (instructed by Campbell Johnston Clark Limited) for the Claimant
David Lewis QC and Hannah Glover (instructed by Reed Smith LLP) for the Defendant
Hearing dates: 10 July 2020 Sent to Parties: 20 July 2020
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.
Introduction
This is the application of the Counterclaimant (“NBF”) under section 12 of the Arbitration Act 1996 (“the 1996 Act”) to extend the time for commencing arbitration proceedings against the Respondent (“Times”).
NBF is said to be the holder of 27 bills of lading (“the Bills of Lading”) issued in respect of cargo shipped on the MV “ARCHAGELOS GABRIEL” (“the Vessel”). Cargo from the Vessel was discharged without production of the Bills of Lading, against letters of indemnity (“LOIs”), over the period between 10 and 20 June 2018. NBF alleges that the discharge was wrongful, and that it is entitled to bring claims as the holder of the Bills of Lading in respect of what it alleges was a misdelivery. The Bills of Lading required all disputes to be submitted to arbitration in London.
NBF commenced an arbitration in London against the registered owners of the Vessel, Rosalind Maritime LLC (“Rosalind”). That arbitration was commenced within the one year limitation period arising under Article III Rule 6 of the Hague Rules which it has been held, at first instance, applies to actions for misdelivery where the cargo has been delivered other than against the presentation of bills of lading ( Deep Sea Maritime Ltd v Monjasa A/S (The Alhani) [2018] EWHC 1495 (Comm)). However, it has since been suggested that the carrier under the Bills of lading was not Rosalind, but Times, to whom Rosalind is said to have bareboat chartered the Vessel. If NBF is required to bring its claims for misdelivery against Times, then an arbitration in respect of those claims was not brought within one year of the completion of delivery. It is to guard against the possibility that any claims against Times are time-barred that NBF brings this application.
In bringing this application, NBF does not admit that Times is the appropriate defendant to the claim for misdelivery or that, absent an extension of time, its claim is time-barred. However it is well-established that the Court is entitled to determine a section 12 application on the assumption that the time bar in question applies to the claimant's claim, without prejudicing a claimant's right to argue otherwise subsequently: see The Seki Rolette [1998] 2 Lloyd's Rep. 638, 646 (Mance J).
NBF has already commenced proceedings against Times in respect of the alleged misdelivery of the cargo before the High Court of Singapore. It is Times' position that those proceedings were commenced in breach of the binding agreement for London arbitration, and it applied to the Commercial Court for an anti-suit injunction to restrain those proceedings. That injunction was granted by Mrs Justice Cockerill, but only on terms that Times undertake not to take a limitation defence in the arbitration. Cockerill J's judgment is reported at [2020] EWHC 1078 (Comm). Permission to appeal against the judgment was refused by Flaux LJ.
Having failed in its attempt to challenge the condition imposed by Cockerill J, Times did not seek to maintain the injunction. Accordingly, it now falls to NBF to pursue its s.12 application.
The background facts
I have had the benefit of an agreed chronology, and of the summary of the facts previously given by Cockerill J, on which I have drawn in preparing this section of the judgment.
The Vessel was originally owned by Briza Holdings SA (“Briza”), with Times Navigation Inc (“Times Navigation”) as the Vessel's ISM Manager. Briza time-chartered the Vessel to Atlantic Palaemon Shipping AG (“APS”) on 4 April 2018 (“the Time Charter”), who in turn entered into a sub-charter with Harmony Innovation Shipping Ltd (“Harmony Hong Kong”) on 24 April 2018 for a time charter trip. Another Harmony company, Harmony Innovation Shipping Pte Ltd (“Harmony Singapore”) entered into a voyage charterparty for the Vessel with Trafigura Maritime Logistics Ltd (“TML”), who in turn entered into a sub-voyage charter with Trafigura Pte Ltd (“Trafigura”) in connection with a contract of sale from Trafigura to Farlin Energy & Commodities FZE (“Farlin”). NBF provided finance to Farlin in connection with that contract of sale.
Times was incorporated on 16 April 2018, and Rosalind on 18 April 2018. Rosalind acquired the Vessel from Briza on 27 April 2018, and on the same date entered into a bareboat charter with Times (“the Bareboat Charter”), as part of a lease financing arrangement. The Time Charter was amended on 27 April 2018 to reflect the transfer of the Vessel from Briza to Rosalind and the bareboat charter of the Vessel by Rosalind to Times, and on 10 May 2018 Briza novated its interest under the Time Charter to Times.
On or about 11 May 2018, the Vessel loaded 55,100 MT of steam (non-coking) coal of Indonesian origin (the “Cargo”) in bulk in East Kalimantan, Indonesia. The Bills of Lading were issued on the Congenbill 1994 form on or around 11 May 2018 on behalf of the master. As I have indicated, the Cargo was discharged between 10 and 20 June 2018 at Navlakhi Port, India without production of the original Bills of Lading against LOIs. The LOIs were given:
i. by Farlin to Trafigura;
ii. by TML to Harmony Singapore;
iii. by Harmony Hong King to APS; and
iv. by APS to Rosalind.
As a result, the 12 month period for bringing suit under Article III Rule 6 of the Hague Rules in respect of the cargo discharged at Navlakhi (if applicable) expired on 20 June 2019.
The Bills of Lading contain a General Paramount Clause and also incorporated an arbitration clause from a voyage charterparty between TML and Harmony Hong Kong dated 25 April 2018. That clause provides:
“54 Law & Arbitration
54.1 This Charterparty, any question regarding its validity, existence or termination, and any non-contractual obligations arising from or connected with it shall be governed by and construed in accordance with English law.
54.2 Any dispute arising out of or in connection with this Charterparty (including any question regarding its validity, existence or termination and any noncontractual obligations arising from or connected with it) shall be referred to arbitration in London before three arbitrators in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof…”.
NBF, through its Singapore solicitors, Rajah & Tann Singapore LLP (“R&T”), asserted a claim for misdelivery against the carrier, which was addressed to the Vessel's registered owner, Rosalind “c/o Times Navigation Inc”, on 28 December 2018. The letter stated:
“2. We are writing to you as the registered owners of the vessel “ARCHAGELOS GABRIEL”….
7. In the event the Cargo is no longer in your possession, our clients invite an urgent account from you on the present whereabouts of the Cargo. (…) In your response, our clients also invite you to state in writing with full supporting documents why you should not be liable to our clients for misdelivery and/or conversion of the Cargo. Please let us hear from you by 1800 h, today, 28 December 2018…”
The West of England (“the Club”), with whom Times, Rosalind and Times Navigation were all entered for FD&D cover on 19 October 2018, appointed the law firm of Waterson Hicks (“WH”) to respond to the letter. WH understood those instructions to come “from both the Club (on behalf of its Members) and from Times Navigation”. WH replied that day stating:
“We act on behalf of the Owners of this vessel. Bearing in mind that the Bills of Lading were issued over seven months ago we are very surprised that your clients should purport to assert title to the cargo after such a long period of delay and without anything having been said previously. (…) Rather than our clients being called upon to explain what they did with the cargo, with respect we believe it is incumbent upon your clients to explain what they have been doing for the last seven and a half months.”
On 2 January 2019 NBF issued an in rem Writ of Summons in the High Court of the Republic of Singapore under case number HC/ADM 2/2019 (“the Singapore Proceedings”). That writ was addressed in the familiar form to “Owners and/or Demise Charterers and/or other persons interested in …” the Vessel, and stated that it was issued by NBF as “lawful holders and/or indorsees of the Bills of Lading”.. It claimed “against the Defendants as carriers… (a) Damages for breach of the contract(s) of carriage contained in and/or evidenced by the Bills of Lading…” with alternative claims in tort and bailment.
On 1 January 2019, R&T were contacted by MFB Solicitors (“MFB”) who acted for APS and the two Harmony companies. On 3 January, R&T told MFB that
“As at the time of writing, we have not heard from Trafigura or indeed (in any meaningful sense) from Head Owners, save for what appears to be a holding message from Waterson Hicks for the latter. (…) Do please also extend to us a copy of the LOI presumably given to...
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