Navig8 Inc. v South Vigour Shipping Inc. and Others

JurisdictionEngland & Wales
CourtQueen's Bench Division (Commercial Court)
JudgeMr. Justice Teare
Judgment Date16 January 2015
Neutral Citation[2015] EWHC 32 (Comm)
Date16 January 2015
Docket NumberCase No: 2013 FOLIO 750

[2015] EWHC 32 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice

Rolls Building, 7 Rolls Buildings

Fetter Lane, London EC4A 1NL

Before:

Mr. Justice Teare

Case No: 2013 FOLIO 750

Between:
Navig8 Inc
Claimant
and
(1) South Vigour Shipping Inc
(2) South Jubilation Shipping Inc
(3) South Eternity Shipping Inc
(4) South Dignity Shipping Inc
(5) Star Maritime Management Co Pte Ltd
Defendants

Andrew Baker QC and Luke Pearce (instructed by Ince & Co LLP) for the Claimant

Robert Bright QC and Emma Hilliard (instructed by Watson Farley & Williams LLP) for the First to Fourth Defendants. The Fifth Defendant was not represented

Hearing dates: 11,12,13,18 and 19 November 2014

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 Teare Mr. Justice Teare
1

In this action Navig8 Inc., the charterers of four Aframax vessels, claim damages from the First to Fourth Defendants, the registered owners of those vessels, on the grounds that they breached the charterparties by withdrawing the vessels from service. The charterers say that the charterparties were fixed by an agent, the Fifth Defendant, on behalf of the registered owners. In response the registered owners deny that they were party to the charterparties and, if they were party to them, that the Fifth Defendant had authority to act on their behalf. The damages claimed by the charterers are of the order of US$10.9m.

2

The charterparties were fixed on 13 April 2012 by the Fifth Defendant, Star Maritime Management Co. Pte. Ltd. ("SMMC"). The following words were used to describe the owners:

" Disponent Owners Signatory in Contract:

Star Maritime Management Company Pte, Ltd."

3

The charterers say that they, their brokers ("Poten") and SMMC intended that the charterparties were fixed on behalf of the registered owners and that the phrase "disponent owners" was used in the sense of SMMC being a manager of the vessels with power to fix charterparties on behalf of the registered owners. The registered owners say that they were plainly not the disponent owners and were not intended to be bound by the charterparties. That is the first issue in the case.

4

The charterers say that the registered owners gave authority to SMMC to enter into those charters at a meeting on 21 September 2011, or by conduct or by telephone on or shortly after 13 April 2012. The registered owners deny that they gave authority to SMMC. That is the second issue in the case.

5

As a result of the long expanse of time between September 2011 and April 2012 considerable oral and documentary evidence has been adduced in order to determine the two main issues in this case. There is another reason for the volume of evidence. The authority alleged to have been given orally at the meeting on 21 September 2011 is not recorded in writing. Moreover, Mr. Rajiv Pal, the representative of SMMC who attended the meeting and who has said in one or more emails relied upon by the charterers that the registered owners agreed at that meeting that SMMC could fix vessels on their behalf did not attend the trial to give oral evidence. As a result the primary focus of the charterers' case, as presented by Mr. Andrew Baker QC, has been on the communications between the parties after September 2011 which communications, submitted Mr. Baker, can "best be explained" by authority having been given by the registered owners to SMMC at the meeting on 21 September 2011.

6

By contrast the registered owners' case, as presented by Mr. Robert Bright QC, is that the first issue in the case can be determined, shortly, by construction of the charterparties and that the second issue in the case, the question of authority, can also be determined, shortly, by consideration of (i) the evidence of Mr. Chan, who attended the meeting of 21 September 2011 on behalf of the registered owners and his manuscript notes on documents used at the meeting and (ii) the subject matter of later meetings between SMMC and the registered owners in April and May 2012 which show that by the dates of those meetings there was plainly no agreement that SMMC had authority to act on behalf of the registered owners.

7

Mr. Baker submitted that the communications between the parties between September 2011 and April 2012 were of crucial importance when considering what was or was not agreed at the meeting on 21 September 2011. In view of that submission the court must consider all of the evidence rather than consider, only, the evidence said by Mr. Bright to be the compelling evidence.

8

The evidence placed before the court can be considered under the following headings:

i) The background leading up to the meeting on 21 September 2011.

ii) The meeting on 21 September 2011.

iii) The events subsequent to the meeting on 21 September 2011.

iv) The events leading up to the fixing of the vessels on 13 April 2012.

v) The meetings on 18 April and 24 May 2012.

vi) Later events.

9

The Claimants called four witnesses to give oral evidence. Mr. Brocklesby is the chairman of Navig8 and has worked, successfully, in the shipping business for over 20 years. He was involved in the chartering of the four Aframax vessels in question. He gave his evidence with clarity and I do not doubt that he gave his evidence honestly. However, he had little relevant evidence to give beyond making it clear that from October 2011 he was not interested in chartering vessels from the demise charterers of the vessel and only wished to charter them from the registered owners. He was not present at the meeting on 21 September 2011 between SMMC and Nan Fung (the group of which the registered owners were part) and had no relevant discussions with Mr. Chan prior to the fixing of the vessels in April 2012. His evidence as to the negotiations on 13 April 2012 is very largely based upon the documents and obviously (and understandably) owes more to reconstruction than recollection. In so far as his recollection of events matters it has to be borne in mind that he was giving evidence in 2014 of events in 2011 and 2012. His recollection may not be accurate and so his evidence must be tested against the probabilities arising from the undisputed events and the contemporaneous documents.

10

Mr. Muralee is employed as a trader by the Navig8 Group. He joined them in September 2013. Before that he was employed by Star Maritime Pte Ltd. ("SMPL") as a chartering executive. The general manager of SMPL was Mr. Rajiv Pal. SMMC, a related company, was set up in July 2011 to manage Nan Fung's four Aframax vessels on behalf of their demise charterers. Mr. Muralee was involved in fixing those vessels. He appeared to be an honest and fair witness. However, he was giving evidence in 2014 of what had happened in the second half of 2011 and the first half of 2012. He had left SMPL and SMMC in August 2013 and did not have access to their files. His evidence was therefore based upon his recollection. As with any witness his recollection of events up to three years ago has to be tested against the contemporaneous documents and the probabilities.

11

Mr. Rasmus Bach Nielsen is also employed by Navig8. He joined them in September 2012 and before that had been managing director of Origoo Pte. Ltd., an investment/advisory firm. At Origoo Mr. Bach (as he was referred to in evidence) had been engaged in private equity, seeking to raise funds for investments in the tanker business. He saw an opportunity to do business with Nan Fung and in that regard had a meeting and discussions with Mr. Chan of Nan Fung in March and April 2012. He also had dealings with Navig8 at the same time. He was a careful witness who sought to be honest and accurate in his answers but his evidence had limited relevance.

12

Mr. Rexer was the chartering broker at Poten & Partners who fixed the four Aframax vessels on behalf of Navig8. Whilst he had dealings with Mr. Pal and Mr. Muralee at SMMC he had no direct contact with Nan Fung. He was at times hesitant in his answers and at other times willing to make suggestions rather than give clear answers to the questions put to him. For that reason it seemed to me that I should have particular regard to the contemporaneous documents and the probabilities when assessing his evidence.

13

The First to Fourth Defendants (the registered owners of the Aframax vessels) also called four witnesses to give oral evidence. The principal witness was Mr. Chan who is a senior manager in the shipping department of Nan Fung. He took up that role in 2008 having previously been involved in Nan Fung's textile business. He was present at the meeting on 21 September 2011 and was concerned with the four Aframax vessels at all material times. It was submitted by Mr. Baker that Mr. Chan had "a knowing smile when key points were put to him, suggesting a witness sticking to a script and remembering his lines" and that his evidence was unsatisfactory in many respects. I myself did not observe "a knowing smile" and in any event find the assessment of a witness' demeanour difficult, especially if he comes from another country or culture as does Mr. Chan; cf The Business of Judging by Lord Bingham at pp.7–13 and in particular at p.11 — "however little insight a judge may gain from the demeanour of a witness of his own nationality when giving evidence, he must gain even less when (as happens in almost every commercial action and many other actions also) the witness belongs to some other nationality…..". I respectfully agree. I find it more helpful to have regard to what a witness says in answer to the questions to put to him and to compare that with the contemporaneous documents. Mr. Chan's answers were concise, he was not argumentative and he...

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