Niagara Maritime Sa - Claimant v Tianjin Iron & Steel Group Company Ltd - Defendant
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE HAMBLEN |
| Judgment Date | 02 August 2011 |
| Neutral Citation | [2011] EWHC 3035 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 02 August 2011 |
| Docket Number | No: 2011-881 |
[2011] EWHC 3035 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Hamblen
No: 2011-881
MR SALAMON QC appeared on behalf of the Claimant
The defendants did not attend and were not represented
Approved Judgment
Tuesday, 2 August 2011
Introduction
This is an application by the claimant owners ("the owners") for the continuation of the order made by Burton J on 21 July 2011 for anti-suit injunctive relief against the respondents/intended defendants ("the defendants"). That application was attended by counsel and solicitors representing the defendants without prejudice to their position that there was no arbitration agreement and no foundation for the owner's application. Since the hearing before Burton J, the defendant's solicitors, Reed Smith, have written to the court on 27 July 2011 to inform it and the claimants that they were no longer instructed and would not be appearing on the return date of today.
Background
By a bill of lading dated 7 July 2009, the owners agreed to carry a consignment of iron ore ("the cargo") from Brazil to Tianjin, China, on board their vessel the MV Good Luck ("the vessel"). The bill of lading was in the Congen Bill form and was consigned to order. It stated on its reverse side that "all terms and conditions, liberties and exceptions of the charter party dated as overleaf, including the law and arbitration clause are herewith incorporated." The front of the bill stated "freight payable as per charter party."
The only charter party in existence at the time was the time charter between the owners and Weill International SA or its nominee. Clause 78 of that charter party provides for English law to apply. Clause 91 of the charter party contains an arbitration clause which provided for LMAA arbitration in London. The clause stated, "Any dispute or controversy relating to or arising out of or in connection with this charter party…" shall be referred to arbitration.
During the voyage, an incident occurred off Singapore in which the vessel collided with seven other vessels and grounded. General average was declared. A LOS salvage agreement was entered into. The first intended defendants, the receivers, were the holders of the bill of lading. They, or their insurers, the second intended defendant, PICC, were required to put up salvage security. The vessel and cargo were successful salved and the receivers took delivery of the cargo in October 2009. A general average adjustment was published in March 2010, which assessed cargo's contribution as being US$ 242,155.39. This has not been paid.
In October 2010, the owners became aware that the receivers and PICC had commenced proceedings against them in the Tianjin Maritime Court in China, seeking an indemnity in respect of their salvage contribution. The claim averred that the cargo had been carried by the Good Luck by the defendant "Under number 1 bill of lading" and it averred that the owners had failed to carry it safely to its destination, indicated damages were to be claimed, the quantum of which was estimated to be in the region of US$ 6 million.
The owners submit that the claim brought in China was plainly a claim "relating to or arising out of or connection with the bill of lading, and thus within the scope of the arbitration clause incorporated into the bill of lading. In December 2010, the owners filed an application objecting to the jurisdiction of the Chinese court on that ground.
On 7 February 2011, the owners commenced arbitration in London in respect of any and all disputes under the bill of lading, including in particular the owners' claim for general average and the owners' claim for declarations that the vessel was seaworthy and that they have no liability to indemnify cargo owners in respect of salvage contributions.
On 21 February 2011, the receivers' solicitors wrote denying that there was any arbitration agreement between them and the owners, but, without prejudice to that, appointing Mr Hamsher as their arbitrator. In March 2011, the owners responded to the receivers' denial of the arbitration agreement by making an urgent application under section 30 of the Arbitration Act 1996 for the tribunal to rule on its own jurisdiction. As explained in the witness statement of Mr Hall, the section 30 procedure took some time, whilst the parties made submissions to the arbitrators and it was not in fact until 20 July 2011 that an award in which the arbitrators confirmed that they had jurisdiction was issued.
Meanwhile, on 7 June 2011, the Tianjin Maritime court (TMC) rejected the owners' objection to jurisdiction. They stated that the terms on the back of the bill of lading did not constitute effective incorporation of the arbitration clause. The TMC decision on jurisdiction is being appealed by the owners. The current position is, therefore, as follows. There are proceedings in the Chinese court still at the jurisdiction stage. Although the TMC has made a decision accepting its jurisdiction, that decision is under appeal. The arbitration tribunal has made its award on jurisdiction and is in a position to embark on consideration of the substantive dispute.
The relief sought
Against that background the owners seek an interim anti-suit injunction against the receivers and PICC to restrain them from continuing the Chinese proceedings or from prosecuting any other proceedings relating to the bill of lading contract, other than by way of London arbitration.
Jurisdiction
The court has jurisdiction to issue an injunction under section 37(1) of the Senior Courts Act 1981. It has been held that, in exercising its discretion under section 37, the court should have regard to matters which arise under section 44 of the Arbitration Act 1996. Under section 44 of the Arbitration Act, the court has jurisdiction to issue an anti-suit injunction, being an order for the preservation of assets within section 44(3): see Starlight Shipping v Tai Ping [2008] 1 Lloyds Rep 230 at paragraph 21.
The court's powers under section 44 arise in the case of urgency. This is a case of urgency because, as explained by Mr Hall, the Chinese...
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