OCM Singapore Njord Holdings Hardrada Pte Ltd v NOC Swiss LLC
| Jurisdiction | England & Wales |
| Judge | Pelling |
| Judgment Date | 11 January 2022 |
| Neutral Citation | [2022] EWHC 57 (Comm) |
| Docket Number | Claim No. CL-2020-000544/594/696/725 |
| Court | Queen's Bench Division (Commercial Court) |
[2022] EWHC 57 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
His Honour Judge Mark Pelling QC sitting as a Judge of the High Court
Claim No. CL-2020-000544/594/696/725
Introduction
This is the hearing of six applications being (a) applications by each of the claimants for summary judgment and (b) the defendant's applications for permission to amend its defences in each claim. At paragraph 17 of his skeleton submissions, Mr Shirazi, who appears on behalf of the defendant, accepted that subject to the amendments that the defendant sought permission to make that the defendant had not “… advanced a defence on liability …”. Subject to the application to amend, Mr Shirazi confines his submissions on the summary judgment application to two generic points, being (a) as against V8 and OCM that judgment should not be given summarily on its claim for final injunctions by reference to the defendant's argument concerning financial impossibility which in turn depends upon two points being (i) alleged illegality to pay given the defendant's alleged financial position and (ii) an alleged absence of funds necessary to enable payment to be made; and (b) as against NOC an assertion that the defendant has a realistically arguable defence to the money claims it makes.
The only basis on which liability can be disputed is by reference to a new assertion that the individuals who signed the letters of indemnity on which the claimants' claims depend lacked authority to execute those documents. That is the principal issue that the defendant seeks to advance by way of amendment. Since it is accepted that the claimants are entitled to judgment if the application to amend fails, all parties considered, and I agree, that the application to amend should be considered before the summary judgment applications.
Primary Facts
It is at this point that I would normally set out the factual background to the level necessary to understand the applications and this judgment. This is not necessary in this case however because I set out the background in my judgment in these proceedings delivered on 22 December 2020 bearing the neutral citation number [2020] EWHC 3689 (Comm) at paragraphs 13 to 15 in relation to the OCM claim and at paragraphs 21 to 23 in relation to the V8 claim. The facts relevant to the NOC claim are set out in my judgment of 13 October 2020 bearing the neutral citation number [2020] EWHC 2820 (Comm) at paragraphs 3 to 8. Since those judgments were delivered there have been some changes to matters of detail but not in ways that affect materially the applications I have to determine at this hearing. In those circumstances, I incorporate by reference into this judgment the summary of primary facts set out in the earlier judgments to which I referred a moment ago.
As is apparent from each of these summaries, each claimant carrier agreed to release a hydrocarbon cargo without sight of the original bills of lading relevant to that cargo against a letter of indemnity (“LOI”) provided by the defendant to each respective claimant. In each case the holders of the original bills made claims for wrongful delivery against the claimants and in turn the claimants intimated claims against the defendant under the respective LOIs. In each case, the defendant failed to comply with the terms of the LOI. Proceedings having been commenced by the claimants against defendants on the LOIs, the defendant filed defences in each claim. It did so when represented by experienced specialist maritime solicitors.
It is necessary that I set out what was initially pleaded by the defendant in relation to each of these cases because each claimant contends, and it is not in dispute, that the proposed amendment involves not merely asserting a positive case that has not before been pleaded but also involves the withdrawal of widespread admissions both express and implied by the defendant as to its liability to each of the claimants under the LOIs.
The Defendant's Currently Pleaded Cases
The OCM claim
Paragraphs 1 to 8 of the particulars of claim set out all the relevant primary facts. Paragraph 1 pleads the time charter by the first to the second claimant. Paragraph 2 pleads the voyage charter by the second claimant to the defendant. Paragraph 3 pleads the agreement contained within clause 15 of the voyage charterparty that the owners would discharge against the letter of indemnity in approved form where original bills of lading were not available. Paragraph 4 pleads various variations to the voyage charterparty. Paragraphs 5 to 6 plead the loading of the cargo and subsequent instructions to the vessel. Paragraph 7 pleads that the defendant ordered the vessel to proceed and discharge at Fujairah and at paragraph 8 it is pleaded that:
“On 9th June 2020, Defendants provided a Letter of Indemnity addressed to ‘The owners of then MT Torm Hardrada c/o Torm AS’ (‘the 9th June LOI’). The 9th June LOI, to which Claimants will refer as may be necessary for its full terms and effect, contained the following express provisions:
‘… we, Gulf Petrochem FZC, hereby request you to deliver the said cargo to Vitol Bahrain EC, or to such party as you believe to be or represent Vitol Bahrain EC, or to be acting on behalf of Vitol Bahrain EC, at Fujairah, UAE without production of the original bill of lading.
In consideration of your complying with our above request we hereby agree as follows:
(1) To indemnify you, your servants and agents and to hold all of you harmless in respect of any liability, loss, damage or expense of whatsoever nature which you may sustain by reason of delivering the cargo in accordance with our request.
(2) In the event of any proceedings being commenced against you or any of your servants or agents in connection with the delivery of the cargo as aforesaid, to provide you or them on demand with sufficient funds to defend the same.
(3) If, in connection with the delivery of the cargo as aforesaid, the ship or any other ship or property in the same or associated ownership, management or control, should be arrested or detained or should the arrest or detention thereof be threatened […] to provide on demand such bail or other security as may be required to prevent such arrest or detention […] And to indemnify you in respect of any liability, loss, damage or expense caused by such arrest or detention or threatened arrest of detention […] whether or not such arrest or detention or threatened arrest or detention […] may be justified.
…
(7) This indemnity shall be governed by and construed in accordance with English Law and each and every person liable under this indemnity shall at your request submit to the jurisdiction of the High Court of Justice of England …’”
By paragraph 1 of its defence, the defendant pleaded that: “ The defendant admits paragraphs 1 to 8 of the particulars of claim.” At paragraph 11 of the particulars of claim, the claimant pleads that it discharged in accordance with the defendant's instruction in reliance upon the LOI. The defendant admits that to be so in paragraph 4 of the defence.
In fact the original bills of lading were held by a trade finance house called Natixis France and at paragraph 12 of the particulars of claim the claimant pleads:
“ E. The Natixis claim.
12. By an email dated 11th August 2020 from Natixis (France) (‘Natixis’) to the Claimants:
(1) Natixis, as consignee and alleged holders of the original Bills, demanded delivery up of the Cargo from the Claimants, alternatively damages for conversion based on the value of the Cargo at US$11,099,611 (‘the Natixis claim’); and
(2) Natixis threatened to arrest and detain the Vessel in the event that the Claimants fail to pay the foregoing demand.”
That allegation too is admitted at paragraph 4 of the original defence.
At paragraph 13 of the particulars of claim the claimant pleads:
“ F. The Defendant's Obligations.
13. In the premises:
(1) Any liability which the Claimants or either of them may bear to Natixis in respect of or in connection with the Natixis Claim is a liability sustained by reason of the Claimants' delivery of the Cargo in accordance with the Defendant's request for the purposes of clause 1 of 9th June LOI and/or clause (i) of the Deemed LOI, and accordingly the Defendant is obliged to indemnify...
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