Orinoco Navigation Ltd v Ecotrade SpA ('The Ikariada') [QBD (Comm)]

JurisdictionEngland & Wales
JudgeCresswell J.
Judgment Date02 July 1999
CourtQueen's Bench Division (Commercial Court)
Date02 July 1999

Queen's Bench Division (Commercial Court).

Cresswell J.

Orinoco Navigation Ltd
and
Ecotrade SpA (“The Ikariada”)

Vasanti Selvaratnam (instructed by Hewett & Co) for the claimants.

Guy Morpuss (instructed by Dorman & Co) for the defendants.

The following cases were referred to in the judgment:

Australian Oil Refining Pty Ltd v R W Miller & Co Pty LtdUNK [1968] 1 Ll Rep 448.

Ben Shipping Co (Pte) Ltd v An Bord BainneUNK [1986] 2 Ll Rep 285.

Berkshire, TheUNK [1974] 1 Ll Rep 185.

Garbis Maritime Corp v Philippine National Oil Co (“The Garbis”)UNK [1982] 2 Ll Rep 283.

Gulf Steel Co Ltd v Al Khalifa Shipping Co Ltd (“The Anwar Al Sabar”)UNK [1980] 2 Ll Rep 261.

Naviera Mogor SA v Société Metallurgique de Normandie (“The Nogar Marin”)UNK [1988] 1 Ll Rep 412 (CA).

OK Petroleum AB v Vitol Energy SA [1995] CLC 850

Pacific Molasses Co v Entre Rios Compania Naviera SA (“The San Nicholas”)UNK [1976] 1 Ll Rep 8 (CA)

Paros Shipping Corp v Nafta (GB) Ltd (“The Paros”)UNK [1987] 2 Ll Rep 269.

Seateam & Co (K/S A/S) v Iraq National Oil Co (“The Sevonia Team”)UNK [1983] 2 Ll Rep 640.

Seven Seas Transportation Ltd v Pacifico Union Marina Corp (“The Satya Kailash”)UNK [1984] 1 Ll Rep 588 (CA).

Shipping — Charterparty — Bill of lading — Master signed bill leaving blank where date of charterparty should have been filled in — Whether bill was contractual and proper one — Whether charterparty terms incorporated into bill as matter of Greek law.

This was a trial of preliminary issues in a claim by owners against charterers for a declaration that they were entitled to damages or an indemnity in respect of the consignee's claim against owners on the ground that charterers had required the master to sign a bill of lading not incorporating the charterparty terms.

Owners chartered their vessel “Ikariada” to the defendants on a voyage charter on an amended Gencon form for the carriage of a cargo from Italy to Greece. The defendants required the ship's master to sign a bill of lading on the Congenbill form naming the defendants as shippers and “Titan” as consignees of the cargo. A blank on the front of the bill of lading which should have contained the date of the charterparty was not filled in. At the discharge port the vessel caused damage to Titan's discharging facilities allegedly as a result of negligence. Titan sued the owners in Greece. Owners sought a declaration that they were entitled to damages and/or an indemnity in respect of any liability to Titan or loss of a chance of defending Titan's claim, on ground that the bill was not a proper one because of the failure to identify the charterparty and that it was therefore ineffective to incorporate the terms of the charter including cl. 35 which would have protected owners from Titan's negligence claim. Preliminary issues were ordered to be tried as to whether the bill was a contractual and proper one under English law as the applicable law of the charterparty and if not the position under Greek law.

Held, ruling accordingly:

1. The charterparty required the master to sign bills as presented and not bills in a specified form. The bill of lading presented was not in a form which contained extraordinary terms or terms which were manifestly inconsistent with the charter. In the present case the failure to fill in the blank on the face of the bill did not as a matter of English law prevent the incorporation of the terms of the charter. It not infrequently happened that where a printed form of bill provided for the incorporation of “the charterparty dated…” the parties omitted to fill in the blank. The effect in English law was the same as if the reference was simply to “the charterparty” and the omission did not demonstrate an intent to negative the incorporation. The defendants were not in breach of any express or implied term of the charterparty nor were they under an obligation to indemnify the claimants against the consequences of requiring the master to sign the bill in the form presented.

2. On the assumption that the bill of lading was not a contractual or proper one, as a matter of Greek law cl. 35 of the charterparty was incorporated into the bill of lading contract. Clause 35 related to relations between the carrier and consignee and was not a “sensitive” clause such as a jurisdiction or arbitration clause. The bill of lading made explicit reference to special clauses of the charterparty. There was only one carrier under both charterparty and bill of lading, and one voyage. The terms of the bill would not appear on a charterparty bill, such the Congenbill. It had not been shown that Titan had been unable to inform itself of the terms of the charterparty. It was unnecessary to consider whether as a matter of Greek law cl. 35 exempted the claimants from liability for damage to Titan's crane.

JUDGMENT

Cresswell J:

Background

By a charterparty on an amended Gencon form dated 19 February 1997, the claimants chartered their vessel “IKARIADA” to the defendants for the carriage of a cargo of bulk furnace slag from Taranto, Italy to Elefsis, Greece.

The charterparty provided by cl. 9 that:

“Captain to sign Bills of Lading at such rate of freight as presented without prejudice to this Charterparty…”

The charterparty by cl. 35 provided:

“any act, neglect, default or error of judgment whatsoever…in the management and/or the navigation of the vessel…always excepted”.

On 24 February 1997 the defendants required the master to sign a bill of lading which named the defendants as shippers and Titan Cement Co SA of Athens (“Titan”) as consignee. The discharge port was identified on the bill as Elefsis (Greece). The bill of lading was on the Congenbill form. The bill of lading included the words “BILL OF LADING TO BE USED WITH CHARTER-PARTIES CODE NAME: CONGENBILL” EDITION 1978 ADOPTED BY THE BALTIC AND INTERNATIONAL MARITIME CONFERENCE (BIMCO). The bill of lading provided, by cl. 1, that “All terms and conditions, liberties and exceptions of the Charter Party, dated as overleaf, are herewith incorporated”. However, a blank on the front of the bill of lading which should have contained the date of the charterparty was not filled in. The box on the front of the bill of lading “Freight payable at” was completed with the words “as per C/P”.

While coming alongside the consignee's discharging facility in Greece in the course of performing the contract of carriage, the vessel was (it is assumed — see below) negligently navigated, causing damage to the consignee's discharging crane. The claimants are being sued in respect of this damage by the consignee in Greece before the Piraeus Multi-Member Court of First Instance.

Titan paid a CIF price.

Claimants' case

It is the claimants' case that by requiring the master to sign a bill of lading in which the identifying charterparty box on its face was left blank, the defendants were in breach of charter. Alternatively, the claimants say that the request to sign such a bill gives rise to an obligation to indemnify the claimants against the consequences of the master signing such a bill. Further the claimants say that the defendants' conduct in requiring the master to sign a bill of lading in this defective form has caused loss to the claimants:

  1. (a) As a matter of Greek law, the claimants say that the failure specifically to identify the governing charterparty on the front of the bill of lading (in particular, the failure to fill in the date in the box on the front of the bill of lading) renders cl. 1 of the bill of lading ineffective to incorporate the exceptions in the charterparty, including the exceptions contained in cl. 35.

  2. (b) Had the face of the bill of lading identified the charterparty by date in the box provided, the general words of incorporation in cl. 1 of the bill would have been sufficient to incorporate the charterparty exceptions into the bill as a matter of Greek law, and cl. 35 would (say the claimants) have afforded the claimants a defence to proceedings brought against them by Titan in Greece in respect of damage caused to Titan's discharging installation while attempting to come alongside the berth, being damage caused by “any act, neglect, default or error of judgment whatsoever…in the management and/or navigation of the vessel…” within the meaning of cl. 35.

The claimants seek a declaration that they are entitled to damages and/or an indemnity in respect of their liability to Titan and/or damages for loss of the chance of successfully defending Titan's claim.

The defendants' case

The defendants deny breach of charter and any obligation to indemnify. They further contend that as a matter of Greek law cl. 35 of the charterparty was incorporated into the bill, but that cl. 35 would not in any event have provided a defence to Titan's claim.

The preliminary issues which arise for determination

At the hearing of the summons for directions on 26 February 1999 Rix J made an order for the trial of the following preliminary issues:

  1. (A) Whether the propriety of the bill of lading is to be determined as a matter of English law or Greek law. (It is common ground that the answer is English law.)

  2. (B) According to applicable law (i.e. English law), whether the bill of lading was a contractual and proper one. In particular,

    1. (i) whether the defendants were in breach of any express and/or implied terms of the charterparty in failing to fill in the blanks on the face of the bill of lading, in particular in failing specifically to identify the governing charterparty by date or otherwise;

    2. (ii) whether the defendants are under an obligation to indemnify the plaintiff against the consequences of requiring the master to sign the bill of lading in that form.

  3. (C) If the bill of lading was not a contractual or proper one, whether as a matter of Greek law, including Greek conflict of law rules, as a result of...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT