Pacific Basin IHX Ltd v Bulkhandling Handymax as [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | Teare J |
| Judgment Date | 25 January 2012 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 25 January 2012 |
Queen's Bench Division (Commercial Court).
Teare J.
Michael Nolan (instructed by Swinnerton Moore LLP) for the Claimant.
Julian Kenny (instructed by Ince and Co LLP) for the Defendant.
The following case was referred to in the judgment:
Vrinera Marine Co Ltd v Eastern Rich Operations Inc (The Vakis T)[2004] 2 CLC 1148.
Arbitration Award Remission Meaning of exposed to War Risks in cl. (2) of Conwartime 1993 Phrase exposed to War Risks properly construed as referring to situation which was dangerous Whether real likelihood that vessel would be exposed to acts of piracy in the sense that the place would be dangerous on account of acts of piracy Issue remitted to arbitrators.
This was a further hearing in an appeal concerning the meaning and effect of the CONWARTIME 1993 clause: see [2011] EWHC 2862 (Comm); [2012] 1 CLC 1.
The court held that the phrase may be or are likely to be exposed to war risks in sub-cl. (2) of CONWARTIME 1993 was intended to express a single degree of possibility or probability, namely that there was a real likelihood, real danger or serious possibility of the vessel being exposed to war risks, including piracy. On that basis the court held that the arbitrators had erred and was minded to remit their award for reconsideration. The court then heard further submissions and it became apparent that there was a dispute between the parties as to the meaning of the phrase exposed to war risks.
The charterers submitted that being exposed to acts of piracy meant being exposed to the peril or danger of piracy, which would include an attack by pirates but would also include a failed attempt to pursue and attack the vessel. The owners submitted that being exposed to acts of piracy simply meant being exposed to the risk of piracy.
Held, ruling accordingly:
1. The dispute concerning the meaning of the phrase exposed to War Risks could and should be resolved by reference to the terms of cl. (2) of Conwartime itself. The clause dealt, first, with the circumstance where the vessel was ordered to proceed to a place where it appeared that the vessel, cargo or crew in the reasonable judgment of the Master and/or Owners, may be, or are likely to be, exposed to War Risks and, second, with the circumstance where the vessel was already within any such place as aforesaid, which only becomes dangerous, or is likely to be or to become dangerous, after her entry into it. The second part of the clause used the word dangerous to describe a situation where the vessel, cargo or crew were or were likely to be exposed to War Risks. Therefore the phrase exposed to War Risks should properly be construed as referring to a situation which was dangerous. Thus the question to be addressed by an owner or master, when ordered to go to a place, was whether there was a real likelihood that the vessel would be exposed to acts of piracy in the sense that the place would be dangerous on account of acts of piracy. That test was not too complex for an owner or master to apply. The wording of the second part of cl. (2) itself contemplated that the owner might have to address both likelihood and...
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