St Shipping and Transport PTE Ltd (Claimant (Respondent in the arbitration) v Space Shipping Ltd (Defendant (Claimant in the arbitration) "CV Stealth"
| Jurisdiction | England & Wales |
| Judge | The Hon. Mr Justice Popplewell |
| Judgment Date | 20 April 2016 |
| Neutral Citation | [2016] EWHC 880 (Comm) |
| Docket Number | Case No: CL-201500759 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 20 April 2016 |
[2016] EWHC 880 (Comm)
The Hon. Mr Justice Popplewell
Case No: CL-201500759
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Mr Simon Croall QC and Mr Koye Akoni (instructed by Clyde & Co LLP) for the Claimant
Mr Sean O'Sullivan QC and Mr James Hatt (instructed by Lax & Co LLP) for the Defendant
Hearing dates: 13 April 2016
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.
Introduction
On 19 September 2014 a Venezuelan Court ordered the detention of the vessel CV STEALTH ("the Vessel") at Puerto La Cruz, where she was waiting to load cargo. She remains there to this day. By a Partial Final Award dated 23 September 2015 ("the Award"), the Arbitrator determined that the charterers of the Vessel were liable to the owners for the financial consequences of the detention. The charterers seek to appeal pursuant to section 69 Arbitration Act 1996. There is an issue as to whether they require permission to appeal.
The facts
The following facts are taken from the findings in the Award.
By a timecharter on an amended Shelltime 4 form dated 10 April 2014 ("the Charterparty"), the Defendant ("the Owners") let the Vessel to the Claimant ("the Charterers") for a period of, in the event, about 8 months. The charter was to last from the date of delivery into the charter until between 1 April and 25 April 2015. Hire was payable monthly in advance at a rate of US$14,500 a day.
Clause 13 was in unamended form as follows:
"13.(a) The master (although appointed by Owners) shall be under the orders and directions of Charterers as regards employment of the vessel, agency and other arrangements…
Charterers hereby indemnify Owners against all consequences or liabilities that may arise
(i) from signing bills of lading in accordance with the directions of Charterers, or their agents, … or … from the Master otherwise complying with Charterers or their agent's orders
(ii) from any irregularities in papers supplied by Charterers or their agents."
The off-hire clause, Clause 21, provided in material parts as follows:
"21.(a) On each and every occasion that there is loss of time for more than 6 (six) hours…
…
(v) due to the detention of the vessel by authorities at home or abroad attributable to legal action against… the vessel, the vessel's owners or Owners (unless brought about by the act or neglect of Charterers)
… the vessel shall be off-hire…"
Clause 27 provided:
"27.(a)… Further, neither the vessel, her master or Owners, nor Charterers shall, unless otherwise in this charter expressly provided, be liable for any loss or damage or delay or failure in performance hereunder arising or resulting from… arrest or restraint of princes, rulers or people"
Clause 28 provided
"28. … No voyage shall be undertaken, nor any goods or cargoes loaded, that would expose the vessel to capture or seizure by rulers or governments."
Clause 41 stated that the Charterparty was to be governed by English law and provided for dispute resolution by arbitration in accordance with the BIMCO Dispute Resolution and Law clause set out at Clause 111 of the Charterparty, which provided for the Arbitration Act 1996 to apply. Clause 41 went on at paragraph 41(c) (ii) to provide:
"The parties hereby agree that either party may –
(a) appeal to the High Court on any question of law arising out of an award;"
On 10 August 2014 the Vessel was delivered into the Charterparty.
On 4 September 2014 the Charterers sub chartered the Vessel to AS Capital by a voyage charter on an amended BPVoy form. The sub charter was for the carriage of a minimum 50.000 m.t., up to a full cargo, of crude oil from one to two safe ports Venezuela, intention Guaraguao, Puerto La Cruz, Venezuela, to a range of ports in sub charterer's option. It was always the intention of AS Capital to carry a cargo of up to 400,000 barrels, or as limited by draught at the discharge port, of Mesa crude oil from Guaraguao Terminal, Puerto La Cruz, Venezuela for anticipated discharge at a United States terminal.
The Charterers gave employment orders to the master on 4 September 2014 in an email in the following terms:
"Vessel: MT CV Stealth
Charterers: AS Capital LTD
…
Load port: Guaraguao Terminal, PLC, Venezuela
LAYCAN: 4–5 Sep 2014
…
Cargo: Mesa Crude-no heating required. Total cargo up to 400 kbbls or as limited by draft at the discharge port.
Surveyors: SGS
Loadport Agents: Atlantic Marine Services SA
…
Vessel to arrive load port in all respects ready to load the nominated cargo.
…
Anticipated discharge destination is TBN Terminal in Houston Ship Channel; complete information to follow"
In that email the Charterers also informed the master that there would be a second set of load port agents, Agemar, who were the Charterers' protective agents to oversee events at Puerto La Cruz because the Charterers were unfamiliar with Atlantic Marine Services.
The Vessel proceeded to Puerto La Cruz pursuant to those orders and arrived at 2300 hours on 5 September 2014.
On 6 September 2014 Atlantic Marine Services were replaced as AS Capital's agents by Grupo Acosta Marine Services ("GAMS"). The master was given an order to communicate with GAMS.
On 11 September 2014 the Charterers' operator, Mr Maciejewski, received a document through the broking channels purporting to be from Petroleos de Venezuela S.A. the state oil company ("PDVSA"). This gave details of the cargo to be loaded and a loading window of 14–17 September 2014. It named the Vessel as the vessel on which the cargo was to be loaded. It turned out that this document was not genuine. Nevertheless I shall refer to it, as the Arbitrator did, as the Authorisation. At around the same time, on 11 September 2014, GAMS sent a copy of the Authorisation to the master of the Vessel.
The Authorisation was stamped but not signed. It aroused Mr Maciejewski's suspicions, and he put in train enquiries to check its authenticity with PDVSA. On 12 September 2014 Mr Maciejewski instructed the master to ignore the Authorisation and comply only with orders coming from the Charterers themselves.
On 13 September 2014 the Vessel was boarded initially by two Port State Control officers, and then by a large team of investigators including six members of the National Guard, government lawyers, security officers from PDVSA, the harbourmaster and customs officers. The investigators inspected, amongst other things, the Vessel's documents and cargo tanks, which were empty. The investigation team's interests were apparently only aroused when they were shown the PDVSA Authorisation. They informed the master that this document was not an official PDVSA document.
On 17 September 2014 the Charterers' agents Agemar sought permission from the harbourmaster for the Vessel to sail, the Charterers having purported to cancel the sub charter. The request was rejected on 19 September 2014, with the harbourmaster commenting that she would not be allowed to sail until further notice.
Meanwhile in the course of its investigation into the forged Authorisation, PDVSA obtained information that led to the arrest of a Mr Asuncion Rafael Barbosa on 12 September 2014. A representative of GAMS who had sent the document to the Charterers informed both PDVSA and the National Guard that it was Mr Barbosa who had engaged GAMS' services. Mr Barbosa was subsequently charged with several criminal offences including the forgery of the PDVSA Authorisation and with attempting to export cargo without the necessary authorisation of PDVSA.
On 19 September 2014 the local Venezuelan Court, the Sixth Court, made a "pre-precautionary or unnamed order", pursuant to a request from the Regional Prosecutor, prohibiting the Vessel from sailing from Puerto La Cruz. The prohibitive measure was a precautionary measure, pending, and to assist, the investigation into Mr Barbosa's alleged crimes.
Despite attempts to have the order discharged, it remained in place and the Vessel has remained detained at Puerto La Cruz ever since. At no stage has there been any allegation made, either by the parties or by the authorities in Venezuela, that the Owners, the Vessel, the crew, or the Charterers, were in any way involved in any improper activity.
The Charterers paid hire up to and including January 2015. They contended that the Charterparty was frustrated on 29 January 2015. The Arbitrator rejected that contention, from which there is no appeal.
By an email of 1 April 2015, and without prejudice to their position that the Charterparty had been frustrated, the Charterers purported to redeliver the Vessel.
The Claims and Issues before the Arbitrator
The Owners claimed a balance of hire, together with costs and expenses, up to the time of redelivery of the Vessel on 1 April 2015. The Charterers contended that the Vessel was off hire from 19 September 2014 until 1 April 2015 pursuant to Clause 21(a)(v) of the Charterparty.
In relation to the period since redelivery on 1 April 2015, the Owners claimed compensation for the continued detention of the Vessel on one or more of three grounds:
(1) under the express indemnity in clause 13(a)(i) of the Charterparty ("against all...
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