Trafigura Maritime Logistics Pte Ltd v Clearlake Shipping Pte Ltd
| Jurisdiction | England & Wales |
| Judge | Mr. Justice Teare |
| Judgment Date | 27 April 2020 |
| Neutral Citation | [2020] EWHC 995 (Comm) |
| Date | 27 April 2020 |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case Nos: CL 2020 000159 AND CL 2020 000171 |
[2020] EWHC 995 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr. Justice Teare
Case Nos: CL 2020 000159 AND CL 2020 000171
Michael Ashcroft QC and Oliver Caplin (instructed by Ince Gordon Dadds LLP) for Trafigura
Robert Thomas QC and Ben Gardner (instructed by Kennedys Law LLP) for Clearlake
Henry Byam-Cook QC (instructed by White & Case LLP) for Petrobras
Hearing date: 22 April 2020
APPROVED JUDGMENT
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
This is the return date in respect of two mandatory injunctions requiring a voyage charterer, Clearlake, and a sub-voyage charterer, Petrobras, “forthwith” to provide such bail or other security required to secure the release of the vessel MIRACLE HOPE from arrest in Singapore.
The ex parte on notice injunction issued against Clearlake was granted by Henshaw J. on 24 March 2020 and the ex parte on notice injunction issued against Petrobras was granted by Jacobs J. on 31 March 2020. Their respective judgments are [2020] EWHC 726 (Comm) and [2020] EWHC 805 (Comm).
The disponent owner who sought the injunction from Henshaw J. was Trafigura who had time chartered the vessel from its registered owner, Ocean Light. That injunction was issued against Clearlake who in turn sought an injunction from Jacobs J. against the sub-charterer.
The injunctions were granted pursuant to a clause which was found in both voyage charters in identical form:
“Notwithstanding any other provision of this Charter, Owners shall be obliged to comply with any orders from Charterers to discharge all or part of the cargo provided that they have received from Charterers written confirmation of such orders.
If Charterers by telex, facsimile or other form of written communications that specifically refers to this clause request Owners to discharge a quantity of cargo either:
(a) without bills of lading …
then Owners shall discharge such cargo in accordance with Charterers' instructions in consideration of receiving an LOI as per Owners' P&I Club wording to be submitted to Charterers before lifting the “subs”. Following indemnity deemed to be given by Charterers on each and every such occasion ……………….
(v) As soon as all original bills of lading for the above cargo which name as discharge port the place where delivery actually occurred shall have arrived and/or come into Charterers' possession, Charterers shall produce and deliver the same to Owners, whereupon Charterers' liability hereunder shall cease. Provided however, if Charterers have not received all such original bills by 24.00 hours on the day 13 (thirteen) calendar months after the date of discharge, then this indemnity shall terminate at that time…
(vi) Owners shall promptly notify Charterers if any person (other than a person to whom Charterers ordered cargo to be delivered) claims to be entitled to such cargo and/or if the vessel or any other property belonging to Owners is arrested by reason of any such discharge of cargo.
(vii) This indemnity shall be governed and construed in accordance with the English law and each and any dispute arising out of or in connection with this indemnity shall be subject to the jurisdiction of the High Court of Justice of England.”
That clause was activated when Petrobras required the cargo of crude oil on board the vessel to be delivered without production of the bills of lading in November 2019. It is common ground (for the purposes of this application) that the form of indemnity required by the International Group of P&I Clubs and which applied in the present case was in these terms:
“In consideration of you 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 [the ship proceeding and] giving delivery of 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 ship proceeding and] giving 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, or should there be any interference in the use or trading of the vessel (whether by virtue of a caveat being entered on the ship's registry or otherwise howsoever), to provide on demand such bail or other security as may be required to prevent such arrest or detention or to secure the release of such ship or property or to remove such interference and to indemnify you in respect of any liability, loss, damage or expense caused by such arrest or detention or threatened arrest or detention or such inference, whether or no such arrest or detention or threatened arrest or detention or such interference may be justified”
In March 2020 a bank, Natixis, which had paid for the cargo under a letter of credit but had not received the cargo, arrested the vessel in Singapore in support of a claim for damages for breach of the shipowner's obligation to deliver the goods against production of the bills of lading. It claims damages of a little over US$76 million, essentially, the value of the cargo of oil. That arrest led to the proceedings in this court seeking mandatory injunctive relief to enforce the provisions of the above indemnity. This court has jurisdiction in this matter because of the choice of jurisdiction clause in both charterparties. Mandatory injunctive relief was issued by this court because it has been recognised for some time that such relief is appropriate to enforce the obligation to provide such bail or other security as may be required to secure the release of a vessel from arrest; see Harmony Innovation Shipping Ltd v Caravel Shipping Inc [2019] EWHC 1037 (Comm) at §30; The Bremen Max [2009] 1 Lloyd's Rep 81 at §12; and The Laemthong Glory (No.2) [2005] 1 Lloyd's Rep 632 at §§51–52.
The order made by Henshaw J. provided as follows:
“The Defendant must provide forthwith such bail or other security as may be required to prevent such arrest or detention or to secure the release of the vessel. For the avoidance of doubt, the Defendant is required to provide the aforementioned bail and/or security directly to the Bank”
The order made by Jacobs J. provided as follows:
“The Defendant must provide forthwith such bail or other security as may be required to secure the release of the Vessel, or if such bail or other security has already been provided by another party, to provide forthwith such substitute security to replace security that may have been provided by another party to secure the release of the Vessel. For the avoidance of doubt, the Defendant is required to provide the aforementioned bail and/or security directly to the Bank.”
Following the grant of the injunctions both Clearlake and Petrobras sought to comply with the injunctions. However, they have failed to reach agreement with Natixis as to the terms of the bank guarantee required to secure the release of the vessel from arrest.
Thus on the return date, 22 April 2020, the position was that the vessel remained under arrest notwithstanding the issue of injunctive relief by this court. There is no dispute that injunctive relief should remain in place. However, Trafigura (and therefore Clearlake) have sought an amendment to the terms of the order. The amendment sought was set out in a draft order but was amended orally during the hearing before me, without a revised form of draft order being provided in writing. The aim of Trafigura is to give greater precision to the order by identifying the date by which action must be taken and describing the action which must be taken. Thus counsel for Trafigura sought an order which required Clearlake to provide, by 24 April 2020 (two days after the hearing), a bank guarantee in the form required by Natixis, failing which there should be a payment into the Singapore Court within 7 working days of the security demanded, some US$76 million.
Clearlake resisted any variation to the injunction, but, if it is to be varied, seeks the same variation against Petrobras. Petrobras not only resisted any variation but also protested at the lack of notice given of the proposed variations. However, although the notice given was late Petrobras (and Clearlake) were able to provide evidence in response and to make detailed submissions. Although I accept that they ought to have had more notice than they were given the matter has been fully argued and it would in reality be an unnecessary delay to adjourn the application for a variation of the injunctive relief to a later date.
The hearing before this court, as a result of the Covid 19 pandemic, took place remotely with the judge and counsel using a video link from their...
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