Transpetrol Maritime Services Ltd v SJB (Marine Energy) BV (The Rowan)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Longmore,Lord Justice Davis,Sir David Keene |
| Judgment Date | 29 February 2012 |
| Neutral Citation | [2012] EWCA Civ 198 |
| Date | 29 February 2012 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A3/2011/0702 |
[2012] EWCA Civ 198
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
HIS HONOUR JUSGE MACKIE QC
2008 FOLIO 1002
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Longmore
Lord Justice Davis
and
Sir David Keene
Case No: A3/2011/0702
Mr Dominic Kendrick QC & Mr. Thomas Raphael (instructed by Stephenson Harwood) for the Appellant
Mr. Stephen Cogley QC (instructed by Andrew Jackson) for the Respondent
Hearing dates: 27 th January 2012
Introduction
1. This case is about an oil tanker voyage charterparty which had provisions about “approvals” given by some major oil companies the purpose of which was, no doubt, to give some comfort to the charterer about the quality of the vessel it was chartering.
2. Many oil companies publish standard printed chartering terms and the parties in the present case chose to incorporate Vitol's Voyage Chartering Terms as Amended on 1 st November 1999 which are themselves based on the well-known Asbatankvoy Charterparty form which is the subject of Section III of Mr Julian Cooke and others’ book on Voyage Charters (3 rd edition 2007). Clause 18 of the Vitol Terms provides under the heading “Oil Company Approvals Clauses”
“Owner warrants that the Vessel is approved by the following companies and will remain so throughout the duration of this charterparty”
adding in brackets and heavy type
“(Owners(s) to advise, including inspection dates and expiry dates)rdquo;.
3. In and before 1999 it seems that some major oil companies were happy to inspect oil tankers and record the results of that inspection on a database, available to subscribers, called SIRE. If an owner wanted to comment on any such inspection report, he was entitled to do so and those comments would also be available on SIRE for all subscribers to see. The relevant oil company would if satisfied then issue an approval of the vessel. The approvals would be dated and would often be expressed to be valid for a particular period of time and thus have an expiry date which an owner could then write in to any contract as envisaged by the Vitol Terms of 1999.
4. This practice began to change as a result of pollution incidents involving the vessels “ERICA and PRESTIGE” in 2002 because statements that those vessels had been “approved” by oil majors led to damaging publicity for the oil majors concerned. Reports continued to be posted on SIRE and letters reflecting “approval” were given, but they were in more guarded terms often stating that blanket approval had not been granted and should not be assumed. The judge quoted the terms in which Lukoil had granted “approval” as apparently typical:—
“We have now received sufficient information with regard to this vessel and will not normally require re-inspecting the vessel for a 12 month period from the date of inspection.
Please note, however, that this letter does not constitute a blanket approval of the vessel for LUKOIL-LITASCO business or for visits to Lukoil terminals or facilities. The vessel will be screened by us on each occasion it is tended (sic) for Lukoil/Litasco business or intends to visit one of our terminals or facilities.
Amongst other criteria, our decision will be based on the continued satisfactory performance of the vessel and any feedback that we may receive.”
The experts called in the present case, Mr Cullen and Mr Pearce, agreed that letters in these guarded terms were still regarded as “approvals” for the purpose of clauses such as clause 18 of the Vitol Terms, unless there was a clear indication that the vessel had positively not been approved.
5. This evidence was accepted by the judge, and not challenged by either party in this court. We are, therefore, left in the somewhat curious position that letters given by oil companies in this case which expressly state that they are not blanket approvals of the vessel are to be taken, nevertheless, to comply with Vitol Clause 18.
6. The charterparty in the present case was made between Transpetrol Maritime Services Ltd as Owner and SJB (Marine Energy) BV as Charterer on 6 th June 2007 for the carriage, on board the oil tanker “ROWAN”, of fuel and/or vacuum gas oil from safe ports in the Black Sea to safe ports in the US Gulf with an option on the part of the Charterer to top up or discharge and re-load at Antwerp. No formal document was ever drawn up but the parties agree that the terms of the charterparty are to be found in a recap e-mail of 6 th June 2007 sent at 16.23 to “Vincent” in the office of the Owner. Under the heading “(VESSEL INFO)” there is this:—
“TBOOK WOG VSL IS APPROVED BY:—
BP/LITASCO/STATOIL-EXXON VIA SIRE”
Transliterated this reads:—
“To best of Owner's knowledge, without Owner's guarantee, vessel is approved by the oil companies [there identified, via the SIRE database]”
7. Under the heading (“TERMS”) there is set out a Turkish Straits Clause relating to delays due to traffic regulations in the Dardanelles and/or the Bosphorus and then:—
“VITOL VOYAGE CHARTERING TERMS – AMENDED 1 ST NOVEMBER 1999”
Each of the Vitol Terms is then referred to for the purpose of express inclusion, amendment, deletion or substitution as required by the parties. By way of example clauses 6,16 and 17 are deleted in their entirety (the Third Party Arrest Clause, the United States Coastguard Clause and the US Custom Regulation Clause). Opposite the number 18, however, in the recap one sees
“TBOOK VESSEL APPROVED BY:—
BP/EXXON/LUKOIL/STATOIL/MOH
Quite why it is said, as part of the VESSEL INFO, that the vessel is approved by some oil companies and, as part of the Oil Company Approvals Clause (Clause 18 of the Vitol Terms), that the vessel is approved by (to some extent) different oil companies such as Motor Oil Hellas, is something of a mystery.
The facts
8. The facts as found by HHJ Mackie QC sitting in the Commercial Court can be shortly stated. The vessel set sail from the Black Sea after 2 nd June and the Charterer exercised its option to discharge and re-load in Antwerp between 2 nd and 7 th July. Class took the opportunity to conduct its Annual Survey while the vessel was at Antwerp. On 4 th July it was learned that an inspection had revealed that the low suction sea-chest valve needed repair before the vessel could sail. Repairs were expected to finish on 5 th July at the lay-by berth to which the vessel had shifted overnight. What actually happened was that Lloyd's Register had issued an interim certificate permitting the valve to be dealt with at the next port and a Condition of Class No. 030 was imposed. The vessel was able to leave Antwerp on 6 th July and on that date the Charterer e-mailed the Owner saying that that was fine provided there was “no negative impact on vetting prospect of our potential USA customers”
9. Meanwhile the Owner thought that it would be a sensible idea to invite Shell to inspect the vessel since a Shell “approval”, if it could be obtained, would be a valuable asset in the marketing of the vessel. Shell proceeded to file a SIRE report with 33 adverse comments on 9 th July, to which the Owner responded on 11 th or 12 th July. None of the comments related to the sea-chest valve. On 10 th July the Charterer made an agreement with Shell subject to vetting for the sale of the cargo at a price of WTI + $13 per barrel. On 13 th July the Owner was able to report that the defect in the suction sea-chest valve had been rectified by the crew at sea and that they would be calling in the Class surveyor at the next port to delete the condition of class. On 17 th July Mr Vellenga reported to the Owner that Shell had said the vessel was not acceptable and that Shell had decided not to purchase the Charterer's cargo. Ms. Van den Bossche of the Owner pointed out that Shell was not among the companies listed as “approving” the vessel in the charterparty, but the Charterer said it had no option but to sell the cargo elsewhere; it has now claimed the difference in price by way of damages from the Owner on the basis that the vessel was not in a fit state to be approved by any oil company and, in particular, the companies identified in the recap e-mail containing the charterparty. The judge has upheld this claim and there is now an appeal.
10. There are 3 questions which need to be resolved:—
(1) What were the (relevant) terms of the charterparty?
(2) What do those terms mean on their true construction?
(3) Was the Owner in breach of those terms on the facts as found by the judge?
Relevant terms of the Charterparty
10. I have already set out the transliterated provision about vessel approval to be found under the heading “VESSEL INFO”, which includes not only the phrase “to the best of owner's knowledge” but also “without owner's guarantee”.
11. The critical question under this head is whether the provision numbered “18’ in the recap e-mail is to be read together with the printed version of clause 18 of the Vitol terms or in substitution for it. Mr Cogley QC for the Charterer points out that the recap e-mail is careful to distinguish between clauses of the Vitol terms which are to be amended (e.g. 1,2,4,8,9,10,11,12,15,23,24,26,27,28,29,31,32,34 and 35–37), and to be deleted (e.g. 6,16,17,20,22,30,33 and 38). On the other hand terms which are to remain (e.g. 7, 13, 14, 19, 21, 39 and 40) are positively identified as such. Mr Kendrick QC for the Owner points out that neither express inclusion nor amendment...
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