Unicredit Bank A.G. v Euronav N.v
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Moulder |
| Judgment Date | 15 March 2022 |
| Neutral Citation | [2022] EWHC 564 (Comm) |
| Docket Number | Case No: CL 2021-000020 |
| Court | Queen's Bench Division (Commercial Court) |
[2022] EWHC 564 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
Rolls Building
Fetter Lane
London
EC4A 1NL
Mrs Justice Moulder
Case No: CL 2021-000020
John Russell QC, Gemma Morgan AND Joe Gourgey (instructed by HFW) for the CLAIMANT
Robert Thomas QC AND Paul Toms (instructed by PRESTON TURNBULL) for the DEFENDANT
Hearing date: 4 March 2022
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.
THE HON. Mrs Justice Moulder
This judgment was handed down by the judge remotely by circulation to the parties' representatives by email and release to Bailii. The date and time for hand-down is deemed to be 10:00am on 15 th March 2022.
INTRODUCTION
This is the court's judgment on the issue raised by the Defendant, Euronav N.V. (“Euronav”), as to whether it may make certain amendments to its Defence on the basis that such amendments fall within the scope of a Consent Order approved by Butcher J dated 14 January 2022 (the “14 January Consent Order”).
If the proposed amendments are found not to fall within the scope of the 14 January Consent Order, Euronav seeks, in the alternative, permission to make the proposed amendments now.
The Claimant, UniCredit Bank A.G. (“UniCredit”), resists the proposed amendments; it contends that the amendments are not within the scope of the 14 January Consent Order and that permission should not now be given at this “late” stage.
The trial in this case is due to commence on 28 March 2022.
This issue was the subject of a full day of submissions at the Pre-Trial Review, heard remotely (via Microsoft Teams) on 4 March 2022.
The Pre-Trial Review was originally listed to take place on 25 February 2022 but was subsequently relisted for 4 March 2022 because both parties ultimately accepted, on the day before the original hearing (after skeletons had been exchanged), that a half-day listing would be insufficient given the scope of what was in issue.
BACKGROUND
I set out below a brief summary of the background to the claim. (This is not intended to be a comprehensive summary of all the issues raised in the pleadings.)
By way of a letter of credit on or about 1 April 2020, UniCredit financed the purchase of part of a cargo of low sulphur fuel oil (the “Cargo”) by Gulf Petroleum FZC (“Gulf”) from BP Oil International Ltd (“BP”).
Euronav was at all material times the owner of the vessel “Mt Sienna”, which BP had originally chartered in relation to the carriage of the Cargo.
UniCredit alleges that Euronav delivered the Cargo to someone other than the lawful holder of the relevant Bill of Lading, or without authorisation of the lawful holder of the Bill of Lading.
Euronav contends in response that the lawful holder of the Bill of Lading at the time of discharge of the Cargo was either BP or Gulf, and that delivery/discharge was authorised by BP, alternatively Gulf.
Euronav further alleges that if UniCredit was the lawful holder of the Bill of Lading at the time of delivery/discharge, UniCredit authorised Gulf to request and obtain discharge/delivery without production of the Bill of Lading and/or has waived (or is estopped from exercising) any right that it might have had for delivery or discharge to be made only against production of the Bill of Lading.
UniCredit accepts that it had – vis-à-vis Gulf – authorised delivery of the Cargo to six identified sub-buyers (the “Sub-Buyers”, also called the “Off-Takers”) on payment terms that required those Sub-Buyers to pay UniCredit directly, 90 days after delivery. However, UniCredit says that the Cargo was in fact discharged from the Mt Sienna to two other vessels without production of the Bill of Lading. UniCredit says that it does not know to whom the Cargo was actually delivered.
UniCredit's claim against Euronav was originally quantified by UniCredit at US$26,367,200, which was said to be the market value of the Cargo at the time of the alleged misdelivery. This figure was then amended by UniCredit, by way of its Amended Particulars of Claim, to US$14,358,400. Euronav contends that the value of the Cargo at the time of the alleged misdelivery, and therefore the correct quantification of UniCredit's claim, is US$13,185,011.24.
However, UniCredit now claims that it is entitled to damages reflecting the value of the Cargo on a later date, which is said to be the date that the Cargo would have been sold in a counterfactual scenario (i.e., the earliest date upon which UniCredit could have reasonably mitigated its loss by taking delivery of the Cargo from Euronav and selling the Cargo into the available market). The value of the Cargo in that counterfactual scenario is alleged to be between US$24,280,800 – US$24,701,600.
EVIDENCE
The court had the following evidence in relation to the issue now before the court:
i) for Euronav, the Third Witness Statement of Andrew James Preston of Preston Turnbull LLP (“Preston Turnbull”); and
ii) for UniCredit, the First Witness Statement of Caroline Frances West of Holman Fenwick Willan Switzerland LLP (“HFW”).
CHRONOLOGY
So far as is material, the chronology of relevant events is as follows:
i) on 22 November 2021, UniCredit circulated draft Amended Particulars of Claim to Euronav, with proposed amendments to its case on quantum;
ii) on 23 November 2021, Preston Turnbull responded on behalf of Euronav, consenting to the proposed amendments save for those at paragraph 29 of the draft Amended Particulars of Claim which related to the counterfactual scenario referred to at [15] above;
iii) on 15 December 2021, Butcher J approved a Consent Order (the “15 December Consent Order”) granting UniCredit permission to amend its Particulars of Claim in the manner proposed, save for the amendments to paragraph 29 concerning the counterfactual scenario (as referred to above);
iv) in early November 2021, Euronav sought disclosure from UniCredit of documents which had not previously been disclosed and which were produced by, or exchanged with, investigatory agents appointed by UniCredit (the “Off-Taker Documents”);
v) UniCredit initially sought to invoke privilege over the Off-Taker Documents;
vi) in late December 2021, the parties reached agreement on both these matters: Euronav consented to the amendments to the Particulars of Claim relating to the counterfactual scenario referred to above; and UniCredit agreed to provide disclosure of the Off-Taker Documents. This agreement is the subject of without prejudice inter partes correspondence which, for reasons discussed below, the court has not considered;
vii) on 14 January 2022, Butcher J approved the 14 January Consent Order which directed, among other things, that:
a) UniCredit should serve its Amended Particulars of Claim, to include the amendments relating to the counterfactual scenario, by 14 January 2022;
b) Euronav should serve its Amended Defence by 18 February 2022 (which constituted an extension of the original deadline that had been stipulated in the 15 December Consent Order referred to above); and
c) UniCredit should disclose the Off-Taker Documents in two tranches, on 10 January 2022 and 21 January 2022;
viii) on 18 February 2022, Euronav served a draft Amended Defence, which included amendments said to have arisen out of the disclosure provided by UniCredit in compliance with the 14 January 2022 Consent Order; and
ix) on 22 February 2022, UniCredit objected to the amendments at paragraphs 33, 66, 71.3, 77.2 and 81 of the draft Amended Defence on the basis that they are not consequential on the amendments made to the Particulars of Claim.
THE PROPOSED AMENDMENTS
Euronav characterised the proposed amendments (paragraphs 22–24 of Mr Preston's witness statement) as falling within one of two categories:
i) amendments relating to the relationship between Gulf and the Sub-Buyers (those at paragraph 33); and
ii) amendments which refer to the connection between Gulf and the Sub Buyers and its impact as to whether there was a misdelivery and/or whether the Claimant suffered any loss as a result of the manner in which the Cargo was delivered (those at paragraphs 66, 71.3 and 81).
By way of its supplemental skeleton submissions filed ahead of the Pre-Trial Review, Euronav confirmed that it was no longer pursuing certain amendments it had proposed to make to paragraph 77.2 of its Defence.
Relationship between Gulf and the Sub-Buyers
Paragraphs 31 to 33 of Euronav's draft Amended Defence read as follows (with the proposed amendments underlined):
“31. By email dated 15 April 2020, Mukul Agarwal provided Diana Bodnya with the details of the six buyers (“the sub-buyers”) who would be purchasing the Financed Cargo and sent unsigned copies of the sale contracts and “credit endorsements”. The email confirmed that the Financed Cargo was still on board the Vessel. Payment under those sub-sale contracts was said to be 90 days from delivery date (in accordance with the previous advice) and the security for each sale was said to be “credit insured”. Gulf advised that it would “revert with sales invoices and BL copies once cargo is delivered”.
32. On the same day, Diana Bodnya confirmed by email that the sub-buyers were acceptable to the Claimant but asked Gulf to confirm that none were related parties to Gulf. The Claimant also asked Gulf to confirm that these were not new sub-buyers and that Gulf had a positive track record with them. Since the contracts that had been sent to the Claimant were not signed, the Claimant asked for a deal recap/email trade confirmation and an updated insurance policy since the one the Claimant had...
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