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Monday, 01 April 19
FORCE MAJEURE SUCCESS NOT A SEA CHANGE - BALTIC EXCHANGE
 KNOWLEDGE TO ELEVATE
It is difficult to successfully argue that contractual performance has been prevented or delayed by force majeure. This is in part because English courts or arbitration tribunals will interpret these clauses strictly and narrowly against the party seeking to rely on them.
Recent decisions, including Triple Point Technology v PTT (2017) and Seadrill Ghana v Tullow Ghana (2018), are evidence of this approach. However, Sucden Middle-East, represented by Nick Fisher of HFW, has recently relied successfully on such a clause in the Commercial Court, on appeal from arbitration.
The case, Sucden Middle-East v Yagci Denizcilik Ve Ticaret Limited Sirketi, “The Mv Muammer Yagci”, involved a shipment of sugar to Algeria on the Sugar Charter Party 1999 form. The facts found by the arbitral tribunal were that when the cargo arrived in Algeria, the cargo-receivers submitted false import documents to local customs authorities. The local customs responded by seizing the cargo, using powers under customs laws and regulations.
A delay to discharging the cargo of four and a half months ensued. Sucden, as charterers, claimed this delay fell within the exceptions to laytime running under clause 28. Owners disagreed. At first instance, the arbitral tribunal agreed with owners.
Charterers appealed to the Commercial Court. Permission to bring the appeal was given on the basis that the question of law was one of general public importance, as it related to a standard form contract in wide commercial usage.
The judgement
The question before the Commercial Court was: “Where a cargo is seized by the local customs authorities at the discharge port causing a delay to discharge, is the time so lost caused by ‘government interferences’ within the meaning of clause 28 of the Sugar Charter Party 1999 form?” Clause 28 reads:
“Strikes and Force Majeure
In the event that whilst at or off the loading place or discharging place the loading and/or discharging of the vessel is prevented or delayed by any of the following occurrences: strikes, riots, civil commotions, lockouts of men, accidents and/or breakdowns on railways, stoppages on railway and/or river and/or canal by ice or frost, mechanical breakdowns at mechanical loading plants, government interferences, vessel being inoperative or rendered inoperative due to terms and conditions of employment of the Officers and Crew, time so lost shall not count as laytime on demurrage or detention…”
In deciding whether a force majeure event had occurred, the Court focused on the construction of “government interferences”. It was fairly straightforward to establish that a government entity acting in a sovereign capacity was involved, but owners argued that the government being involved was not enough and that there had to be “interferences”. In reaching its decision that there had been no interference, the tribunal had considered it a key point that seizure was an “ordinary” action. The Court rejected this conclusion. It held that the seizure of the cargo was not routine and did fall within the meaning of “interferences”. Seizure is a significant exercise of executive power and therefore could not be regarded as “ordinary”. Suspected or predictable consequences are not the same as ordinary actions (such as the inspection of the cargo by a government surveyor): “In the usual course of things, cargo is not seized and property rights are not invaded in that way.” The very fact that false documents were involved showed that the circumstances were not routine.
The Court emphasised that it was of “real importance” that its conclusion on the language was not difficult to apply, nor did it in any way offend commercial common sense.
The owners’ causation argument was also dismissed, as it was held that the seizure caused the delay, even if the submission of false documents caused the seizure.
Further detail
In allowing the appeal, the Court still maintained the strict and narrow approach to force majeure, stressing that “the answer given to the question is only a narrow ‘yes’. It is ‘yes’ where the circumstances are as in the present case. The answer does not address all of the circumstances that may come within or fall outside clause 28. The answer is concerned only with the seizure of a cargo and with that seizure by a customs authority that is a State revenue authority acting in a sovereign capacity”.
This judgment gives some welcome publicly-available guidance on the interpretation of a force majeure clause in a standard form widely used in sugar trading. While the charterers were successfully able to rely on the force majeure clause in this case, it does not signal a change in the strict and narrow approach typically adopted by the English courts.
Source: Baltic Exchange
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Friday, 29 January 21
COAL EXPORTS FROM AUSTRALIA TO MAINLAND CHINA DECLINED BY -22.2% Y-O-Y IN 2020 - BANCHERO COSTA
In the 12 months of 2020, global seaborne coal trade declined by as much as -12.7% year-on-year, according to vessel tracking data from Refinitiv, ...
Friday, 29 January 21
OPEC+, COVID-19 AND ENERGY TRANSITION - 3 THEMES IMPACTING OIL MARKETS AND REFINING IN 2021 - WOOD MACKENZIE
Wood Mackenzie’s latest outlook report shows that the art of balancing oil markets and the refining sector in 2021 hinges upon three key them ...
Thursday, 28 January 21
STRONG CHINESE THERMAL COAL IMPORTS TO BENEFIT INDONESIAN MINERS IN THE NEAR TERM - FITCH RATINGS
China's thermal coal imports are likely to remain strong ahead of the Chinese New Year in mid-February on robust demand, high utilisation at do ...
Thursday, 28 January 21
WIND PROPULSION FOR DRY BULK CARRIERS - OLDENDORFF
Oldendorff Carriers (OC) has signed a Joint Development Project (JDP) with Anemoi Marine Technologies (Anemoi), Lloyd’s Register (LR) and Sha ...
Thursday, 28 January 21
BUMA PRICED A USD400 MILLION 7.75% 5-YEAR SENIOR NOTES
PT Delta Dunia Makmur Tbk. announced that its subsidiary, PT Bukit Makmur Mandiri Utama priced a USD400 million 5-year (non-callable 2-year)& ...
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- Cigading International Bulk Terminal - Indonesia
- Interocean Group of Companies - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Riau Bara Harum - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Banpu Public Company Limited - Thailand
- Planning Commission, India
- Medco Energi Mining Internasional
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Straits Asia Resources Limited - Singapore
- Orica Australia Pty. Ltd.
- Bayan Resources Tbk. - Indonesia
- Ministry of Transport, Egypt
- London Commodity Brokers - England
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Indogreen Group - Indonesia
- Metalloyd Limited - United Kingdom
- Essar Steel Hazira Ltd - India
- Electricity Generating Authority of Thailand
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- GAC Shipping (India) Pvt Ltd
- Independent Power Producers Association of India
- Pipit Mutiara Jaya. PT, Indonesia
- Grasim Industreis Ltd - India
- Price Waterhouse Coopers - Russia
- Jorong Barutama Greston.PT - Indonesia
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Videocon Industries ltd - India
- Timah Investasi Mineral - Indoneisa
- Bangladesh Power Developement Board
- Vijayanagar Sugar Pvt Ltd - India
- Coal and Oil Company - UAE
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Iligan Light & Power Inc, Philippines
- White Energy Company Limited
- Tata Chemicals Ltd - India
- PowerSource Philippines DevCo
- Merrill Lynch Commodities Europe
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- Intertek Mineral Services - Indonesia
- Aditya Birla Group - India
- Altura Mining Limited, Indonesia
- Georgia Ports Authority, United States
- TNB Fuel Sdn Bhd - Malaysia
- Kapuas Tunggal Persada - Indonesia
- LBH Netherlands Bv - Netherlands
- Bharathi Cement Corporation - India
- Standard Chartered Bank - UAE
- European Bulk Services B.V. - Netherlands
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Minerals Council of Australia
- Agrawal Coal Company - India
- Kepco SPC Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Therma Luzon, Inc, Philippines
- Sical Logistics Limited - India
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Simpson Spence & Young - Indonesia
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- OPG Power Generation Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- International Coal Ventures Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Global Green Power PLC Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thai Mozambique Logistica
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Baramulti Group, Indonesia
- SMC Global Power, Philippines
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- Sree Jayajothi Cements Limited - India
- Meenaskhi Energy Private Limited - India
- Sojitz Corporation - Japan
- Directorate General of MIneral and Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Singapore Mercantile Exchange
- Attock Cement Pakistan Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- Miang Besar Coal Terminal - Indonesia
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Wood Mackenzie - Singapore
- Mercuria Energy - Indonesia
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Marubeni Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Edison Trading Spa - Italy
- Jaiprakash Power Ventures ltd
- Bhushan Steel Limited - India
- Energy Development Corp, Philippines
- Mjunction Services Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Dalmia Cement Bharat India
- Sakthi Sugars Limited - India
- Gujarat Mineral Development Corp Ltd - India
- The University of Queensland
- Bhatia International Limited - India
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- The Treasury - Australian Government
- Commonwealth Bank - Australia
- Uttam Galva Steels Limited - India
- Global Business Power Corporation, Philippines
- Indian Energy Exchange, India
- Wilmar Investment Holdings
- TeaM Sual Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Parry Sugars Refinery, India
- Aboitiz Power Corporation - Philippines
- SMG Consultants - Indonesia
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Sindya Power Generating Company Private Ltd
- Ministry of Finance - Indonesia
- GMR Energy Limited - India
- Anglo American - United Kingdom
- Maheswari Brothers Coal Limited - India
- Eastern Energy - Thailand
- Borneo Indobara - Indonesia
- Carbofer General Trading SA - India
- Ind-Barath Power Infra Limited - India
- MS Steel International - UAE
- Australian Coal Association
- Coastal Gujarat Power Limited - India
- CIMB Investment Bank - Malaysia
- Jindal Steel & Power Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
- Savvy Resources Ltd - HongKong
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- Leighton Contractors Pty Ltd - Australia
- Bukit Baiduri Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- Petron Corporation, Philippines
- CNBM International Corporation - China
- Renaissance Capital - South Africa
- Ministry of Mines - Canada
- Posco Energy - South Korea
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- Kohat Cement Company Ltd. - Pakistan
- Barasentosa Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Alfred C Toepfer International GmbH - Germany
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kobexindo Tractors - Indoneisa
- Romanian Commodities Exchange
- ASAPP Information Group - India
- New Zealand Coal & Carbon
- Semirara Mining and Power Corporation, Philippines
- Chamber of Mines of South Africa
- Maharashtra Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- Ambuja Cements Ltd - India
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Heidelberg Cement - Germany
- PTC India Limited - India
- Salva Resources Pvt Ltd - India
- Mintek Dendrill Indonesia
- San Jose City I Power Corp, Philippines
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Star Paper Mills Limited - India
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
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