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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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Wednesday, 13 January 21
CHINA THERMAL GENCO PROFITS FACE PRESSURE AMID POWER SHORTAGES - FITHCH WIRE
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Wednesday, 13 January 21
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Sunday, 10 January 21
KOREAN GENCOS INVITED BIDS FOR TOTAL 880,000 TONS OF COAL FOR MARCH 2021 LOADING
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Friday, 08 January 21
INDIA COULD COMPETE AGAINST CHINA IN SOLAR MODULE PRODUCTION WITH THE RIGHT GOVERNMENT SUPPORT - IEEFA
The focus should be on helping manufacturers become globally competitive
Although one of the top 10 solar module producers in the world, India ...
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- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
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- Planning Commission, India
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- Global Coal Blending Company Limited - Australia
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- Carbofer General Trading SA - India
- Economic Council, Georgia
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- Eastern Coal Council - USA
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
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- Sarangani Energy Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- Bukit Makmur.PT - Indonesia
- Parry Sugars Refinery, India
- Xindia Steels Limited - India
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ambuja Cements Ltd - India
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- Jorong Barutama Greston.PT - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Georgia Ports Authority, United States
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- Therma Luzon, Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Goldman Sachs - Singapore
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- Vijayanagar Sugar Pvt Ltd - India
- Attock Cement Pakistan Limited
- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thai Mozambique Logistica
- South Luzon Thermal Energy Corporation
- Rashtriya Ispat Nigam Limited - India
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Coal and Oil Company - UAE
- Directorate Of Revenue Intelligence - India
- Central Java Power - Indonesia
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Heidelberg Cement - Germany
- Leighton Contractors Pty Ltd - Australia
- SN Aboitiz Power Inc, Philippines
- Bhatia International Limited - India
- Thiess Contractors Indonesia
- Edison Trading Spa - Italy
- Bharathi Cement Corporation - India
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- Africa Commodities Group - South Africa
- Ministry of Mines - Canada
- Coalindo Energy - Indonesia
- Banpu Public Company Limited - Thailand
- McConnell Dowell - Australia
- Gujarat Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Renaissance Capital - South Africa
- Romanian Commodities Exchange
- The University of Queensland
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Indika Energy - Indonesia
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- Posco Energy - South Korea
- Riau Bara Harum - Indonesia
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- White Energy Company Limited
- Borneo Indobara - Indonesia
- Merrill Lynch Commodities Europe
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining and Power Corporation, Philippines
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- Australian Commodity Traders Exchange
- MS Steel International - UAE
- Mercator Lines Limited - India
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Power Finance Corporation Ltd., India
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- Medco Energi Mining Internasional
- Energy Development Corp, Philippines
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- PTC India Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Krishnapatnam Port Company Ltd. - India
- Coastal Gujarat Power Limited - India
- San Jose City I Power Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Deloitte Consulting - India
- Siam City Cement - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Malabar Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Indonesian Coal Mining Association
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Parliament of New Zealand
- Sree Jayajothi Cements Limited - India
- Global Green Power PLC Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Bangladesh Power Developement Board
- Toyota Tsusho Corporation, Japan
- Essar Steel Hazira Ltd - India
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Kideco Jaya Agung - Indonesia
- Cement Manufacturers Association - India
- Marubeni Corporation - India
- GAC Shipping (India) Pvt Ltd
- Electricity Authority, New Zealand
- Makarim & Taira - Indonesia
- Independent Power Producers Association of India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Petrochimia International Co. Ltd.- Taiwan
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- GVK Power & Infra Limited - India
- Kartika Selabumi Mining - Indonesia
- Sical Logistics Limited - India
- Australian Coal Association
- Jaiprakash Power Ventures ltd
- Ceylon Electricity Board - Sri Lanka
- Formosa Plastics Group - Taiwan
- Wilmar Investment Holdings
- Tata Chemicals Ltd - India
- Straits Asia Resources Limited - Singapore
- Kumho Petrochemical, South Korea
- Agrawal Coal Company - India
- Karaikal Port Pvt Ltd - India
- Latin American Coal - Colombia
- Dalmia Cement Bharat India
- Baramulti Group, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Price Waterhouse Coopers - Russia
- Vedanta Resources Plc - India
- Interocean Group of Companies - India
- Wood Mackenzie - Singapore
- AsiaOL BioFuels Corp., Philippines
- Indo Tambangraya Megah - Indonesia
- Kepco SPC Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- Salva Resources Pvt Ltd - India
- Star Paper Mills Limited - India
- Standard Chartered Bank - UAE
- SMC Global Power, Philippines
- Anglo American - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Indian Energy Exchange, India
- Barasentosa Lestari - Indonesia
- Globalindo Alam Lestari - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Mineral Development Corp Ltd - India
- Chettinad Cement Corporation Ltd - India
- Indian Oil Corporation Limited
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
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