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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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Tuesday, 29 December 20
CORROSION-RESISTANT STEELS FOR CARGO OIL TANKS - DNV GL
KNOWLEDGE TO ELEVATE
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Wednesday, 23 December 20
COKING COAL'S DECLINE LIKELY TO FOLLOW THE PATH OF THERMAL COAL’S PROGRESSIVE DEMISE - IEEFA
Technology disruption the likely theme of global energy markets in 2021
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Wednesday, 23 December 20
MARKET INSIGHT - INTERMODAL
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Tuesday, 22 December 20
2021 DRY BULK OUTLOOK - SUPPLY GROWTH - TORVALD KLAVENESS
In the first article in the series we mentioned that dry bulk freight was in a super cycle between 2001 and 2008. The growth in global yard capacit ...
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Eastern Coal Council - USA
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Oldendorff Carriers - Singapore
- Ministry of Transport, Egypt
- Meralco Power Generation, Philippines
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Heidelberg Cement - Germany
- GN Power Mariveles Coal Plant, Philippines
- Iligan Light & Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Marubeni Corporation - India
- Makarim & Taira - Indonesia
- Petron Corporation, Philippines
- Metalloyd Limited - United Kingdom
- LBH Netherlands Bv - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- PTC India Limited - India
- Carbofer General Trading SA - India
- Bukit Baiduri Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- Merrill Lynch Commodities Europe
- Parliament of New Zealand
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Chamber of Mines of South Africa
- GMR Energy Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- VISA Power Limited - India
- Commonwealth Bank - Australia
- Bukit Makmur.PT - Indonesia
- White Energy Company Limited
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- Antam Resourcindo - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kobexindo Tractors - Indoneisa
- Ministry of Finance - Indonesia
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- Ceylon Electricity Board - Sri Lanka
- Karbindo Abesyapradhi - Indoneisa
- ASAPP Information Group - India
- Directorate Of Revenue Intelligence - India
- Kohat Cement Company Ltd. - Pakistan
- SMC Global Power, Philippines
- Central Electricity Authority - India
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Lanco Infratech Ltd - India
- Port Waratah Coal Services - Australia
- Mercuria Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tamil Nadu electricity Board
- Sakthi Sugars Limited - India
- MS Steel International - UAE
- Krishnapatnam Port Company Ltd. - India
- Indian Oil Corporation Limited
- Grasim Industreis Ltd - India
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Baramulti Group, Indonesia
- Latin American Coal - Colombia
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Energy Development Corp, Philippines
- SMG Consultants - Indonesia
- Chettinad Cement Corporation Ltd - India
- Straits Asia Resources Limited - Singapore
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- AsiaOL BioFuels Corp., Philippines
- Meenaskhi Energy Private Limited - India
- Kepco SPC Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Mercator Lines Limited - India
- Leighton Contractors Pty Ltd - Australia
- Mintek Dendrill Indonesia
- The State Trading Corporation of India Ltd
- Wood Mackenzie - Singapore
- Tata Chemicals Ltd - India
- Australian Commodity Traders Exchange
- Kumho Petrochemical, South Korea
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Electricity Authority, New Zealand
- Ind-Barath Power Infra Limited - India
- Semirara Mining Corp, Philippines
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Intertek Mineral Services - Indonesia
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Uttam Galva Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Borneo Indobara - Indonesia
- Aboitiz Power Corporation - Philippines
- Maheswari Brothers Coal Limited - India
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Videocon Industries ltd - India
- San Jose City I Power Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Indian Energy Exchange, India
- London Commodity Brokers - England
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- Renaissance Capital - South Africa
- Siam City Cement - Thailand
- Sical Logistics Limited - India
- PowerSource Philippines DevCo
- PNOC Exploration Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Xindia Steels Limited - India
- Georgia Ports Authority, United States
- Asmin Koalindo Tuhup - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Ministry of Mines - Canada
- Cigading International Bulk Terminal - Indonesia
- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- Posco Energy - South Korea
- Parry Sugars Refinery, India
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- Rio Tinto Coal - Australia
- Power Finance Corporation Ltd., India
- ICICI Bank Limited - India
- Deloitte Consulting - India
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- Global Business Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Agrawal Coal Company - India
- Australian Coal Association
- Romanian Commodities Exchange
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Eastern Energy - Thailand
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Thiess Contractors Indonesia
- Kaltim Prima Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Minerals Council of Australia
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- Karaikal Port Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Indogreen Group - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Essar Steel Hazira Ltd - India
- Bhatia International Limited - India
- IHS Mccloskey Coal Group - USA
- OPG Power Generation Pvt Ltd - India
- Edison Trading Spa - Italy
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- Economic Council, Georgia
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Binh Thuan Hamico - Vietnam
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Wilmar Investment Holdings
- Sojitz Corporation - Japan
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Sindya Power Generating Company Private Ltd
- New Zealand Coal & Carbon
- Holcim Trading Pte Ltd - Singapore
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Interocean Group of Companies - India
- Bahari Cakrawala Sebuku - Indonesia
- Goldman Sachs - Singapore
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