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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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Monday, 28 September 20
NEW LNG PROJECTS - ALL DRESSED UP AND NO PLACE TO GO - WOOD MACKENZIE
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Thursday, 24 September 20
KOREA MIDLAND POWER TO BUY 1.92 MILLION TONS OF 4,300-4,700 NCV COAL FOR THREE YEARS
COALspot.com: Korea Midland Power Co. Ltd, has issued an International tender for 640,000 MT 4,300-4,700 kcal/kg NCV coal per year.
...
Wednesday, 23 September 20
VIETNAM'S NEW POWER DEVELOPMENT PLAN MUST OPTIMIZE RENEWABLES AND AVOID FOSSIL FUEL LOCK-IN: IEEFA
EVN’s financial constraints leaves the utility with little room for error
Implementing Vietnam’s soon-to-be-launched next Power De ...
Wednesday, 23 September 20
MARKET INSIGHT - INTERMODAL
Undoubtedly, this year (ongoing) will never be forgotten because in a matter of months it has managed to severely affect and shape our day to day p ...
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- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Medco Energi Mining Internasional
- LBH Netherlands Bv - Netherlands
- McConnell Dowell - Australia
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- Bhushan Steel Limited - India
- Kobexindo Tractors - Indoneisa
- The University of Queensland
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- Trasteel International SA, Italy
- Mjunction Services Limited - India
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- Petron Corporation, Philippines
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- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
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- Ministry of Mines - Canada
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- Altura Mining Limited, Indonesia
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- Leighton Contractors Pty Ltd - Australia
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- Global Green Power PLC Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
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- Tamil Nadu electricity Board
- Jindal Steel & Power Ltd - India
- Wood Mackenzie - Singapore
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- Chettinad Cement Corporation Ltd - India
- SMG Consultants - Indonesia
- Miang Besar Coal Terminal - Indonesia
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- Kaltim Prima Coal - Indonesia
- Posco Energy - South Korea
- Carbofer General Trading SA - India
- Planning Commission, India
- Sojitz Corporation - Japan
- Bhatia International Limited - India
- Gujarat Sidhee Cement - India
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- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- Jaiprakash Power Ventures ltd
- Thai Mozambique Logistica
- Deloitte Consulting - India
- Bahari Cakrawala Sebuku - Indonesia
- Power Finance Corporation Ltd., India
- Georgia Ports Authority, United States
- Bulk Trading Sa - Switzerland
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Price Waterhouse Coopers - Russia
- Indian Oil Corporation Limited
- TeaM Sual Corporation - Philippines
- Larsen & Toubro Limited - India
- Commonwealth Bank - Australia
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- GVK Power & Infra Limited - India
- Therma Luzon, Inc, Philippines
- Eastern Coal Council - USA
- Sakthi Sugars Limited - India
- Coal and Oil Company - UAE
- Electricity Generating Authority of Thailand
- Edison Trading Spa - Italy
- Borneo Indobara - Indonesia
- Port Waratah Coal Services - Australia
- Semirara Mining Corp, Philippines
- Metalloyd Limited - United Kingdom
- Iligan Light & Power Inc, Philippines
- Thiess Contractors Indonesia
- Rashtriya Ispat Nigam Limited - India
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Samtan Co., Ltd - South Korea
- Bukit Makmur.PT - Indonesia
- India Bulls Power Limited - India
- Energy Development Corp, Philippines
- Makarim & Taira - Indonesia
- Sarangani Energy Corporation, Philippines
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- Jorong Barutama Greston.PT - Indonesia
- Attock Cement Pakistan Limited
- Ind-Barath Power Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Siam City Cement - Thailand
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- PowerSource Philippines DevCo
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Independent Power Producers Association of India
- Karbindo Abesyapradhi - Indoneisa
- London Commodity Brokers - England
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- PTC India Limited - India
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- Africa Commodities Group - South Africa
- Lanco Infratech Ltd - India
- Standard Chartered Bank - UAE
- Global Business Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
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- TNB Fuel Sdn Bhd - Malaysia
- Globalindo Alam Lestari - Indonesia
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- Parliament of New Zealand
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- Semirara Mining and Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- Ceylon Electricity Board - Sri Lanka
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Rio Tinto Coal - Australia
- Indo Tambangraya Megah - Indonesia
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Chamber of Mines of South Africa
- Karaikal Port Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Malabar Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Electricity Authority, New Zealand
- Interocean Group of Companies - India
- Xindia Steels Limited - India
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- GMR Energy Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Renaissance Capital - South Africa
- Goldman Sachs - Singapore
- Uttam Galva Steels Limited - India
- Tata Chemicals Ltd - India
- Kumho Petrochemical, South Korea
- Madhucon Powers Ltd - India
- Central Electricity Authority - India
- Essar Steel Hazira Ltd - India
- Global Coal Blending Company Limited - Australia
- Baramulti Group, Indonesia
- Indian Energy Exchange, India
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- Maheswari Brothers Coal Limited - India
- PNOC Exploration Corporation - Philippines
- Vedanta Resources Plc - India
- Oldendorff Carriers - Singapore
- Salva Resources Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Ambuja Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- Coalindo Energy - Indonesia
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coastal Gujarat Power Limited - India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- Economic Council, Georgia
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Sindya Power Generating Company Private Ltd
- Alfred C Toepfer International GmbH - Germany
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- The Treasury - Australian Government
- Vizag Seaport Private Limited - India
- San Jose City I Power Corp, Philippines
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