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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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Sunday, 26 April 20
STRONGER BUNKER PRICES FAIL TO RALLY FREIGHT MARKET - FIS
VLSFO bunker prices rebounded by $22.50 to $229/mt in the port of Singapore but failed to turn around the spot freight market.
Some ...
Saturday, 25 April 20
KOREA SOUTH-EAST POWER CO. INVITED BIDS FOR 780K - 900K MT OF 5600 NCV COAL FOR JULY TO OCTOBER 2020 LOADING
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) has issued an international tender for 780,000~900,000 Metric Tons (MT) s ...
Saturday, 25 April 20
SEAFARER MENTAL WELLBEING DURING THE COVID-19 PANDEMIC - STANDARD CLUB
KNOWLEDGE TO ELEVATE
COVID-19 has forced many parts of the world to enforce a lockdown in a bid to flatten the curve in terms of transmissions ...
Friday, 24 April 20
KOMIPO INVITED BIDS FOR 5700 NAR COAL FOR JUNE & JULY LOADING
COALspot.com: South Korea’s Korea Midland Power Co. Ltd. (KOMIPO) Has Issued An International Tender For 260,000 Metric Tons (MT) Steam Coal ...
Friday, 24 April 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Dalmia Cement Bharat India
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- McConnell Dowell - Australia
- GVK Power & Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Mercuria Energy - Indonesia
- Altura Mining Limited, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Price Waterhouse Coopers - Russia
- Karaikal Port Pvt Ltd - India
- Star Paper Mills Limited - India
- Economic Council, Georgia
- Sinarmas Energy and Mining - Indonesia
- Interocean Group of Companies - India
- Goldman Sachs - Singapore
- White Energy Company Limited
- Ministry of Transport, Egypt
- Lanco Infratech Ltd - India
- Makarim & Taira - Indonesia
- Iligan Light & Power Inc, Philippines
- Samtan Co., Ltd - South Korea
- Global Business Power Corporation, Philippines
- Siam City Cement - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Thai Mozambique Logistica
- Videocon Industries ltd - India
- PNOC Exploration Corporation - Philippines
- ASAPP Information Group - India
- Australian Coal Association
- Latin American Coal - Colombia
- Vizag Seaport Private Limited - India
- AsiaOL BioFuels Corp., Philippines
- Energy Development Corp, Philippines
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Kobexindo Tractors - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Mercator Lines Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Therma Luzon, Inc, Philippines
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sakthi Sugars Limited - India
- SMC Global Power, Philippines
- Banpu Public Company Limited - Thailand
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Indika Energy - Indonesia
- Marubeni Corporation - India
- Bulk Trading Sa - Switzerland
- Bhatia International Limited - India
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Indonesian Coal Mining Association
- International Coal Ventures Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Global Green Power PLC Corporation, Philippines
- Trasteel International SA, Italy
- Chamber of Mines of South Africa
- Savvy Resources Ltd - HongKong
- Medco Energi Mining Internasional
- Ministry of Mines - Canada
- Manunggal Multi Energi - Indonesia
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Simpson Spence & Young - Indonesia
- The State Trading Corporation of India Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- PTC India Limited - India
- Mjunction Services Limited - India
- OPG Power Generation Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Planning Commission, India
- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Central Java Power - Indonesia
- Jaiprakash Power Ventures ltd
- Wilmar Investment Holdings
- Malabar Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Eastern Coal Council - USA
- GMR Energy Limited - India
- Krishnapatnam Port Company Ltd. - India
- San Jose City I Power Corp, Philippines
- Aboitiz Power Corporation - Philippines
- VISA Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- Parliament of New Zealand
- New Zealand Coal & Carbon
- Karbindo Abesyapradhi - Indoneisa
- Sical Logistics Limited - India
- IHS Mccloskey Coal Group - USA
- Uttam Galva Steels Limited - India
- London Commodity Brokers - England
- Kumho Petrochemical, South Korea
- Kartika Selabumi Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- Larsen & Toubro Limited - India
- Edison Trading Spa - Italy
- Directorate General of MIneral and Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- CIMB Investment Bank - Malaysia
- Chettinad Cement Corporation Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Indian Oil Corporation Limited
- Intertek Mineral Services - Indonesia
- Posco Energy - South Korea
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Globalindo Alam Lestari - Indonesia
- Borneo Indobara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Renaissance Capital - South Africa
- SN Aboitiz Power Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Sree Jayajothi Cements Limited - India
- Barasentosa Lestari - Indonesia
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Antam Resourcindo - Indonesia
- Parry Sugars Refinery, India
- Thiess Contractors Indonesia
- Indogreen Group - Indonesia
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Vedanta Resources Plc - India
- GAC Shipping (India) Pvt Ltd
- South Luzon Thermal Energy Corporation
- India Bulls Power Limited - India
- TeaM Sual Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Minerals Council of Australia
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Eastern Energy - Thailand
- PetroVietnam Power Coal Import and Supply Company
- Sojitz Corporation - Japan
- Aditya Birla Group - India
- Orica Mining Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Commonwealth Bank - Australia
- Madhucon Powers Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- ICICI Bank Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- Standard Chartered Bank - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
- Sindya Power Generating Company Private Ltd
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Power Finance Corporation Ltd., India
- Indo Tambangraya Megah - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Romanian Commodities Exchange
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