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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, 07 December 21
COAL FIRMS SEE SHARE PRICES SURGE MONDAY, AFTER GOVERNMENT READJUSTS CONTRACT PRICES - GLOBAL TIMES
Share prices of China’s coal enterprises jumped on Monday on the A-share market following a nationwide adjustment to annual thermal coal pric ...
Monday, 06 December 21
CHINA SETS 2022 ANNUAL THERMAL COAL PRICES AT 700 YUAN/T - MEDIA: REUTERS
China’s top economic planner has proposed to set annual thermal coal prices for 2022 at between 550 yuan and 850 yuan ($86-$133) per tonne, a ...
Thursday, 02 December 21
BUMI RECORDED US$ 666.18 MILLION AS REVENUE IN THE 3RD QUARTER, UP 13.31% YOY
PT Bumi Resources Tbk and its subsidiaries have recorded a surge in revenue in the third quarter of 2021. BUMI has recorded US$ 666.18 million as r ...
Thursday, 02 December 21
CHINA'S COAL CRUNCH IS OVER, BUT PRICES ARE STILL TOO HIGH - REUTERS
China’s coal crisis has largely been resolved with gains in both production and stockpiles sufficient to ensure power supplies over winter.
...
Wednesday, 01 December 21
2022 OUTLOOK: INDONESIAN COAL MINING - FITCH RATINGS
Fitch Ratings has a neutral outlook on the Indonesian coal sector for 2022.
Earnings generation should slow down as selling pr ...
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- Bayan Resources Tbk. - Indonesia
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Parry Sugars Refinery, India
- Sree Jayajothi Cements Limited - India
- Goldman Sachs - Singapore
- Samtan Co., Ltd - South Korea
- Price Waterhouse Coopers - Russia
- Deloitte Consulting - India
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Karaikal Port Pvt Ltd - India
- London Commodity Brokers - England
- Alfred C Toepfer International GmbH - Germany
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kobexindo Tractors - Indoneisa
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- IEA Clean Coal Centre - UK
- Commonwealth Bank - Australia
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Coal and Oil Company - UAE
- Indogreen Group - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Ind-Barath Power Infra Limited - India
- McConnell Dowell - Australia
- Energy Development Corp, Philippines
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- PTC India Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- Bukit Baiduri Energy - Indonesia
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Electricity Generating Authority of Thailand
- Neyveli Lignite Corporation Ltd, - India
- Meenaskhi Energy Private Limited - India
- Bhatia International Limited - India
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- The State Trading Corporation of India Ltd
- Coastal Gujarat Power Limited - India
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Indika Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Sindya Power Generating Company Private Ltd
- Aditya Birla Group - India
- Pipit Mutiara Jaya. PT, Indonesia
- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Bangladesh Power Developement Board
- Australian Coal Association
- Global Business Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Essar Steel Hazira Ltd - India
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Global Coal Blending Company Limited - Australia
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- Kartika Selabumi Mining - Indonesia
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dalmia Cement Bharat India
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Gujarat Mineral Development Corp Ltd - India
- Petron Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Orica Mining Services - Indonesia
- Singapore Mercantile Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Marubeni Corporation - India
- Siam City Cement PLC, Thailand
- Indo Tambangraya Megah - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- Banpu Public Company Limited - Thailand
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Jindal Steel & Power Ltd - India
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Rio Tinto Coal - Australia
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Ambuja Cements Ltd - India
- Merrill Lynch Commodities Europe
- Kumho Petrochemical, South Korea
- Sical Logistics Limited - India
- Standard Chartered Bank - UAE
- Kapuas Tunggal Persada - Indonesia
- Sojitz Corporation - Japan
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- Port Waratah Coal Services - Australia
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- IHS Mccloskey Coal Group - USA
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
- Tamil Nadu electricity Board
- VISA Power Limited - India
- Tata Chemicals Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wood Mackenzie - Singapore
- SMC Global Power, Philippines
- Lanco Infratech Ltd - India
- Grasim Industreis Ltd - India
- Bhoruka Overseas - Indonesia
- Oldendorff Carriers - Singapore
- Mercuria Energy - Indonesia
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- Vedanta Resources Plc - India
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Energy Link Ltd, New Zealand
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement - Thailand
- Georgia Ports Authority, United States
- Coalindo Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Semirara Mining Corp, Philippines
- Parliament of New Zealand
- Indian Energy Exchange, India
- Intertek Mineral Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Minerals Council of Australia
- San Jose City I Power Corp, Philippines
- Latin American Coal - Colombia
- Pendopo Energi Batubara - Indonesia
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Ceylon Electricity Board - Sri Lanka
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The University of Queensland
- Salva Resources Pvt Ltd - India
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Therma Luzon, Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Agrawal Coal Company - India
- Krishnapatnam Port Company Ltd. - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate General of MIneral and Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- MS Steel International - UAE
- Antam Resourcindo - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Africa Commodities Group - South Africa
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- Jaiprakash Power Ventures ltd
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