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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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Friday, 28 June 24
INDIAN POWER STATIONS STOCKED WITH BUMPER COAL SUPPLY AS TRANSPORT WOES EASE - BUSINESS STANDARD
Even as power demand has touched a historic high of 250 gigawatts (Gw) amid sweltering heat this June, India’s power stations are stocked wit ...
Friday, 28 June 24
INDIA'S CY23 COAL USE LARGER THAN NORTH AMERICA, EUROPE COMBINED - THE HINDU
For the first time, India’s coal consumption surpassed that of North America and Europe combined in the calendar year 2023, said Energy Insti ...
Monday, 24 June 24
PLN'S FINANCIAL SUSTAINABILITY RESTS ON ACCELERATED COAL RETIREMENT AND RENEWABLES DEPLOYMENT - MUTYA YUSTIKA
On 28 May 2024, Indonesia’s national electricity utility, PT Perusahaan Listrik Negara (PLN), released its financial report for 2023. Althoug ...
Monday, 24 June 24
INDIA'S COAL-BASED POWER DEMAND AT ALL-TIME HIGH, GOVERNMENT SAYS - REUTERS
India’s demand for coal-based power has risen by 7.3% this fiscal year to an all-time high, the government said in a statement on Wednesday.
...
Monday, 24 June 24
CHINA'S COAL INDUSTRY TURNS GREENER THROUGH INNOVATIVE APPROACHES - PEOPLE'S DAILY
At an opencast mine operated by Inner Mongolia Pingzhuang Coal Group Co. Ltd., a subsidiary of CHN Energy Investment Group (CHN Energy), a 14-meter ...
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Showing 11 to 15 news of total 6871 |
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- Gujarat Sidhee Cement - India
- Kepco SPC Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Medco Energi Mining Internasional
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- Barasentosa Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Videocon Industries ltd - India
- Leighton Contractors Pty Ltd - Australia
- Grasim Industreis Ltd - India
- Pendopo Energi Batubara - Indonesia
- Electricity Authority, New Zealand
- Maheswari Brothers Coal Limited - India
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- Port Waratah Coal Services - Australia
- Merrill Lynch Commodities Europe
- San Jose City I Power Corp, Philippines
- Australian Coal Association
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- Jaiprakash Power Ventures ltd
- Edison Trading Spa - Italy
- Kartika Selabumi Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Georgia Ports Authority, United States
- Oldendorff Carriers - Singapore
- Xindia Steels Limited - India
- Manunggal Multi Energi - Indonesia
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Altura Mining Limited, Indonesia
- Antam Resourcindo - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- Aboitiz Power Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Interocean Group of Companies - India
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- Savvy Resources Ltd - HongKong
- Gujarat Mineral Development Corp Ltd - India
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- Rashtriya Ispat Nigam Limited - India
- SMC Global Power, Philippines
- Singapore Mercantile Exchange
- South Luzon Thermal Energy Corporation
- Orica Mining Services - Indonesia
- Orica Australia Pty. Ltd.
- Parliament of New Zealand
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- PNOC Exploration Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Coalindo Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Globalindo Alam Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- Formosa Plastics Group - Taiwan
- ASAPP Information Group - India
- Aditya Birla Group - India
- Semirara Mining Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- TeaM Sual Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Intertek Mineral Services - Indonesia
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- VISA Power Limited - India
- New Zealand Coal & Carbon
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Siam City Cement - Thailand
- Larsen & Toubro Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Cigading International Bulk Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Lanco Infratech Ltd - India
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Karaikal Port Pvt Ltd - India
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- Kapuas Tunggal Persada - Indonesia
- Rio Tinto Coal - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maharashtra Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- MS Steel International - UAE
- Ministry of Finance - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Essar Steel Hazira Ltd - India
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- CIMB Investment Bank - Malaysia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- Baramulti Group, Indonesia
- Minerals Council of Australia
- SN Aboitiz Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- Independent Power Producers Association of India
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Bharathi Cement Corporation - India
- Marubeni Corporation - India
- The University of Queensland
- McConnell Dowell - Australia
- LBH Netherlands Bv - Netherlands
- Wilmar Investment Holdings
- Planning Commission, India
- Power Finance Corporation Ltd., India
- Coastal Gujarat Power Limited - India
- The State Trading Corporation of India Ltd
- SMG Consultants - Indonesia
- Bangladesh Power Developement Board
- Meralco Power Generation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- IHS Mccloskey Coal Group - USA
- Bukit Baiduri Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Anglo American - United Kingdom
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- Economic Council, Georgia
- International Coal Ventures Pvt Ltd - India
- Carbofer General Trading SA - India
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Sinarmas Energy and Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Kumho Petrochemical, South Korea
- Central Java Power - Indonesia
- Commonwealth Bank - Australia
- Salva Resources Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sical Logistics Limited - India
- Asmin Koalindo Tuhup - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Binh Thuan Hamico - Vietnam
- PTC India Limited - India
- CNBM International Corporation - China
- Mercator Lines Limited - India
- Attock Cement Pakistan Limited
- India Bulls Power Limited - India
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Electricity Generating Authority of Thailand
- Uttam Galva Steels Limited - India
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Global Green Power PLC Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- White Energy Company Limited
- Latin American Coal - Colombia
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