Delivery without the production of bills of lading – construction of LOI’s – relevant belief in the identity of receiver that of the master – limitation of duration of indemnity in charter party not replicated in LOI construed on its own wording
Pursuant to a pool agreement, the vessel was time chartered on the Shelltime 4 form by Songa to Navig8 Chemicals Pool Inc.
Navig8 chartered her on the Vegoilvoy form to Glencore Agriculture BV to carry a minimum of 19,000 m.t. of crude sunflower seed oil from Ilychevsk, Ukraine, for delivery at safe ports in the New Mangalore/Kakinada range in Glencore’s option.
The vessel loaded under the voyage charter at Ilychevsk and bills of lading consigned to order were issued naming Ruchi as the notify party.
Glencore’s contract of sale was to sell 6,000 m.t. to Aavanti . Aavanti had contracted to sell 6,000 m.t. to Ruchi.
In the event, 4,000 m.t. was delivered to Ruchi from the vessel at New Mangalore and 2,000 m.t. was delivered to Ruchi from the vessel at Kakinada.
Neither delivery was made against presentation of any original bill of lading.
By two LOIs addressed to Glencore, Aavanti requested that delivery without production of bills of lading be made to Ruchi (or to such party as Glencore believed to be, to represent, or to be acting on behalf of Ruchi) (‘the Aavanti LOIs’). One of these LOIs requested delivery of 4,000 m.t. “at the port of MANGALORE, INDIA“, the other requested delivery of 2,000 m.t. “at KAKINADA, INDIA“.
By LOIs addressed to Navig8, Glencore requested that delivery without production of bills of lading be made to Aavanti (or to such party as Navig8 believed to be, to represent, or to be acting on behalf of Aavanti) (‘the Glencore LOIs’).
By LOIs deemed to have been issued by Navig8 addressed to Songa, Navig8 requested that delivery without production of bills of lading be made to Aavanti (or to such party as Songa believed to be, to represent, or to be acting on behalf of Aavanti) (‘the Navig8 LOIs’). The deemed issue of the Navig8 LOIs, by operation of clause 87 of the time charter, is common ground between Songa and Navig8.
The purchase by Aavanti from Glencore was financed by Société Générale, the holder of the bills of lading for the quantities discharged against the LOIs.
Neither Aavanti nor SG were paid .
Having obtained security for its claim by way of a letter of undertaking provided by Glencore, against a threatened arrest of the vessel or a sister ship under in rem proceedings commenced in Singapore, SG pusued Songa in London arbitration under the bills of lading for damages for misdelivery.
Songa claimed against Navig8, in claim no. 627 under the Navig8 LOIs, that in taking delivery from the vessel, Ruchi represented or was acting on behalf of Aavanti so that delivery was indeed to Aavanti as requested, alternatively that in effecting such delivery Songa believed Ruchi to represent or act on behalf of Aavanti, alternatively that the delivery to Ruchi was deemed by paragraph 4 of the Navig8 LOIs to have been delivery to Aavanti.
In claim no. 637 under the Glencore LOIs, Navig8 made the equivalent claim against Glencore.
Songa and Navig8 respectively sought interim declaratory and injunctive relief.
Findings Continue reading “564. Songa Chemicals AS v Navig8 Chemicals Pool Inc (the “Songa Winds”)  EWHC 397 (Comm)”