Contract formation – agreement to agree not enforceable – shipbuilding contracts. The Facts Teekay Tankers Ltd, incorporated in the Marshall Islands and listed on the New York Stock Exchange, a subsidiary of Teekay Corp, operate a fleet of oil tankers from Vancouver. Teekay contracted with STX, Korea to build 16 aframax tankers. The first 4 […]
545. El Greco (Australia) (Pty) Ltd v Mediterranean Shipping Co SA (the “MSC Melbourne”)  2 Lloyds Rep 537
Hague Visby Rules – substantial quantity of individual prints and posters packed in a container – not “units” for purposes of limitation The Facts A cargo of posters and prints were loaded on board the vessel at Port Botany, Sydney in a 20 foot general purpose container. The vessel sailed for Antwerp where the container […]
544. Kyokuyo Ltd v AP Møller v Maersk A/S t/a “Maersk Line” (the “Maersk Tangier”) EWHC 654 (Comm);  EWCA Civ 778
Hague/Hague Visby Rules – limitation as applied to containerized frozen fish. The Facts Twelve containers of frozen tuna were shipped on Maersk Tangier on 24 November 2012. The vessel sailed from Cartagena, Spain to Yokohama. En route, at Valencia, nine of the twelve containers were transshipped onto Maersk Emden. The three remaining containers A, B […]
Hague Rules – containers are not “packages” for the purposes of limitation – parties’ agreement to treat containers as packages hit by Art.III rule 8. The Facts The vessel sank off the coast of Portugal with loss of life and total loss of cargo. Clause 9 (B) of the Bills of Lading provided: “Shipper packed […]
542. Navelmar UK Ltd v Kale Maden Hammaddeler Sanayi Ticaret AS (“the MV Arundel Castle”)  EWHC 116 (Comm)
Port charterparty – “within port limits” defined. The Facts A fixture recap contained the following clause: “15. Notice of readiness to be tendered at both ends even by cable/telefax on vessel’s arrival at load/discharging ports within port limits. The notice of readiness not to be tendered before commencement of laydays. … Otherwise Gencon 94 printed […]
Claim for recovery of money paid under an illegal contract The Facts Patel paid £620 000 to Mirza to bet on Royal Bank of Scotland shares, using inside information. The purpose of the contract was never carried out and Patel sued for the return of his money. Findings Deputy Judge David Donaldson QC refused the claim […]
540. Transgrain Shipping (Singapore) Pte Ltd v Yangtze Navigation (Hong Kong) Co Ltd (the “MV Yangtze Xing Hua”)  EWHC 3132 (Comm)
Interpretation of clause 8(d) of the Inter-Club Agreement, 1996 The Facts Soya bean meal was shipped from South America to Iran under a trip time charter on the NYPE form. The vessel arrived off the discharge port in Iran in December 2012. Not having been paid for the cargo, charterers ordered the vessel to wait […]
539. Volcafe Ltd v Compania Sud Americana de Vapores SA (trading as “CSAV”)  EWCA Civ 1103;  UKSC 61
Hague Rules – carrier bears the full onus to prove the absence of negligence under Art III 2 and under Article IV 2 (m) (inherent vice exception) The Facts Nine consignments of washed Columbian green coffee beans were carried in 20 dry, unventilated 20 foot containers, each loaded with 275 hessian 70kg bags from Buenaventura, […]
Implied terms – Lord Hoffmann’s analysis is Belize Telecom qualified – scope for implying terms in a comprehensive written agreement is limited The Facts A written lease between the parties gave the tenant the option of premature termination on a certain date. Rent was to be paid quarterly in advance. A condition for the exercise […]
Contract of employment providing for payment in lieu of statutory minimum period of notice – employee dismissed summarily in breach of contract – payment directly into employee’s bank account unaccompanied by any form of notice held not sufficient to constitute proper notice of termination. The Facts The employee was employed in 2005 in terms of […]
Hague Rules – “dangerous goods” include those dangerous to the venture, not only vessel – shippers strictly liable – right to sue transferred by Bills of Lading Act 1855 not affecting liability of shippers – carrier’s liability for dangerous cargo at common law also strict. The Facts On 18 November 1990, a cargo of ground-nut […]
535. Vinnlustodin HF Vatryggingaffelag Islands HF v Sea-Tank Shipping AS (the “Aqasia”)  EWHC 2514 (Comm);  EWCA Civ 276
Hague Rules – package limitation not applying to bulk cargoes.
The Facts Fish oil was carried pursuant to a charterparty on the “London Form”, an old tanker voyage form now replaced in common usage by Intertankvoy 76. The vessel loaded 2,056,926 kg of fish oil in bulk at Faskrudsfjordur and Vestmannaeyjar. The vessel sailed to Lovund in Norway and loaded a further cargo of fish oil. On arrival at the discharge port 547,309 kg/mt of the cargo was found to be damaged. Claimants claimed $367,836 together with interest and costs. Ship owners sought limit their liability to £54 730 i.e. £100 per metric ton of cargo damaged pursuant to Article IV r.5 of the Hague Rules. Article IV r.5 provides: “… neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with goods in an amount exceeding £100 per package or unit or the equivalent of that sum in other currency, unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading”. The shipowners sought to limit their liability to £100 per metric ton. The counter argument was that it was not possible to equate "unit" with an undefined standard of measurement. Findings (more…)
Marine insurance The Facts On a voyage between London and Seville, the master deviated to Guernsey to smuggle. The charterer, insured, suffered loss through storm damage. Storm damage and barratry were insured perils. Deviation was an exclusion. Findings Lord Mansfield sitting with two other judges held for the insured. Deviation could only operate as an […]
Marine insurance – successive causes – insured peril leading to excluded peril – insurers not liable. The Facts A time marine insurance policy contained the usual perils (including “barratry of the master”). The subject-matter of insurance was warranted “free from capture and seizure”. On the night of 23rd May 1879, the master of the vessel […]
532. Atlasnavios-Navegação, LDA v Navigators Insurance Company Ltd (the “B Atlantic”)  1 Lloyds Rep 629;  1 Lloyds Rep 117;  EWCA Civ 808;  UKSC 26
War risks insurance – narcotics strapped to the hull leading to detention and confiscation -constructive total loss – insurers entitled to rely on customs infringement exclusion The Facts The vessel was insured on a standard war risks policy on the Institute War and Strikes clauses 1/10/83 with additional perils. The conditions for hull and machinery […]
“Customs regulations” in war risks policy to be given business-like interpretation
The vessel was insured under a war risks policy with Lloyd’s underwriters “which took the usual form but is very complicated” (per Lord Denning MR).
Usual perils included barratry.
The FCS clause read: “warranted free of capture, seizure, arrest, restraint or detainment, and the consequences thereof or of any attempt thereat”.
Clause 4(1)(e) excluded arrest or detainment by reason of infringement of any customs regulations.
In 1966 Vietnam was in political turmoil.
The vessel, an elderly Edwardian steamship sailed from Taiwan bound for Saigon, calling on Hong Kong on the way.
At Cap St. Jacques anchorage, 40 miles downriver from Saigon, customs authorities discovered contraband of war concealed in the vessel.
The master and crew were tried by a special court under a Vietnamese statute which provided for confiscation of the means of transport employed in the offence. The master was acquitted but five of the seamen were convicted and sentenced to imprisonment. The vessel was confiscated.
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530. Saga Cruises BDF Limited v Fincantieri SPA (formerly Fincantieri Cantieri Navali Italiani SPA) (the “Saga Sapphire”) 2016 [EWHC] 1875 [Comm]
Refurbishment contract interpreted to shield shipyard from consequences of failure to replace a vital part The Facts A 1981 built cruise ship was refitted by the defendant shipyard for some 14m Euros pursuant to a written contract, the salient terms of which were: “Works” means repair, refurbishment and the other works and services specified in […]
rule that title in damaged goods unnecessary for locus standi where owners sued by charterers restricted by the House of Lords The Facts The sister ship of this vessel which was arrested by the charterers, the Albacruz, sank in the North Atlantic on 14 January 1970 and was totally lost with its cargo of 15 000 […]
528. Golden Endurance Shipping SA v RMA Watanya SA & others (the “Golden Endurance No.2”)  EWHC 2110 (Comm)
Time bar under Hague Rules – foreign proceedings qualifying as a “suit” – negative claim for non-liability not doing the same. The Facts Wheat bran pellets were shipped to Morocco from three ports, Awendo in Gabon, Lomé in Togo and Takoradi in Ghana. On arrival in Casablanca, it was discovered that the cargo was damaged […]
Liability of charterers to owners under indemnity established by judgment obtained in India subject to appeal – held that indemnity enforceable without waiting for the outcome of the appeal. The Facts Clause 47 of a voyage charterparty on a Gencon 1976 form read: “In case of ‘clean on board’ bills of lading to be issued, […]