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Arbitration clause – bills of lading incorporating unidentified charterparty (multiple options) – arbitration clause in P&I Club letter superseding prior arbitration clauses

 The Facts

Bagged rice was shipped from Thailand to Nigeria under 4 different bills of lading each on a standard Congen form.

Clause 1 read as follows:

“All terms and conditions, liberties and exceptions of the “Charterparty, dated as overleaf, including the law and arbitration clause, are herewith incorporated”

Each bill neglected to identify the charterparty.

There were three charterparties involved: the head charter, a sub-charter (both time charters) and a voyage charter.

The time charters provided for London arbitration with specific reference to the LMAA procedure for small claims under $100 000.

The voyage charter provided simply for arbitration in Singapore.

The ship owners’ P&I Club issued a letter in respect of all 4 bills of lading. The letter contained an arbitration clause providing for arbitration under the auspices of the LMAA but with no reference to the small claims procedure.

The entire dispute was referred to a single panel of LMAA arbitrators.

Owners took the point that those claims below the threshold of $100 000 should have been referred separately in terms of the arbitration clauses as set out in the time charters.


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Charter Party Casebook