Actionable fault and general average. Due diligence and unseaworthiness.

Actionable fault and general average. Due diligence and unseaworthiness.

 

In The CMA CGM Libra  [2019] EWHC 481 (Admlty), a container vessel grounded on leaving Xiamen on a shoal in an area in which there is a risk of uncharted shoals. Salvors refloated the vessel which then proceeded on her voyage. The shipowners funded the salvage and declared general average. 8% of cargo interests refused to pay their share on the grounds of actionable fault on the part of the shipowners. The vessel’s primary means of navigation was intended to be paper charts published by the United Kingdom Hydrographic Office (UKHO). Before leaving Xiamen the Second Officer prepared a passage plan which the Master approved. The plan was inadequate in that it did not refer to the existence of a crucial Preliminary Notice to Mariners (NM6274/P10) that had been issued by the UKHO approximately 5 months before the grounding, alerting mariners to the presence of numerous depths less than charted in the approaches to Xiamen and confirming that the charted depths within the dredged channel were sufficient for the vessel. Nor did the passage plan refer to any “no-go areas” which had not been marked or identified on the chart. At trial the Master confirmed that had the chart been marked up with the appropriate “no-go areas” he would not have attempted to execute the manoeuvre that ultimately led to the stranding of the vessel.

Teare J considered the burden of proof. The Supreme Court’s decision in Volcafe related to the burden of proof in relation to Article III.2 of the Hague Rules and did not deal with the burden of proof for Article III.1. There had been actionable fault through a breach of Article III.1 of the Hague Rules Article IV r.1 provides that where loss or damage results from unseaworthiness the burden of proving the exercise of due diligence shall be on the carrier. Thus it deals with the burden of proof for the purposes of Article III r.1. It is implicit in Article IV r.1 that the burden of proving causative unseaworthiness must lie upon the cargo owner for the article assumes that such unseaworthiness has been established.

Teare J then found that cargo interests had established a breach of Article III.1 in that the absence of an adequate passage plan was a cause of the grounding.. The presence on board a vessel of the appropriate chart is an aspect of seaworthiness. Where the Admiralty gives notice of a correction to the appropriate chart a vessel will not be seaworthy unless the chart has been corrected. If the vessel’s navigating officer fails, before the commencement of the voyage, to correct the chart the vessel is thereby rendered unseaworthy. The production of a defective passage plan is not merely “an error of navigation” but involves a breach of carrier’s obligation that the vessel is seaworthy “before and at the beginning of the voyage.” If there is a causative breach of Article III r.1 the fact that a cause of the subsequent casualty is also negligent navigation will not protect the carrier from liability. Passage planning by the master before the beginning of the voyage is necessary for safe navigation.

The carrier’s duty under Article III r.1 was not discharged by putting in place proper systems and ensuring that the requisite materials were on board to ensure that the master and navigating officer were able to prepare an adequate passage plan before the beginning of the voyage. As set out in Scrutton on Charterparties and Bills of Lading 23rd.ed at paragraph 14-046:

“The due diligence required is due diligence in the work itself by the carrier and all persons, whether servants or agents or independent contractors whom he employs or engages in the task of making the ship seaworthy; the carrier does not therefore discharge the burden of proving that due diligence has been exercised by proof that he engaged competent experts to perform and supervise the ask of making the ship seaworthy. The statute imposes an inescapable personal obligation.”

Due diligence was not exercised because the Owners’ SMS contained appropriate guidance for passage planning and that the auditors of the vessel’s practices were competent. To comply with Article III r.1, which imposes a non-delegable duty on thecarrier, it is not enough that the owner has itself exercised due diligence to make the ship seaworthy. It must be shown that those servants or agents relied upon by the owner to make the ship seaworthy before and at the beginning of the voyage have exercised due diligence. Negligence by the master or chief engineer or other officer before the commencement of a voyage can amount to a failure by the carrier to make the vessel seaworthy.

 

Accordingly there had been actionable fault by the shipowners and cargo were not required to contribute to general average.

 

No absolute immunity for international organisations before US courts.

 

The International Finance Corporation (IFC) makes loans to private businesses to finance projects in developing countries. In 2008, it lent $450 million to finance a coal-fired power plant in India. Local residents complained of harm suffered as a result of pollution from the plant and sued the IFC before a federal court in Washington, D.C., where it is headquartered, claiming, inter alia, that the the IFC had violated provisions of the loan agreement that were included to protect the local community. The International Organizations Immunities Act 1945 gives international organizations “the same immunity from suit” as “as is enjoyed by foreign governments.”

At the time foreign governments enjoyed virtually absolute immunity and the IFC claimed immunity from suit. Since then s1605(2)(a) of the Foreign Sovereign Immunities Act 1976, s1605(2)(a) U.S.C., has lifted the immunity of foreign governments in respect of suits based on their commercial activities, but the Act made no reference to the immunity of international organisations. In Jam et al v International Finance Corporation 586 U.S _ (2019) the US Supreme Court held on 27 Feb, Justice Breyer dissenting, that the immunity of international organisations is co-equivalent with that of foreign governments and the IFC is not absolutely immune from suit. The case was remanded for further hearing consistent with this opinion.

However under s.1605(2)(a) there are three alternative conditions for the lifting of immunity: (i) the action arises out of commercial activity in the US, or (ii) the action arises out of an act in the US in connection with commercial activity elsewhere, or (iii) the action arises out of an act outside the US in connection with commercial activity elsewhere  and the act causes a direct effect in the US. In many cases against international organisations based in the US these criteria will not be satisfied and this may prove to be the case with the further hearings in the instant case.

A fair cop? Transnational torts and trouble at the mine.

 

Kalma v African Minerals Ltd and others [2018] EWHC 3506 (QB) is an interesting recent decision involving transnational tort claims against a UK company in respect of events at and around its mine in Sierra Leone. It is, I believe, the first of these type of claims brought by London solicitors, Leigh Day, to go to trial.

 

The claims arose out of violent police suppression of protests in 2010 and 2012 by a local community in Sierra Leone against a mine created and operated by the defendant, a UK company, and its two Sierra Leonean subsidiaries. The protests prompted a significant overreaction from some members of the Sierra Leone Police (“SLP”) whose response to disruptive protests and threats against the personnel, property and business of AML soon degenerated into violent chaos during the course of which many villagers were variously beaten, shot, gassed, robbed, sexually assaulted, squalidly incarcerated and, in one case, killed.

 

The claimants alleged that they were among the victims of these abuses and contend that, although the SLP perpetrated the worst of these excesses, the defendants were nevertheless liable to compensate them by the application of a broad range of distinct common law remedies to the facts of this case.

 

It was accepted that the law of Sierra Leone applied to the issues both of liability and quantum. In respect of liability, it was agreed that the law of Sierra Leone could be treated, for all practical purposes, as being identical to that of England and Wales. Turner J dismissed the claims having considered seven possible grounds on which the defendants might incur liability for the acts of the Sierra Leone police towards the claimants.

 

  1. EMPLOYEE VICARIOUS LIABILITY

 

It was alleged, for example, that one employee of the defendant directly and violently assaulted some of the claimants and that others encouraged members of the SLP to use excessive force. Two criteria are involved.

(i)    as regards the sort of relationship which must be found to exist between an individual and a defendant before the defendant can be found to be vicariously liable in tort for the conduct of that individual; That was clearly satisfied here as the individuals concerned were employees

(ii)    as regards concerns the scope of the conduct of such an individual in respect of which vicarious liability is to be imposed on the defendant.

 

Applying Muhamud v Wm Morrison Supermarkets plc [2016] AC 677 if any claimants could prove that they were the victims of torts perpetrated directly upon them by an employee or employees of the defendant then the means deployed, even if seriously criminal, remain sufficiently closely connected to their employment to give rise to vicarious liability on the part of the defendant. However on the facts the claimants had not made out that the employees against whom such allegations have been raised were, themselves, guilty of free-standing tortious conduct.

 

  1. NON-EMPLOYEE VICARIOUS LIABILITY

 

The claimants contended that the defendant was vicariously liable for the torts of the SLP. Various Claimants v Catholic Welfare Society [2013] 2 AC 1 established that the relevant test is whether or not the non-employment relationship is, upon analysis, one that is “akin to that between an employer and employee”. The most important factors tending to establish a relationship akin to that between employer and employee in this context arise in the following circumstances:

(i)             the tort will have been committed as a result of activity being undertaken by the tortfeasor on behalf of the defendant;

(ii)           the tortfeasor’s activity is likely to have been part of the business activity of the defendant; and

(iii)         the defendant, by engaging the tortfeasor to carry on the activity, will have created the risk of the tort committed by the tortfeasor.

 

This claim was unsustainable. Save for the six officers permanently stationed at the mine, in respect of whom there is no evidence of wrongdoing, the officers involved were performing duties which extended far beyond the narrow parameters of the business activity of the defendant. The defendant did not exercise any significant degree of control over the SLP. The communications between employees and the police did not amount to orders or direction but comprised, at their highest, encouragement to do a robust and thorough job.

 

  1. ACCESSORY LIABILITY

 

It was alleged that the SLP’s use of unlawful force on the protesters was part of a common plan between the defendant and the SLP the execution of which rendered the defendant liable for the entirety of the injuries and harm caused.  The principle of accessory liability was reviewed and clarified by the Supreme Court in Fish & Fish v Sea Shepherd UK [2015] AC 1229 in which Lord Toulson observed at paragraph 21:

“To establish accessory liability in tort it is not enough to show that D did acts which facilitated P’s commission of the tort. D will be jointly liable with P if they combined to do or secure the doing of acts which constituted a tort. This requires proof of two elements. D must have acted in a way which furthered the commission of the tort by P; and D must have done so in pursuance of a common design.”

 

The central issue was whether or not the defendant was at the material times assisting the police in their tortious conduct to a more than minimal degree in pursuance of a common design. Where the parties to an alleged common design include corporate bodies, the requisite design must be common to individuals whose acts and knowledge are legally attributable to such bodies by the application of the approach of Lord Hoffmann in the Privy Council decision of Meridian Global Funds Management Asia Limited v Securities Commission [1995] 2 AC 500.

 

Here the defendant’s provision of vehicles and drivers to the SLP was sufficient to facilitate the tortious conduct of the SLP to an extent that was more than de minimis. However, it was not the case that the defendant intended the police to act tortiously at any stage. Those in authority in the defendant’s organisation were understandably concerned that the disruptions to their undertaking were potentially extremely damaging to their prospects of commercial success. However, at all relevant times the solutions they proposed were directed at conciliation and not at the deployment of unlawful means. In particular, it would have been perfectly possible for the SLP to deploy the defendants’ vehicles lawfully and it was no part of the defendant’s plans that they should do otherwise. Similarly, the provision of cash, food, accommodation and drink although alien to what would be expected in the UK were pragmatic incentives and not bribes to achieve tortious ends.

 

  1. PROCUREMENT LIABILITY

Procurement liability is a further manifestation of joint liability whereby a defendant might incur liability by procuring the commission of a tort by, for example, “inducement, incitement or persuasion” of the primary tortfeasor. If the torts, including battery and false arrest, perpetrated by the SLP were pursuant to “some direction, or procuring or direct request, or direct encouragement” from the defendant then the defendant would be liable as a joint tortfeasor for the loss and damage sustained as a result.

 

On the facts here, the defendant neither incited or procured the SLP to act tortiously. Its employees on the ground were anxious that the police should deal with the protesters robustly and not tolerate the construction and manning of unlawful roadblocks or any other form of unlawful protest. However, they had not exhorted them to unlawful behaviour including false arrest, battery or tortious damage to property.

 

  1. MALICIOUS PROSECUTION

 

The ingredients of the tort of malicious prosecution are set out in Clerk and Lindsell on Torts 22 nd Ed. (2018) at paragraph 16-12:

“In an action for malicious prosecution the claimant must show first that he was prosecuted by the defendant, that is to say, that the law was set in motion against him by the defendant on a criminal charge..; secondly, that the prosecution was determined in his favour; thirdly, that it was without reasonable and probable cause; fourthly, that it was malicious. The onus of proving every one of these is on the claimant. Evidence of malice of whatever degree cannot be invoked to dispense with or diminish the need to establish separately each of the first three elements of the tort.”

Following the incident in 2010, members of the local population were rounded up and later prosecuted for various criminal offences alleged to have been committed during the disturbances. The claimants in this case fell at the first hurdle as those who were prosecuted in the aftermath of the 2010 incident faced charges which were set in motion by the police.

 

  1. NEGLIGENCE

 

The claimants alleged the defendant owed them a duty of care in three ways.

 

(i)                   There was an obligation on the Defendants when operating in a country such as Sierra Leone to ensure clear protocols and procedures were adopted and implemented so as to ensure the use of public and private security forces did not lead to abuses of the rights of those affected by the Defendants’ operations;

(ii)                 Further or alternatively, there was an assumption of responsibility by the Defendants towards the Claimants via their commitments to abide by the international standards and in the course of their use and control of the Claimants’ land and their coordinated response to the protests;

(iii)               Alternatively, if and in so far as the Defendants were operating as a separate entities, in the case of the First Defendant, there was an assumption of responsibility towards the Claimants via its commitments to abide by the international standards and its full effective control over the subsidiaries in respect of operational risk management and health and safety, to advise and direct its subsidiaries to take steps to prevent human rights abuses by their servants, agents and/or the police did not lead to abuses of the rights of those affected by the Defendants’ operations.

Turner J found that no duty of care arose on any of these pleaded grounds.

 

The defendant at senior management level was aware both in 2010 and 2012 that there was a risk that the police might react to protest with disproportionate violence. The generic danger of the police causing injury and loss was not, however, one which was “created” by the defendant. The proclivities of the police were, unhappily, an institutional fact long before the arrival of the defendant and, although not mitigated by the defendant’s failures to follow the active steps advocated by the relevant international standards, were not thereby exacerbated.

 

Nor could it be said that the defendant created the danger simply by calling the police. In both 2010 and 2012, dangerous situations were already developing which called for an effective response. In particular, the defendant undoubtedly owed a duty of care to its own employees to take reasonable care for their safety. The only sense in which it could realistically be argued that the defendant created the danger is with respect to the provision of vehicles, food, and financial or other support to the police. But the defendant was providing no more than that which the Sierra Leonean state, itself, ought to have provided to maintain an efficient police force in the first place. Suitable vehicles, proper remuneration, food and water are prerequisites to the proper functioning of any force.

 

The defendant exercised no supervision or control over the SLP. Individual employees did not give directions to the police and the responses of the police to the incidents which they were called upon to deal with were operationally entirely of its own choosing.

 

The claimants were members of the general public who lived near the mine and were policed by officers who, for the most part, would not have been there but for the activities of the defendant. This fell far short of establishing that the defendant had assumed a responsibility for the actions of the police. The circumstances in which the police are to be held to have assumed responsibilities for the acts of third parties is heavily circumscribed. The circumstances in which a party ought reasonably to be found to have assumed a responsibility for the police could hardly be less so. A finding to the contrary would open up the defendant to almost unlimited liability to a broad swathe of potential claimants within a class almost impossible to define or circumscribe with any clarity.

 

 

  1. BREACH OF A NON-DELEGABLE DUTY

 

The claimants sought to amend their pleadings to allege that if the SLP were operating, not in a relationship akin to employment but as independent contractors to the defendant, then they were engaged in an extra-hazardous activity the negligent performance of which exposed the defendant to liability As a general rule, liability does not generally attach to a defendant in respect of the tortious conduct of his independent contractors, although there is an exception which concerns extra-hazardous activities. In Honeywill & Stein Ltd v Larkin Bros (London’s Commercial Photographers) Ltd [1934] 1 KB 191. The scope of this exception was severely restricted by the Court of Appeal in Biffa Waste Services Ltd v Maschinenfabrik Ernst Hese GmbH [2009] QB 725.

 

The claimants needed to prove (i) that the police officers who caused them injury, loss and damage were acting as independent contractors for the defendant and (ii) that the activities they were undertaking were exceptionally dangerous whatever precautions were taken.

 

They failed on both elements. First, with the possible exception of the officers stationed at the mine itself, the police were acting at any time as independent contractors of the defendant. The payments made to the police did not provide the defendant, either in form or substance, with any degree of significant control over what the police did or in what numbers. Similarly, the provision of vehicles, food and water was on an ad hoc basis and brought with it no corresponding contractual obligation on the part of the police to carry out its duties in a particular way which departed from those which they owed to the public at large to maintain the peace.

 

Second, although what many officers did was dangerous in both 2010 and 2012 the task in hand was not inherently and exceptionally dangerous if proper precautions had been taken. Honeywill liability arises where the work is extra-hazardous in itself not where the contractor’s performance makes it so.

 

Something new for May and Trump’s in-trays. ICJ rules on UK’s retention of administration over the Chagos Archipelago

 

The UK’s decolonisation of Mauritius saw the detachment of the Chagos Archipelago which remained under UK administration. The inhabitants of the area were forcibly removed from the area which became the site of a US military base pursuant to an agreement in 1966 between the US and the UK.

On Monday the International Court of Justice gave its advisory opinion as requested by resolution 71/292 of the UN General Assembly on the following two questions relating to the UK’s process of decolonization of Mauritius in 1968

(a) “Was the process of decolonization of Mauritius lawfully completed when Mauritius was granted independence in 1968, following the separation of the Chagos Archipelago from Mauritius and having regard to international law, including obligations reflected in General Assembly resolutions 1514 (XV) of 14 December 1960, 2066 (XX) of 16 December 1965, 2232 (XXI) of 20 December 1966 and 2357 (XXII) of 19 December 1967?”;

The ICJ’s opinion is that the detachment of the Chagos Archipelago from Mauritius was not carried out in accordance with international law. Although the colony of Mauritius agreed in principle to such a detachment, the Court considered that this detachment was not based on the free and genuine expression of the will of the people concerned.

 

(b) “What are the consequences under international law, including obligations reflected in the above-mentioned resolutions, arising from the continued administration by the United Kingdom of Great Britain and Northern Ireland of the Chagos Archipelago, including with respect to the inability of Mauritius to implement a programme for the resettlement on the Chagos Archipelago of its nationals, in particular those of Chagossian origin?”

 

The ICJ concluded that the UK’s continued administration of the Chagos Archipelago constitutes a wrongful act entailing the international responsibility of that State. The UK Kingdom has an obligation to bring to an end its administration of the Chagos Archipelago as rapidly as possible, and that all Member States must co-operate with the United Nations to complete the decolonization of Mauritius. The resettlement on the Chagos Archipelago of Mauritian nationals, including those of Chagossian origin, is an issue relating to the protection of the human rights of those concerned, which should be addressed by the General Assembly during the completion of the decolonization of Mauritius.

 

No set-off rule does not apply to freight forwarding contract.

 

More developments on the no-set off rule in The “Aries” [1977] 1 WLR 185 (HL), which bars set-off against freight claims. As noted in this blog,     https://iistl.blog/2017/11/22/in-the-air-with-the-aries-freight-no-set-off-rule-also-applies-to-air-carriage/     the rule was held to extend to carriage by air in Schenker Ltd v Negocios Europa Ltd [2018] 1 WLR 718.

 

In Globalink Transportation and Logistics Worldwide LLP v DHL Project & Chartering Ltd [2019] EWHC 225 (Comm) (19 February 2019), it was held that the rule does not apply to freight forwarding contracts under which the forwarder has contracted to arrange carriage rather than to act as the carrier.

Sinopec engaged DHL to arrange the carriage of large items of plant and machinery from China to Kazakhstan. DHL sub-contracted the arrangement of carriage from the Black Sea onwards to Globalink. One of the barges involved was delayed and it was then fount that its draught was too deep to enable it to complete the final leg of the voyage before the Ural-Caspian canal closed for the winter, resulting in the cargo having to be stored until the Spring when Globalink were engaged to arrange completion of the carriage.

DHL refused to pay the two last instalments due under its contract with Globalink arguing a set-off of its counter claims for breach of contract arising out of the delays with the second barge.

Nicholas Vineall QC held that:

“the rule in The Aries does not extend, and should not be extended, to cover the services provided by a freight forwarding agent, when those services are to arrange the carriage of goods. It is not suggested that parties to freight forwarding contracts invariably contract on the assumed basis that no set off is available, and I see no justification for extending the ambit of a rule which is, in Lord Simon’s phrase, a pre-Cambrian outcrop, beyond contracts of carriage and into a new – albeit adjacent – area. To do so would run counter to the general principle of the law which is that a cross claim can in principle operate as a defence by way of set off. I see no basis upon which it could properly be open to me to extend the rule in The Aries into a new area.” [61]

However, in Britannia Distribution v Factor Pace [1998] 2 Lloyds Rep 420, it was held that freight forwarders acting as agents had the benefit of the no set-off rule to the extent that they could show that the sum of which they sought payment was in respect of freight that they had paid to a carrier.

Accordingly, as regards US$113,000 of the US$1.65 million total claimed that could be shown to be freight payable by Globalink to a carrier, an order for payment should be made, conditional on proof of payment by Globalink

 

Prove it. No damages for redelivery with dirty holds

 

.

London Arbitration 1/19 shows that owners need to substantiate a claim for cleaning dirty holds after redelivery under a time charter. The vessel was chartered on an amended NYPE 1946 form for “2–3 laden legs of minimum duration 40 days”. Line 22 of the charterparty provided for the carriage of “any ordinary cargo” with an additional clause containing various cargo exclusions and restrictions including a stipulation that coal was not to be the last cargo. The charter also provided “Charterers shall have the option of redelivering the Vessel without cleaning of holds against paying the Owners a lumpsum of USD5,000 lumpsum, including removal of dunnage/bark/debris.”

In breach of charter the final voyage was for a full cargo of anthracite, following which the vessel was redelivered to the owners without any cleaning of the holds. The owners then used the crew to clean the holds which took nine days. The vessel’s next employment commenced two days later.

The owners claimed to be compensated at the hire rate for the time spent cleaning the cargo holds following the redelivery of the vessel, some 9.3854 days. The charterers submitted that there was no legal basis for the owners’ method of assessment of their damages claim as being effectively an extended period of hire. The owners had not provided any evidence of any cleaning operations, or of losses or extra costs. There was no evidence of any possible follow-on fixture being missed. No details had been provided of the cleaning operation which was said to have occupied more than nine days. The charterers accepted that payment of US$5,000 for redelivery with unclean holds was due to the owners but denied that any further compensation was due.

The tribunal held that the only possible conclusion to be drawn from the absence of any evidence of losses or extra costs incurred by the owners as a result of their having to clean the cargo holds had to be that none were in fact incurred, and that the owners’ claim therefore had to fail. Owners’ claim was dismissed.

 

 

 

Bill of lading shipper liable for sums due under incorporated head charter.

 

In Singapore Arbitration 1/19 a fraudulent broker purported to charter to shipowners on behalf of X and then sub-chartered to Z. Under the charter to X 100% freight was to be paid within six days of signing and release of bills of lading. The cargo was loaded and a bill of lading was issued to Z as  Z, incorporating all the terms and conditions of the charter and stating ‘freight payable as per charterparty dated 9 November 2010’.  Both charters bore that date. The broker received 95% freight from Z and paid part of that to owners in respect of freight under the X head charter. Owners later claim the unpaid balance of freight, and loading port demurrage, under the X charter from Z as bill of lading shipper. The owners had discharged into a port authority warehouse but had lost their lien when receivers managed to take delivery without payment of sums due under the charter with X. Owners commenced arbitration in Singapore against Z under the bill of lading.

The tribunal held that it did have jurisdiction to determine which of two charters with the same date was incorporated into the bill of lading. Both charters were subject to English law. Applying the San Nicholas it was the head charter that was incorporated.  Notwithstanding the transfer of the bill of lading, the shipper’s liability remained due to section 3(3) COGSA 1992.  Owners did not have to give credit for what Z had paid, but only for what they had received. Owners could not be criticised for having failed to act with due diligence once the balance due under the charter with X came due and had not been received. Owners acted reasonably in discharging into a port authority warehouse. The unfortunate Z was liable for the sums claimed by owners.

Are fall in value claims due to delay and deviation “Cargo Claims” ?

 

 

This issue arose in London Arbitration 4/19 under a charter on NYPE form which incorporated the Inter-Club Agreement 1984 with any subsequent modification or replacement. The parties agreed to extend time for six months under an addendum which contained cl.6 providing that charterers would be fully liable for all cargo claims, howsoever caused, including seaworthiness. During the extended charter period the vessel diverted to Goa and spent 36 days there. Charterers then deducted $295,000 from hire being what they had paid receivers in respect of financial losses due to a fall in the sound arrived value of the cargo due to the deviation to and delay at Goa. Although “cargo claims” could as a matter of language be restricted to claims for physical loss or damage, clause 6 had to be interpreted in the light of the Inter-Club Agreement which was also part of the charter and in particular the definition of “cargo claims” contained in the 1996 Agreement as “claims for loss, damage, shortage…overcarriage of or delay to cargo.” Charterer’s claim therefore related to a “cargo claim” for which they were fully liable under the terms of cl.6.

Anti-suit injunction against non-party to contract

Qingdao Huiquan Shipping Company v Shanghai Dong He Xin Industry Group Co Ltd  QBD [2018] EWHC 3009 (Comm) involved a claim for an anti-suit injunction against a non-party to a contract containing a submission to English law and London arbitration. Owners concluded a settlement with cargo receivers whereby the latter paid for the lifting of a lien over cargo which the owners had exercised following time charterers’ default in paying h ire. The agreement was subject to English law and provided for London arbitration. The settlement provided that the receivers authorised agent, SDHX, which was not a party to the agreement, would make the payment. Three years later SDHX sued owners in a Chinese court claiming repayment of those sums. It alleged that there was an oral agreement between itself and the owners. In December 2017 the Qindao Shinan District Court decided that the dispute constituted a maritime dispute, and that the matter should be transferred to the Qingdao Maritime Court to decide on the validity of the London arbitration clause. SDHX’s appeal was dismissed by the Qindao Intermediate Maritime Court which stated that one of the foundations of SDHX’s claim was the settlement agreement between owners and the receivers.

In August 2018 owners applied for an interim anti-suit injunction. Bryan J held that this was an appropriate cased where such an injunction could be obtained against a non-party to the contract. SDHX had sought to rely upon the terms of the Settlement Agreement in advancing its claims in the Chinese proceedings. In doing so, therefore, it had to take the burden of the arbitration clause. For the purpose of the interim relief claim the issue of whether there was an oral agreement with the owners did not need to be considered. SDHX were unable to show that there had been such excessive delay by owners in commencing proceedings that the court should not exercise its discretion. This was not a case involving considerations of comity or where there had been substantive proceedings in China which would lead to the English court second-guessing an existing ruling of a Chinese court. There was also some benefit from the clarity that had been provided by the Chinese appellate court.

Bully off. New amendments to Maritime Labour Convention now in effect.

 

On 8 January 2019 the 2016 amendments to the Maritime Labour Convention came into effect. These amend Guideline B4.3.1 concerning the provisions on occupational accidents, injuries and diseases so as to include harassment and bullying. Governments and shipowners are expected to adopt measures to improve protection for seafarers from shipboard harassment and bullying using as a reference the Guidance on Eliminating Shipboard Harassment and Bullying  jointly published by the International Transport Workers’ Federation and the International Chamber of Shipping. The amendments also allow for an extension of the validity of maritime labour certificates in circumstances where ships have passed the relevant inspection but where a new certificate cannot immediately be issued and made available on board.