Hi-Fert Pty Ltd v United Shipping Adriatic Inc & Ors [1998] FCA 1622

Procedural Posture

Federal Court Proceedings Concerning Carriage of Goods by Sea, Stay Applications Under Arbitration Clauses, and an Injunction Proceeding Restraining Foreign Arbitration / Ex Tempore Reasons on Notices of Motion for Stays and Application for Injunction; Matter Stood Over for Short Minutes and Orders

Legal Issues

1. 1 ['Whether the Bill of Lading incorporated clause 34 of the Voyage Charter so as to create an arbitration agreement between Hi-Fert and United.' "Whether Hi-Fert's participation in London arbitration correspondence constituted an ad hoc submission to arbitration." 'Whether section 11 of the Carriage of Goods by Sea Act 1991 (Cth) rendered the arbitration agreement ineffective insofar as it would preclude or limit the jurisdiction of the Federal Court.' 'Whether amendments made by the Carriage of Goods by Sea Amendment Act 1997 and Carriage of Goods by Sea Regulations 1998 altered the operation of section 11.' 'Whether the North of England undertaking rendered the arbitration clause inoperative within section 7(5) of the International Arbitration Act 1974 (Cth).' 'Whether Hyundai was entitled to a stay in respect of claims under the Voyage Charter.' 'Whether United should be restrained from prosecuting London arbitration proceedings.']

Ratio Decidendi

Clause 34 of the Voyage Charter was expressly incorporated into the Bill of Lading, but section 11 of the Carriage of Goods by Sea Act 1991 (Cth) made that arbitration agreement of no effect insofar as it would preclude or limit the Federal Court's jurisdiction over the Bill of Lading dispute between Hi-Fert and United. The later regulations did not validly or effectively remove that protection for this case. Hi-Fert's London correspondence, read with its reservations as to Australian jurisdiction, did not amount to an ad hoc submission to arbitration. United was therefore not entitled to a stay, and continuing the London arbitration while the Federal Court proceeding was pursued would be...

Court Disposition

United's stay application was to fail; Hyundai was entitled to a stay and referral to arbitration only for contractual claims, subject to conditions; Hi-Fert was entitled to an injunction restraining United from prosecuting the London arbitration while the Main Proceeding was prosecuted with due expedition; no order...

Orders

• ["United's claim for a stay of the Main Proceeding should fail." 'Hi-Fert and Hyundai should be referred to arbitration in respect of contractual claims arising from the Voyage Charter, with a condition that Hi-Fert not prosecute those claims in arbitration against Hyundai until after completion of the Main...