NYK Bulkship (Atlantic) N.V. v Cargill International S.A. [2014] EWCA Civ 403 (08 April 2014)

NYK Bulkship (Atlantic) N.V. v Cargill International S.A. [2014] EWCA Civ 403 (08 April 2014)

The proviso to clause 49 is to be construed broadly: 'agents' includes delegates such as sub-charterers and receivers, and the proviso is not limited to acts or omissions occurring only in the course of performing a delegated task. The carve-out applies where the act, omission, or default of the charterer or its delegate occasioned the detention or arrest, regardless of the precise contractual relationship or whether the act was in the course of a delegated task. The question of causation—whether the acts or omissions of Transclear and/or IBG occasioned the detention or arrest—remains for the arbitrators to decide.

Citation
[2014] EWCA Civ 403
Parties
Respondent, Cross Appellant (owners): NYK Bulkship (Atlantic) N. V.; Appellant, Cross Respondent (charterers): Cargill International S. A.
Jurisdiction
England and Wales
Judgment Date
08 April 2014
Procedural Posture
Appeal From Arbitration Award (commercial Court, Queen's Bench Division) / Court of Appeal Judgment on Appeal and Cross Appeal
Outcome
Appeal and cross-appeal dismissed; judgment of Field J upheld for different reasons.
Legal Topics
Charterparty Interpretation, Off Hire Clauses, Arbitration Appeals, Risk Allocation in Shipping Contracts
Commercial Law Maritime Law Charterparty Interpretation Off Hire Clauses Arbitration Appeals Risk Allocation in Shipping Contracts

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Parties

NYK Bulkship (Atlantic) N. V.

Respondent, Cross Appellant (owners)

Cargill International S. A.

Appellant, Cross Respondent (charterers)

Procedural Posture

Appeal From Arbitration Award (commercial Court, Queen's Bench Division) / Court of Appeal Judgment on Appeal and Cross Appeal

Legal Issues

  1. 1 What is the correct construction and application of the proviso to an off-hire clause (clause 49) in a time charterparty regarding capture, seizure, detention or arrest of the vessel?
  2. 2 Does the proviso apply only to acts or omissions by charterers or their agents in the course of performing delegated tasks?
  3. 3 Who qualifies as an 'agent' or 'delegate' of the charterer for the purposes of the proviso?

Ratio Decidendi

The proviso to clause 49 is to be construed broadly: 'agents' includes delegates such as sub-charterers and receivers, and the proviso is not limited to acts or omissions occurring only in the course of performing a delegated task. The carve-out applies where the act, omission, or default of the charterer or its delegate occasioned the detention or arrest, regardless of the precise contractual relationship or whether the act was in the course of a delegated task. The question of causation—whether the acts or omissions of Transclear and/or IBG occasioned the detention or arrest—remains for the arbitrators to decide.

Court Disposition

Appeal and cross-appeal dismissed; judgment of Field J upheld for different reasons.

Orders

  • The construction of the proviso to clause 49 is as set out in this judgment.
  • The question of causation is remitted to the arbitrators for determination.