M/V Pacific Pearl Co Ltd v Osios David Shipping Inc [2022] EWCA Civ 798 (14 June 2022)

M/V Pacific Pearl Co Ltd v Osios David Shipping Inc [2022] EWCA Civ 798 (14 June 2022)

Under clause C of ASG 2, once a party offers security in a form reasonably satisfactory to the other, the recipient is contractually obliged to accept it and refrain from seeking alternative or better security by arrest. The respondent's refusal to accept the LOU offered by the appellant's P&I Club, which was found...

Source-derived case information.

Citation
[2022] EWCA Civ 798
Parties
Appellant/claimant: M/V Pacific Pearl Co Limited; Respondent/defendant: Osios David Shipping Inc
Jurisdiction
England and Wales
Judgment Date
14 June 2022
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (commercial Court)
Outcome
Appeal allowed. Judgment for the appellant.
Legal Topics
Collision Jurisdiction Agreements, Security for Maritime Claims, Interpretation of Standard Form Contracts, Implied Terms, Sanctions Clauses in Letters of Undertaking
Admiralty Law Contract Law Collision Jurisdiction Agreements Security for Maritime Claims Interpretation of Standard Form Contracts Implied Terms Sanctions Clauses in Letters of Undertaking

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Summary, issues, holding and outcome

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Parties

M/V Pacific Pearl Co Limited

Appellant/claimant

Osios David Shipping Inc

Respondent/defendant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (commercial Court)

Legal Issues

  1. 1 Whether a party offered security in a reasonably satisfactory form under clause C of ASG 2 is obliged to accept it and refrain from seeking alternative security by arrest.
  2. 2 Whether the LOU offered by the appellant's P&I Club, containing a sanctions clause, was in a form reasonably satisfactory to the respondent.

Ratio Decidendi

Under clause C of ASG 2, once a party offers security in a form reasonably satisfactory to the other, the recipient is contractually obliged to accept it and refrain from seeking alternative or better security by arrest. The respondent's refusal to accept the LOU offered by the appellant's P&I Club, which was found to be in a reasonably satisfactory form, was a breach of the Collision Jurisdiction Agreement.

Court Disposition

Appeal allowed. Judgment for the appellant.

Orders

  • Judgment entered for the appellant in the sum of €297,000 and US $201,275.
  • Appellant entitled to recover further losses accruing between judgment and conclusion of South African proceedings.