M/V Pacific Pearl Co Limited v Osios David Shipping Inc

M/V Pacific Pearl Co Limited v Osios David Shipping Inc

Where parties have entered into a Collision Jurisdiction Agreement in the terms of ASG 2, and security in a form reasonably satisfactory to the other is offered, the recipient is contractually obliged to accept that security and refrain from seeking alternative or better security by arresting a ship. The inclusion of a sanctions clause in the P&I Club Letter of Undertaking did not render the security unsatisfactory in this case.

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
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed
Legal Topics
Collision Jurisdiction Agreements, Security for Maritime Claims, Interpretation of Standard Form Contracts, Implied Terms, Sanctions Clauses in Letters of Undertaking
Maritime 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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Parties

M/V Pacific Pearl Co Limited

Appellant/claimant

Osios David Shipping Inc

Respondent/defendant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether a party to a Collision Jurisdiction Agreement (ASG 2) is contractually obliged to accept security in a reasonably satisfactory form and refrain from seeking alternative security by arresting a ship
  2. 2 Whether the inclusion of a sanctions clause in a P&I Club Letter of Undertaking renders the security unsatisfactory

Ratio Decidendi

Where parties have entered into a Collision Jurisdiction Agreement in the terms of ASG 2, and security in a form reasonably satisfactory to the other is offered, the recipient is contractually obliged to accept that security and refrain from seeking alternative or better security by arresting a ship. The inclusion of a sanctions clause in the P&I Club Letter of Undertaking did not render the security unsatisfactory in this case.

Court Disposition

Appeal allowed

Orders

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