Gas Natural Aprovisionamientos SDG S.A. v Methane Services Ltd

Gas Natural Aprovisionamientos SDG S.A. v Methane Services Ltd

The charter and clause 59(d) do not require delivery of a substitute vessel at the exact location of withdrawal unless the next loading port is identified; clause 59(d) is an accounting formula to protect charterers from financial disadvantage. Charterers are obliged to give orders upon tender of substitute vessel, and the communication of 26 June 2007 did not constitute an order to the vessel.

Parties
Claimant: Gas Natural Aprovisionamientos SDG S.A.; Defendant: Methane Services Limited
Jurisdiction
England and Wales
Judgment Date
25 September 2009
Procedural Posture
Appeal Under S.69 Arbitration Act 1996 / Judgment on Appeal
Outcome
appeal dismissed
Legal Topics
Charterparty Substitution, Delivery of Vessel, Hire and Bunkers, Interpretation of Contract Clauses
Commercial Law Arbitration Shipping Law Charterparty Substitution Delivery of Vessel Hire and Bunkers Interpretation of Contract Clauses

Case Brief

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Parties

Gas Natural Aprovisionamientos SDG S.A.

Claimant

Methane Services Limited

Defendant

Procedural Posture

Appeal Under S.69 Arbitration Act 1996 / Judgment on Appeal

Legal Issues

  1. 1 Whether a shipowner can lawfully deliver a substitute vessel not at the place where the previously chartered vessel went off hire under clause 59(d)
  2. 2 Whether a charterer is obliged to give orders 'without prejudice' when there is a dispute about validity of delivery
  3. 3 Whether a statement by charterer to proceed to a named port constitutes an order as to employment

Ratio Decidendi

The charter and clause 59(d) do not require delivery of a substitute vessel at the exact location of withdrawal unless the next loading port is identified; clause 59(d) is an accounting formula to protect charterers from financial disadvantage. Charterers are obliged to give orders upon tender of substitute vessel, and the communication of 26 June 2007 did not constitute an order to the vessel.

Court Disposition

appeal dismissed

Orders

  • Charterers' appeal on all questions fails
  • No need to remit award to arbitrators