Fal Oil Co Ltd. & Ors v Petronas Trading Corporation SDN BHD

Fal Oil Co Ltd. & Ors v Petronas Trading Corporation SDN BHD

Petco failed to prove on a balance of probabilities that the cargo was contaminated with water in excess of the contractual specification at the time it passed the DEVON’s manifold. The evidence does not exclude the possibility that the contamination occurred after the STS transfer. Therefore, the claim fails on the burden of proof. On demurrage, the contractual clause is construed as an indemnity, not an independent obligation.

Parties
Claimant: FAL Oil Co Limited; Claimant: Credit Agricole Indosuez (Suisse) S.A.; Defendant: Petronas Trading Corporation Sdn Bhd
Jurisdiction
England and Wales
Judgment Date
10 October 2003
Procedural Posture
Commercial Dispute / Judgment After Trial
Outcome
Claim dismissed
Legal Topics
Contaminated Cargo, Burden of Proof, Demurrage, Charterparty Interpretation
Commercial Law Contract Law Shipping Law Contaminated Cargo Burden of Proof Demurrage Charterparty Interpretation

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Parties

FAL Oil Co Limited

Claimant

Credit Agricole Indosuez (Suisse) S.A.

Claimant

Petronas Trading Corporation Sdn Bhd

Defendant

Procedural Posture

Commercial Dispute / Judgment After Trial

Legal Issues

  1. 1 Whether the cargo of oil received by the defendant contained more than the permitted level of water at the time of transfer
  2. 2 Whether the defendant is liable for demurrage under the contract

Ratio Decidendi

Petco failed to prove on a balance of probabilities that the cargo was contaminated with water in excess of the contractual specification at the time it passed the DEVON’s manifold. The evidence does not exclude the possibility that the contamination occurred after the STS transfer. Therefore, the claim fails on the burden of proof. On demurrage, the contractual clause is construed as an indemnity, not an independent obligation.

Court Disposition

Claim dismissed