Mare Nova Incorporated v Zhangjiagang Jiushun Ship Engineering Co., LTD

Mare Nova Incorporated v Zhangjiagang Jiushun Ship Engineering Co., LTD

The tribunal committed a serious irregularity under section 68(2)(a) of the Arbitration Act 1996 by deciding the damages claim on the basis of discharge of liability under clause 6.3, an issue not raised in the arbitration, depriving the claimant of a fair opportunity to address it. The tribunal’s legal construction of clauses 2.1 and 6.3 as discharging liability was obviously wrong; such clauses do not discharge accrued liability for breach absent clear and express language.

Parties
Claimant: Mare Nova Incorporated; Defendant: Zhangjiagang Jiushun Ship Engineering Co., Ltd
Jurisdiction
England and Wales
Judgment Date
02 October 2025
Procedural Posture
Arbitration Claim / Judgment on Section 68 Challenge and Section 69 Appeal
Outcome
Section 68 challenge allowed; section 69 appeal dismissed.
Legal Topics
Serious Irregularity Under Arbitration Act 1996 S.68, Appeal on Point of Law Under Arbitration Act 1996 S.69, Contractual Interpretation, Discharge of Liability, Guarantee Liability
Arbitration Commercial Law Contract Law Serious Irregularity Under Arbitration Act 1996 S.68 Appeal on Point of Law Under Arbitration Act 1996 S.69 Contractual Interpretation Discharge of Liability Guarantee Liability

Case Brief

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Parties

Mare Nova Incorporated

Claimant

Zhangjiagang Jiushun Ship Engineering Co., Ltd

Defendant

Procedural Posture

Arbitration Claim / Judgment on Section 68 Challenge and Section 69 Appeal

Legal Issues

  1. 1 Whether the tribunal committed a serious irregularity by deciding on discharge of liability without giving the claimant an opportunity to address the issue
  2. 2 Whether clauses 2.1 and/or 6.3 of the General Conditions discharged the defendant’s liability for breach of contract upon the vessel’s departure
  3. 3 Proper construction of guarantee clause 2.10

Ratio Decidendi

The tribunal committed a serious irregularity under section 68(2)(a) of the Arbitration Act 1996 by deciding the damages claim on the basis of discharge of liability under clause 6.3, an issue not raised in the arbitration, depriving the claimant of a fair opportunity to address it. The tribunal’s legal construction of clauses 2.1 and 6.3 as discharging liability was obviously wrong; such clauses do not discharge accrued liability for breach absent clear and express language.

Court Disposition

Section 68 challenge allowed; section 69 appeal dismissed.

Orders

  • The award is remitted to the tribunal for reconsideration.
  • No direction given as to the terms of any revised award.