20th INTERNATIONAL MARITIME LAW ARBITRATION MOOT COMPETITION 2019

IN THE MATTER OF AN ARBITRATION HELD IN LONDON

TEAM 33

MEMORANDUM FOR RESPONDENT

ON BEHALF OF AGAINST

OMEGA CHARTERING LIMITED PANTHER SHIPPING INC

RESPONDENT/CHARTERERS CLAIMANT/OWNERS

COUNSEL

KHOO SHER RYNN

PEH QI HUI

SOH LIP SHAN

TAN JIA SHEN

TABLE OF CONTENTS

TABLE OF ABBREVIATIONS

TABLE OF AUTHORITIES

STATEMENT OF FACTS ................................................................................................................ 1

THE RESPONDENT IS NOT LIABLE FOR DAMAGES FOR LOSS OF NEXT

FIXTURE..................................................................................................................................... 2

A. The RESPONDENT did not breach its safe port warranty under the Charterparty ................. 2

i. West Coast was at all material time a safe port ................................................................... 3

a. There was no unavoidable danger ................................................................................ 3

b. There was no abnormal occurrence .............................................................................. 3

ii. In any event, the RESPONDENT has no secondary obligation to re-nominate a loading

port after the Ebola outbreak ............................................................................................... 4

iii. Wahanda was at all time a safe port .................................................................................... 4

a. The Vessel was not exposed to any physical or political danger ................................. 4

b. The delay in Quarantine was avoidable by good navigation or seamanship ................ 4

c. The RESPONDENT had no obligation to re-nominate a discharge port ..................... 4

B. Late redelivery of the Vessel was not caused by the RESPONDENT ..................................... 5

i. Late redelivery of the Vessel was caused by the Quarantine .............................................. 5

a. The but-for test is satisfied ........................................................................................... 5

b. The Quarantine was a result of the CLAIMANT’s failure to avoid the Quarantine .... 5

ii. Late redelivery of the Vessel was caused by inspection of damaged Cargo ....................... 5

iii. CLAIMANT voluntarily assumed the risk of losing the Next Fixture ............................... 6

C. The CLAIMANT’s claim is too remote ................................................................................... 6

i. The loss of Next Fixture constituted special loss ................................................................ 6

ii. The loss of Next Fixture was unlikely ................................................................................. 7

iii. The RESPONDENT did not have special knowledge of the Next Fixture ......................... 7

iv. The RESPONDENT did not assume responsibility for the loss of Next Fixture ................ 8

D. The CLAIMANT is not entitled to damages amounting to USD 15,330,000 ......................... 8

i. Failure of the CLAIMANT to secure other fixtures is a failure to mitigate which disentitles

the CLAIMANT to damages ............................................................................................... 8

ii. Alternatively, failure to secure other fixtures is an independent transaction ...................... 9

iii. The CLAIMANT found a Replacement Fixture for Champion Chartering ........................ 9

iv. In any event, the RESPONDENT is only liable for the minimum period of two years,

limited to the difference between market rate and charterparty rate of the Next Fixture ... 9

THE RESPONDENT IS NOT LIABLE FOR THE FULL EXPENSES INCURRED DUE

TO HULL CLEANING ............................................................................................................ 10

A. The CLAIMANT cannot invoke Cl 83 .................................................................................. 10

B. The RESPONDENT did not breach Cl 83 ............................................................................. 11

i. The RESPONDENT did not have the duty to clean the hull as there was no inspection . 11

ii. The RESPONDENT was prevented from hull cleaning ................................................... 11

a. by the prohibition and detention of the Vessel at Wahanda ....................................... 12

b. by the CLAIMANT’s disagreement to have the hull cleaned at North Titan ............ 12

c. In any event, the RESPONDENT took all reasonable steps to carry out its obligation

to clean the hull .......................................................................................................... 13

C. However, the CLAIMANT waived its right to claim for remuneration by refusing to reach a

consensus, upon redelivery, on the lump sum amount payable. ............................................ 13

D. In any event, the CLAIMANT is only entitled to the cost of hull cleaning at North Titan. .. 13

i. The RESPONDENT is not liable for the cost of hull cleaning at South Island, amounting

to $41,000.00. .................................................................................................................... 14

ii. The RESPONDENT is not liable for the hire and bunkering cost during the voyage to South

Island to clean the Vessel, amounting to $55,567.42. ....................................................... 14

THE VESSEL WAS OFF-HIRE DURING THE QUARANTINE ...................................... 15

A. The Vessel is off-hire pursuant to Cl 17 of NYPE ................................................................. 15

i. There was loss of time ....................................................................................................... 15

ii. The full working of the Vessel was prevented .................................................................. 15

iii. The prevention was caused by events prescribed in Cl 17 ................................................ 16

a. The prevention was caused by “detention by Port State Control for… Vessel

deficiencies” ............................................................................................................... 16

b. The prevention was caused by port authorities acting on suspicion of “deficiency of

officers or ratings” ...................................................................................................... 16

c. The Quarantine amounts to “any similar cause” ........................................................ 17

B. The Vessel was off-hire pursuant to Cl 44 of the Charterparty ............................................. 17

C. The Off-hire Clauses are not negated by the RESPONDENT’s purported breach ................ 18

D. Alternatively, the RESPONDENT is entitled to damages in lieu of the overpaid hire.......... 18

THE CLAIMANT SHOULD INDENMNIFY THE RESPONDENT FOR THE CARGO

CLAIM ....................................................................................................................................... 19

A. The RESPONDENT enjoys 100% indemnity under the ICA ................................................ 19

i. Cargo Claim arose out of unseaworthiness and/or error or fault in navigation or

management of the Vessel under Article 8(a) ................................................................... 20

a. The failure in ballasting operation constitutes unseaworthiness ................................ 20

b. The ballasting operation was a fault in management of the Vessel ........................... 20

ii. The ballasting operation does not fall under Cargo Operation in Article 8(b) .................. 21

iii. Alternatively, there is clear and irrefutable evidence that the damage was caused by the act

or neglect of the CLAIMANT’s servant. ......................................................................... 21

a. The damage arose out of crew member’s act or neglect ............................................ 22

b. The crew member acted as the CLAIMANT’s servant .............................................. 22

B. The RESPONDENT is not time barred from bringing the Indemnity Claim ........................ 22

i. The RESPONDENT stopped the time bar on 7 Jul 2016 .................................................. 23

a. A sufficient notice was submitted before the RESPONDENT was time barred........ 23

b. The sufficiency of the notice should be scrutinized when the notice was submitted . 23

c. At the material time, the absence of information was justified by impossibility. ...... 23

1. The nature of the claim was unavailable ............................................................... 23

2. The amount claimed was not ascertained .............................................................. 24

3. The Contract of Carriage was unnecessary ........................................................... 24

ii. Valid notice was submitted before the extended time bar expired .................................... 24

TABLE OF AUTHORITIES

Cases

A B Helsingfors Steamship Co Ltd v Rederiaktiebolaget Rex (‘The White Rose’) [1969] 3 All ER 374

............................................................................................................................................................ 22

A.B. Marintrans v Comet Shipping (The Shinjitsu Maru No. 5) [1985] 1 Lloyd’s Rep. 568 ............ 22

Action Navigation Inc. v Bottigliere Di Navigazone S.p.A. (The “Kitsa”) [2005] EWHC 177 (Comm)

............................................................................................................................................................ 13

Actis Co. Ltd v The Sanko Steamship Co. Ltd (‘The Aquacharm’) [1980] 2 Lloyd’s Rep. 23716, 17,

18

Alexandros Shipping Co. of Piraeus v MSC Mediterranean Shipping Co. S.A. of Geneva (‘The

Alexandros P’) [1986] 1 Lloyd’s Rep. 42 .......................................................................................... 22

Allied Maples Group Ltd v Simmons and Simmons [1995] 1 WLR 1602 ........................................... 9

André & Cie. S.A. v Orient Shipping (Rotterdam) B.V. (The Laconian Confidence) [1997] 1 Lloyd’s

Rep. 13 ................................................................................................................................... 15, 16, 17

Antaios Compania Naviera v Salen Rederierna [1985] A.C. 191 ..................................................... 24

Attica Sea Carriages Corporation v Ferrostaal Poseidon Bulk Reederei G.M.B.H. (“The Puerto

Buitrago”) [1976] 1 Lloyd’s Rep 250 ................................................................................................ 14

Baker v Willoughby [1970] A.C.467 ................................................................................................... 5

Bank of Credit and Commerce International v Ali (No.3) [2002] ALL ER 750 ................................. 9

Barclays Bank Plc v HHY Luxembourg SARL [2011] 1 BCLC 336 .................................................. 14

Belcore Maritime Corporation v F.L.L.I Moretti Cereali S.p.A. (‘The Mastro Giorgis’) [1983] 2

Lloyd’s Rep. 66 ............................................................................................................................ 16, 17

British Columbia Sawmill v Nettleship [1868] LR 3 CP 499 .............................................................. 7

British Westinghouse Electric and Manufacturing Co v Underground Electric Railways [1912] A.C.

673 ........................................................................................................................................................ 8

C Czarnikow Ltd v Koufos (‘The Heron II’) [1967] 2 Lloyd's Rep. 457 ............................................. 7

Chand v Commonwealth Bank of Australia [2015] NSWCA 181 ...................................................... 6

Cl 1(b.............................................................................................................................................. 2, 22

Commonwealth v Amann Aviation Pty Ltd (1992) 174 CLR 64 ...................................................... 10

Communications, Electrical, Electronic, Information, Postal, Plumbing and Allied Union of Australia

and Others v QR Ltd and Others [2010] FCA 591 ............................................................................ 12

County Ltd v Girozentrale Securities [1996] 3 ALL E.R. 834 ............................................................ 5

Dalwood Marine Co. v Nordana Line AS, (‘The Elbrus’) [2010] 2 Lloyd’s Rep 315 ........................ 9

Darbishire v Warran [1963] 1 W.L.R. 1067 ..................................................................................... 14

Deutsche Genossenschaftsbank v Burnhope [1996] 1 Lloyd’s Rep 113 ..................................... 11, 13

Dimond v Lovell [2002] 1 A.C. 384 ................................................................................................... 14

Exportelisa S.A. v Rocco Giuseppe & Figli Soc. Coll. [1978] 1 Lloyd’s Rep 433 ............................ 12

Ferro, [1893] P. 38 ............................................................................................................................ 21

Forrest v Glasser [2006] 2 Lloyd's Rep 392 ..................................................................................... 23

Gard Marine & Energy Ltd v China National Charter Co Ltd (‘The Ocean Victory’) [2017] UKSC

35 .......................................................................................................................................................... 3

Golden Fleece Maritime Inc and another v ST Shipping and Transport Inc (“The Elli” and “The

Frixos”) [2009] 1 All ER 908 ............................................................................................................ 19

Hamilton & Co v Mackie& Sons (1885) 5 T.L.R. 677 ...................................................................... 21

HIH Casualty & General Insurance Ltd v Axa Corporate Solutions [2002] EWCA Civ 1253 ........ 11

Holding and Barnes Plc v Hill House Hammond Ltd [2001] EWCA Civ 1334, .............................. 11

Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 Q.B. 2 ............................... 20

Hourani v T.& J.Harrison, (1927) 28 Ll.L.Rep. 120 ........................................................................ 21

Hyundai Merchant Marine Co Ltd v Furness Withy (Australia) Pty (The ‘Doric Pride’) [2006] 2

Lloyd’s Rep 175 ................................................................................................................................. 16

Hyundai Merchant Marine v. Gesuri Chartering (‘The Peonia’) [1991] 1 Lloyd’s Rep. 100 ............ 6

Investors Compensation Scheme v West Bromwich Building Society [1998] 1 W.L.R. 896 ............. 10

IPSOS SA v Dentsu Aegis Network Ltd [2015] EWHC 1171 [21]..................................................... 23

John Grimes Partnership Ltd v Gubbins 146 ConLR 26, ................................................................... 8

Jumbo King Ltd v Faithful Properties Ltd (1999) H.K.C.F.A.R. 279 ............................................... 11

K/S Penta Shipping Inc A/S v Ethiopian Shipping Lines Corporation (‘The Saga Cob’) [1992] 2

Lloyd’s Rep 545 ............................................................................................................................... 3, 5

Koch Marine Inc v D’Amica Societa di Navigatione (‘The Elene d’Amico’) [1980] 1 Lloyd’s Rep.

75 .......................................................................................................................................................... 9

Kpohraror v Woolwich Building Society [1996] 4 AER 119............................................................... 7

Laminates Acquisition Co v BTR Australia Ltd [2003] EWHC 2540 (Comm) ................................. 24

Leeds Shipping Co Ltd v Societe Francaise Bunge (‘The Eastern City’) [1958] 2 Lloyd’s Rep 127 . 3

Leon Bernsterin Co. v Wilhelmsen, 232 F.2d 771............................................................................. 20

Malik Co. v Central European Trading Agency Ltd. [1974] 2 Lloyd's Rep. 279 .............................. 13

Manifest Shipping Co Ltd v Uni-Polaris Insurance Co Ltd and La Re Âunion Europeane (The Star

Sea) [1997] 1 Lloyd's Rep 360 ........................................................................................................... 20

McKinnon Co v Moore-McCormack Lines, 1959 AMC 1842 (SD. N.Y. 1959) .............................. 20

Merit Shipping Co. Inc V T.K. Boesen A/S (The ‘Goodpal’) [2000] Vol.1 Lloyd’s Rep 638 ........... 22

Motor Oil Hellas (Corinth) Refineries S.A. v Shipping Corporation of India (The Kanchenjunga)

[1990] 1 Lloyd’s Rep. 391 ................................................................................................................... 5

MSC Mediterranean Shipping Co. SA v Alianca Bay Shipping Co. Ltd. (‘The Argonaut’) [1985] 2

Lloyd’s Rep. 216 ................................................................................................................................ 22

Navigas International Ltd v Trans-Offshore Inc (‘The Bridgestone Maru No. 3’) [1985] 2 Lloyd’s

Rep. 62 ............................................................................................................................................... 17

Nobahar-Cookson & Ors v The Hut Group Ltd [2016] EWCA Civ 128 .......................................... 23

Orient Ins. Co v United S.S. Co 1961 AMC 1228 (S.D. N.Y. 1961) ................................................ 20

Osmium Shipping Corporation v Cargill International SA (‘The Captain Stefanos’) [2012] EWHC

571 ...................................................................................................................................................... 16

Pan Ocean Shipping Ltd v Creditcorp Ltd (“The Trident Beauty”) .................................................. 18

Papera Traders Co. Ltd. And Others v Hyundai Merchant Marine Co. Ltd. And Another (‘The

Eurasian Dream’) [2002] 1 Lloyd's Rep 719 ..................................................................................... 20

Payzu, Ltd. v Saunders [1918-19] All ER Rep 219 ........................................................................... 14

Pearl Carriers Inc v Japan Line Ltd (‘The Chemical Venture’) [1993] 1 Lloyd’s Rep 508 ................ 3

Petroplus Marketing AG v Shell Trading International Ltd [2009] 2 Lloyd’s Rep 611 ................... 11

Prestcold (Central) Ltd v Minister of Labour [1969] 1 W.L.R. 89 ................................................... 21

Rheinol GmbH v Huron Liberian Co. (‘The Concordia C’) [1985] 2 Lloyd’s Rep 55 ....................... 9

Riverstone Meat Co Pty Ltd v Lancashire Shipping Co Ltd (‘The Muncaster Castle’) [1961] 1 Lloyd’s

Rep. 57 (H.L.) .................................................................................................................................... 20

Robin Hood Flour Mills Ltd v N M Paterson & Sons Ltd (The Farrandoc) [1967] 2 Lloyd's Rep 232

............................................................................................................................................................ 20

Rowson v. Atlantic Transport Company, [1903] 2 K.B. 666 ............................................................. 21

Ruxley Electronics and Constructions Ltd. V Forsyth [1995] 3 WLR 118, ...................................... 14

Sandeman And Others v Scurr And Others (1866) 2 Q.B. 86 ........................................................... 22

SIB International S.R.L. v Metallgesellschaft Corporation (‘The Noel Bay’) [1989] 1 Lloyd’s Rep.

361 ........................................................................................................................................................ 9

Sig Bergesen D.Y. & Co. and Others v Mobil Shipping and Transportation Co. (‘The Berge Sund’)

[1993] 2 Lloyd’s Rep. 453 ................................................................................................................. 15

Sidermar SpA v Apollo Corporation (‘The Apollo’) [1978] 1 Lloyd’s Rep. 200 ........................ 16, 17

Skips A/S Nordheim v Syrian Petroleum Co Ltd [1984] Q.B. 599..................................................... 21

Smailes and Son v Hans Dessen and Co (1906) 94 LT 492 ................................................................ 8

Sotiros Shipping Inc. and Aeco Maritime S.A. v Sameiet Solholt (“The Solholt”) [1983] 1 Lloyd’s

Rep 605 .............................................................................................................................................. 14

Standard Oil Company of New York v. Clan Line Steamers Ltd. (The Clan Gordon) [1924] A.C. 100

............................................................................................................................................................ 20

Sykes v Midland Bank Executor and Trustee Co [1971] 1 Q.B. 113 ................................................ 10

The Glenochill [1896] P 10 ................................................................................................................ 20

The Sanko Steamship Co. Ltd. v Fearnley and Eger A/S (‘The Manhattan Prince’) [1985] 1 Lloyd’s

Rep. 140 ............................................................................................................................................. 17

Torvald Klaveness A/S v Arni Maritime Corporation (‘The Gregos’) [1995] 1 Lloyd’s Rep. 1 ......... 6

Total Gas Marketing Ltd v Arco British Ltd [1998] 2 Lloyd’s Rep 209 ........................................... 11

Transfield Shipping Inc v Mercator Shipping Inc, (‘The Achilleas’) [2008] 2 Lloyd’s Rep. 275 ... 6, 8

Transgrain Shipping v Yangtze [2017] EWCA civ 2107 ................................................................... 22

Transoceanic Petroluem Carrier v Cook Industries Inc (The Marry Lou) [1981] 2 Lloyd's Rep 272 . 4

Transworld Oil Ltd v North Bay Shipping Corporation (‘The Rio Claro’) [1987] 2 Lloyd's Rep. 173

.............................................................................................................................................................. 7

TS Lines Ltd v Delphis NV (‘The TS Singapore’) [2009] 2 Lloyd’s Rep. 54..................................... 15

Union of India v. Reederij Amsterdam [1963] 2 Lloyd’s Rep. 223 ................................................... 20

Venezolana De Navegacion v Bank Line (‘The Roachbank’) [1987] 2 Lloyd’s Rep. 498 .......... 16, 17

Victoria Laundry v Newman Industries [1949] 1 All ER 997 ............................................................. 7

Warinco A.G. Fritz Mauthner [1978] 1 Lloyd’s Rep 15 ................................................................... 12

Wye Shipping Company Ltd v Compagnie du Chemin de Fer Paris-Orleans [1922] 10 LI.L. Rep. 85

............................................................................................................................................................ 14

Other Authorities

BIMCO Special Circular No.3, 24 June 2013 (updated 16 July 2015) – Hull Fouling Clause for Time

Charter Party ...................................................................................................................................... 12

Index Mundi, ‘tea monthly prices’ Jan 2015- Feb 2015 .................................................................... 24

The Inter-club Agreement 1996/2011, Article ................................................................................... 19

Rules

Hague Visby Rule .............................................................................................................................. 24

Regulations

International Health Regulation. ........................................................................................................ 18

Prevention and Control of Disease Regulation. ................................................................................. 18

Textbooks

H.G. Beale, ed., Chitty on Contracts, vol. 1, 30th ed. (London: Thomson Reuters (Legal) Limited,

2008) .................................................................................................................................................. 11

Julian Cooke et al, Voyage Charters (Informa Law, 4th ed, 2014), .................................................. 10

Terence Coghlin et al, Time Charters (Informa Law, 7th ed, 2014), para 4.53 ................................... 6

Article

R. White, “The Human Factor in Unseaworthiness Claims” [1995] LMCLQ 221 ........................... 20

Trim Optimisation - Theory and Practice, the International Journal on Marine Navigation and Safety

of Sea Transportation, Vol 8 No 3 Sep 2014 ..................................................................................... 21

TABLE OF ABBREVIATIONS

ABBREVIATION TERM

CLAIMANT Panther Shipping Inc

RESPONDENT Omega Chartering Limited

BIMCO Baltic and International Maritime Council

Cargo Damaged Cargo

Cargo Claim The claim between the receivers, Hawkeye Import& Export Pty and the

RESPONDENT, Omega Chartering Limited

Cargo Operation Loading, stowage, lashing, discharge, storage or other handling of cargo

Champion Champion Chartering Corp

Charterparty The Time Charterparty between Panther Shipping Inc and Omega

Chartering Limited

Cl Clause

Clause 83 BIMCO Hull Fouling Clause for Time-Charter Parties in NYPE

ICA Inter-Club Agreement 1996/2011

Indemnity Claim The claim between the RESPONDENT and CLAIMANT on the

apportionment of Cargo Claim liability

NYPE New York Produce Exchange Form 2015

Quarantine The quarantine of M/V THANOS QUEST at Wahanda Port

Regulation Hong Kong’s Prevention and Control of Disease Regulation 2008 (Cap.

599, Section)

Vessel M/V THANOS QUEST

Vessel Operation Unseaworthiness and/or error or fault in navigation or management of

the vessel

Wahanda Wahanda, Bao Kingdom

WHO World Health Organization

1

STATEMENT OF FACTS

1. On 18 March 2016, Panther Shipping Inc (CLAIMANT) chartered M/V “THANOS QUEST” (Vessel)

to Omega Chartering Limited (RESPONDENT) for about 50-55 days from West Coast to Wahanda.

2. Sometime before 18 April, an Ebola outbreak occurred at West Coast. Although the Vessel managed

to leave West Coast, she was detained and subsequently quarantined at Wahanda (Quarantine) as a

number of crew was found to have high fever upon inspection on 11 May.

3. On 15 June, the CLAIMANT entered into a time charter with Champion Chartering Corp (Champion)

for a period of two years, with a two years extension at the charterers’ option (Next Fixture).

4. The Vessel finally obtained free pratique on 26 June. On the same day, the CLAIMANT sent an email

notifying the RESPONDENT that the Vessel was fixed for her next voyage to East Coast.

5. Champion cancelled the Next Fixture on 28 June, the last day of the laycan. Subsequently, the

CLAIMANT chartered the Vessel to Fairwind International (Fairwind) for about 50 to 55 days.

6. Throughout the Quarantine, the parties exchanged numerous email correspondence regarding the

cleaning of the hull (Cleaning). After learning that hull cleaning could not be performed at Wahanda,

the RESPONDENT sought the CLAIMANT’s advice and made the first proposal to settle hull cleaning

with a lump sum payment of USD15,000, which was rejected by the CLAIMANT.

7. On 27 June, the RESPONDENT made the second proposal to clean the hull at North Titan port, which

required half a day sailing from Wahanda or a lumpsum payment of USD20,000. The CLAIMANT

ignored this proposal. Instead, the CLAIMANT requested the RESPONDENT to arrange inspection and

cleaning at South Island, quadrupled the length of the initial journey.

8. On 30 June, the RESPONDENT redelivered the Vessel and made a third proposal of a lump sum

payment of USD30,000. The hull was eventually cleaned at South Island on 2 July.

2

9. The Vessel was carrying 8600mt of English Tea Bags (Cargo). 2000mt of cargo was discovered to

be damaged during discharge on 27 July. An on-board inspection revealed that the damage was

caused by the erroneous ballasting operation, flooding the hold.

10. The RESPONDENT sent a formal notice of indemnity claim, attached with the Survey Report, to the

CLAIMANT on 7 July 2016. Thereafter, The RESPONDENT acquired 6 months’ extension upon two

separate requests.

11. The CLAIMANT commenced the present arbitral proceedings, seeking compensation for hull cleaning

costs (USD41,000), costs of the voyage to South Island (USD55,567.42) and loss of Next Fixture

(USD15,330,000). The RESPONDENT counterclaims for amount of hire overpaid (USD 375,000) and

seeks 100% indemnity for the cargo claim (USD 100,000,000).

CLAIM

THE RESPONDENT IS NOT LIABLE FOR THE LOSS OF NEXT FIXTURE

1. The CLAIMANT’s claim for loss of Next Fixture is not recoverable because (A) the RESPONDENT is

not in breach of the Charterparty and (B) the late delivery of Vessel was not caused by the

RESPONDENT. Further, (C) the loss of Next Fixture is too remote and (D) the CLAIMANT failed to

take reasonable steps to mitigate its loss.

A. The RESPONDENT did not breach its safe port warranty under the Charterparty

2. Under the Fixture Recap1 and Cl 1(b) & (c) of the NYPE,2 the RESPONDENT undertakes to always

trade within safe ports and berths. The RESPONDENT did not breach such warranty because (i) West

Coast was, at all material times, a safe port and (ii) a secondary obligation to re-nominate a loading

port did not arise. Further, (iii) Wahanda was at all times a safe port, hence the RESPONDENT was

1 Record, 6, Line 6: “Always via SPS, SBS” referring to a contractual promise that the Vessel will also trade via safe ports

(SPS) and safe berths (SBS). 2 Cl 1(b): “Trading limits – The Vessel shall be employed in such lawful trades between safe ports and safe places within

the following trading limits…as the Charterers shall direct.”; Cl 1(c): “Berths - The Vessel shall be loaded and discharged

in any safe anchorage or at any safe berth or safe place that the Charterers or their agents may direct, provided the Vessel

can safely enter, lie and depart always afloat.”

3

under no obligation to re-nominate a discharge port.

i. West Coast was at all material time a safe port

3. According to The Eastern City,3 a port is safe if, in the relevant period of time, the particular ship can

reach it, use it and return from it without, in the absence of some abnormal occurrence, being exposed

to danger which cannot be avoided by good seamanship.

a. There was no unavoidable danger

4. West Coast did not present any danger that was unavoidable by good seamanship. On 18 Apr 2016,

the virus mainly affected the city and only a few cases were reported at the port.4 The risk of

transmission was low due to the proximity to the crucial infected area. Since Ebola can only be

transmitted through bodily fluids,5 such risk can easily be reduced by minimising direct contact with

shore personnel.6 The risk of danger to the Vessel is negligible, to the extent that the CLAIMANT did

not decline to stay and load his vessel at West Coast.7

b. There was no abnormal occurrence

5. The outbreak of Ebola amounts to an ‘abnormal occurrence’ since it was rare and could not be

expected by any particular ship at any time of the year.8 The unpredictable outbreak of a virus does

not constitute a characteristic of the West Coast port.9 It is settled that the CLAIMANT bears the

responsibility of losses caused by ‘abnormal occurrence’.10

3 Leeds Shipping Co Ltd v Societe Francaise Bunge (‘The Eastern City’) [1958] 2 Lloyd’s Rep 127, 131; Gard Marine &

Energy Ltd v China National Charter Co Ltd (‘The Ocean Victory’) [2017] UKSC 35 [11] 4 Record, 24 5 World Health Organisation, Ebola situation assessment: What we know about transmission of the Ebola Virus Among

Humans, 6 October 2014, available at: https://www.who.int/mediacentre/news/ebola/06-october-2014/en/ 6 Centers for Disease Control and Prevention, Ebola Virus Disease, Prevention, available at:

https://www.cdc.gov/vhf/ebola/prevention/index.html. 7 K/S Penta Shipping Inc A/S v Ethiopian Shipping Lines Corporation (‘The Saga Cob’) [1992] 2 Lloyd’s Rep 545, 551;

Pearl Carriers Inc v Japan Line Ltd (‘The Chemical Venture’) [1993] 1 Lloyd’s Rep 508, 519 8 The Ocean Victory [2017] UKSC 35 [18] 9 Uni-Ocean Lines Pte Ltd v C-Trade S.A. (“The Lucille”) [1984] 1 Llyod’s Rep. 224, at 250; The Ocean Victory [2017]

UKSC 35, [11]; Transoceanic Petroluem Carrier v Cook Industries Inc (‘The Mary Lou’) [1981] 2 Lloyd's Rep 272, 277 10 The Mary Lou [1981] 2 Lloyd's Rep 272, at 277; Kodros Shipping Corporation v Empresa Cubana De Fletes (The Evia

(No.2)) [1982] 2 Lloyd’s Rep 307, 317

4

ii. In any event, the RESPONDENT has no secondary obligation to re-nominate a loading

port after the Ebola outbreak

6. A secondary obligation does not arise when it is impossible to perform. 11 When the outbreak of

Ebola was reported on 18 April 2016,12 there were already over 100 cases of Ebola in the city and

several cases at the port. This indicates that the outbreak occurred at least a week before 18 April.

When the RESPONDENT knew of the outbreak, it was impossible to avoid the possible infection from

the outbreak. Therefore, re-nominating a port would have been a futile effort.

iii. Wahanda was at all time a safe port

a. The Vessel was not exposed to any physical or political danger

7. In furtherance of the test in The Eastern City, a port is only unsafe if the ship cannot enter, use or

leave the port without being exposed to any physical or political danger.13 Wahanda did not possess

or expose the Vessel and its crew to any such danger.

b. The delay in Quarantine was avoidable by good navigation or seamanship

8. Art 28(4) of the International Health Regulation mandates the ship officers to report to the port on

evidence of public health risk or any illness indicate of an infectious disease without delay.

9. If the Master had informed Wahanda of the crew’s sickness, they would’ve been informed of the risk

of Quarantine. Such risk was avoidable by either disembarking its sick crew, sanitising or fumigating

the Vessel at a more lenient port prior to its arrival in Wahanda.

c. The RESPONDENT had no obligation to re-nominate a discharge port

10. The CLAIMANT had also failed to inform the RESPONDENT of the sickness of the crew. Without such

information, the RESPONDENT could not have reasonably predicted the prolonged period of

11 The Evia (No.2) [1982] 2 Lloyd’s Rep 307, 320 12 Record, 24 13 The Evia (No.2) [1982] 2 Lloyd’s Rep 307, 316; Ogden v Graham (1861) 1 B. & S. 773, 780-782

5

Quarantine when the order to Wahanda was made,14 hence was under no obligation to nominate an

alternative discharge port or order the Vessel to perform necessary prevention measures.15

B. Late redelivery of the Vessel was not caused by the RESPONDENT

11. Late redelivery of the Vessel was caused by the (i) Quarantine and (ii) the need to inspect damaged

cargo, both resulted from the CLAIMANT’s default. Where there are two causes, the contract-breaker

is liable so long as his breach was an “effective cause”; the court need not choose which cause was

the more effective.16 Further, the CLAIMANT has (iii) assumed the risk of losing the Next Fixture.

i. Late redelivery of the Vessel was caused by the Quarantine

a. The but-for test is satisfied

12. The Vessel arrived at Wahanda on 7th May,17 but was subsequently quarantined on 11th May when a

number of crew members was found to have high fever.18 But for the Quarantine, the the Vessel

would have been redelivered timely.

b. The Quarantine was a result of the CLAIMANT’s failure to avoid the Quarantine

13. Even if West Coast or Wahanda was unsafe, the Master had complied with the RESPONDENT’s orders

without objections. The Master had a duty to act reasonably once the danger become apparent to

them.19 To avoid or mitigate the effect of Quarantine, the Master should’ve informed Wahanda of its

Crew’s sickness and taken preventive measures in other ports as discussed in [9]. Failure to do so is

default on the CLAIMANT’s obligation.

ii. Late redelivery of the Vessel was caused by inspection of damaged Cargo

14 The Saga Cob [1992] 2 Lloyd’s Rep 545, 551 15 The Saga Cob [1992] 2 Lloyd’s Rep 545, 551 16 County Ltd v Girozentrale Securities [1996] 3 ALL ER 834, 857 [F], [G], 859 [C]; Baker v Willoughby [1970] AC 467,

492 [B]-[E], 494 [B]-[D], [F]-[G]; The Ocean Victory [2014] 1 Lloyd’sRep. 59, Teare J, [73]-[175] 17 Record, 27 18 Record, 26 19 Motor Oil Hellas (Corinth) Refineries SA v Shipping Corporation of India (‘The Kanchenjunga’) [1987] 2 Lloyd’s Rep.

509, 516

6

14. The Quarantine ended when the Vessel obtained free pratique on 26th June,20 leaving a window of

two days before the laycan of Champion’s fixture expires on 28th June.21 During this crucial time, the

CLAIMANT’s crew acted negligently and damaged the cargo,22 causing the on-board inspection that

lasted from 28th to 30th June 2016.23 As the delivery port for the Next Fixture is Wahanda.24 The

vessel could have been delivered in time if not for the inspection.

iii. CLAIMANT voluntarily assumed the risk of losing the Next Fixture

15. The CLAIMANT, fully appraised of the circumstances, contracted the Next Fixture while the Vessel

was quarantined.25 Such a move was unreasonable, having regard to its high risk nature, since at the

material time there was no prospect of the Quarantine coming to an end.26

C. The CLAIMANT’s claim is too remote

16. By default, the CLAIMANT is only entitled to the normal measure of damage, calculated as the

difference between the Charterparty rate of hire and the market rate of hire for the period of

overrun.27 The CLAIMANT is not entitled to the loss of Next Fixture because it is too remote since (i)

it was special loss, (ii) unlikely to happen and (iii) the RESPONDENT neither had special knowledge

nor (iv) assumed responsibility for it.

i. The loss of Next Fixture constituted special loss

17. The Next Fixture is 26.5 times more lucrative, in terms of duration, compared to the present

charterparty and the subsequent Fairwind charter. 28 The Next Fixture does not arise from the

20 Procedural Order No.2 [7] 21 Record, 33: “LAYCAN 22-28JUNE” 22 Record, 48 23 Record, 48 24 Record, 33: “DEL DLOSP WAHANDA ATDNSHINC” 25 Record, 32 26 Chand v Commonwealth Bank of Australia [2015] NSWCA 181 [105]-[107]; Chand v Commonwealth Bank of

Australia [2015] NSWCA 181, [105]-[107] 27 Terence Coghlin et al, Lloyd’s Law Library Time Charters (Informa Law, 7th ed, 2014) [4.53]; Hyundai Merchant

Marine v. Gesuri Chartering (‘The Peonia’) [1991] 1 Lloyd’s Rep. 100, 108; Torvald Klaveness A/S v Arni Maritime

Corporation (‘The Gregos’) [1995] 1 Lloyd’s Rep. 1, 5; Transfield Shipping Inc v Mercator Shipping Inc, (‘The Achilleas’)

[2008] 2 Lloyd’s Rep. 275, 278 [10] 28 Record, 6 (Omega: ABT 50-55 DAYS); 33 (Champion: 2 YR CHARTER WITH 2 YR EXTENSION IN CHOPT); 57

(Fairwind: ABT 50-55 DAYS)

7

CLAIMANT’s usual course of business, since it could be inferred that the CLAIMANT primarily dealt

with short-term charterparties.29

ii. The loss of Next Fixture was unlikely

18. First, considering the grave uncertainties as to the duration of the Quarantine, it was not likely that

CLAIMANT would enter into a subsequent fixture while the vessel was still quarantined.

19. Second, it is unlikely that Champion would terminate a possibly 4-year charterparty due to a delay of

two days. In view of the difficulty to acquire a similar replacement within a short period of time,

even if Champion has unfettered rights to cancel the contract, exercise of that right was unlikely.

Hence, it was not in both parties’ contemplation as it would only happen in a small minority of cases.30

20. Third, it would not cross the mind of any reasonable person that a mere delay of 2 days would lead

to the loss of an astronomical fixture.31

iii. The RESPONDENT did not have special knowledge of the Next Fixture

21. The RESPONDENT was kept in the dark of CLAIMANT’s use of vessel, except for the information of a

subsequent fixture on 26 June 2018 with no mention of the cancelling date.32 The mere knowledge of

a possible future fixture does not amount to accepting it with a special condition attached.33 Thus, the

information supplied was insufficient to constitute knowledge of special circumstances to satisfy the

test in Hadley v Baxandale.

22. Moreover, the RESPONDENT was given the impression that the vessel’s next itinerary was not known

and there was no compelling need to quickly redeliver the vessel.34

29 Victoria Laundry v Newman Industries [1949] 1 All ER 997, 1005 30 C Czarnikow Ltd v Koufos (‘The Heron II’) [1967] 2 Lloyd's Rep. 457, 463; Transworld Oil Ltd v North Bay Shipping

Corporation (‘The Rio Claro’) [1987] 2 Lloyd's Rep. 173, 175 31 Kpohraror v Woolwich Building Society [1996] 4 AER 119, 127 32 Record, 36: “The vessel has already been fixed for her next voyage (to load at East Coast)” 33 British Columbia Sawmill v Nettleship [1868] LR 3 CP 499, 509 34 Record, 30: “the vessel’s next itinerary is not yet known”

8

23. In any event, the special knowledge must be communicated before the breach crystalizes. Here, the

special circumstances were only communicated 2 days before the cancelling date. At material time,

the breach has become inevitable as 2 days was too short for the inspection and discharge of cargo.35

iv. The RESPONDENT did not assume responsibility for the loss of Next Fixture

24. First, at the time the contract was entered into, the RESPONDENT did not know the length and terms

of the Next Fixture, hence could not have assumed liability for it, as that would amount to assuming

responsibility for an unquantifiable risk.36

25. Second, it is improper to impose such mammoth loss on the RESPONDENT considering the nature of

the contract and the commercial background.37 As a relatively small-scale entity, the RESPONDENT

entered into a charterparty of the duration of 50 to 55 days.38 It would be gravely disproportionate to

force upon the REPONDENT the liability of a loss of a possibly 4 year charterparty, 26.5 times the

length of the one that the RESPONDENT entered into.

D. The CLAIMANT is not entitled to damages amounting to USD 15,330,000

i. Failure of the CLAIMANT to secure other fixtures is a failure to mitigate which disentitles

the CLAIMANT to damages

26. After learning the loss of Next Fixture, the CLAIMANT was obliged to mitigate its loss39 and act in

the best interest of itself and RESPONDENT.40 The CLAIMANT cannot take advantage of the occasion

and not look for other replacement fixtures.

27. Had the CLAIMANT took initiative to mitigate its loss, most if not all of the losses could have been

avoided. First, the market rate was on the rise.41 Second, the CLAIMANT is an established commercial

35 Record, 48: “attended on board… on 28, 29 and 30 June” 36 The Achilleas [2008] 2 Lloyd’s Rep. 275, 280 [23] 37 John Grimes Partnership Ltd v Gubbins 146 ConLR 26, 36 [24] 38 Record, 6: “DURATION ABT 50-55 DAYS” 39 British Westinghouse Electric and Manufacturing Co v Underground Electric Railways [1912] AC 673, 689 40 Smailes and Son v Hans Dessen and Co (1906) 94 LT 492 41 Record, 6 (Omega: HIRE USD7500 DAILY), 34 (Champion: HIRE USD10500 DAILY), 57 (Fairwind: HIRE

USD11000 DAILY)

9

entity in the industry with a fleet of bulk cargo vessels.42 Third, the CLAIMANT effortlessly secure

four fixtures -unknown pre-Omega voyage,43 Omega44, Champion45 and Fairwind46- almost back-to-

back. Hence, Failure of CLAIMANT to secure other substitutes amounts to unreasonable inaction.

ii. Alternatively, failure to secure other fixtures is an independent transaction

28. After losing the Next Fixture, the CLAIMANT was placed in a position to make commercial decision

on its next move, and had decided to not take advantage of the market, resulting in the losses.47 As

the losses are independent of the RESPONDENT’s breach, the CLAIMANT is not entitled to the loss of

next fixture.

iii. The CLAIMANT found a Replacement Fixture for Champion Chartering

29. The Replacement Fixture was only possible because of the fixture with Champion was repudiated.48

The Replacement Fixture mitigated the CLAIMANT’s loss of fixture, and its value should be deducted

from damages to prevent unjust enrichment.49

iv. In any event, the RESPONDENT is only liable for the minimum period of two years,

limited to the difference between market rate and charterparty rate of the Next Fixture

30. The chances of Champion extending its contract to its maximum period are not substantial but

speculative,50 as numerous factors would influence Champion’s decision to extend the contract.51

There are no facts to infer that there was a substantial chance,52 on the contrary, the demanding

attitude demonstrated by Champion in refusing a delay of 2 days signifies that there is little chance

42 Record, 3 43 Record, 5 “VSL IS CURRENTLY DISCH BULK CARGO AT WEST COAST PORT AREA WHERE SHE IS

EXPECTED TO COMPLETE DISCHARGE” 44 Record, 4 45 Record, 32 46 Record, 55 47 Koch Marine Inc v D’Amica Societa di Navigatione (‘The Elene d’Amico’) [1980] 1 Lloyd’s Rep. 75, 89 48 Dalwood Marine Co. v Nordana Line AS, (‘The Elbrus’) [2010] 2 Lloyd’s Rep 315, 320 [33] 49 SIB International S.R.L. v Metallgesellschaft Corporation (‘The Noel Bay’) [1989] 1 Lloyd’s Rep. 361, 365; Rheinol

GmbH v Huron Liberian Co. (‘The Concordia C’) [1985] 2 Lloyd’s Rep 55, 58 50 Allied Maples Group Ltd v Simmons and Simmons [1995] 1 WLR 1602, 1610 51 Bank of Credit and Commerce International v Ali (No.3) [2002] ALL ER 750 52 Sykes v Midland Bank Executor and Trustee Co [1971] 1 QB 113, 130

10

of future cooperation.53 Further, the option of the 2-year extension was not impliedly nor expressly

promised by Champion, thus not constituting a commercial advantage inherent of the Next Fixture.54

31. In any event, the damages should be calculated on the assumption that the CLAIMANT had acted

reasonably in obtaining substitute fixtures to mitigate its loss.55 Thus, the damages should be limited

to the difference between market rate and the lost charterparty rate for the two years.

THE RESPONDENT IS NOT LIABLE FOR THE FULL EXPENSES INCURRED DUE TO

HULL CLEANING

32. Cl 83 shifts the risk and obligation of hull cleaning from the owners to the charterers when the vessel

remains idle for an extended period on the charterer’s order.56 (A) Cl 83 does not apply in the current

circumstances. Alternatively, if Cl 83 is applicable, the RESPONDENT (B) was prevented from

cleaning the hull. As a result, the CLAIMANT was entitled to a lump sum payment for the expenses of

hull cleaning, but (C) the CLAIMANT has waived its right to claim for remuneration of hull cleaning.

Alternatively, (D) the CLAIMANT is only entitled to claim the cost of hull cleaning at North Titan.

A. The CLAIMANT cannot invoke Cl 83

33. Given the clear wording of C 83(a) 57, Charterer only assumes the responsibility of hull cleaning when

the Charterer deliberately orders a vessel to remain idle at a port for a prolonged period.58 However,

Vessel remained at Wahanda for 50 days due to the CLAIMANT’s default in [13] and [14], not upon

the RESPONDENT’s instruction. Therefore, the claim for hull cleaning should be defeasible on the

principle that “a man cannot take advantage of his own wrong”.59

53 Record, 42 54 Commonwealth v Amann Aviation Pty Ltd (1992) 174 CLR 64 [28] 55 Julian Cooke et al, Voyage Charters (Informa Law, 4th ed, 2014) [21.97] 56 Record, 18 57 Cl 83(a): “in accordance with Charterers’ orders” 58 Investors Compensation Scheme v West Bromwich Building Society [1998] 1 W.L.R. 896, 913 [5], Lord Hoffmann,

“commonsense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal

documents” 59 Petroplus Marketing AG v Shell Trading International Ltd [2009] 2 Lloyd’s Rep 611, 615, [17]

11

34. The RESPONDENT did not waive its rights to contest the applicability of Cl 83.60 The RESPONDENT

did not unequivocally accept that hull fouling arose from its orders.61 Alternatively, the CLAIMANT’s

reliance on such representation does not it make it inequitable to dispute on the applicability of Cl

83,62 because it is the CLAIMANT merely performed its common law obligation to clean the hull.

B. The RESPONDENT did not breach Cl 83

35. If Cl 83 is invoked, the RESPONDENT has the duty to (i) clean the hull only upon inspection63 and (ii)

if prevented, (iii) parties are to agree to a lump sum prior to redelivery.64

i. The RESPONDENT did not have the duty to clean the hull as there was no inspection

36. Cl 83(c) indicates that the duty to clean the hull arises only “as a result of the inspection”. An

inspection is thus a condition precedent to the cleaning of the hull.65 The parties’ agreement on the

extent of hull fouling after the proceeding commenced66 does not nullify the condition precedent in

Cl 83(c) in retrospect. The parties’ intention, inferred from the clear language of the clause,67 cannot

be disregarded just because the consequence may appear to be lopsided in hindsight.68

ii. The RESPONDENT was prevented from hull cleaning

37. Cl 83(d)69 states that hull cleaning need not be carried out if Charterers are prevented from it.

60 HIH Casualty & General Insurance Ltd v Axa Corporate Solutions [2002] EWCA Civ 1253, 1060, [19] 61 Record, 28, 31, 38, 41, 44, 45; refer to the RESPONDENT’s alternate stance in arranging for hull cleaning and in

negotiating on lump sum payment after raising prevention. 62 H.G. Beale, ed., Chitty on Contracts, vol. 1, 30th ed. (London: Thomson Reuters (Legal) Limited, 2008) at para. 24-

008 63 Cl 83(c), “… as a result of the inspection either party calls for cleaning of any of the underwater parts, such cleaning

shall be undertaken by the Charterers at their risk, cost, expense and time” 64 Cl 83(d), “… If, nevertheless, Charterers are prevented from carrying out such cleaning, the parties shall, prior to but

latest on redelivery, agree a lump sum payment in full and final settlement of Owners’ costs and expenses arising as a

result of or in connection with the need for cleaning” 65 Total Gas Marketing Ltd v Arco British Ltd [1998] 2 Lloyd’s Rep 209, at 215 66 Procedural Order No.2, para. 5 67 Deutsche Genossenschaftsbank v Burnhope [1996] 1 Lloyd’s Rep 113, at 116 68 Jumbo King Ltd v Faithful Properties Ltd (1999) H.K.C.F.A.R. 279, cited by the Court of Appeal in Holding and

Barnes Plc v Hill House Hammond Ltd [2001] EWCA Civ 1334, at para 17, 40 69 Cl 83(d): “Cleaning in accordance with this Clause shall always be carried out prior to redelivery. If, nevertheless,

Charterers are prevented from carrying out such cleaning, the parties shall, prior to but latest on redelivery, agree a lump

sum payment in full and final settlement of Owners’ costs and expenses arising as a result of or in connection with the

need for cleaning pursuant to this Clause.”

12

a. by the prohibition and detention of the Vessel at Wahanda

38. For the bulk of the charter period, the Vessel was at the port of Wahanda which prohibits hull cleaning

at the port.70 While authorities may suggest that RESPONDENT must clean the hull elsewhere to fulfill

its obligation where possible,71 hull-cleaning remained an impossibility to the RESPONDENT, as the

RESPONDENT was duty bound to mitigate the late redelivery of the Vessel by redelivering as soon as

the discharge operation was completed on 30th June 2016.72

b. by the CLAIMANT’s disagreement to have the hull cleaned at North Titan

39. Cl 83(c) requires the arrangement of hull cleaning to be done “in consultation with” the CLAIMANT.

The RESPONDENT attempted to consult the CLAIMANT by giving notice to the CLAIMANT on hull-

cleaning arrangements and affording an opportunity to the CLAIMANT to express its views on such

arrangements.73 Although a right to be consulted is not a right to veto,74 the CLAIMANT’s agreement

on the arrangement of hull cleaning is of practical necessity. The RESPONDENT needed to pay heed

to the Vessel’s intricate anti-fouling system and other traits,75 lest the CLAIMANT suffers loss when

damage arises from cleaning.76

40. A discussion77 did not happen, as the CLAIMANT merely restated their stance dismissively without

engaging and considering the RESPONDENT’s proposals. Eventually, the CLAIMANT ordered the

RESPONDENT to clean the Vessel at South Island. However, such order was out of convenience, not

70 Record, 27; Procedural Order No.2 [7] 71 Warinco A.G. Fritz Mauthner [1978] 1 Lloyd’s Rep 151, 153, 154; Exportelisa S.A. v Rocco Giuseppe & Figli Soc.

Coll. [1978] 1 Lloyd’s Rep 433, 437 72 Record, 44, 45 73 Communications, Electrical, Electronic, Information, Postal, Plumbing and Allied Union of Australia and Others v QR

Ltd and Others 268 ALR 514, 527 [44] 74 Communications, Electrical, Electronic, Information, Postal, Plumbing and Allied Union of Australia and Others v QR

Ltd and Others 268 ALR 514, 527 [44] 75 Cl 83(c)(i) illustrates the importance of consulting the Owner through the phrase “cleaning shall always be under the

supervision of the Master…” 76 BIMCO Special Circular No.3, 24 June 2013 (updated 16 July 2015) – Hull Fouling Clause for Time Charter Party 77 “Consultation” is defined as the action or process of formally consulting or discussing, Oxford dictionary,

https://en.oxforddictionaries.com/definition/consultation

13

necessity,78 as South Island was the next delivery port for the CLAIMANT. Such stubbornness and

arbitrariness prevented an effective consultation, placing the RESPONDENT in an impossibility to

clean the Vessel.

c. In any event, the RESPONDENT took all reasonable steps to carry out its obligation to

clean the hull

41. Prevention is successfully established as the RESPONDENT took all reasonable steps to carry out its

hull-cleaning obligation.79 The RESPONDENT’s multiple attempts to arrange for inspection and for

hull cleaning at Wahanda came to naught due to the port authority’s prohibition.80 The RESPONDENT

even made a further proposal to arrange for hull cleaning at North Titan, 81 but the CLAIMANT

dismissed it.82

C. However, the CLAIMANT waived its right to claim for remuneration by refusing to reach a

consensus, upon redelivery, on the lump sum amount payable.

42. Cl 83 provides for an exhaustive list of steps83 to be taken to shift the responsibility of hull cleaning

or of bearing the cost of hull cleaning to the RESPONDENT. As a lumpsum payment could not be

agreed on, the steps became an impossibility. Hence, the obligations under Cl 83 extinguished with

redelivery. The governing regime is reinstated to be that of the common law, under which the

CLAIMANT is obliged to clean the hull after redelivery.84

D. In any event, the CLAIMANT is only entitled to the cost of hull cleaning at North Titan.

78 Record, 56

79 Malik Co. v Central European Trading Agency Ltd. [1974] 2 Lloyd's Rep. 279, 282, 283 80 Record, 28, 29, 30, 31 81 Record, 41 82 Record, 45 83 Deutsche Genossenschaftsbank v Burnhope [1996] 1 Lloyd’s Rep 113, 116, the principle is that parties’ intention can

only be inferred through express language used in a contract.84 Action Navigation Inc. v Bottigliere Di Navigazone S.p.A.

(The “Kitsa”) [2005] EWHC 177 (Comm), 437 [15], 439 [23] 84 Action Navigation Inc. v Bottigliere Di Navigazone S.p.A. (The “Kitsa”) [2005] EWHC 177 (Comm), 437 [15], 439

[23]

14

i. The RESPONDENT is not liable for the cost of hull cleaning at South Island, amounting

to $41,000.00.

43. Damages must be directly proportionate to the loss sustained, not to provide a gratuitous benefit to

the aggrieved party.85 By opting to clean the Vessel at South Island, the CLAIMANT gratuitously

benefited from this costlier choice. This is more so when the CLAIMANT rejected the RESPONDENT’s

proposal of a cheaper alternative which would make good his loss, 86 which is hull cleaning at North

Titan Port. The RESPONDENT is only liable to the damages directly caused by the RESPONDENT‘s

breach of duty.87 Hence, the RESPONDENT is only liable for the cost of hull cleaning amounting to

USD33,000. 88

ii. The RESPONDENT is not liable for the hire and bunkering cost during the voyage to

South Island to clean the Vessel, amounting to $55,567.42.

44. First, as hire and bunkering cost incurred is an affair post-redelivery, it falls outside the sphere of the

RESPONDENT‘s liability. Otherwise, it would amount to a compulsion of specific performance of

continuous hire from the RESPONDENT until after hull cleaning.89

45. Second, “time” in Cl 83(c) should not be construed to impose post-redelivery liability on the

RESPONDENT to prevent commercial unreasonableness.90 Otherwise, the RESPONDENT would be

deprived of the utility of the Vessel post-redelivery, despite having to pay for it.

46. Third, the additional benefits acquired by the CLAIMANT by going to South Island, which is the

convenience for the next fixture, was not reasonably incurred as the cost of hull cleaning.91

85 Ruxley Electronics and Constructions Ltd. V Forsyth [1995] 3 WLR 118, 124, 125, 131 86 Darbishire v Warran [1963] 1 WLR 1067, 1078 87 Sotiros Shipping Inc. and Aeco Maritime SA v Sameiet Solholt (“The Solholt”) [1983] 1 Lloyd’s Rep 605, 608 88 Payzu, Ltd. v Saunders [1918-19] All ER Rep 219, 220, “By not accepting the defendant’s offer, the plaintiffs had

sustained a greater loss than they might have, and therefore, the damages must be limited to the loss they would have

suffered if they had accepted the defendant’s offer.” 89 Attica Sea Carriages Corporation v Ferrostaal Poseidon Bulk Reederei GMBH (“The Puerto Buitrago”) [1976] 1

Lloyd’s Rep 250, 255; Wye Shipping Company Ltd v Compagnie du Chemin de Fer Paris-Orleans [1922] 10 LI.L. Rep.

85, 87, where the King’s Bench Division held that Charterer was not liable for hire after tendering redelivery of the vessel

despite the fact that the vessel was not redelivered in good order as required by the charterparty. 90 Barclays Bank Plc v HHY Luxembourg SARL [2011] 1 BCLC 336, 344 [26] 91 Dimond v Lovell [2002] 1 AC 384, 401, 407, where the House of Lords held that the additional benefits of hiring a

replacement car from a company providing credit at a higher rate, which is not having to worry about failure to claim

such compensation from the defendant, is not reasonably incurred as a mitigation measure after an accident.

15

COUNTERCLAIM

THE VESSEL WAS OFF-HIRE DURING THE QUARANTINE

47. The Charterparty contains off-hire regimes which exempt the RESPONDENT from paying hire under

(A) Cl 17 of NYPE and (B) Cl 44 of the Rider Clauses. Pursuant to both clauses, the Vessel is off-

hire throughout the Quarantine period. The RESPONDENT had overpaid hire amounting to

USD375,000 and is thus entitled to the restitution of that sum since (C) the Quarantine was not a

result of the RESPONDENT’s order or instruction. Alternatively, (D) the RESPONDENT is entitled to

damages for the time loss resulting from the Quarantine.

A. The Vessel is off-hire pursuant to Cl 17 of NYPE

48. The RESPONDENT fulfilled all three conditions required under Cl 17.92 (i) There was a loss of time

and (ii) the full working of the vessel was prevented (iii) by events prescribed in the clause.

i. There was loss of time

49. On 5 May 2016, the Vessel was detained and subsequently quarantined by Wahanda Port State

Control on suspicion of the crew contracting Ebola Virus.93 The Vessel only obtained free pratique

on 26 June 2016.94 The RESPONDENT suffered a net loss of 50 days, during which the RESPONDENT

could have berthed and discharged the Cargo if not for the Quarantine.

ii. The full working of the Vessel was prevented

50. A vessel is prevented from working when she is prevented from performing the next operation

required by the charter service.95 The Vessel was required to discharge the cargo. This could not be

performed when the Vessel was detained by the port authorities.

92 Sig Bergesen DY & Co and Others v Mobil Shipping and Transportation Co (‘The Berge Sund’) [1993] 2 Lloyd’s Rep.

453; André & Cie. SA v Orient Shipping (Rotterdam) BV (‘The Laconian Confidence’) [1997] 1 Lloyd’s Rep. 139 93 Record, 24 94 Procedural Order No.2 [7] 95 The Berge Sund [1993] 2 Lloyd’s Rep. 453, 459; TS Lines Ltd v Delphis NV (‘The TS Singapore’) [2009] 2 Lloyd’s

Rep. 54

16

51. The natural meaning of the phrase “…preventing the full working of the Vessel” in Cl 1796 includes

prevention by legal or administrative action.97 Although the Vessel was physically fit, it was legally

incapacitated by the Quarantine, thus preventing the full working of the Vessel.

iii. The prevention was caused by events prescribed in Cl 17

a. The prevention was caused by “detention by Port State Control for… Vessel deficiencies”

52. First, it is undisputed that the Vessel was quarantined by the Port State Control.98 Second, the

underlying reason that the Vessel was quarantined was ‘Vessel deficiencies’.

53. ‘Vessel deficiencies’ should be construed to include any deficiency that the Owners are responsible

for. This interpretation is in line with the commercial purpose99of the off-hire clause, which is to shift

the risk of delay from the Charterers to the Owners, where the delay is caused by risks within the

Owners’ control and responsibility.100 The present vessel deficiency is caused by the CLAIMANT’s

failure to meet the port’s requirement to obtain timely free pratique. Regardless of whether it is a

breach, it is still a matter solely within the CLAIMANT’s control as the shipowner.

b. The prevention was caused by port authorities acting on suspicion of “deficiency of

officers or ratings”

54. An interference of port authorities acting on the suspected named event is sufficient to satisfy the

causal test provided that the authorities were acting properly, reasonably and foreseeably.101

55. The Wahanda Port State Control suspected that the crew carried Ebola virus. This alleged health risk,

96 The Laconian Confidence [1997] 1 Lloyd’s Rep. 139, 150 97 Terence Coghlin et al, Time Charters (Informa Law, 7th ed, 2014), 444 [25.15]; The Laconian Confidence [1997] 1

Lloyd’s Rep. 139; Belcore Maritime Corporation v F.L.L.I Moretti Cerealli S.p.A. (‘The Mastro Giorgis’) [1983] 2

Lloyd’s Rep. 66; Cosco Bulk Carrier Co Ltd v Team-Up Owning Co Ltd (‘The Saldanha’) [2010] EWHC 13 98 Record, 24 99 Osmium Shipping Corporation v Cargill International SA (‘The Captain Stefanos’) [2012] EWHC 571 [9] 100 Hyundai Merchant Marine Co Ltd v Furness Withy (Australia) Pty (The ‘Doric Pride’) [2006] 2 Lloyd’s Rep 175,

179 101 The Laconian Confidence [1997] 1 Lloyd’s Rep. 139, 151; Sidermar SpA v Apollo Corporation (‘The Apollo’) [1978]

1 Lloyd’s Rep. 200; Actis Co. Ltd v The Sanko Steamship Co. Ltd (‘The Aquacharm’) [1980] 2 Lloyd’s Rep. 237; Belcore

Maritime Corporation v F.L.L.I Moretti Cereali S.p.A. (‘The Mastro Giorgis’) [1983] 2 Lloyd’s Rep. 66, C.A; Venezolana

De Navegacion v Bank Line (‘The Roachbank’) [1987] 2 Lloyd’s Rep. 498

17

would undoubtedly affect the efficiency of the crew.102 In the most extreme of situation, the entire

crew would fall ill, leaving the ship unmanned and dangerously contagious. Such deadly deficiency,

if materialised, clearly amounts to “deficiency of officers” that will reasonably and foreseeably attract

detention or denial of entry by the port authorities.

c. The Quarantine amounts to “any similar cause”

56. In the absence of the word ‘whatsoever’, “any other cause” is normally construed either ejusdem

generis or in some limited way reflecting the general context of the Charterparty and the clause.103

The phrase “any similar cause” should be construed likewise.

57. The off-hire regime in the Charterparty is heterogeneous in nature. In Cl 17, the off-hire events relate

not only to the physical condition of the vessel,104 but also its officers105 and cargo onboard.106

Besides, detention by Port State Control and quarantine are also off-hire events in Cl 17 and Cl 44

respectively. Thus, the general context is sufficiently wide to include a quarantine by a Port State

Control, due to the suspected illness of the crew and officers.

B. The Vessel was off-hire pursuant to Cl 44 of the Charterparty

58. According to Cl 44, the loss of time through detention caused by infraction of local laws may be

deducted as off-hire.107 Under SS.44 and 45 of Prevention and Control of Disease Regulation (“the

Regulation”),108 any ships entering the waters of Bao Kingdom shall submit a Ship Sanitation

Control Certificate (SSCC) or Ship Sanitation Exempt Control Certificate (SSECC). In the former,

102 Navigas International Ltd v Trans-Offshore Inc (‘The Bridgestone Maru No. 3’) [1985] 2 Lloyd’s Rep 62 103 The Laconian Confidence [1997] 1 Lloyd’s Rep. 139, 150; The Apollo [1978] 1 Lloyd’s Rep. 200, 205; The Aquacharm

[1980] 2 Lloyd’s Rep. 237, 239 (Justice Lloyd); The Mastro Giorgis [1983] 2 Lloyd’s Rep. 66, 68; The Sanko Steamship

Co. Ltd. v Fearnley and Eger A/S (‘The Manhattan Prince’) [1985] 1 Lloyd’s Rep. 140, 146; The Roachbank [1987] 2

Lloyd’s Rep. 498, 507; Cosco Bulk Carrier Co Ltd v Team-Up Owning Co Ltd (‘The Saldanha’) [2010] EWHC 1340

[30]. 104 Cl 17: “…damage to hull, machinery or equipment…” 105 Cl 17: “…deficiency and/or default and/or strike of officers or ratings…” 106 Cl 17: “detention by average accidents to …. Cargo” 107 “Owners shall be liable for…any time loss through detention by customers or other authorities caused by smuggling

or other such infraction of local law on the part of the Master.” 108 Procedural Order No.2 [1]: A regulation enacted in Hong Kong, which resembles Bao Kingdom’s law

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the Master shall supply any information required by the competent authority as to the health

conditions on board during the voyage.109 As for SSCC or SSECC, the possession of the certificate

indicates that a competent authority under the International Health Regulation110 is satisfied that the

ship is infection-free.111 The need for the Quarantine reflects the CLAIMANT’s failure in complying

with either S.44 and/or S.45 of the Regulation.

59. Further, if the crew did not contract fever as contended by the CLAIMANT112 and that the Vessel was

in sanitised condition, the Wahanda port authorities would have accepted the existing SSCC or

SSECC of the Vessel. Alternatively, the Master would have been able to renew its certificates at

Wahanda with no difficulties. In both the scenarios, a quarantine would not have been necessary.

Therefore, the 50-day Quarantine infers a breach of either S.44 of S.45 of the Regulation, which is a

punishable offence under the Regulation.

C. The Off-hire Clauses are not negated by the RESPONDENT’s purported breach

60. As discussed in [2-10], the RESPONDENT did not breach its safe port warranty. 113 Thus, the

RESPONDENT cannot be denied of its right to invoke an off-hire clause.

D. Alternatively, the RESPONDENT is entitled to damages in lieu of the overpaid hire

61. Even if the RESPONDENT cannot resort to the off-hire clauses, the RESPONDENT is nonetheless

entitled to claim for damages for breach of Charterparty in the amount of overpaid hire.114 The

CLAIMANT has breached Cl 46 of the Charterparty and Cl 2 of NYPE, which resulted in the loss of

time from Quarantine.

62. The CLAIMANT has an obligation under Cl 46 of the Charterparty to obtain necessary certificates “to

comply with all safety and health regulations and all current requirements at all port of call…without

hindrance or delay”. As discussed in [58-59], the CLAIMANT failed to meet the Regulation at

109 Art 37(2) of International Health Regulation 110 Art 1 and 4 of International Health Regulation 111 Art 39(6) of International Health Regulation, s.46(2) and s.48 of the Prevention and Control of Disease Regulation 112 Record, 24: email from the CLAIMANT on 11 May 2016 113 Refer to Ground I(A) 114 The Aquacharm [1980] 2 Lloyd’s Rep. 237; Pan Ocean Shipping Ltd v Creditcorp Ltd (“The Trident Beauty”) [1994]

1 All ER 470

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Wahanda, which resulted in the delay due to Quarantine.

63. Next, the CLAIMANT’s failure in obtaining free pratique timely also amounts to a breach of the

CLAIMANT’s seaworthy obligation under Cl 2 of NYPE 2015. The Vessel was not “in any way fit” to

be employed for the intended service.

64. A seaworthiness obligation includes the legal fitness 115 vis-à-vis carrying the necessary

documentation relating to her fitness to perform the voyage. Even if the Vessel only became unfit due

to possible Ebola infection after departing from West Coast, it was the CLAIMANT’s obligation to

restore her fitness116 by renewing the SSCC and by sanitising the Vessel to avoid prolonged detention

at Wahanda. Failure to do so was a breach of Cl 2 of NYPE.

THE CLAIMANT SHOULD INDENMNIFY THE RESPONDENT FOR THE CARGO CLAIM

A. The RESPONDENT enjoys 100% indemnity under the ICA

65. Rider Clause Cl 53 and NYPE Cl 27 provide that all Cargo Claims are captured by the ICA, so long

as all the condition precedents have been fulfilled117 There is undisputedly a valid Contract of

Carriage118 and a proper settlement and payment of the claim.119 Under the ICA, the RESPONDENT

enjoys 100% indemnity because (i) the cargo claim arose out of unseaworthiness and/or error or fault

in navigation or management of the vessel (“Vessel Operation”) under Article 8(a) and (ii) the

ballasting operation does not fall under loading, stowage, lashing, discharge, storage or other handling

of cargo (“Cargo Operation”) in Article 8(b). Alternatively, (iii) the damage was caused by the act

or neglect of the CLAIMANT’s servant under Article 8(d).

115 Golden Fleece Maritime Inc and another v ST Shipping and Transport Inc (“The Elli” and “The Frixos”) [2009] 1

All ER 908 [18-19] 116 The Elli” and The Frixos [2009] 1 All ER 908 [21] 117 The Inter-club Agreement 1996/2011, Article 4 118 Procedural Order No.2 [15] 119 Procedural Order No.2 [10]-[11]

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i. Cargo Claim arose out of unseaworthiness and/or error or fault in navigation or

management of the Vessel under Article 8(a)

a. The failure in ballasting operation constitutes unseaworthiness

66. Seaworthiness entails providing competent ship members who can carry out their duties with

reasonable skill, care and competence.120 Even if failure to provide competent crews is manifested in

one incident,121 it breaches the continuous duty of ensuring seaworthiness of the vessel.122 The

present failure was caused by incompetence of the crew for two reasons.

67. First, the crew was unfamiliar with the structure of the Vessel.123 Crews without specific knowledge

on the Vessel’s ballasting operation system caused the current mistake.124

68. Second, the crew was not reasonably trained and prepared for an emergency.125 The crew’s failure to

perform immediate remedial measures, such as pumping out the water after opening the wrong valve

to minimize the cargo losses glares unpreparedness during an emergency.126

b. The ballasting operation was a fault in management of the Vessel

69. Management of the vessel includes acts which affect the overall fitness of the vessel rather than acts

which only affect the cargo. Ballasting operation falls under management of the vessel, for it is done

primarily to ensure the safety of the vessel by stiffening it.127 The Rider Clause also shows that

ballasting is to be done, having due regard to “stability and seaworthiness of the Vessel”.128 The

120 Union of India v Reederij Amsterdam [1963] 2 Lloyd’s Rep. 223 (H.L.),231; Hongkong Fir Shipping Co Ltd v

Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26 121 Papera Traders Co. Ltd. And Others v Hyundai Merchant Marine Co Ltd And Another (‘The Eurasian Dream’) [2002]

1 Lloyd's Rep 719, 736: “but we can find nothing to support the proposition that a series of acts must always be necessary

in order to establish incompetence or inefficiency” 122 Riverstone Meat Co Pty Ltd v Lancashire Shipping Co Ltd (‘The Muncaster Castle’) [1961] 1 Lloyd’s Rep. 57 (H.L.) 123 Robin Hood Flour Mills Ltd v N M Paterson & Sons Ltd (The Farrandoc) [1967] 2 Lloyd's Rep 232, 235; Standard

Oil Company of New York v. Clan Line Steamers Ltd. (The Clan Gordon) [1924] AC 100 124 Record, 48: ‘Preliminary Survey Report’ 125 Manifest Shipping Co Ltd v Uni-Polaris Insurance Co Ltd and La Re Âunion Europeane (The Star Sea) [1997] 1

Lloyd's Rep 360; R. White, “The Human Factor in Unseaworthiness Claims” [1995] LMCLQ 2217 126 Record, 48: “Indeed some bags were seen floating in the hold!” 127 The Glenochill [1896] P 10; Orient Ins. Co v United S.S. Co 1961 AMC 1228 (S.D. N.Y. 1961); Leon Bernsterin Co.

v Wilhelmsen, 232 F.2d 771, 772; McKinnon Co v Moore-McCormack Lines 1959 AMC 1842 (SD. N.Y. 1959) 128 Record, 14: Rider Clause 64

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present ballasting operation was done to prepare the vessel for her departure voyage.129

70. Acts done primarily for the want of care for Cargo is different from acts to ensure overall fitness of

the vessel incidentally affecting the cargo.130 Although the present ballasting incidentally affected the

cargo, it does not convert the nature of the operation into part of Cargo Operation.

ii. The ballasting operation does not fall under Cargo Operation in Article 8(b)

71. As the ICA is incorporated into the NYPE to be one instrument,131 the difference in wordings between

the former and the latter must be presumed to be deliberate.132 Article 8(b) of the ICA lays down

“Claims in fact arising out of the loading, stowage, lashing, discharge, storage or other handling of

cargo”. In contrast, NYPE adumbrates the Charterers’ obligation as “Charterers shall perform all

cargo handling, including but not limited to loading, stowing, trimming, lashing, securing, dunnaging,

unlashing, discharging, and tallying”. The exclusion of ‘trimming’ is deliberate to remove actions

that are conceptually ambiguous to be classified under either 8(a) or 8(b) of the ICA. Such actions

include ballasting.133

72. In any event, such failure in Cargo Operation is caused by unseaworthiness, as explained in [66].

iii. Alternatively, there is clear and irrefutable evidence that the damage was caused by the

act or neglect of the CLAIMANT’s servant.

73. Article 6(d) provides that the CLAIMANT is to bear 100% liability if the damage was caused by the

negligence of the CLAIMANT’s servant.

74. Hence, the CLAIMANT should indemnify the RESPONDENT because (a). The damage arose out of the

crew member’s act or neglect and (b) the crew member acted as the CLAIMANT’s servant.

129 Record, 48: Preliminary Survey Report 130 Hourani v T.& J.Harrison, (1927) 28 Ll.L.Rep. 120; Ferro, [1893] P. 38; Rowson v. Atlantic Transport Company,

[1903] 2 KB 666 131 Skips A/S Nordheim v Syrian Petroleum Co Ltd [1984] QB 599; Hamilton & Co v Mackie & Sons (1885) 5 T.L.R. 677 132 Prestcold (Central) Ltd v Minister of Labour [1969] 1 WLR 89: ”if he uses different words the presumption is that he

means a different thing or concept” 133 Trim Optimisation - Theory and Practice, the International Journal on Marine Navigation and Safety of Sea

Transportation, Vol. 8, No. 3, Sep 2014, “The trim optimisation can be done by proper ballasting…”

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a. The damage arose out of crew member’s act or neglect

75. It is a common ground that the damage arose out of crew member’s error in ballasting,134 satisfying

the need of factual causal link required by law.135

b. The crew member acted as the CLAIMANT’s servant

76. First, as the crew is employed by the CLAIMANT,136 the crew is the CLAIMANT’s servant in a time

charterparty.137

77. Second, Cl 64 of the Charterparty specifies the CLAIMANT’s authority on crew member in a ballast

operation.138 The CLAIMANT, collectively the Owner, Master and crew, undertakes to guarantee the

safety of vessel during ballast and deballasting operations.139 As a delegate of the Master’s authority,

the crew is the CLAIMANT’s servant.

78. Alternatively, even if the crew member acted for Cargo Operation, the addition of “and responsibility”

in Cl 8 of the NYPE shifts the legal responsibility of Cargo Operation to the CLAIMANT.140 In acting

for Cargo Operation, the crew acted to discharge the CLAIMANT’s responsibilities, hence was the

CLAIMANT’s servant.

B. The RESPONDENT is not time barred from bringing the Indemnity Claim

79. The 24-month time bar starts running when the cargo is delivered on 27 June 2016. As 6 months’

extension was granted upon request,141 the time limitation expires after 30 months, on 27th Dec 2018.

80. First, the RESPONDENT is not time-barred because (i) a sufficient notice was submitted before time

bar. As (ii) sufficiency of a notice was scrutinised at the material time the notice was submitted, (iii)

134 Record, 48: Preliminary Survey Report; Procedural Order No.2 [9] 135 Transgrain Shipping v Yangtze [2017] EWCA Civ 2107 136 NYPE Cl 6(a); NYPE Cl 2(b) 137 Merit Shipping Co. Inc V T.K. Boesen A/S (The ‘Goodpal’) [2000] Vol.1 Lloyd’s Rep 638, 640; “Thus, if … shortage

was … by a crew member, then 100% to Owners”; Sandeman And Others v Scurr And Others (1866) 2 Q.B. 86, 97; A B

Helsingfors Steamship Co Ltd v Rederiaktiebolaget Rex (‘The White Rose’) [1969] 3 All ER 374, 384 138 Record, 14: Rider Clause 64 139 Record, 14: Rider Clause 64 140 A.B. Marintrans v Comet Shipping (The Shinjitsu Maru No. 5) [1985] 1 Lloyd’s Rep. 568; MSC Mediterranean

Shipping Co. SA v Alianca Bay Shipping Co. Ltd. (‘The Argonaut’) [1985] 2 Lloyd’s Rep. 216; Alexandros Shipping Co.

of Piraeus v MSC Mediterranean Shipping Co. S.A. of Geneva (‘The Alexandros P’) [1986] 1 Lloyd’s Rep. 421 141 Record, 59-60

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the absence of information was justified by impossibility then. Alternatively, the RESPONDENT

submitted a valid notice within the extended time limitation.

i. The RESPONDENT stopped the time bar on 7 Jul 2016

a. A sufficient notice was submitted before the RESPONDENT was time barred

81. Before 27 Dec 2018, the RESPONDENT submitted a notice of claim on 7 Jul 2016. In sufficiently clear

terms, the notice informed the CLAIMANT that the RESPONDENT would receive a claim from the

Receivers,142 and would seek indemnification from the CLAIMANT.143 Such certainty fulfills the

common law requirement of a contractual notice, that a notice must specify that a claim would be

made rather than a claim might be made.144 Nonetheless, a notice in ICA should be subjected to looser

requirements, because it is contingent on a principal claim and the notice was submitted before the

principal claim materialized. Hence, the information might not be accessible to the RESPONDENT.145

b. The sufficiency of the notice should be scrutinized when the notice was submitted

82. As an exclusion clause, Article 6 of the ICA must be construed narrowly.146 The phrase “Such

notification shall if possible include…” must mean that the sufficiency of the notice should be

assessed when the notice was submitted. The wording of the clause should not be construed to impose

a continuing duty to provide fresh information after submission of the notice.

c. At the material time, the absence of information was justified by impossibility.

1. The nature of the claim was unavailable

83. The nature of the claim refers to the form and substance of the claim, including the breach of the

Cargo Claim and the reference in the bill of lading.147 When the notice was served, it was impossible

142 Record, 48; “they would be making a claim against Charterers under the Contract of Carriage” 143 Record, 47; “Meantime please treat this message as formal notice of claim against you” 144 IPSOS SA v Dentsu Aegis Network Ltd [2015] EWHC 1171 [21] 145 Forrest v Glasser [2006] 2 Lloyd's Rep 392: ‘Every notice turns on its own wording’ 146 Nobahar-Cookson & Ors v The Hut Group Ltd [2016] EWCA Civ 128 147 Laminates Acquisition Co v BTR Australia Ltd [2003] EWHC 2540 (Comm) [31], [37]

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to ascertain the nature of the claim as there were vast possibilities which might lead to drastically

different results. Also, it might be subjected to the limitation of liability148 and time bar.149 Because

of this, the Receivers and the RESPONDENT failed to identify the nature of the claim even after around

18 months of negotiation.150

2. The amount claimed was not ascertained

84. Many variables might affect the actual amount claimed by the Receivers. Factually, the amount is

affected by the Receivers’ choice to recondition the goods, the degree of damage of the goods151 and

the volatile value of tea,152 which might fluctuate as much as 23% in a month.153 Legally, the liability

might be limited.154 The surveyor even acknowledged that the quantum of damaged was “too early

to tell”,155 amounting to an impossibility to estimate the amount claimed at the material time.156.In

fact, the RESPONDENT has consistently highlighted the impossibility to ascertain the amount

claimed.157

3. The Contract of Carriage was unnecessary

85. It conforms to practical business efficacy158 to deliver the Contract of Carriage with the nature and

amount of the claim in one transaction. However, when such information is unavailable in the

Contract of Carriage, it is useless to provide the Contract of Carriage.

ii. Valid notice was submitted before the extended time bar expired

148 Hague Visby Rule, Article IV (5) 149 Hague Visby Rule, Article III (6) 150 Record, 60: Email on 23 Mar 2017; Record, 59: Email on 23 Nov 2017 151 Record, 48: Preliminary Survey Report: “They will see if any of the tea can be salvaged or re-conditioned… Receivers

will need to assess their options.” 152 Record, 23 153 Index Mundi, ‘tea monthly prices’ Jan 2015- Feb 2015

https://www.indexmundi.com/commodities/?commodity=tea&months=120 154 Hague Visby Rule, Article IV (5) 155 Record, 48: Preliminary Survey Report 156 Laminates Acquisition Co v BTR Australia Ltd [2003] EWHC 2540 (Comm) [41] 157 Record, 59: Email on 23 Aug 2017 158 Antaios Compania Naviera v Salen Rederierna [1985] AC 191, 201

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86. The notice was valid as it was submitted before the time bar expired. The time limitation expired on

27 Dec 2018. However, the proceeding on the Cargo Claim commenced on 17 Dec 2018, through the

counterclaim, 10 days before time bar expired. 159 All relevant details were provided in this

proceeding.160

159 Record, 76 160 Procedural Order No.2 [15]