Africa Express Line Ltd ("Ael") v Socofi SA ("Socofi") & Anor [2009] EWHC 3223 (Comm)

[2009] EWHC 3223 (Comm)Case No 2009 FOLIO NO. 994
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 11 th December 2009
Before
MR JUSTICE CHRISTOPHER CLARKE
Between
AFRICA EXPRESS LINE LIMITED ("AEL")Claimant(1) SOCOFI S.A. ("Socofi")Defendants(2) PLANTATIONS DAM S.A. (“DAM”)Defendant
Mr. Neil Hart (instructed Watson, Farley and Williams) for ClaimantMr Chirag Karia (instructed by Dawsons LLP) for First DefendantHearing Hearing dates: Friday 27th November
JudgmentMr Justice Christopher Clarke :
[1]I have before me an application by the first defendant for an order declaring that the court has no jurisdiction to hear the claimant’s claim against it upon the ground that the exclusive jurisdiction clause relied on by the claimant was not clearly incorporated into the contract between the parties.[2]The claimant - Africa Express Line Limited (“AEL”) - is a carrier operating refrigerated vessels on a weekly liner service between West Africa and Europe. The first defendant – Socofi S.A. (“Socofi”) – is a company incorporated in France. It has no offices outside France. It imports into Europe pineapples, bananas, mangos and other fruits from the Ivory Coast and other places. The Second Defendant Plantations Dam S.A. (“DAM”) is a fruit grower in the Ivory Coast. Mr Jacques Daudet (“Mr Daudet”) is the General Director of both Socofi and DAM.[3]An agreement was entered into on 1st January 2005between Socofi and DAM under which Socofi agreed to buy the entirety of all fruit produced by DAM (“the Socofi/Dam Purchase Agreement”) on FOB terms.[4]DAM is a member of the Organisation Centrale des Producteurs Exportateurs d’Ananas et de Bananes (“OCAB”) which is an association of fruit producers and exporters in the Ivory Coast. Between 2002 and 2006 AEL worked with OCAB on an informal basis to ship the fruit produced by OCAB members.[5]On 1 December 2006 AEL entered into a three year framework agreement with OCAB, terminable by four month's notice expiring at the end of each calendar year. The agreement provided that:
“Article 1: Object of the contract The object of this contract is to define the principles that govern the maritime transport conditions that will apply between AEL and the OCAB and its members, conditions transcribed into a “Slot Charter Agreement “Contrat d’Affrètement d’Espace” ” which must be signed at the latest by 11 December 2006. Article 4: General Conditions applying to members of the OCAB The service agreement supplied by AEL is defined in the slot charter agreement entered into with the members of OCAB under the aegis of OCAB……”
. In effect OCAB was to agree with AEL a form of contract of affreightment to be entered into by its members. Contracts in that form would then be signed by AEL and the relevant member.

Article 4: General Conditions applying to members of the OCAB

[6]In what is said to be around April 2007 an agreement was entered into between AEL and DAM (“the AEL/DAM Agreement”). The agreement was signed by Mr Traoré who was DAM’s designated representative in OCAB. Under this agreement DAM was bound to ship the entirety of its produce exclusively upon AEL’s vessels. The agreement was in French. Under it DAM was to ship fresh fruits in cardboard packages stacked on pallets on AEL’s vessels. The Agreement was to last for 3 years (clause 2) although it also provided for DAM to indicate at the latest on 31 August of each year whether or not it intended to renew the Agreement for a further year, and, if yes, to indicate the quantity of pallets it expected to ship for the following year. AEL would by 30th September at the latest announce the freight rates and amendments, if any, to the Agreement for the following year and the parties were to reach an agreement on the renewal of the contract within 15 days after that.[7]Clause 3.1. provided that DAM expected to ship and AEL was to arrange the transport from Abidjan to Europe of an annual volume of about 7500 pallets of pineapples. DAM undertook to ship on AEL’s vessels the whole of its exportable production. Weekly and annual forecasts were set out in Annex 3. These forecasts were said not to constitute an engagement on DAM’s part “Les volumes previsionnels annuel et hebdomadaire, figurent en annexe 3. Bien que ces volumes ne constituent pas engagement de la Structure Exportatrice, ces informations doivent obligatoirement etre annexes au present contrat”. In the agreement DAM was termed the “Structure Exportatrice”. . The agreement had provisions about(a) forecasts of the number of pallets to be loaded,(b) deadfreight if the forecasts were not met,(c) the type of bills of lading to be used,(d) AEL’s intended schedules, the seaworthiness of AEL’s vessels and an option to load on an alternate vessel if the nominated vessel was delayed; (f) the appointment of stevedores;(e) the 2007 freight rates,(f) the payment of freight (which was to be made in advance as per the instructions on the relevant invoice), adjustments to freight rates to take account of increased bunker costs, a currency adjustment factor,(g) lien,(h) insurance,(i) force majeure and other matters.[8]The Agreement contained an arbitration and jurisdiction clause which provided for LMAA arbitration for claims up to $ 125,000, and for larger disputes to be submitted to the High Court as follows: “10 Arbitration of Disputes In case of dispute, the parties agree to seek for an amicable agreement. If they do not reach to such agreement in a delay of one month after the event, each party shall appoint an arbitrator…. [There then follow the provisions about arbitrating claims up to $ 125,000] Any dispute where the amount in dispute exceeds USD 125,000 …… shall be submitted to the High Court of Justice of London. The Defendant shall, within 14 days of receipt of a request to do so, instruct solicitors to accept service on its behalf of proceedings in the High Court of Justice and file an acknowledgement of service.”

[There then follow the provisions about arbitrating claims up to $ 125,000]

[9]In his witness statement of 29th September 2009 Mr Daudet records that all Socofi’s fruit shipment from the Ivory Coast was undertaken by a company called LV Fruits on the basis of agreed rates per pallet to Mediterranean and Northern European ports. LV Fruits shipped the produce and the cost of the service was invoiced by LV Fruits to Socofi. According to him “In practice, therefore, the OCAB/AEL contract, as signed by DAM, was not in fact applied to any shipments of DAM’s produce.” In his witness statement of 11th November he refers to the contract as being “de nom seulement” since everyone knew that DAM had agreed to sell all its produce to Socofi on FOB terms.[10]According to the evidence of Mr Christopher Larkin, the Managing Director of AEL, that is inaccurate. The true position is that prior to July 2007 Socofi purchased DAM’s fruit pursuant to the Socofi/DAM purchase agreement; DAM shipped it on board AEL’s vessels as it was bound to do under the AEL/DAM Agreement. AEL carried the fruit to Europe. LV Fruits provided freight forwarding and stevedoring services at French discharging ports pursuant to some arrangement with Socofi. LV Fruits then rendered a global invoice to Socofi both for its own services and for the sea carriage provided by AEL. Socofi paid that global invoice, LV Fruits was named as the consignee in the bills to ensure that the fruit was not released to Socofi before the freight and associated charges had been paid by Socofi. AEL did not deal directly with Socofi. It invoiced LV Fruits and LV Fruits paid AEL out of sums received from Socofi.[11]AEL is a subsidiary of Compagnie Fruitiere, a major producer and distributor of fruit based in Marseilles. Transit Fruits is another subsidiary of Compagnie Fruitiere.[12]In July 2007 Socofi’s relationship with LV Fruits came to an end. On 20th July 2007 LV Fruits notified DAM by fax that it had decided to stop providing freight forwarding services for DAM/Socofi because of the sums owed to it by Socofi on DAM’s behalf (“importants impayés de la socieée SOCOFI intervenant pour le compte de la societé DAM”). On the same day Mr Daudet informed the President of OCAB of this and asked him to inform AEL that Socofi would be willing to pay AEL direct the freight due upon shipments made by DAM (“le fret maritime du au titre des chargement effectués par la societe Plantations DAM”) and requesting relevant contact details.[13]According to Mr Daudet Mr de Frémont of Transit Fruits got in touch with Socofi to inquire whether the Compagnie Fruitiere group could provide the services which Socofi was looking for. A meeting took place on Friday 27th July 2007 at Compagnie Fruitiere’s offices in Marseilles attended by Mr Daudet and other representatives of Socofi together with the President (Mr Robert Fabre) and Director General (Mr Frederic Fabre) of Compagnie Fruitiere, and for part of the meeting Mr van Opstal of AEL. In the course of that meeting there was a discussion of the services Socofi was looking for and the prices which the group might be able to offer. Compagnie Fruitiere confirmed that it would be able to provide the service needed to Socofi for the same prices as those agreed with OCAB for all OCAB members. There was no mention of the arbitration/jurisdiction clause in the AEL/DAM agreement.[14]On Monday 30th July 2007 Mr Daudet of Socofi sent an e-mail in French to Mr de Frémont of Transit Fruits. Mr Frederic Fabre had said that Transit Fruits would be happy to confirm their quote and had suggested corresponding with Mr de Frémont direct. The e-mail referred to the Socofi/DAM Purchase Agreement and to the meeting the previous Friday and went on to say:
“We can confirm that we are the sole importer of merchandise (fresh pineapples) produced by [DAM] in Cote d’Ivoire, and that we purchased said merchandise at FOB Abidjan prices under the terms of an agreement dated 1 January 2005 …. In a letter sent to us by e-mail and fax on 20 July 2007, LV FRUITS informed us that it intends to cease providing all services on our behalf without notice….. Consequently, we would like you to provide the following services on our behalf directly for Port Vendres and with our usual correspondent for Anvers: All transit/customs clearance operations All handling operations from alongside vessel until “wagon depart” and deliveries following our “directives”, whether departing the port to the client or made available for transport to warehouses. ……,… If you agree, please provide us with your standard charges for both ports and your payment conditions for acceptance by us “vostarifs habituels pour les deux ports et vos conditions de reglment pour acceptation de notre part” … … On a practical level, we propose that you invoice us as per usual with a reference to maritime freight ..”

All transit/customs clearance operations

[15]On 3 August 2007 Mr Larkin of AEL, not Transit Fruits, wrote to Mr Daudet of Socofi as follows:
“Following your e-mail dated 31/02/2007, which was forwarded to me by Mr de Fremont from Transit-Fruits, AEL can confirm the following points within the framework of your request for services. First of all, we noted the exclusive purchase agreement that ties your firm to [DAM], a structure with which we signed a slot charter agreement for 2007.This purchase agreement clearly states that SOCOFI assumes responsibility for costs associated with maritime freight, handling and forwarding for fruits from the DAM shipper. We are prepared to offer you transport services from alongside Cote d’Ivoire to on truck in Europe in the ports of Port-Vendres and Anvers. This offer includes Free In/Liner Out (FILO) maritime transport under the conditions of the aforementioned charter agreement between AEL and DAM “aux conditions du contrat d’affrètement précité, signépar AEL et DAM”. . In addition to the above, an additional flat charge of 35 euros per pallet of pineapples has been added. This charge includes: - Handling to warehouse and from warehouse to loaded onto vehicles - Transit (excluding T 1) - 48 hours storage at temperature You will be invoiced directly for all other services by the port service provider at your location.”
[16]On the same day Mr Daudet replied as follows:
“Subject: Your tariff proposal “proposition tarifaire” of today “We acknowledge receipt of your mail sent today, and confirm our acceptance of the following points: 1) The maritime transport service under the conditions of the contract of affreightment between AEL and DAM 2) The fixed charge of € 25 per pallet including the services indicated by you …” “We acknowledge receipt of your mail sent today, and confirm our acceptance of the following points: 1) The maritime transport service under the conditions of the contract of affreightment between AEL and DAM 2) The fixed charge of € 25 per pallet including the services indicated by you …”
[17]AEL claims in these proceedings against both defendants freight in the sum of $ 350,649.36 plus interest said to be due in respect of pineapples shipped between November 2007 and September 2008. It does not, however, seek to recover twice.[18]In December 2007 there was, according to Socofi, a catastrophic breakdown of the delivery services being provided by AEL’s agent in Antwerp, Sea Invest, as a result of which there were long delays in delivering pallets of fruit to waiting lorries. A quantity of product perished giving rise to substantial losses which Socofi claims against AEL.[19]On 17th December 2007 AEL wrote to the President of OCAB as follows:
“Our organisation for the maritime transport of fruit exported by Cameroonian, Ghanaian and Ivorian producers is directly reliant on the signing of the EPA. On this day, after the very recent signing of these agreements by the Cote d’Ivoire and Ghana, uncertainty remains with regard to Cameroon. However, as this week is the week for the first shipments of 2008, we are sending you below the details of our maritime transport offer for this new year. This offer is, however, liable to modification (following prior notification) in the event that an agreement does not occur in time between Cameroon and the European Union. Currently, these agreements that bound AEL and the Ivorian shippers in 2007 (and which finish with the shipments of week 50) have been terminated and will not, therefore, be renewed in 2008.”
The letter went on to explain the reason for a significant change in AEL’s freight offer and set out new freight rates and bunker adjustment factors as well as rules for reserving and allocating freight, provisions about ullage, payment rules, port storage costs, liner out terms and the form of the bills of lading. It made no reference to an arbitration or jurisdiction clause.[20]OCAB sent a copy of the letter to each of its members including DAM which sent a copy to Socofi. The letter indicated that AEL would be offering a different service to members of OCAB in 2008 with increased prices per pallet. AEL started applying the new prices to Socofi’s shipments on or about 14th February 2008. The rival contentions[21]AEL contends that the agreement between them and Socofi constituted by the exchange of letters in August 2007 incorporated the terms of the AEL/DAM Agreement including the English arbitration/jurisdiction clause.[22]Socofi denies that it ever agreed that clause. At one stage it contended that, even if it did, the shipments made at the 2008 prices were on the terms of the new arrangements set out in the letter of 17th December 2007 which did not incorporate an English arbitration/jurisdiction clause. That contention has not been pressed before me.[23]According to Mr Daudet he was not familiar with what he described as the OCAB contract signed by DAM. He was, however, the Director General of DAM. Law[24]The Court will only have jurisdiction to hear the action against Socofi if there is in existence a valid prorogation of jurisdiction clause within the meaning of Article 23 of Council Regulation No 44/2001 (“the Judgments Regulation”). In that respect Community law requires “real consent” to, or “actual acceptance” of, a jurisdiction clause, which must be “clearly and precisely demonstrated”. (Estasis Salotti v RUWA [1977] 1 CMLR 345, 355 @ [7] (ECJ); MSG v Les Gravieres [1997] Q.B. 731, 754 – 755 @ [17] (ECJ); Coreck Maritime GmbH v Handelsveen [2001] C.L.C. 550, 557 @ [26] (ECJ)).[25]It is for AEL to show that it has “a much better argument than the defendants that on the material available at present, the requirements of form in article 23(1) are met and that it can be established, clearly and precisely, that the clause conferring jurisdiction on the court was the subject of consensus between the parties”: Bols Distilleries BV (trading as Bols Royal Distilleries) and another v Superior Yacht Services Ltd [2007] 1 WLR 12 at [26] to [28].[26]Mr Chirag Karia, for Socofi, submits, and I agree, that the authorities distinguish between(i) cases where parties agree to incorporate standard trading terms (either of their own or standard in the trade) which contain a jurisdiction clause, into their contract; and(ii) cases where the parties incorporate the provisions of an existing, separate contract with a third party. Standard terms[27]In Estasis Salotti di Colzani Aimo e Gianmario Colzani v RÜWA Polstereimaschinen GmbH[1976] ECR 1831, the ECJ held, in respect of the analogous provisions of Article 17 of the Brussels Convention, that the requirement of writing under the first paragraph of Article 17 of the Convention is fulfilled:(a) where a clause conferring jurisdiction is included among the general conditions of one of the parties printed on the back of a contract, but only if the contract signed by both parties contains an express reference to those general conditions; or(b) where the contract refers to a prior written offer which refers to general conditions including a jurisdiction clause, only if the express reference can be checked by a party exercising reasonable care and the general conditions (including the jurisdiction clause) have been communicated to the other party with the prior offer The second condition is not expressed in the ruling of the court, although it is in the judgment. .[28]Where the contract refers expressly to one party’s standard terms it is not necessary for there to have been a specific reference to the jurisdiction clause for the purposes of establishing the real consent required by Article 23: 7E Communications Ltd v Vertex Antennentechnik GmbH [2007] 1 W.L.R. 2175, 2185, para [32] (CA) Credit Suisse Financial Products v Société Générale d'Entreprises [1997] CLC 168, 171 – 172 (CA) (per Saville L.J., delivering the only reasoned judgment of the Court in a case involving the 1992 ISDA Master Agreement). In those circumstances it is irrelevant that the party against whom the jurisdiction clause is sought to be enforced does not have a copy of the terms and conditions. Further the parties’ agreement may be contained in more than one document e.g. by an exchange of correspondence: 7E Communications para 33.[29]So there will be a valid agreement in writing where a quotation is made on one party’s own standard terms and is accepted, even though the acceptor did not have a copy of those terms. In 7E Communicationsa German company faxed a quotation to an English company offering to sell certain satellite equipment on its general terms and conditions. These contained an exclusive German jurisdiction clause. No copy of those terms was sent to the claimant, which faxed the defendant a purchase order for the goods in the quotation. It was held that there was an agreement in writing for the purpose of Article 23(1).[30]Where the terms of a wholly separate contract are incorporated, different considerations apply. A bill of lading which incorporates all the conditions of a specified charterparty will not usually incorporate a charterparty arbitration clause, in the absence of express wording to that effect. By analogy with the incorporation of arbitration clauses into bills of lading from charterparties, the law adopts “a fairly strict approach” - Dornoch Ltd. v. Mauritius Union Assurance Co. Ltd. [2006] Lloyd’s (Ins. & Reins.) Rep. 127, 141 @ [48] (Aikens, J.), affirmed [2006] 2 Lloyd's Rep. 475 (CA) - to the incorporation of jurisdiction clauses from an insurance (or reinsurance) contract into another reinsurance contract. Only those terms directly germane to the parties’ agreement are carried over. The presumption is that these usually exclude a jurisdiction clause. In that case a provision in the excess reinsurance slip that it was “to follow all terms and conditions of the primary policy together with riders and amendments thereto covering the identical subject matter and risk” was held to be inapt to incorporate a Mauritian jurisdiction clause in the primary reinsurance.[31]It is, however, necessary, always to remember that the ultimate issue is what objectively did the parties intend: see Dornoch at first instance, para 48. In the Court of Appeal in that case Tuckey LJ said this [2006] 2 Lloyd’s Rep 475, 481:
“27 There are many cases in which the courts have to decide whether terms from one contract have been incorporated in another. A number of these cases concern the incorporation of terms from a direct insurance into a reinsurance. But no hard and fast rules emerge from these cases as one would expect. The question in each case is one of construction: did the parties to the contract in which the general words of incorporation appear intend that their contract should include the particular term from the other contract referred to? It may be, as Mr Kealey submits, that the courts will answer this question in favour of incorporation more readily in some categories of cases than in others, but that is no more than saying that the contractual context and the words used are all important. As choice of law and jurisdiction clauses are important, clear words of incorporation are required. In the insurance context where the contracts concerned are back-to-back and cover the same subject matter and interest incorporation is more likely to have been intended than where the contracts are not so closely connected.”
[32]In AIG Europe SA v QBE International Insurance Ltd [2001] 2 Lloyd's Rep. 268, 273 @ [26] – [27] (followed by Gross J in Siboti v. BP France [2003] 2 Lloyd’s Rep. 364, 372 – 373 @ [40] & 376 @ [58]) Moore-Bick J. said:
“26 ………The incorporation of the terms of one contract into another related contract between different parties raises rather different questions from those which arise when one party to a contract seeks to incorporate by reference a set of standard trading terms. In the former case most, but not all, of the terms of the original contract are likely to be directly relevant to the substance of the contract into which they are to be incorporated. In these circumstances it becomes necessary to decide which terms the parties intended to incorporate and which they did not. In many cases the answer will be that in the absence of specific language the Court will not be able to infer with confidence that the parties did intend to incorporate any terms other than those which are germane to their own contract: see the comments of Mr. Justice Colman in AIG Europe (U.K.) Ltd. v. The Ethniki at pp. 309f-310e. . . . . The present case, of course, is of the former kind. It does not necessarily, follow, therefore, that general words in the reinsurance contract incorporating the terms and conditions of the underlying policy can be taken as demonstrating clearly and precisely the existence of a consensus in relation to clauses which are ancillary to the substance of the contract. In each case the Court must construe the language of the contract in the context of its commercial background and ask itself whether a consensus on the subject matter of the jurisdiction clauses is clearly and precisely demonstrated. 27 ……… The decisions in AIG Europe (U.K.) Ltd. v. The Ethniki and Arig v. Sasa support the view that in the context of contracts of reinsurance jurisdiction clauses, being ancillary in nature and having no bearing on the definition of the risk, are not germane to the substance either of the underlying policy or of the reinsurance contract. In those circumstances general words of incorporation will not suffice to demonstrate with sufficient certainty to satisfy the requirements of art. 17 the existence of the necessary consensus. Although the commercial background does not reinforce this conclusion (as it did in both AIG Europe (U.K.) Ltd. v. The Ethniki and Arig v. Sasa), it is not of sufficient weight to make good this deficiency in the language of the contract.”
[33]In the context of Article 23, it has been said that consideration of an agreement which contains general words of incorporation (e.g. “all terms and conditions as original”/“wording as original”) requires: “... substantial weight to be attached to the likelihood that the parties would not mutually intend to incorporate terms merely ancillary to the substance of the contract, such as an arbitration clause. Having regard to the underlying reasons for that approach to construction of incorporation clauses with regard to arbitration clauses, I have reached the conclusion that the same approach should normally apply to jurisdiction clauses.” (per Colman J, AIG Europe (UK) Ltd, v. The Ethniki [1999] Lloyd’s Rep IR 221 at 227 col 2;[34]Colman J’s first instance decision was upheld on appeal, although on the slightly different basis that the requisite “clear and precise demonstration” of consensus to the jurisdiction clause was not satisfied by general words of incorporation where the subject matter of the two contracts was not the same (per Evans LJ, AIG Europe UK Ltd v The Ethniki [2000] 2 All ER 566 at 575-576 (CA)). The Court also held that “the circumstances in which charterparty provisions are stated to be incorporated in a bill of lading are special and possibly unique, and they cannot give rise to any rule of construction which should apply whenever one contract incorporates the term of another” (para 38). Practical application[35]In all of the cases to which I have previously referred the jurisdiction clause from the separate contract was held not to have been incorporated into the contract in dispute. Thus:(i) In The Ethnikithe Court of Appeal held that “Conditions: wording as original” was insufficient to incorporate the jurisdiction clause: The Ethniki [2000] 2 All ER at 574 – 575 @ [30] & [39] – [41]. (The same decision had been reached earlier by Tuckey J. in Arig Insurance Co. Ltd. v. Sasa Assicurazione Riassicurazione S.p.A. (unreported, Feb. 10, 1998).)(ii) “Conditions: All terms, Clauses and conditions as original and to follow the original in all respects including settlements” was held to be insufficient in AIG Europe SA v QBE International Insurance Ltd. [2001] 2 Lloyd's Rep. at 269 @ [4] & 273 – 274 @ [27].(iii) “All the terms whatsoever of the said charter apply to and govern the rights of the parties concerned in this shipment” failed to incorporate a jurisdiction clause in Siboti v. BP France [2003] 2 Lloyd’s Rep. [18], [45] – 46] & [58], despite the “whatsoever”.(iv) “To follow all terms and conditions of the primary policy together with riders and amendments applicable there - to covering the identical subject matter and risk including . . .” was held insufficient in Dornoch even though that clause contained the words “Jurisdiction Clause” on a separate line at the bottom. Aikens J. (affirmed by the Court of Appeal) held even that was not enough: Dornoch [2006] Lloyd’s (Ins. & Reins.) Rep. at 135 @ [19] & 142 - 143 @ [53].(v) In Prifiti v Musini [2004] Lloyd’s (Ins & Reins) Rep 518 a full reinsurance clause (“Being a reinsurance of and warranted subject to the same terms and conditions (excluding limits and rates) as and to follow the settlements of the Reassured”) was inapt to incorporate a Spanish jurisdiction clause, even though the slip for the previous year had made express reference to such a clause. Andrew Smith J held that, even in the earlier year, there was no such incorporation because the fact that the leading underwriter had initialled the wording of the clause under a slip which read “Form Slip Reinsurance NMA 1779a plus wording as agreed by Leading Underwriter on 10 December 1999” did not mean that the jurisdiction clause was incorporated into the reinsurance policy Socofi’s submissions[36]Socofi contends that the present case is a fortiori to those cases. Firstly, as it submits, the parties in the present case were really talking only about monetary terms. They agreed to incorporate the payment conditions (“conditions de règlement”) from the AEL/DAM contract into the Socofi/AEL contract. They used no express language of incorporation of the jurisdiction clause. The agreement reached between Socofi and AEL was different from the AEL/DAM agreement. It was not a Slot Charter Agreement but in effect an agreement for freight forwarding services. Provisions in the DAM/AEL Agreement were not all carried over. For instance, Socofi, which produced no fruit itself, could not be taken to have bound itself to any annual shipment quantity or to ship whatever it exported, whereas DAM which was a producer, had bound itself to ship all the fruit that it produced. A reason why in this category of case express reference to the jurisdiction clause is needed is because, even with a purported incorporation of all conditions, not every one of them will be incorporated. It is, therefore necessary to decide which of them are, and, in this respect, it is not to be inferred that the parties clearly consented to, accepted and intended to incorporate an ancillary clause about the resolution of disputes which was not germane to the provision of the services contracted for.[37]Socofi further submits that the correspondence shows that only the payment conditions from the AEL/DAM contract were to be incorporated into the Socofi/AEL contract in that: i. The understanding at the end of the Marseilles meeting was that Socofi would be contracting with the French company, Transit Fruits, and not its English sister, AEL : see paras 15-16 of Daudet 1st Witness Statement. ii. As a result, following the meeting, on 30th July Mr Daudet sent an e-mail to M. de Frémont of Transit Fruits (not, AEL) asking for their “payment conditions for acceptance by us” (“conditions de règlement pour acceptation de notre part”). iii. For some reason the reply came from Mr Larkin of AEL. He offered services on FILO terms, “on the conditions of the above contract of carriage signed by AEL and DAM” (“aux conditions du contrat d'affrètement précité, signé par AEL et DAM”) plus “an additional flat charge of 25 euros per pallet of pineapples”. iv. Finally, Mr Daudet wrote back to Mr Larkin under the heading “Your tariff proposal of today” (“votre proposition tarifaire de ce jour”) accepting AEL’s offer. v. The parties’ focus had been exclusively on what service was to be provided and at what cost. There was no discussion of or any suggestion that the parties contemplated questions of jurisdiction. The clause conferring jurisdiction was not “in fact the subject of consensus between the parties” as required (Bols [2007] 1 WLR 12, 22 @ [28]).

AEL’s submissions

[38]AEL submits that the position is much simpler than that. The letter of 3rd August 2007 from AEL was an offer which said:
“ We are prepared to offer you transport services from Cote d’Ivoire to on truck in Europe in the ports of Port-Vendres and Anvers This offer includes …. Free In/Liner Out (FILO) maritime transport under the conditions of the aforementioned charter agreement between AEL and DAM “aux conditions du contrat d’affrètement précité, signépar AEL et DAM”. . Socofi then replied : “We acknowledge receipt of your mail sent today, and confirm our acceptance of the following points 1) The maritime transport service under the conditions of the contract of affreightment between AEL and DAM”
[39]In those circumstances there has been a clear, precise and express acceptance of the application of the terms of the AEL/DAM Agreement by the use of the words “under the conditions” of the AEL/DAM Agreement. There can be no basis for narrowing the scope of the terms offered and accepted by including those related to AEL’s standard charges and payment conditions but excluding the jurisdiction clause. The agreement made in correspondence should be regarded as incorporating all the terms of the AEL/DAM agreement save those incapable of incorporation - such as the obligation to export all its production (“la totalité de sa production exportable”). Reliance was placed on the decision of the Court of First Instance of Hong Kong in Astel-Peiniger Joint Venture v Argos Engineering & Heavy Industries Ltd, 18 August 1994.[40]It is nothing to the point whether Mr Daudet had seen those conditions (just as it was irrelevant whether the English company in 7e Communications had done so). It is in any event implausible to suppose that he had not seen them since the AEL/DAM contract was a contract for AEL to carry all of DAM’s exports and he was DAM’s general director. On any view he could easily have done so.[41]The bill of lading and reinsurance contract cases provide a very different context from the present case. In the case of bills of lading there is a particular need for certainty as to which clauses in a charterparty are incorporated into the bill of lading contract since the bill is a negotiable instrument which may pass through many hands and amongst those who may well neither know, nor have the means of knowledge, of the charterparty in question and, in particular, that it may require arbitration in some place entirely foreign to him. Further, for better or for worse, a body of case law has built up in relation to bills of lading which places them somewhat in a category of their own. In relation to reinsurance there is or may be a need for caution in treating jurisdiction clauses as incorporated particularly since reinsurers may well be unaware of the jurisdictional provisions of any underlying insurance, which may have been entered into after the date of the reinsurance contract in question.[42]Here, by contrast, the context is much closer to that of an offer to contract on standard terms. Socofi were aware of or, at the very least, had ready access to the AEL/DAM agreement. Mr Daudet was not a remote endorsee of an original bill of lading but the General Director of DAM and Socofi and he freely negotiated a contract on the same terms as the AEL/DAM agreement. He was in effect transferring terms from one company to another when he was General Director of both. The words used are very clear and there is no reason why they should not have full effect so as to incorporate all terms relating in any way to the carriage of the goods and the services being offered, especially when Socofi was stepping into the shoes of DAM as far as possible. Conclusions[43]I am not persuaded that Socofi’s acceptance of the jurisdiction clause has been clearly and precisely established.[44]Prior to the events of July and August 2007 a somewhat complex set of interlocking relationships existed. Socofi had an agreement of 1st January 2005 with DAM to purchase all its produce on FOB terms. Although I have not seen that agreement it would appear (see AEL’s letter of 3rd August 2007) that under it Socofi assumed responsibility for all the costs associated with maritime freight, handling and forwarding in respect of DAM’s fruits. By the AEL/DAM Agreement, reached under the aegis of OCAB, DAM agreed with AEL that AEL would ship its entire produce via AEL. DAM fulfilled that agreement. Socofi was responsible under the Socofi/DAM Purchase Agreement for, in essence, all the transport and handling costs after the goods had been loaded on board. Socofi arranged with LV Fruits for it to carry out handling operations at the two discharge ports of Port Vendres and Antwerp and paid LV Fruits a sum which included the freight which LV Fruit paid to AEL.[45]Then, when LV Fruits declined to continue, Socofi needed to secure the same services that LV Fruits had previously provided in addition to a continuation of the arrangements for marine carriage of DAM’s products that had previously existed. The initial negotiations were with Transit Fruits. Their original purpose was to find a substitute for LV Fruits who would carry out its former role. Thus Mr Daudet’s e-mail of 30th July 2007 asked whether Transit Fruits would like to provide transit/customs clearance and handling services which had previously been provided by LV Fruits and asked for details of standard charges and payment conditions. What he received was a letter of 3rd August 2007 from AEL offering “transport services from alongside vessel Cote d’Ivoire to on truck in Europe” at the two ports including “Free in/Liner out (FILO) maritime transport under the conditions of the AEL and DAM agreement” and handling up to the warehouse. Mr Daudet replied in terms which indicated that the subject to which he was principally addressing himself was the tariff proposed in AEL’s letter and that he was accepting “the maritime transport service under the conditions of the contract of affreightment between AEL and DAM” (a service for which, under the contract between Socofi and DAM, Socofi was already obliged to pay) and the fixed charge of € 25 per pallet for the other services.[46]The primary emphasis of this correspondence is to identify the services which are to be provided and their cost. These were the provisions with which the parties were concerned. I accept that the jurisdiction clause is a condition of the contract of affreightment between AEL and DAM. But, as the authorities show, such a provision is an ancillary provision. Whilst everything must depend on the precise terms of the communications between the parties and the intention which must, objectively, be attributed to them in the light of those communications, an incorporation of conditions by general wording is usually inapt to incorporate an ancillary arbitration or jurisdiction clause.[47]In the present case AEL did not send an offer with their standard terms on the back; nor did the parties incorporate standard terms in a particular trade or a master agreement. What was offered in correspondence was a set of services which included maritime transport services under AEL/DAM conditions. It is common ground that the entirety of those conditions is not incorporated. Among those not incorporated are DAM’s obligation to ship all its export produce on AEL vessels and, probably, the deadfreight provisions. The conditions do, however, contain various terms which directly relate to the provision of the carriage service (e.g. the provisions as to bills of lading, freight rates, payment of freight and charges, the bunker adjustment factor, AEL’s lien, insurance, and force majeure). Socofi’s agreement to AEL’s conditions is not left without meaningful content if the jurisdiction clause is not included. The words that the parties have used are entirely apt to incorporate the AEL conditions insofar as they bear upon the nature and cost of the services to be provided and the extent of the parties’ obligation to do so.[48]I am not, however, able to infer with confidence that the parties intended to incorporate into their agreement the jurisdiction clause in the agreement between DAM and AEL, an agreement made under the aegis of OCAB of which I do not understand Socofi to have been a member. To my mind the application of the jurisdiction clause is not clearly and precisely demonstrated nor, despite the able submissions of Mr Neil Hart for AEL, does AEL have much the better side of the argument. Whilst recognising that the charterparty and reinsurance cases are not to be treated as some form of legal straitjacket and that there is no precise delineation between the two categories of case to which I referred in paragraph 26 above, I find it difficult to distinguish the present case from those cases. Indeed the present case, which does not refer to “all conditions”, seems a fortiori.[49]Contracts which include words of incorporation must be construed in their commercial context which may cast light on whether an arbitration or jurisdiction clause is to be treated as incorporated by general words of incorporation.[50]In the present case AEL was an English carrier. Socofi is a French Company which was looking to replace the services provided to it by another French company, LV Fruits. The shipments envisaged were from a Francophone country (Côte d'Ivoire) to France and Belgium. The July 2007 negotiations took place in Marseilles between three French companies (Socofi, Transit Fruits and Compagnie Fruitiere). AEL’s Jan van Opstal was present only for part of the meeting. Mr Daudet approached a French company (Transit Fruits) for a price quote on 30th July 2007, not AEL, and all the relevant correspondence was in French. This is not a context which prompts or supports the inference that the parties intended that the English High Court should determine any disputes and certainly not one which makes good any deficiency in the language of incorporation.[51]Accordingly AEL is not, in my judgment able to rely on the jurisdiction clause in the AEL/DAM Agreement, and, subject to any question as to the form of the order, I propose to make the declaration sought. Postscript[52]On 6th March 2008 AEL applied to the Tribunal de Commerce du Perpignan for a saisie conservatoire in respect of 44 pallets of Socofi’s cargo on board the vessel “COSTA RICAN STAR” as security for freight. In so doing it relied on the 1996 “Loi sur les contrats d’affretement et de transport maritime” in these terms: “The Act of 1966 on Contracts of Carriage and Maritime Transport and its Implementation Decree stipulates that the shipowner provides his vessel, or space on his vessel in exchange for the payment of freight.” “Que la loi de 1966 sur les contrats d’affrètement et de transport maritimes et son décret d’application prévalent que le fréteur met à disposition son navire ou un espace sur ce navire en échange du paiement d’un fret”). Article 2 of that law grants the shipowner a right of lien over the cargo for the payment of the freight (“fret”).[53]On 6th March the President of the Tribunal made the requisite order. On 7th March a judge of the Tribunal allowed AEL to sell the seized pallets and directed that the proceeds be held in a designated account.[54]Socofi relies on these events as showing that AEL cited and relied upon substantive rights conferred upon a carrier under French domestic law rather than the lien clause in the AEL/DAM contract. This, it is submitted shows that AEL did not think that the contractual terms of the AEL/DAM contract had been incorporated. The significance of that is said to be that the existence of “actual consent” is to be determined by Community law and not the proper law of the contract (Siboti [2003] 2 Lloyd’s Rep. at 372 @ [40(i)]). Civil law systems do not refuse to consider post-contractual conduct to interpret a contract. As Lord Denning explained in Port Sudan v. Chettiar [1977] 2 Lloyd's Rep. 5, 11 col. 1, admitting evidence of post-contractual conduct for the purposes of interpretation is “the rule in every other civilised system of law, including the other countries of the Common Market.”[55]It appears however from the evidence of Mr Patrick Simon, the current president of the French maritime law association and a member of the Paris Bar that the lien for unpaid freight provided by article 2 of the 1996 law is not restricted to arrests made pursuant to contracts of carriage governed by French law or containing French jurisdiction clauses. Hence it is possible to arrest a cargo where the contract of carriage is subject to English law. No specific plea of the application of any particular law was required nor was one made.[56]In those circumstances I derived no real assistance as to the true agreement between the parties from the content of the “Requete a fin de saisie conservatoire”.

Cited in 4 later judgments