Golden Endurance Shipping SA v RMA Watanya S.A. & Ors [2014] EWHC 3917 (Comm)

Case No 2014 FOLIO NO. 817[2014] EWHC 3917 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 25/11/2014
Before
MR JUSTICE BURTON
Between
GOLDEN ENDURANCE SHIPPING SAClaimant(1) RMA WATANYA S.A.Defendants(2) AXA ASSURANCE MAROC S.A.Defendant(3) WAFA ASSURANCE S.A.Defendant(4) DALIA COMODEX S.A.Defendant
Michael Collett Q.C.(instructed by Jackson Parton) for ClaimantJessica Wells (instructed by Holman Fenwick Willan LLP) for DefendantsHearing Hearing dates: 11 November 2014
JudgmentMr Justice Burton :
[1]A cargo of 6489.95 mt of wheat bran pellets was shipped on Golden Endurance (“the vessel”) to Morocco from three ports in Gabon (Owendo), Togo (Lomé) and Ghana (Takoradi) in June and July 2013. They were the subject of three separate Bills of Lading (the “Owendo Bill”, the “Lomé Bill” and the “Takoradi Bill”), all of them providing for “freight payable as per Charter-Party dated 11 June 2013”, and issued severally on 27 June, 18 July and 22 July 2013.[2]The Claimant is the Head owner of the vessel, incorporated in the Republic of Liberia, and the disponent owner was Chemical Flair Inc of the Marshall Islands. The vessel was chartered to Swiss Agri SA, the sellers of the cargo. The purchasers and receivers were the Fourth Defendant, incorporated in Morocco, of which the First, Second and Third Defendants are the subrogated insurers.[3]On the vessel’s arrival at Casablanca on 2 August 2013, it became apparent that the cargo was damaged by the presence of live insects and wet and black mould. The majority of the damage was to hold 3, where most of the Takoradi cargo was stored, but there was some damage to all the holds. Discharge commenced on 27 August but stopped completely on 31 August 2013, when approximately 4,168 mt of the cargo remained on board, including the entirety of the contents (2,450 mt from the Takoradi cargo) of hold 3.[4]On 2 September 2013 the vessel was arrested by order of the Casablanca Commercial Court at the suit of the First to Third Defendants, seeking security in the sum of US$1,010,713.32 in respect of the damage to the cargo. The Claimant alleged that there was delay by the Defendants and unnecessary requirements made in respect of the proposed security, such that they threatened on 18 September 2013, and issued on 24 September, an application in this court for an anti-suit injunction: but such application was withdrawn without any hearing, upon a bank guarantee from the Moroccan Bank for External Commerce being provided and accepted on 30 September 2014. On 4 October 2013 there was a second arrest by the Casablanca Court at the instance of the Fourth Defendant to secure its uninsured losses (equivalent to approximately US$1,055,000) in respect of the costs of discharging and destroying the cargo remaining on board, but this was lifted on 2 October 2013 upon the Claimant’s undertaking that the vessel would not discharge the cargo remaining on board at Casablanca, in terms of a Pledge contained in a court order of 4 October 2013. A third arrest took place on 4 October 2013, which is not now suggested before me to be relevant, and that was lifted on 5 October 2013.[5]On 6 October 2013, the vessel sailed from Casablanca with the remaining cargo still on board: such cargo was subsequently discharged and sold at Cadiz. On 25 March 2014 the First to Third Defendants issued a cargo claim in the Casablanca court where the arrest had occurred, claiming the value of the damage in the sum secured by the bank guarantee. The Claimant was informed by letter dated 15 April 2014 of the Moroccan proceedings. On 9 May 2014 the Claimant’s English solicitors wrote requesting discontinuance of those proceedings and indicating an intention to apply otherwise for an anti-suit injunction in London. The Moroccan proceedings continued, and procedural hearings took place on 20 May, at which the Claimant’s lawyer attended, and also on 17 June, and there was to be a further such hearing on 15 July.[6]On 27 June the Claimant’s solicitors sent to the Defendants draft orders in relation to a proposed application by them to the English Court, on 3 July they informed them that the hearing of their applications would take place the following afternoon, 4 July, and on 4 July on an ex parte application Eder J granted the Claimant permission to serve a claim form out of the jurisdiction on the Defendants and granted an anti-suit injunction against the First to Third Defendants. This order required those Defendants to take steps to discontinue the Moroccan proceedings, although this was plainly inapt, and the order was varied to be limited to restraint upon their continuing proceedings until after a return date, by Order of Males J on 14 July 2014.[7]At the next Moroccan procedural hearing the Claimant attended and filed submissions. The Defendants contend that they thereby submitted to the jurisdiction of the Moroccan Court, but it is common ground that, in the light of the disagreement between the Moroccan lawyers on this topic, I cannot resolve that issue.[8]The Claimant filed Particulars of Claim on 7 August, claiming a declaration of non-liability to the Defendants in respect of the damage to the cargo, damages for breach of the contract of carriage by virtue of the Fourth Defendant’s failure or refusal to discharge, a final anti-suit injunction and equitable damages. On 11 August the Defendants issued an application in this court challenging the jurisdiction. A fourth and a fifth procedural hearing have ensued in the Moroccan proceedings on 30 September and 28 October: on the latter date the Court indicated that it would proceed to judgment on 11 November 2014, but the Defendants have applied, as I understand it successfully, for a stay.[9]Before me there has been the hearing of the application by the four Defendants, represented by Ms Jessica Wells of counsel, to set aside the Order for service out of the jurisdiction and these proceedings against them, opposed by Mr Michael Collett QC for the Claimant, and simultaneously the return date of the anti-suit injunction made against the first three Defendants. Mr Collett made clear that he is no longer seeking to claim an anti-suit injunction against the Fourth Defendant, which is not a party to the Moroccan proceedings. On 31 October 2014, the Claimant commenced London Arbitration in respect of the Lomé Bill.[10]Three matters should be made clear in respect of the proceedings before me:(i) Although on its face the application for the continuation of the anti-suit injunction is for an interim injunction, both parties were agreed that I should treat this application as if it were a final injunction, since if it is not granted now then, given the stage reached by the Moroccan proceedings, it will not be possible at any later stage to obtain such an injunction (as opposed to a different injunction, if appropriate, to restrain enforcement of any judgment obtained in the Moroccan proceedings).(ii) On the face of the Particulars of Claim and in its evidence, the Claimant has sought to pursue a claim for what it calls equitable damages in respect of alleged unconscionable or vexatious and oppressive conduct by the Defendants, in relation to the Casablanca proceedings, both the arrests and the proceedings themselves. Both in the light of the decision of Andrew Smith J in Navig8 Pte Ltd v Al-Riyadh Co for Vegetable Oil Industry (The “Lucky Lady”) [2013] 2 Lloyd’s Rep 104, that such a claim, and any claim for a self-standing injunction could not be brought within the gateway of “in respect of a contract” pursuant to para 3.1(6)(c) of the Practice Direction 6B of the Civil Procedure Rules (and that there was no other available gateway), and in the light of the disputed nature of the evidence as to whether any such case of unconscionability, oppression or vexatiousness could be established, Mr Collett has not pursued his case for equitable damages. He has limited his claim, as set out below, to an injunction (said to be ancillary to the contract claim) and, if ever appropriate, to damages in lieu of an injunction under s.50 of the Senior Courts Act 1981 (“Lord Cairns’ Act damages”).(iii) As will be seen, the real issue between the parties is whether their dispute should be resolved by reference to the Hague Rules (which would be the case if the proceedings were tried in this court or in London Arbitration), or by reference to the Hamburg Rules, as would be the case in the Moroccan Courts, where by legislation any such dispute must be decided according to Hamburg Rules and the ambit of the Hague Rules is ousted.[11]As to the three Bills, the Lomé Bill is on its front page headed up, in the left hand corner “Code Name:
‘CONGENBILL’: Edition 1978”: but on the reverse page, which sets out the Conditions of Carriage, it is recorded “To be used with charter-parties Code Name ‘CONGENBILL’
Edition 1994”. Those Conditions of Carriage recite:
“(1) All terms and conditions, liberties and exceptions of the Charter- Party, dated as overleaf, including the Law and Arbitration Clause, are herewith incorporated. (2) General Paramount Clause (a) The Hague Rules contained in the International Convention for the Unification of certain rules relating to Bills of Lading, dated Brussels the 25th August 1924 as enacted in the country of shipment shall apply to this Bill of Lading. When no such enactment is in force in the country of shipment, the corresponding legislation of the country of destination shall apply, but in respect of shipments to which no such enactments are compulsorily applicable, the terms of the said Convention shall apply. (b) Trades where Hague-Visby Rules apply. . . ” (a) The Hague Rules contained in the International Convention for the Unification of certain rules relating to Bills of Lading, dated Brussels the 25th August 1924 as enacted in the country of shipment shall apply to this Bill of Lading. When no such enactment is in force in the country of shipment, the corresponding legislation of the country of destination shall apply, but in respect of shipments to which no such enactments are compulsorily applicable, the terms of the said Convention shall apply. (b) Trades where Hague-Visby Rules apply. . . ”
[12]The Owendo and Takoradi Bills are in identical form. They both provide similarly in the top left hand corner of the first page by reference to the 1978 Edition and on the reverse page recite the Conditions of Carriage (by reference to the 1978 Edition). The Conditions of Carriage record:
“All terms and conditions, liberties and exceptions of the Charter-Party, dated as overleaf, are herewith incorporated. The Carrier shall in no case be responsible for loss of or damage to cargo arisen prior to loading and after discharging.”
The General Paramount Clause is then recited in identical terms to that set out above, and there is also a provision relating to the application of the Hague-Visby Rules, not relevant in relation to any of these three Bills.[13]There is no signed Charter-Party in evidence before me. What there is as follows: (i) An internal email from the Agents, Affremarine SA to itself dated 11 June 2013, which records:
“M.V. Golden Endurance/Swiss Agri CP 11/6/2013 plse find hereunder full and final fixing recap with all subs in order and already lifted”
. A standard form Affremarine Continent Grain Charter-Party is annexed as an exemplar. The email, relied upon by the Claimant as the Fixing Recap, records the name and place of incorporation of both the Head Owners and the Disponent Owners (as set out in paragraph 2 above). There are, as Ms Wells points out one or two loose ends relating to the details of the owner’s bank and bank account, the identity of the underwriters and, although an estimated quantity of cargo is given, an estimated maximum quantity is to be advised, but otherwise all the details are given, subject to the words “fixture (if any) is concluded with disp (onent) owners”. This was exhibited to the First Witness Statement of Mr Parton on behalf of the Claimant on 1 July 2014. (ii) He exhibits to his Third Witness Statement a letter sent by Affremarine to Capt Paburas of Pontos Marine Inc, the Claimant’s Commercial Manager, which encloses “original Charter-Party together with a working copy for your file”, and asks for the original to be duly signed and stamped by the owners. No such signed and stamped copy is produced. Mr Parton explains that Chemical Flair Inc is a company in the control of Pontos Marine, and that the owners of Pontos Marine also own Chemical Flair, using it for the purposes of freight collection. He produces documents to show that the same person has been appointed as the proxy of both Chemical Flair Inc and Pontos Marine, the Claimant’s Commercial Manager, and records as follows:
“22. Capt Paburas has confirmed . . . that (the 11 June 2013 email) message was the full and final recap for the Charter-Party. He has also provided me with (the 21 June 2013 letter) enclosing a drawn up version of the Charter-Party. As is not unusual, this does not appear to have been signed.” (iii) The unsigned Charter-Party records that “it is this day agreed between [the Claimant] as Head Owners and Messrs Chemical Flair Inc, Marshall Islands as disponent Owners, Owners of the m/v Golden Endurance . . . and Swiss Agri SA, Geneva (Switzerland) Charterers”
. Mr Parton continues:
“23. I confirm . . . that there is no separate written contract between the Claimant and Chemical Flair Inc in relation to this voyage. In circumstances where the Claimant and Chemical Flair are in common ownership and under common control, and where the names of both appear in recap and drawn up Charter-Party, I do not believe that the absence of a separate written contract raises any question about Chemical Flair’s ability to sub-charter the Vessel to Swiss Agri. 24. Capt Paburas has further confirmed to me that the Master of the Vessel was employed by the managers on behalf of the Claimant (as the registered owners of the Vessel) and the Master did authorise the agents to sign the Bills of Lading on his behalf. ”

The Issues

[14]The issues are as follows:(i) Lomé Bill. The Claimant has commenced arbitration and asserts that the Moroccan proceedings should be restrained in favour of arbitration. (a) The 1994 Edition point (Issue 1). Is the clause set out in paragraph 11 above at (i) on the reverse of the Lomé Bill of Lading incorporated into the contract? (b) The Charter-Party issue (Issue 2). The Fixture Recap email and the unsigned Charter-Party provide for arbitration in London and English law to apply. Does that govern the Bill of Lading? (c) If the answer to the first two issues is affirmative, it would seem to follow (and there was no argument to the contrary) that that would be sufficient both for a good arguable case and a serious issue to be tried so as to found both the arbitration gateway and grant the injunction.(ii) The other two Bills: (a) The Charter-Party Issue (Issue 2) applies here too. If that is satisfied, then that leads to a good arguable case for the English law gateway. (b) Serious issue to be tried as to damages and a declaration of non-liability: this depends primarily upon the resolution of Issue 2 and of the Pledge Issue (Issue 3), namely whether the Claimant is prevented from pursuing the contractual claims by virtue of it. (c) Whether a separate gateway is required for the claims for an anti-suit injunction and for damages under Lord Cairns’ Act (Issue 4). (d) Forum conveniens, the onus being upon the Claimant to establish that England and Wales is clearly the more appropriate forum (Issue 5). (e) Whether an injunction should be granted (Issue 6). (f) Whether there was material non-disclosure and/or inadequate notice of the ex parte injunction application so as to set aside the ex parte Order (Issue 7).

Issue 1

[15]The Defendants submit that the 1994 Edition Terms were not incorporated into the Bill, and hence the arbitration provision in the Fixing Recap/unsigned Charter-Party could not be incorporated. There was obviously a muddle (no other explanation is given) by virtue of the 1978 Edition front page and the 1994 Edition reverse page being put together and used – this does not apply to the other two Bills – and a sensible construction has to be given by the Court of the contract which results. The Claimant relies upon the terms spelt out on the reverse, and the Defendants upon the provision for incorporation of the 1978 Edition, which would not include the Law and Arbitration clause referred to. Ms Wells refers to The Starsin (Homburg Houtimport BV and Others v Agrosin Private Ltd and Another) [2004] 1 AC 715), a case in which there was an inconsistency between the description of the carrier on the first page of the Bill and in the terms on the reverse. She refers to dicta, predicated upon that of Lord Bingham at paragraph 10, referring to the business sense which was to be given to business documents as being that which “businessmen, in the course of their ordinary dealings, would give the document”. She relies upon Lord Steyn at paragraph 45, addressing the way in which a reasonable person, versed in the shipping trade, would read the bill, and that he would “give greater weight to words specially chosen, such as the words which appear above the signature, rather than standard form printed conditions. Moreover I have no doubt that in any event he would, as between provisions on the face of the bill and those on the reverse side of the bill, give predominant effect to those on the face of the bill. Given the speed at which international trade is transacted, there is little time for examining the impact of barely legible printed conditions at the time of the issue of the bill of lading. In order to find out who the carrier is it makes business common sense for a shipper to turn to the face of the bill, and in particular to the signature box, rather than clauses at the bottom of column two of the reverse side of the bill.” She also refers to Lord Hoffmann’s emphasis at paragraph 74 that the reasonable reader of the bill of lading would know that it was addressed not only to the shipper and consignee named on the bill but to a potentially wide class of third parties including banks which have issued letters of credit.[16]But it is clear from the very passages from their Lordships’ speeches cited that The Starsin was in no way a decision that the content of the first page of a bill of lading should be preferred to the content of the reverse page. In this case the Conditions of Carriage are set out clearly and legibly on the reverse of the Bill. There is no need for anyone to cross-refer to the content of the relevant Edition of those standard terms in order to cross-check them. It is only if somebody either already knows the contents of that Edition by heart or takes the trouble so to check, that the inconsistency will appear, and the very words of Lord Steyn emphasise the speed of international trade and the natural choice of the reader to trust what is written in the bill rather than to wade through small print, particularly small print which is not even contained in the bill itself. I am entirely satisfied that, construing the Bill of Lading in a business sense, the conditions which are incorporated are those which are set out in the Bill, rather than those which are said to be incorporated by a reference on the top left hand corner of the first page. For the purposes of the Arbitration gateway, I am certainly satisfied that there is a good arguable case to that effect, but in any event I conclude that it is correct, and insofar as I need to make a final judgment to that effect, I do.

Issue 2

[17]Ms Wells asserts that:(i) the Charter-Party said to be contained in the Fixture Recap and/or the enclosure to the letter dated 21 June 2013 is uncertain and incomplete.(ii) The Charter-Party referred to in the Bills of Lading must be the Head Charter-Party, and there is either no Charter-Party or only an oral Charter-Party between the Head Owner, the Claimant, and the Disponent Owner Chemical Flair Inc: thus there is no Head Charter-Party into which the provision for English law can thus be incorporated.(iii) A Charter-Party in writing must be executed before the goods are discharged, and there is no evidence that it was. Thus there is no effective English law clause incorporated in the Charter-Party for the purposes of the English law gateway.[18]As to these points, Mr Collett QC’s answers are powerful, and I accept them:(i) Insofar as there were some matters left incomplete, as appears from paragraph 13(i) above, none of them are significant such as to contra – indicate a consensus ad idem sufficient for there to be a contract, and in any event there is the annexed standard form and the subsequent unsigned Charter-Party containing all the relevant terms. He refers to Pagnan v Feed Products [1987] 2 Lloyd’s Rep. 601. Swiss Agri plainly regarded there as being a Charter-Party, which was performed.(ii) He accepts that the Charter-Party cannot be oral if the English law clause is to be incorporated into the Bills of Lading. However it plainly was evidenced in writing, as in Welex AG v Rosa Maritime Ltd (“The Epsilon Rosa”) [2003] 2 Lloyd’s Rep 509. He also accepts that there is a presumption that where there are two or more relevant charters of a vessel, the general rule is that “the Head Charter, to which the Shipowner is party, is incorporated on the basis that the party issuing the Bill of Lading must be contemplating a charter to which he is a party” (Aikens, Lord and Bools Bills of Lading (First Ed 2006) at 7-102 and “where . . . there is more than one Charter-Party and the incorporation clause fails to identify which is to be incorporated, the presumption normally made is that it is the Head Charter-Party which is intended to be incorporated, since that it is the one to which the Shipowner is party” (Cooke Voyage Charters (Fourth Ed 2014) at 18.61. However, in this case, the best that the Defendants can say is that there was one oral Charter-Party and one Charter-Party in writing, in which case it is obviously more likely to be the one in writing which is referred to in the Bill and incorporated into it, particularly where it is clear that the Head Owners and Disponent Owners are related. However in fact in this case it seems clear that there was only one Charter-Party, to which both the Head Owner and the Disponent Owner were parties (see paragraph 13(iii) above).(iii) Both counsel refer to the Epsilon Rosa in relation to the question of the necessity for a completed Charter-Party prior to the discharge of the goods. Ms Wells points to the fact that it cannot be proved that the Charter-Party was in fact ever signed (see paragraph 13 above). However at paragraphs 31-32 of the Epsilon Rosa, Tuckey LJ makes plain that an inability to produce an executed Charter-Party is not fatal to the case that it is incorporated in the Bill of Lading, provided that its terms were agreed prior to such discharge. Albeit it cannot be shown to have been signed, the Charter-Party attached to the letter of 21 June 2013 was dated 11 June 2013, and I am satisfied that it is to that document which the Conditions of Carriage on the reverse of the Bills of Lading refer, by reference to the “Charter-Party, dated as overleaf”, I am satisfied that in any event the Charter-Party has been documented in such a way that its terms are readily ascertainable, within paragraph 6-017 of Scrutton on Charterparties and Bills of Lading, (22nd Ed).[19]In relation to Issue 2 also, I am satisfied that there is at least a good arguable case sufficient to satisfy the English law gateway; and as to the gateway for an injunction under s.37 of the Senior Courts Act 1981 to support English arbitration, this is thus established as in AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2013] 1 WLR 1889 (at paragraphs 48 to 58). As set out in paragraph 14(i)(c) above, it follows that I shall grant the injunction.

Issue 3

[20]I turn to the question whether there is a serious issue to be tried in respect of the claims which fall within the contractual gateway, the declaration of non-liability and the claim for damages for breach of the contracts of carriage. The Defendants rely upon the Pledge, referred to in paragraph 4 above. The relevant provisions, as translated from the Arabic, are as follows:
“Whereas the means by the defendant that the Ship master refused to return with the concerned vessel and insisted on discharging the damaged goods is refuted by the pledge of the Lawyer for the plaintiff recorded in the minutes of the hearing and whereby they declared to recognize and dispense the company DALIA COMODEX from any commitment to discharge and destroy the goods and not to discharge them in Casablanca and shall be discharged under his responsibility and care.”
[21]The Defendants contend that this amounts to an absolute discharge by the Claimant of any liability of the Defendants such as is pleaded in paragraphs 43 and 44 of the Particulars of Claim, relating to the failure or refusal by the Fourth Defendants to discharge the cargo, from 31 August onwards. The issue is whether this simply released the Defendants’ obligation to discharge at Casablanca, leaving the Claimant with the right to sue for breach of that obligation, or whether it absolved the Defendants from any liability for damages for such breach. There is a dispute between the two Moroccan lawyers instructed. Maître Chelaifa for the Defendants advises that the meaning of the clause is that the Claimant is ordered to depart from the port with the goods and to destroy them at its cost, and that it does not reserve the right of the Claimant subsequently to claim those costs from the cargo interests: the Claimant promises “without reserves” to depart with the damaged goods and destroy them at its cost, and no longer has the possibility of going back upon such promise in judicial proceedings made without reserve. Maître Eddine for the Claimant asserts that there was no waiver of any right of the Claimant to bring any subsequent claim: “the said order contained no express waiver on the part of the Owners of the right to contest the motives of the receivers for arresting the vessel and seek damages for wrongful detention of the vessel and expenses incurred . . . there has only been a provisional decision and not a judgment on the merits after the exhaustion of all legal proceedings”.[22]I am unable to resolve that dispute between the two Moroccan lawyers as to the effect in Moroccan law of the Order of the Moroccan Court, and I consider that there is a serious issue to be tried as to whether the Claimant is entitled to pursue its claim for damages under the contracts of carriage (governed by English law) for failure or refusal to discharge the cargo. Ms Wells also raised certain contentions about the quantum of the damages claimed, alleging that, as is clear from the schedule to the Particulars of Claim, the Claimant is seeking damages against the Fourth Defendant in respect of the entirety of the period from 31 August to 4 October, when at best it would be entitled in respect of the periods between 31 August and 2 September and 30 September and 4 October. I am however entirely satisfied on that issue also, having heard Mr Collett in response, that there is a serious issue to be tried as to whether the Claimant can in fact recover against the Fourth Defendant damages in respect of that entire period.[23]Accordingly I resolve Issue 3 in favour of the Claimant.

Issue 4

[24]This relates to whether the Claimant, which on the above analysis has succeeded in establishing a contractual gateway both for its declaration of non-liability and its damages claim, can also proceed with its claims for an anti-suit injunction and “equitable damages”, although now the latter are expressly limited, as appears from paragraph 10(ii) above, to Lord Cairns’ Act damages, and the claim for equitable damages said to be based upon unconscionable or vexatious conduct by the Defendants is not pursued.

(c) :

“A claim is made in respect of a contract where the contract . . . is governed by English law.”
Andrew Smith J found that such a claim for equitable damages is not a claim “in respect of a contract”.[25]Andrew Smith J also found (again not challenged before me) that a claim for an anti-suit injunction did not fall within that gateway, and it is common ground that there is no other gateway within which an anti-suit injunction could be said to fall: indeed Ms Wells emphasises such absence by reference to the express inclusion in Practice Direction 6B of the gateway provided by para 3.1(2) for “an injunction ordering the Defendant to do or refrain from doing an act within the jurisdiction”. Mr Collett however submits that his argument raised before Andrew Smith J (at paragraph 11 of that judgment) that “the claim for injunctive relief need not be included in the claim form because, if the claims for declarations succeed, the court will have jurisdiction to make an injunction ancillary to them”,and/or for a claim for Lord Cairns’ Act damages, was not ruled out by the Learned Judge. Indeed in that case (where he did not give permission to serve out of the jurisdiction in respect of any damages claimed, but simply in respect of the claim for declaratory relief), the Judge appears to have accepted that there might subsequently be grounds for an “ancillary anti-suit order”, at least in the event that the declaration was granted at trial.[26]Mr Collett submitted that there is other authority upon which he can rely to support the availability of an ancillary anti-suit injunction where the Court had or has acquired jurisdiction against the Defendant, not dependent upon the availability of a special gateway in respect of that injunction. Whereas I do not consider that his reliance upon Fourie v Le Roux [2007] 1 WLR 320 at para 30 per Lord Scott assists him, as the issue of service out of the jurisdiction was not in terms being considered, in my judgment he can place reliance upon the judgment of Lawrence Collins LJ in Masri v Consolidated Contractors International (UK) Ltd (No. 3) [2009] QB 503. In that judgment, against the background of an express issue raised by the judgment debtors (paragraph 30) that “a claim for anti-suit injunction is a separate claim, based on a separate cause of action, which must in turn be based on a substantive legal or equitable right and for which an independent basis for jurisdiction must be found under the . . . CPR”, he concluded (at paragraph 32) that a claim for an anti-suit injunction was not “a new claim which must satisfy its own jurisdiction or criteria”, and that:
“26. . . the English court has power over persons properly subject to its in personam jurisdiction to make ancillary orders in protection of its jurisdiction and its processes, including the integrity of its judgments.” (See also paragraph 59). In summary he said: “99. Where a party is properly before a court, an anti-suit injunction is not a separate claim requiring its own basis of jurisdiction. In alternative forum cases, such as the present, it is not necessary for the applicant to rely on a cause of action establishing a separate right not to be sued. The right to apply for an injunction is not of itself the cause of action but is ancillary and incidental to the existing proceedings. The judgment debtors' submission to the English jurisdiction in those proceedings is a sufficient basis for the imposition of the anti-suit injunction, and the claim for the injunction does not require any amendment, and does not require any separate basis of jurisdiction either under the Brussels I Regulation or under CPR 6.20. Nor in the case of an injunction directed at a domiciliary of a Brussels I Regulation State is it necessary that the injunction be a protective or provisional measure, but if that were necessary, then the anti-suit injunction was such a measure.”
[27]Ms Wells points out that in Masri the injunction was sought at the tail end of a considerable amount of litigation in this court, so that it can indeed be said to have been made “in protection of [the English Court’s] jurisdiction and its processes, including the integrity of its judgments”. In this case, however, she submits that it is apparent that from the very start the main purpose of these proceedings was to obtain an anti-suit injunction, as she illustrates by reference to the Claimant’s skeleton argument on the ex parte injunction application, in which the application for the anti-suit injunction is put up front (in paragraph 15), over and above the assertion of breaches of the English law contracts addressed in paragraph 16. It could also be said that Andrew Smith J’s leaving open of the position in relation to an ancillary application for anit-suit injunction was only by reference to the possible appropriateness of such an injunction if and when at trial a declaration of non-liability were granted. On the other hand, as Mr Collett points out, in Lucky Lady no claim for damages for breach of contract went forward, unlike this case, and the ancillary application for an anti-suit injunction would in this case, if successful, be intended to be a continuing protection of the jurisdiction of this court to resolve claims for damages for breach of English law contracts.[28]Ms Wells did not seek to argue that a different answer would apply to the Lord Cairns’ Act damages claim than in relation to an injunction: if the injunction application goes forward as ancillary to the contractual claims, then the Lord Cairns’ Act damages would go forward as well.[29]I am persuaded that Mr Collett is correct, that there is no need for a separate gateway in order to permit the application for an anti-suit injunction (and/or Lord Cairns’ Act damages) to go forward as ancillary to the contractual claims, which I have already determined fall within the contractual gateway. I therefore resolve Issue 4 in favour of the Claimant.

Issue 5

[30]Can the Claimant show that England and Wales is clearly the more appropriate forum than Morocco? There was, as I have found at least seriously arguable, an English law clause, but no English jurisdiction clause, exclusive or non-exclusive. There is no doubt that the rival matters raised by the parties on each side as to the convenience or otherwise of the fora are, in the context, of little or no significance – domicile of the Defendant insurers, place of discharge, availability or residence of witnesses, factual or expert. Similarly on the authorities there is little to be said in relation to which proceedings started first (or can be more speedily concluded), unless there is a clear issue as to submission to the jurisdiction; and as to the latter, when, as here, there is a disputed issue, depending upon matters of law and fact, which I cannot possibly resolve, as to whether the Claimant has submitted to the Moroccan jurisdiction, I cannot base any conclusion upon it.[31]What was in the forefront of the argument was the fact that if (as I have concluded) the contracts consisting of the Owendo and Takoradi Bills are governed by English law, that can be, as it is, heavily relied upon by the Claimant. An English law clause does not, like an English jurisdiction clause, trump, or nearly trump, other competent jurisdictions. But that is dependent upon the precise circumstances. The Claimant’s case is that the English courts applying English law will apply the Hague Rules, while it is clear that the Moroccan courts will apply the Hamburg Rules, both because the Hamburg Rules apply in Morocco, the place of discharge, but also because in the Moroccan courts Moroccan law provides expressly that in such contracts of carriage the Hamburg Rules are automatically incorporated, irrespective of and ousting the contractual provision. It is common ground that if the Hague Rules apply they are considerably more favourable to the ship owner and less favourable to cargo interests than the Hamburg Rules.[32]In that context Mr Collett relies upon the words of Lord Mance in his speech in the Supreme Court in VTB Capital plc v Nutritek International Corp [2013] 2 AC 337:
“46. The governing law, which is here English, is in general terms a positive factor in favour of trial in England, because it is generally preferable, other things being equal, that a case should be tried in the country whose law applies. However, that factor is of particular force if issues of law are likely to be important and if there is evidence of relevant differences in the legal principles or rules applicable to such issues in the two countries in contention as the appropriate forum.”
In The Lucky Lady Andrew Smith J at paragraph 28 accepted that Lord Mance’s observations were obiter, but also accepted that they presented a synthesis of the approach of the Court of Appeal and the High Court in a number of other cases where “the parties had (expressly or impliedly) chosen English law”. He concluded that the passage in Lord Mance’s statement was “of general application and is, of course, from the leading majority judgment”. He cited Parker LJ in The Magnum [1989] 1 Lloyds Rep 47 at 53, stating that: “it would be unjust to the plaintiff to prevent him from proceeding in Courts where the result of his bargain would be to produce success and to force him to proceed in Courts where the result would or might be that the defendants escaped their bargain”, and he concluded that the choice of English law outweighed all other considerations and clearly and distinctly established England as the proper forum.[33]Mr Collett also relies upon the recent decision of Males J in Caresse Navigation Ltd v Office National De L'electricite (“The Channel Ranger”) [2014] 1 Lloyd’s Rep 337 (not dissented from in the Court of Appeal [2014] EWCA Civ 1366) where he said (referring to Lord Mance and to The Lucky Lady):
“61. As for the significance of the express choice of English law, such a choice is capable of being a factor of significant and even decisive weight, particularly if the foreign court's application of a different law would or might lead to a different result as that would be to deprive the claimant of the benefit of its bargain . . . 62. In my judgment there is a real risk that forcing the owners to proceed in Morocco where Moroccan law and the Hamburg Rules would be applied would have the effect of depriving the owners of the benefit of their bargain.”
[34]Mr Collett pointed out that there is a further significant factor arising by virtue of the application of the Hague Rules, namely that it would be arguable in the light of The Kapetan Markos NL[1986] 1 Lloyd’s Rep 211 especially at 232, that in fact the Defendants’ claim would be ruled out of time by reference to the Hague Rules. This appeared to me to be ‘too much of a good thing’, and almost to point against choosing a forum in which the Defendants might be ruled out before they started. In those circumstances, after taking instructions, Mr Collett on behalf of the Claimant gave an undertaking that if the Commercial Court proceedings continue here and he is granted an anti-suit injunction as he seeks, his clients would not take the time point in the Commercial Court proceedings (although they are of course free to do so in the Arbitration).[35]Ms Wells submits that English law was not ‘chosen’, but ‘implied’ by the exercise of construction of the contracts at English law carried out above, and that should be set against the fact that the parties agreed that the cargo would be sent to a ‘Hamburg State’. However Andrew Smith J expressly referred (as set out in paragraph 32 above) to the approach applicable where English law is “expressly or impliedly chosen”.[36]I am persuaded that, upon the assumption and in the context referred to above, the fact that the English courts will apply English law is such a very distinct benefit to the Claimant that, as anticipated by Lord Mance, it means that these courts are clearly the more appropriate forum. Consequently I resolve Issue 5 in favour of the Claimant.

Issue 7

[37]Before I address Issue 6, I should deal shortly with the issues raised by Ms Wells of non-disclosure and inadequate notice. Ms Wells submitted that there was either no or inadequate disclosure of (inter alia) the threat and issue of the withdrawn application for an anti-suit injunction in this court in September 2013 (referred to in paragraph 4), the fact that the imminent Moroccan hearing in July 2014 was merely procedural, that the Claimant had already participated in at least one procedural hearing and that the Claimant had been indicating an intention to apply to this court since May 2014. Whereas I am not in fact persuaded that there was inadequate disclosure of those matters (and I did not call on the Claimant in this regard), in any event I am satisfied that insofar as a tabula in naufragio, such as described by Slade LJ in Brink’s-MAT Ltd v Elcombe [1988] 3 AER 188 at 194j, is capable of carrying a barrel, the bottom of that barrel was being scraped. I am also not satisfied that even if longer notice had been given of the date of the hearing than was given (as appears in paragraph 6 above), that would have made any difference to the result. I resolve Issue 7 in favour of the Claimant.

Issue 6

[38]The last issue is whether an injunction should be granted. Given that the proceedings continue here in respect of the two contracts governed by English law, and that, on the assumption set out above, the continuation of both English and Moroccan proceedings will lead to inconsistent judgments, the temptation for any court must be to seek to resolve that situation in order to avoid multiplicity of proceedings and inconsistency of judgments, particularly in a case where there will already be arbitration proceedings between the same parties and in relation to the same shipment and the same damage (albeit only a relatively small proportion of it in the light of the fact that the major damage was to hold 3 (as set out in paragraph 3 above)). My own personal attempt to prevent two parallel inconsistent proceedings in Deutsche Bank AG v Highland Crusader Offshore Partners LP at first instance([2009] 2 Lloyd’s Rep 61) was reversed by the Court of Appeal [2010] 1 WLR 1023, upon the basis (per Toulson LJ at paragraph 110H) that:
“. . . it does not follow that because parallel proceedings are undesirable they are necessarily oppressive. If they are improperly brought they are oppressive, but here the argument becomes circular.”
My conclusion that “when it comes to deciding whether it is vexatious or oppressive to continue two sets of proceedings in parallel, it is vexatious and oppressive, in the absence of any . . . exceptional unforeseeable circumstances, for a party to pursue proceedings in the non-contractual forum” was concluded (per Toulson LJ at paragraph 113) to be a misdirection. That was in a case where there was even, unlike here, a (non-exclusive) jurisdiction clause enabling it to be said that the foreign forum was “non-contractual”.[39]The Claimant does not for the purposes of this hearing and at this stage any longer put the case that there was any unconscionable or vexatious conduct by the Defendants, save the bringing of the Moroccan proceedings themselves. In the absence of a claim to a contractual right to restrain the foreign proceedings, something else is required. In Dicey, Morris & CollinsThe Conflict of Laws(15th Ed.) at 12-080 it is stated that “the underlying principle is that the jurisdiction is exercised ‘where it is appropriate to avoid injustice’, or, as it was once put, where the foreign proceedings are ‘contrary to equity and good conscience’. Although it is possible to identify certain categories of cases in which the jurisdiction has been exercised, ‘the width and flexibility of equity are not to be undermined by categorisation’.” Nevertheless, the reference, which follows, to the fact that “in the most recent authoritative formulation of the principles, there is no indication that the exercise of the discretion is limited by the need to demonstrate a legal or equitable right not to be sued”, is in fact to Masri, in which it is clear that the Court found that there was a classic case of vexation and oppression and conduct designed to interfere with the process of the English court in litigation to which the defendants had submitted (as per the head note). I have referred to the decision of the Court of Appeal in Deutsche Bank in which, by reference (at paragraph 63) to earlier authorities Toulson LJ concluded that:
“25. The prosecution of parallel proceedings in different jurisdictions is undesirable but not necessarily vexatious or oppressive.”
[40]Subsequent to that in Star Reefers Pool v JFC Group [2012] 1 Lloyd’s Rep 376 Rix LJ, giving the unanimous judgment of the Court of Appeal said:
“25. There was no dispute about the basic principles applicable to the power to grant an anti-suit injunction. What was needed was either an agreement for exclusive English jurisdiction . . ., in which case the court would ordinarily enforce the parties’ agreement by granting an anti-suit injunction in the absence of strong reason not to do so; or else two other conditions had to be satisfied, namely England had to be the natural forum for the resolution of the dispute and the conduct of the party to be injuncted had to be unconscionable.”
He concluded at paragraph 29:
“I do not think that [counsel for the Claimant] was able to show us a case in which a respondent, first in the field in a foreign jurisdiction . . . was injuncted for his unconscionable conduct in the absence of his agreement to litigate or arbitrate in England. I do not say that it may not happen or have happened, only that it may be a strong thing to do and that an example of it happening has not come readily to hand.”
Toulson LJ did allow for the possibility of exceptional circumstances (at paragraphs 63 and 119).[41]Mr Collett has sought to develop the argument he ran in a slightly different context in The Lucky Lady. Andrew Smith J explains at paragraph 21 that he sought to justify his case for an injunction in that case, by a late proposed amendment “and formulated it in a draft pleading as follows: ‘By its prosecution of the Jordanian proceedings, [the defendant] seeks to prevent [the claimant] from availing itself of the exclusions and limitations of liability’ in the exclusion provision. His argument is, I think, that the parties to the bills chose English as the governing law, and under English law [the claimant has] a right under the 1999 Act to the protection of the exclusion provision.” Andrew Smith J at paragraph 22 rejected this argument of “a right, deriving apparently from the choice of English law, not to be sued in any jurisdiction that does not give effect to a choice of English law that is recognised by English private international law, at least unless the foreign jurisdiction recognises rights similar to those recognised by English law.”[42]He puts his case before me differently. He refers to the speech of Lord Goff in Airbus Industrie G.I.E v Patel [1999] 1 AC 119 as an authority for the proposition that anti-suit injunctions may be granted to protect the Court’s own jurisdiction or to prevent evasion of its public policies: he refers to Deutsche Bank per Toulson LJ at 58 and 61. He submits that there are two public policies here being evaded, first the policy that the parties’ agreement (including their choice of law and contractual regimes) should be upheld and secondly the policy in favour of the Hague Rules or the Hague-Visby Rules and against the Hamburg Rules, unless freely chosen by the parties in circumstances where the Hague Visby Rules do not apply by force of law under the Carriage of Goods by Sea Act 1971, reflected by the fact that England has not enacted the Hamburg Rules.[43]He relies upon four authorities in support of these propositions, although citing all four of them by reference to his alleged first public policy. He refers to Vita Food Products v Unus Shipping [1939] AC 277 at 299, in which Lord Wright refers to the “fundamental principle of the English law of conflict of laws that intention is the general test of what law is to apply”, but as this case was not a case dealing with jurisdiction, or indeed conflict of jurisdictions, I do not conclude that this is of any assistance. In Akai Pty Ltd v Peoples Insurance Co Ltd [1998] 1 Lloyd’s Rep 90, Thomas J addressed the differences between the Australian and English courts so far as deciding the case was concerned, but in refusing to stay the English proceedings he was resting (at paragraph 100) upon the existence of a “freely negotiated choice of law and jurisdiction” (my underlining), so that the English court “should not as a matter of comity give effect to the decision of the (Australian) court that overrode that bargain and that choice”. In Shell International Petroleum Co Ltd v Coral Oil Co Ltd [1999] 1 Lloyd’s Rep 72, Moore-Bick J certainly emphasised the desirability of holding the parties to their agreement, pointing out that the Lebanese court would apply a rule of Lebanese law contrary to the parties’ agreement, but this was within the confines of dealing with a contract with an exclusive jurisdiction clause: he was saying that, far from there being strong reasons for not granting an injunction, there were strong reasons for doing so (at 78) and the injunction in question was one to restrain a breach of the exclusive jurisdiction agreement.[44]Finally in OT Africa Line v Magic Sportswear[2005] 2 Lloyd’s Rep 170, a case which also involved addressing the fact that the Hamburg Rules would be applied in Canada, in refusing a stay the Court of Appeal (per Rix LJ), while referring to the importance of the role of the proper law of the contract, enforced the exclusive jurisdiction clause (paragraph 81).[45]It is entirely clear that all the cases referred to by Mr Collett as in some way supporting his proposition that there is a public policy of the English forum to protect its jurisdiction, where a foreign court would not apply the English proper law of the contract, are in fact based upon standard principles of enforcement of a contractual exclusive or other jurisdiction clause. There is nothing which supports any exception to the general rule enunciated by Toulson LJ in Deutsche Bank and Rix LJ in Star Reefers.[46]In any event none of his authorities support his proposition that there is a secondary argument for protection of an alleged public policy in favour of the Hague or Hague-Visby Rules. Certainly no such case appears to have been argued (even as a fall back) in the OT Africa case. I do not consider that the statutory incorporation in the 1971 Act of the Hague Visby Rules (or the fact that the United Kingdom is not a party to the Hamburg Rules) either creates a separate matter of public policy or in some way elevates a contractual provision for English law which would incorporate the Hague Rules into a kind of contractual provision which creates an exception to the principles discussed above that an English law clause, unprotected or unaccompanied by an English jurisdiction clause, does not ensure an English forum; not to speak of turning a choice of another appropriate forum into unconscionable conduct, or conduct evasive of English public policy. In my judgment, comity does not countenance such an argument, and the only way to achieve what the Claimant would now seek would be to ensure that an English jurisdiction clause was incorporated into the relevant Bills of Lading and/or the relevant Charter-Party, such as was an arbitration clause in relation to the Lomé Bill.[47]I accordingly resolve Issue 6 in favour of the Defendants, and refuse the application for an anti-suit injunction. This effectively means that, absent agreement between the parties, there will regrettably be three on-going sets of proceedings, the arbitration proceedings in relation to the Lomé Bill and the Moroccan and English proceedings in relation to the other two Bills. It plainly leaves open the possibility, subject to what may happen hereafter, of an application, if the Claimant were to obtain judgment in these proceedings, for a post-judgment injunction.

Ms Wells new argument

[48]Almost at the close of the hearing, in her reply, Ms Wells raised a new argument, by reference to a construction of the General Paramount Clause, which I have set out in paragraph 11 above. She submitted that in relation to the second sentence, the words “corresponding legislation” would mean the legislation in the country of destination incorporating rules relating to the contract of shipment; so that if, as is the case, the country of destination (Morocco) imposed by legislation the Hamburg Rules, that is “corresponding legislation”, such that the Hamburg Rules would apply in this case at least in relation to the shipment from Gabon, where there is no enactment of the Hague Rules. This interpretation is vigorously resisted by Mr Collett, whom I permitted to put in written submissions after the hearing (responded to by Ms Wells). He submits that “corresponding legislation” means nothing of the kind. The clause plainly says that the Hague Rules “as enacted in the country of shipment” applies to the Bill of Lading. If they are not enacted in the country of shipment, then the “corresponding legislation”, namely legislation enacting the Hague Rules, will apply if they are enacted in the country of destination, and if not then the Hague Rules apply in any event. Hence, he submits, the General Paramount Clause is regarded, even without spelling out its content, as a clause which incorporates the Hague Rules (see The Agios Lazarus [1976] 2 Lloyd’s Rep 47 and Seabridge Shipping AB v AC Orssleff's Eftf's A/S [1999] 2 Lloyd's Rep 685, the only issue having been what the impact of this would be on the Hague-Visby Rules, a point that would not apply in this case because the Hague-Visby Rules are separately provided for in the Bills of Lading.[49]The reason why this belated argument was put forward by Ms Wells, as she makes clear in her responding submissions is that “there is no public policy justification for the English court to restrain the Moroccan proceedings”. I have already so concluded, even without her new argument.[50]The authorities to which both counsel refer are not limited to those set out in paragraph 48 above, but include The Superior Pescadores [2014] 1 Lloyd’s Rep 660, and the Happy Ranger [2001] 2 Lloyd’s Rep 530 and [2002] 2 Lloyd’s Rep 357 (CA). Mr Collett says that he has searched a database containing decisions from 60 common law jurisdictions, which did not reveal any case in which it had even been argued that a Paramount Clause (in any form) incorporated the Hamburg Rules into a bill of lading.[51]Mr Collett submits that in the (as he contends) unlikely eventuality of Ms Wells’s submissions being correct, then it would have a substantial impact upon all major P & I Club Rules, leading to the risk that many P & I Club Members would be exposed to the risk of being uninsured for cargo issues.[52]Whereas Ms Wells appears to rely upon the argument for the purpose of success on Issue 6, upon which she has now succeeded in any event, it seems to me possible that there would be, if her case were or could be right, arguments available to her also in relation to Issue 5, although not such in my judgment as to render it likely that the result before me would be any different. In any event, after taking into account, to a limited extent, the respective written submissions of counsel, I reach a provisional view that the arguments of Mr Collett are more likely to be correct. But I do not resolve them, not least because in my judgment further argument would be necessary before reaching a final conclusion, which is not required by virtue of the conclusion to which I have in any event come.

Conclusion

[53]I dismiss the Defendants’ application to set aside the English proceedings in relation to the Owendo and Takoradi Bills, but I decline to grant an anti-suit injunction in respect of the proceedings in Morocco. So far as concerns the Lomé Bill, I accept the Claimant’s case and reject the Defendants’: there will be London arbitration, which has already been commenced by the Claimant, and I grant an injunction restraining the Moroccan proceedings, in favour of that arbitration.

Cited in 1 later judgment