“In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.”
“In consideration of and upon the condition that you release and/or refrain from arresting and/or re-arresting or otherwise detaining [the Vessel] or any other vessel, asset, or other property in the same or associated ownership, management, or control to secure the above claim, we, the American Steamship Owners Mutual Protection and Indemnity Association, Inc., hereby undertake to pay you within (30) days of our receipt of your written demand, any such sums(s) that may be adjudged to be due to you in respect of [the alleged loss, shortage and/or damage to the Cargo] from the vessel and/or her owners, by a final, unappealable award of a London arbitration Tribunal, or as may be agreed between the parties and the undersigned Association, to be recoverable from the owners of the vessel, in respect of the said claim(s), provided that the total of our liability hereunder shall not exceed the sum of US$9,000,000 …including interest and costs.”
“Your clients presently hold an LOU issued by the American Club in the sum of US$9 million as security for a cargo claim allegedly arising in summer 2011. This claim has never been pursued by your clients. We can only assume that this is because they understand that there are no merits in the claim…. Our clients deny that they had any liability for the cargo damage. Brookes Bell were in attendance at Aqaba and we have their survey report confirming that there were no seaworthy issues with the vessel and, if there was cargo damage, it was not caused by the ship.”
“Other than the appointment of arbitrators, no steps have been taken in relation to the cargo claim. The proceedings are ripe for an application to strike out for want of prosecution.”
“We have spoken to cargo interests and we understand that they wish to transfer the file to us. However, we are waiting for written confirmation, but expect to have this shortly. In the meantime, my understanding is that [Dera] object in the strongest possible terms to any application for strike out. Irrespective of the condition of the cargo, it appears that Owners simply sailed off with the full cargo on board and sold it in a convenient (for them) jurisdiction, and that the proceeds of sale have not been accounted for to [Dera]. Instead, Owners appear to have pocketed the money on the basis of set off against an unascertained claim for demurrage/other expenses in achieving the sale.”
“We can therefore only conclude that the service of [Dera’s] Defence and Counterclaim on1st June 2015 had been prompted as alleged by the [Owners], by the service of [the Owners’] Claim Submissions on23rd March 2015 .”
“Given that, the outcome of the application before us is that the Cargo Claim which has been brought by [Dera] as a counterclaim in these proceedings has been struck out and has accordingly been extinguished, the [Owners] ha[ve] been successful and we see no reason to depart from the general principle that costs follow the event. We therefore award the [Owners] [their] costs in this reference and those costs shall be in the currency that they were billed rather that the United Sates dollars as sought by the [Owners].”
“(1) A party to arbitral proceedings may…apply to the court challenging an award in the proceedings on the ground of serious irregularity affecting the tribunal, the proceedings or the award. A party may lose the right to object (see section 73) and the right to apply is subject to the restrictions in section 70(2) and (3). (2) Serious irregularity means an irregularity of one or more of the following kinds which the court considers has caused or will cause substantial injustice to the applicant- a) failure by the tribunal to comply with section 33 (general duty of tribunal)…” a) failure by the tribunal to comply with section 33 (general duty of tribunal)…”
“A balance has to be drawn between the need for finality of the award and the need to protect parties against the unfair conduct of the arbitration. In striking this balance, only an extreme case will justify the Court’s intervention. Relief under s. 68 will only be appropriate where the tribunal has gone so wrong in its conduct of the arbitration, and where its conduct is so far removed from what could reasonably be expected from the arbitral process, that justice calls out for it to be corrected.”
“Unless otherwise agreed by the parties, a party to arbitral proceedings may…appeal to the court on a question of law arising out of an award made in the proceedings.”
“(3) If the tribunal is satisfied that there has been inordinate and inexcusable delay on the part of the claimant in pursuing his claim and that the delay- (a) gives rise, or is likely to give rise, to a substantial risk that it is not possible to have a fair resolution of the issues in the claim, or (b) has caused, or is likely to cause, serious prejudice to the respondent, the tribunal may make an award dismissing the claim.” the tribunal may make an award dismissing the claim.”
“…where parties agree or are otherwise subject to a limitation period such as one year, so much shorter than the period of six years which would otherwise apply, it is clearly contemplated that the parties will or ought to proceed with litigation with that dispatch and promptitude inherent in the relevant time scale.”
“It is usually inappropriate for an award dismissing the claim to be made within the applicable limitation period, because the delay is usually not regarded as ‘inordinate’ until the limitation period has expired, and the claimant would be free in any event to start another arbitration: see TAG Wealth Management v West, which stands as the only reported authority on section 41(3), and where Aikens J (as he then was) appears to have assumed as correct that it would be wrong for a tribunal to dismiss a claim for want of prosecution where the limitation period had not expired….In our view, the corollary of the principle accepted in TAG Wealth Management is that, once the limitation period has expired, the delay is much more easily classifiable as inordinate; the question becomes whether it is inexcusable, which is for the tribunal to determine on the facts, if an application is made to dismiss the claim.”
“Inordinate means “excessive”
“what is or is not inordinate delay must depend upon the facts of each particular case”
“…As Professor Michael Sturley noted (in “The History of COGSA and the Hague Rules”) (1991) 1 JMLC 1 at 23-24) the time of suit provisions were “the cargo interests’ other big victory” at the Hague Conference, their effect being seen as “guaranteeing a cargo claimant a full year in which to bring suit”.”
“In my opinion the argument is unsound. It was well settled before the Act that an unjustifiable deviation deprived a ship of the protection of exceptions. They only applied to the contract voyage. If it had been the intention of the legislature to make so drastic a change in the law relating to contracts of carriage of goods by sea, the change should and would have been enacted in clear terms.”
“In my view, it is not right to say that the law prohibits and nullifies a clause exempting or limiting liability for a fundamental breach or breach of a fundamental term. Such a rule of law would involve a restriction on freedom of contract and in the older cases I can find no trace of it. In each case not only have the terms and scope of the exempting clause to be considered but also the contract as a whole. In the cases I have cited above, I think that, on construction of the contract as a whole, it is apparent that the exempting clauses were not intended to give exemption from the consequences of the fundamental breach.”
“…I am convinced that, with the possible exception of Lord Upjohn whose critical passage, when read in full, is somewhat ambiguous, their Lordships [in Suisse Atlantique], fairly read, can only be taken to have rejected those suggestions for a rule of law which had appeared in the Court of Appeal and to have firmly stated that the question is one of construction, not merely of course of the exclusion clause alone, but of the whole contract… I do not think that I should be conducing to the clarity of the law by adding to what was already too ample a discussion a further analysis which in turn would have to be interpreted. I have no second thoughts as to the main proposition that the question whether, and to what extent, an exclusion clause is to be applied to a fundamental breach, or a breach of a fundamental term, or indeed to any breach of contract, is a matter of construction of the contract. Many difficult questions arise and will continue to arise in the infinitely varied situations in which contracts come to be breached - by repudiatory breaches, accepted or not, by anticipatory breaches, by breaches of conditions or of various terms and whether by negligent, or deliberate action or otherwise. But there are ample resources in the normal rules of contract law for dealing with these without the superimposition of a judicially invented rule of law. I am content to leave the matter there with some supplementary observations.”
“The doctrine of "fundamental breach" in spite of its imperfections and doubtful parentage has served a useful purpose. There was a large number of problems, productive of injustice, in which it was worse than unsatisfactory to leave exception clauses to operate. Lord Reid referred to these in the Suisse Atlantique case [1967] 1 A.C. 361, 406, pointing out at the same time that the doctrine of fundamental breach was a dubious specific. But since then Parliament has taken a hand: it has passed theUnfair Contract Terms Act 1977 . This Act applies to consumer contracts and those based on standard terms and enables exception clauses to be applied with regard to what is just and reasonable. It is significant that Parliament refrained from legislating over the whole field of contract. After this Act, in commercial matters generally, when the parties are not of unequal bargaining power, and when risks are normally borne by insurance, not only is the case for judicial intervention undemonstrated, but there is everything to be said, and this seems to have been Parliament's intention, for leaving the parties free to apportion the risks as they think fit and for respecting their decisions. At the stage of negotiation as to the consequences of a breach, there is everything to be said for allowing the parties to estimate their respective claims according to the contractual provisions they have themselves made, rather than for facing them with a legal complex so uncertain as the doctrine of fundamental breach must be. What, for example, would have been the position of the respondents' factory if instead of being destroyed it had been damaged, slightly or moderately or severely? At what point does the doctrine (with what logical justification I have not understood) decide, ex post facto, that the breach was (factually) fundamental before going on to ask whether legally it is to be regarded as fundamental? How is the date of "termination " to be fixed? Is it the date of the incident causing the damage, or the date of the innocent party's election, or some other date? All these difficulties arise from the doctrine and are left unsolved by it.”
“I must add to this, by way of exception to the decision not to "gloss" the Suisse Atlantique [1967] 1 A.C. 361 a brief observation on the deviation cases, since some reliance has been placed upon them, particularly upon the decision of this House in Hain Steamship Co. Ltd. v. Tate and Lyle Ltd. (1936) 155 L.T. 177 (so earlier than the Suisse Atlantique) in the support of the Harbutt doctrine. I suggested in the Suisse Atlantique that these cases can be regarded as proceeding upon normal principles applicable to the law of contract generally viz., that it is a matter of the parties' intentions whether and to what extent clauses in shipping contracts can be applied after a deviation, i.e., a departure from the contractually agreed voyage or adventure. It may be preferable that they should be considered as a body of authority sui generis with special rules derived from historical and commercial reasons. What on either view they cannot do is to lay down different rules as to contracts generally from those later stated by this House in Heyman v. Darwins Ltd. [1942] A.C. 356.”
“The doctrine is said to be based on the fact that goods insured for a voyage were uninsured when the ship was off the voyage route; this might also in former times have been true of the ship, which might be insured together with its cargo. Nowadays it seems that by virtue of “held covered” clauses and other provisions this would no longer be so, and it seems that ships are more likely to be insured on a time basis. In any case, this explanation would explain the displacement of the excepted perils, but not that of other clauses.”
“…the carrier and the ship shall in any event be discharged from all liability whatsoever in respect of the goods, unless suit is brought within one year of their delivery or of the date when they should have been delivered. This period may, however, be extended if the parties so agree after the cause of action has arisen.”
“Mr Nicholls relies on a passage in the current edition of Scrutton at page 167: “The effect of deck stowage not so authorised will be to set aside the exceptions of the charter or bill of lading, and to render the shipowner liable under his contract of carriage for damage happening to such goods.”
“I have no second thoughts as to the main proposition that the question whether, and to what extent, an exclusion clause is to be applied to a fundamental breach, or a breach of a fundamental term, or indeed to any breach of contract, is a matter of construction of the contract.”
“…It provides that the carrier shall in any event be discharged from all liability whatsoever unless suit is brought within one year. This is even wider language than the old Article III rule 6, which omitted the word “whatsoever”
“…However, the seriousness of the breach is no longer a self-sufficient yardstick for determining whether exception or limitation clauses apply to particular breach. The doctrine of fundamental breach or breach of a fundamental term was discredited in Suisse Atlantique…and given its formal burial in Photo Production…which decided that the question whether particular clauses applied to excuse or limit liability was solely a matter of construction of the contract. But the doctrine of fundamental breach never sprang fully fledged from the heads of Judges in the middle years of the last century; it had a respectable commercial origin in the 19th century cases relating to “serious” breaches of contract such as deviation from the contractual voyage and storing goods in a warehouse other than that originally agreed. It has not yet been conclusively decided whether what I may call the deviation cases and the warehouse cases must be regarded as dead and buried along with the doctrine of fundamental breach….”
“….the Hague Rules are an international Convention…to be construed on broad principles of general acceptation…. It may be difficult to know in any given case what “broad principles of general acceptation” are to prevail over domestic principles but the approach must be very relevant where it is sought to rely on the peculiarly common law principle derived from the deviation cases. This is not an appropriate case to decide whether what Lord Wilberforce called “a body of authority sui generis with special rules” … is consistent with the law as expounded in the Photo Production case. It is, however, on any view a peculiar creature of the common law. Although it appears to have been received into the United States and, indeed, to have been extended to apply to cases of carriage on deck in breach of contract, it cannot be described as a “broad principle of general acceptation” …. It is a question of some controversy whether they now exemplify even a principle of English law.”
“…in the light of his rejection of the “deviation” argument, I doubt if the conclusion would have been different, if the question had arisen under the old form of the rule…”
“in commercial matters generally, when the parties are not of unequal bargaining power, and when risks are normally borne by insurance… there is everything to be said, and this seems to have been Parliament's intention, for leaving the parties free to apportion the risks as they think fit and for respecting their decisions”
“It was held in The Kapitan Petko Voivoda that these words [i.e. the words “in any event”] indicate that as a matter of interpretation the package or unit limitation applies even where the goods are wrongfully stowed on deck, which can be regarded as a form of deviation, and the reasoning is clearly intended to apply to the time bar also. Whether it also applies to traditional geographical deviation by the vessel was not decided. But the emphasis on the significance of the words “in any event” in both provisions suggests that it does. The reasoning is stronger under the Hague-Visby Rules, because they have the “force of law”
“It remains to be seen whether it would apply in the case of a true geographical deviation… which as a matter of law gives the right to the bill of lading holder to treat the contract of carriage as repudiated and deprives the carrier of the benefit of the contract exceptions, unless the deviation is waived. Since the doctrine of deviation is understood to displace the contract of which Article III rule 6 forms a part, it may be thought that the breadth of formulation of the rule should not be material. However, the tenor of modern judicial and academic opinion seems to favour retaining the Hague Rules protection even in the case of such deviation. The precise analytical basis is not clear; it may be that terms relating to claims procedures are not abrogated in the same way as exceptions clauses or other clauses germane to the loading, carriage and delivery of the goods. There may in any event be a significant difference in this respect between the application of the Hague Rules and the Hague-Visby Rules.”
“In the past the significance of classifying the breach as fundamental was that, if the innocent party chose to terminate the contract, he was able to avoid any clauses excluding or limiting liability. The controversial question is whether that fundamental breach doctrine still applies to deviation cases even though its use as a rule of law has otherwise been abolished by the House of Lords in the Suisse Atlantique caseand Photo Production Ltd v Securicor Ltd.Any breach, however serious, can now generally be excluded by an appropriately worded exclusion clause: whether it does so or not is a question of construction. On one view, the fundamental breach doctrine lives on in respect of deviation. This derives some support from dicta of Lord Wilberforce in the Photo Production case: ‘‘It may be preferable that [the deviation cases] should be considered as a body of authority sui generis with special rules derived from historical and commercial reasons’’.If this view prevails then where the charterer or goods-owner elects to terminate the contract for deviation, he can claim the delivery of his goods, and since the exceptions contained in the contract are inapplicable, the shipowner will be liable for any loss or damage which the goods may have sustained, unless he can show (1) that the loss or damage was occasioned either by the act of God, or by the King’s enemies, or by inherent vice of the goods, and (2) that the said loss or damage must equally have occurred even if there had been no deviation.And it is probably immaterial whether the loss or damage arises before, or during, the deviation, or after it has ceased.The alternative view is that the fundamental breach doctrine has been abolished even for deviation so that, where the charterer or goods-owner elects to terminate, the applicability of contractual exceptions clauses is a matter of construction. This view has been favoured by Lloyd and Longmore LJJ ‘‘the deviation cases should now be assimilated to the ordinary law of contract’’.It is likely to prevail.”
“It is submitted that the right course for the courts is to reject the English line of special authority even for geographical deviation; to regard the reasoning in Joseph Thorley Ltd v Orchis SS Co Ltd as superseded by that of the House of Lords in Hain SS Co Ltd v Tate & Lyle Ltd; and to redevelop the reasoning in the latter case (where the preoccupation at the time was with the significance of waiver) in accordance with the doctrine of discharge of contract by breach subsequently laid down by the House in Heyman v Darwins Ltd and Photo Production Ltd v Securicor Transport Ltd. This would emasculate the ancient doctrine, and any modern extensions it might be argued to have, but it is submitted that it is appropriate to do so. It would, as already stated, leave untouched established case law regarding the burden of proof in bailment and the interpretation of contract clauses; though where the Hague or Hague-Visby Rules apply, the wording of the time bar and package or unit limitations is already strong enough to resist the latter technique in this context.”
“…unless the Supreme Court were to overrule at least one previous decision of the House of Lords […For example, Hain Steamship Co Ltd v Tate and Lyle Ltd [1936] 2 All E.R. 597…] it is difficult to see how the deviation cases may be treated except as a body of substantive law with rules of its own.”
“…The facts of this case indicate that [Dera] was aware of its Cargo Claim from an early stage and this is supported by the fact that it filed an action against [the Owners] at the Aqaba Court of First Instance on12th September 2011 for the full value of the Cargo following the decision of the Jordanian Ministry of Agriculture to reject it…”
“Correction of award or additional award … (3) The tribunal may on its own initiative or on the application of a party- a) Correct an award so as to remove any clerical mistake or error arising from an accidental slip or omission or clarify or remove any ambiguity in the award,….” a) Correct an award so as to remove any clerical mistake or error arising from an accidental slip or omission or clarify or remove any ambiguity in the award,….”
“In addition to the powers set out in section 57 of the Act, the tribunal shall have the following powers to correct an award or to make an additional award: ii) The tribunal may on the application of a party give an explanation of a specific point or part of the award.” ii) The tribunal may on the application of a party give an explanation of a specific point or part of the award.”
“… (4) Delay which is inordinate is prima facie excusable…It is for the plaintiff to make out a credible excuse….”
“In conclusion, from the foregoing review of the evidence before the evidence before us, we have not been persuaded on a balance of probabilities that the Respondent has a credible excuse for its delay in pursuing its Cargo Claim or that the Claimant bore responsibility for such delay.”
“We were persuaded on a balance of probabilities that the Respondent does not have a credible excuse for its delay in pursuing its Cargo Claim or that the Claimant bore responsibility for such delay.”
“Following our decision that the Respondent did not have a credible excuse for not prosecuting the Cargo claim any earlier than it did, the burden of proof then shifted to the Claimant to show that the delay “has caused, or is likely to cause, serious prejudice to the Claimant” and/or “gives rise, or is likely to give rise, to a substantial risk that it is not possible to have a fair resolution of the issues in that claim.”
“….We can therefore only conclude that the service of its Defence and Counterclaim on1st June 2015 had been prompted as alleged by the Claimant, by the service of its Claim Submissions on23rd March 2015 .”
“MR AIKMAN: You are telling us that two and a half years beyond the expiry of the 12 months is not inordinate. We have to wonder why the claim wasn’t made to the insurance company. Unless of course, [there wasn’t a claim under the insurance policy].” iii) “MR AIKMAN: [What claim are they defending?] MR SEMARK: That brings me on to my next point. MR AIKMAN: [Is that none, there isn’t a claim they are defending?]”
“MR AIKMAN: Your view is noted.”
“MR MOCATTA: What does “inordinate” mean? It is not a word I normally use in normal conversation. MR ASWANI: Well, I say that “inordinate” has to, in this context, be judged by reference to the applicable limitation period….Now, I don’t suggest that the moment limitation expires it’s necessarily an inordinate delay. That would be putting it too highly. But it is a yardstick or a benchmark which any tribunal should have in mind as to whether the delay is inordinate, it has to be judged by reference to the applicable limitation period. MR MOCATTA: So if you have got the one-year time limit and nothing happens, you can’t say that’s inordinate. Do you then say, oh, well, let’s add another one year on top of that, so if nothing happens say within two years you can say that is inordinate? “in” implies a negative and “ordinate”, a coordinate, ordinate? It means extraordinary?…” b) Mr Mocatta and Mr Aikman explored at length the parties’ respective positions in relation to the delay: “MR MOCATTA: You’re saying two and a half years elapsed between November 2012, which is when the one-year time limit would have expired, and June 2015 when they finally served their counterclaim? MR SEMARK: Correct. But within that two and a half year period, there must be a further period where the delay cannot be inordinate, because the guillotine does not drop automatically on the expiry of the one-year period. It is not for me to tell you what that is. Nowhere in the case that has been presented to you, either in Mr Moore’s evidence or my learned friend’s submissions, has he tried to do that…. MR AIKMAN: Isn’t he trying to persuade us that two and a half years is inordinate? MR SEMARK: If he does try to persuade you on that – MR AIKMAN: Hasn’t he done that? Isn’t that the point? MR SEMARK: If that is his case, which don’t understand it to be – perhaps it is a point he would like to revisit in reply – it can’t be right because, as I said, a delay doesn’t suddenly become inordinate once the one-year Hague Rules time bar is up, because if that is right, then every single cargo claim which is particularised after expiry of a one-year period would be – MR AIKMAN: We have got past the one year, haven’t we? We have another two and half years. MR SEMARK: Yes, at some point in that two and a half years what my learned friend has to do is convince you that a period started which was inordinate. MR AIKMAN: isn’t it sufficient to say two and a half years is inordinate? … MR MOCATTA: Doesn’t it depend to a certain extent on the timing of the initiation of all this? In many of these cargo claims, the cargo is discharged. I don’t know, there are some surveys. The claim isn’t raised against the P&I Club or the owner until some time has elapsed after the discharge, despite that clause in the Hague Rules which says that have to give notice within seven days of something being wrong. So about a year later, this thing sort of may arise and sometimes, very often, the first you hear about it is a P&I Club man says, “They want an extension of time because the year is running out”. … “MR MOCATTA: Then you have another year. But in this case the cargo interests knew immediately what the problem was: the cargo disappeared. They went to court in Aqaba. They got anti-suit injunction. Then they knew what was going on in Turkey but they didn’t [do] anything about presenting their cargo claim apart from getting hold of a letter of indemnity from the American Club which didn’t actually result in the ship being able to sail. Then they did nothing. Then two and a half years later, in 2015 they put in their claim. So surely you could take part of that year – you say you exclude the year altogether, but surely if they know about it and they haven’t actually started anything you should be able to take that into consideration. I’m not saying that on day 366 you would say it was inordinate delay. But if it was 18 months, and nothing happened, and they knew about it from the beginning, that would seem to me to be excessive, where you haven’t even really raised your claim. MR SEMARK: Well, it depends. The yardstick against which it falls to be measured – how are other claims like this dealt with in the industry? Because inordinate must mean something inordinate in comparison to something else. MR MOCATTA: In my experience, if the cargo owner is saying, hey, the shipowner has sailed off with my cargo, it should start very quickly. They are not going to hang around. You are going to presumably try to follow the ship and try to arrest it at the next port it goes to. MR SEMARK: That’s to obtain security, yes, quite, which we did. MR MOCATTA: They got security and the ship still sailed. What I mean is, if they were really concerned that the owner had converted the cargo or taken it off without permission, wouldn’t they have tried to arrest the ship? You could follow ship movements relatively easily, go to a Turkish Court and say “This guy has walked off with my cargo, I beg you to intercede on my behalf”, but they didn’t do anything like that.” … “You’re saying what would we as claims handlers in P&I Clubs expect to happen in something. In a normal cargo claim it turns up on month 11, you give an extension, you try to find out as much as you can about it. Yes, you probably wouldn’t be able to argue about delay until at least another year had gone by but in this particular instance it is something immediate. They must know – they knew their cargo had disappeared.”
“MR ASWANI: …There are some serious issues in relation to what exactly the value of this cargo was, if indeed beyond zero, at Aqaba. The reasons I say there is a credible case it was zero is, if it is sitting there, no reasonable prospect of anything happening, in order to realise even$1 of value it has to go somewhere else if nothing can be done in Jordan. You have my submissions on that. MR AIKMAN: As a matter of interest, it is not uncommon for the price of this sort of cargo to rise during the summer, to reach peak in the autumn. This is what’s behind many of [these games] for some years.” b) Mr Aikman’s comment that “[there wasn’t a claim under the insurance policy]” was made during the course of submissions from Mr Semark for Dera on the question of why the cargo claim was not particularised earlier than it was. Mr Semark was seeking to rebut the suggestion (made by the Owners) that Dera was acting purely reactively in response to the Owners’ particularisation of its declaration claim in 2015. Mr Aswani sought to do so by pointing to Dera’s attempts, two years earlier (in 2013), to instruct a law firm to take forward the cargo claim on its behalf. Mr Aikman was seeking to find out whether Dera had also made a claim under its cargo insurance policy: “MR AIKMAN: One of the things the cargo interests were not doing, presumably they believed they had a claim against the owner under contract of carriage. MR SEMARK: That is my understanding. MR AIKMAN: For which they took out an insurance policy. MR SEMARK: Correct. MR AIKMAN: They did not issue an insurance claim and they did not allow the insurance company to take recovery action against the owners. MR SEMARK: That is an issue which has arisen during the course of the evidence given by Mr Bulbul. So it is not something on which we have had an opportunity to – MR AIKMAN: You know with such claims that’s the normal procedure. MR SEMARK: It is the normal procedure. But, as you also know, Mr Aikman, if an insurance company sees a way not to pay out on a claim, it will not do so. MR AIKMAN: One of the reasons it sees not to pay out on a claim is because it doesn’t fall under the policy. MR SEMARK: It doesn’t fall under the policy. One of the exclusions we were looking at yesterday is an exclusion for rejection of cover for where the loss or damage occurs by rejection by the Jordanian authority. I will show you what the evidence is later on. The evidence is that what Mr Bulbul senior was trying to do prior to the vessel leaving was to get the Jordanian authorities to reverse its decision. Now, I don’t know at this stage, because I haven’t seen the exchanges between the insurers and the owners, why it is precisely that a claim wasn’t made, but I don’t think it is safe to assume – MR AIKMAN: Do you see the difficulty for the tribunal? MR SEMARK: Well, you will have to explain that difficulty, sir. MR AIKMAN: You are telling us that two and a half years beyond the expiry of the 12 months is not inordinate. We have to wonder why the claim wasn’t made to the insurance company. Unless, of course, [there wasn’t a claim under the insurance policy].”
“So what you have to decide is, is that allegation which is contained in an unsigned witness statement of a witness who is not before you, and who obviously hasn’t been presented – this is another illogicality in my learned friend’s case, because of course I have produced a witness. You have had the opportunity to see my client give his evidence. The owners are on that side of the table. They haven’t produced any witness. Normally when an owner says “my ability to defend that claim has been prejudiced” you expect somebody from the owners to come and tell us. MR AIKMAN: [What claim are they defending?] MR SEMARK: That brings me on to my next point. MR AIKMAN: [Is that none, there isn’t a claim they are defending?] MR SEMARK: No, certainly not, sir. That brings me on to my next point.” (In this context Mr Semark also complained that the Tribunal had seen fit to rely on what was only an unsigned witness statement from Mr Bulut who had not come to give evidence. However, Mr Bulut’s absence (through ill health) and poor recollection substantiated the very prejudice of which Owners were complaining.); MR AIKMAN: [What claim are they defending?] MR AIKMAN: [Is that none, there isn’t a claim they are defending?] MR SEMARK: No, certainly not, sir. That brings me on to my next point.” d) Mr Mocatta and Mr Baker’s questions about the contents of the expert reports were asked during the course of submissions from Mr Semark in relation to those reports. Mr Semark was seeking to rebut the suggestion (made by the Owners) that the Owners had suffered prejudice through the lack of available evidence. Dera sought to do that by pointing out that these reports existed. Mr Mocatta and Mr Baker were simply making observations about what those reports said: “MR SEMARK: As far as Aqaba is concerned, well, of course we do have Captain Daniels’ own contemporaneous report. He was there. He will presumably be tendered as witness of fact at any hearing in which the company [sic] of the cargo in in issue. In obvious preparation for the defence of the claim, Captain Daniells sent all the samples he had taken to Salamon & Seaber for analysis in London. You see a synopsis of the analyses carried out by Salamon & Seaber on page 116 and the actual analysis reports are located in a cluster of documents that run from 117 all the way through to 140. Then at 141 we have photographs. They start with photographs of events at the loadport, again, obviously collected by Mr Daniells from presumably the vessel’s crew or somebody who took them during the course of loading operations. THE CHAIRMAN: Sorry, can I just pose one question in relation to the summary of Salamon & Seaber at page 116. When looking at the averages for holds 1 and 2, I think they were within the Jordanian specification. So it raises a question about why Dera didn’t seek to discharge at least the sound – well, sound within the Jordanian specification cargo. MR SEMARK: I am not sure and I don’t have instructions on this but I consider it to be unlikely that these were ever sent to us at the time. I can take instructions on that if you wish me to, but this is evidence which the owners – these certificates are address to Brookes Bell. So it is evidence that the owners collected. THE CHAIRMAN: I don’t know if they were shared with – MR SEMARK: I can take instructions. The answer is no, we didn’t see them at the time, according to Mr Bulbul. I agree, it might well have been useful if we had, but we didn’t. THE CHAIRMAN: I would have thought that the analysis of the government would have reflected a similar sort of range of values. MR SEMARK: Yes, one would have hoped so. But I think the reason we often send samples to Salamon & Seaber is the governments overseas are not always – MR MOCATTA: They don’t seem to show any signs of saltwater damage, those reports. I don’t know whether you would have expected them to. Moisture more or less within the 14 per cent acceptable limit.”
“MR SEMARK: I would ask you to bear this in mind: why has this reference not progressed since my clients sent their reply submission? It has not progressed for two reasons. First, the claimants alleged that my client’s time [sic] was barred by the orders made by the Turkish court. That was a transparently weak allegation which should never have been made. They alleged in their defence submissions. That was then followed almost a year later by an application for dismissal, and it has taken all that time since then to bring – before we have had a chance to resolve this matter. So when we are talking about delay in this reference, there has indeed been an extensive delay in this reference but it has not been one caused by my client’s actions, let alone culpable actions. MR MOCATTA: I’m sure [we all thought] that by doing preliminary points [we might be able to short-circuit and avoid a full cargo claim hearing], but judging by the amount of documentation produced, it is the same sort of size.”
“MR ASWANI: Yes. I fully accept there may be seasonal variations in price. Neither party has raised any suggestion that that’s an issue in this case. MR AIKMAN: Correct.”
“MR SEMARK: Well, it is Mr Bulbul’s evidence, as I understand it, that he has not to this date made a claim under the insurance policy. But you would have to ask yourself why that point would be relevant to your analysis of whether there has been an inordinate delay by my client in bringing his claim against the shipowners. Now, there may be any number of reasons why a claim hasn’t been made. One obvious reason why a claim may not have been made is because the policy wording that we looked at specifically excludes loss caused by rejection by the authorities, and we know that at the time the vessel had left Aqaba Mr Bulbul senior was attempting to persuade the authorities to reconvene a third inspection committee and reverse its previous decision to disallow the cargo in, but the vessel left before that step could be taken. So that may well explain why it is that a claim was not in fact made on the policy. But you can’t assume, from the fact that a claim wasn’t made under policy, that that necessarily meant that my client somehow thought he didn’t have a claim against the owners. MR AIKMAN: Except the fact that the cargo was disallowed the day after the vessel arrived. MR SEMARK: Well, there were two rejections of the cargo by the Jordanian authorities, and my client was in the process of trying to reverse that, as we will see. But my submission to you is that that is not a relevant consideration for you here. MR AIKMAN: Okay.”
“MR SEMARK: No, certainly not, sir.” d) Mr Mocatta and Mr Baker’s comments (“[They don’t seem to show any signs of saltwater damage, those reports]” and (“[When looking at the averages for holds 1 and 2, I think they were within the Jordanian specification. So it raises a question about why Dera didn’t seek to discharge at least the sound – well, sound within the Jordanian specification cargo.]”) were followed by: “MR SEMARK: That will no doubt be the argument advanced against me at the hearing on the merits. The question for us today is – MR MOCATTA: At which you will no doubt challenge Mr Daniel’s recollection of events on the basis of the lapse of time. MR SEMARK: This is essentially my point. The point for you today is not – emphatically clearly not – has my client proved its cargo claim. The application before you is to dismiss my client’s claim on the basis that it is no longer possible for the owners to get a fair resolution of it because their ability to defend the claim has been seriously prejudiced. When assessing the strength of that averment, it’s obviously a point for you, gentlemen, but you may carry out a preliminary assessment of what this evidence which the owners have collected shows and decide whether or not it is the sort of evidence which you might expect an owner to submit in defence of such a claim. If you are satisfied that the evidence does or will assist in the claim, then that is obviously a factor that you have to take into account in assessing whether or not to dismiss my client’s claim under section 41(3) because that is the only application for you today.” e) Mr Moccatta’s comments that “[we all thought] …[we might be able to short-circuit and avoid a full cargo claim hearing]” were followed by: “MR SEMARK: Yes, that is water under the bridge. But the only question for you now, sir – this is the point. There are two issues before you. One, is my client’s claim time barred by the order of the Turkish courts? I will take you very briefly if we have time to why the answer is no. But it should be very obvious to you from what Mr Guzel said yesterday. And, secondly, can the owners show that their ability to defend the claim has been seriously prejudiced by a culpable delay by my clients which is inexcusable?”
“In the LMAA Questionnaire [the Owner] proposed a preliminary issue on whether [Dera’s] cargo claim was time barred. When we explained in our e-mail of 10th March why the claim could not possibly be time barred, the proposal suddenly metamorphosed into a Preliminary Issue on whether [Dera’s] cargo claim should be struck out for delay. The tribunal has since allowed that Preliminary Issue in its order below, before we have commented on the matter (albeit we had two and a bit days to do so, before the tribunal made its order).”