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Exemption clauses, including those purporting to exclude or limit liability for deliberate and repudiatory breaches, are to be construed by reference to the normal principles of contractual construction. There is no presumption in English law that exemption clauses do not apply to fundamental breaches. Nor is there a requirement for any particular form of words or level of language to exclude liability.Continue Reading Exemption clauses subject to contractual interpretation

BP GTCs 2007: Septo Trading Inc v Tintrade Limited [2021] EWCA Civ 718

Introduction

In Septo Trading Inc v Tintrade Limited ([2021] EWCA Civ 718) the Court of Appeal overturned a High Court decision ([2020] EWHC 1795 (Comm)) that a term in a trade recap which provided that an inspector’s results were “binding on the parties save for fraud or manifest error” was qualified by the BP 2007 General Terms and Conditions for FOB sales (the “BP GTCs 2007”). Our blog post on the High Court’s decision can be found here.  
Continue Reading Court of Appeal clarifies that term in trade recap stating that certificate of quality is final and binding is not qualified

In CVLC Three Carrier Corp and Anor v Arab Maritime Petroleum Transport Company ([2021] EWHC 551 (Comm)), Reed Smith (Nick Austin, Charles Weller, Alfred Perkins, Vassilis Mavrakis) represented two shipowning companies in successfully overturning an arbitration award which held that there was an implied term in a performance guarantee that the beneficiary would not seek further security beyond that created by the guarantee itself, thus protecting the guarantor’s vessels from arrest.
Continue Reading Performance guarantees, vessel arrests, and implied terms

On 19 February 2021 the Supreme Court delivered its very first judgment in relation to a collision action.  While the Supreme Court was only established in 2009, it is almost half a century since the highest appellate court in England and Wales has decided such a matter.  In this eagerly anticipated decision, the Court had to consider the application of the International Regulations For Preventing Collisions At Sea 1972 (the ‘COLREGS’), in relation to a collision between the 7.030 TEU container ship Ever Smart and the laden 153,044 DWT VLCC Alexandra 1 off the dredged access channel to Jebel Ali in the late evening of 11 February 2015.
Continue Reading Smart as ever, the Supreme Court provides clarity on the crossing rules

Reed Smith (Charles Weller and Nick Wright) recently acted for the successful claimants (“WFS”) in two in rem claims against cruise ships “Columbus” and “Vasco da Gama”.  The claims derived from WFS providing multiple bunker stems to the cruise ships, for which WFS remained unpaid.

The decision of the Admiralty court provides useful guidance on recovery under secondary contractual obligations in a claim for the supply of necessaries to a ship.
Continue Reading Trans-Tec International SRL, World Fuel Services (Singapore) Pte Ltd v the“Columbus” and the “Vasco da Gama” [2020] EWHC 3443 (Admlty)

At a glance: the words “CLEAN ON BOARD” and “SHIPPED in apparent good order and condition” in a draft bill of lading presented to the Master for signature, were merely an invitation by the shippers to the Master to make those representations in accordance with his own assessment.

Our previous briefing on this case can be found here.
Continue Reading The “Tai Prize” [2021] EWCA Civ 87: An invitation to the Master?

At a glance: In a recent judgment, the Commercial Court highlighted the difficulties that can arise of out of LoU wording in terms of arbitration agreements and extensions of time.

Background

The M/V Majesty was carrying 25,000 mt of rice under a voyage charterparty on an amended Synacomex 90 form. Five Bs/L were issued. The charterparty contained (a) a BIMCO arbitration clause; and (b) a bespoke arbitration clause (“CP Arbitration Clause”), although it was common ground between the parties that the Bs/L incorporated the bespoke CP Arbitration Clause rather than the BIMCO clause.
Continue Reading The “Majesty”: Cargo claims, LoUs, and the importance of clear cross-referencing

We have previously dedicated blog posts to so-called “No Oral Modification” or “NOM” clauses. You can find our previous post focusing on the Supreme Court judgment in MWB Business Exchange Centres v. Rock Advertising [2018] UKSC 24 here.

The validity of contractual modifications is a recurring theme in commercial disputes. A recent English Court of Appeal judgment in Kabab‑Ji S.A.L (Lebanon) v. Kout Food Group (Kuwait) [2020] EWCA Civ 6 considered this issue.

The NOM clause in Kabab‑Ji was not unlike clauses often seen in commercial contracts. It read as follows: “The Agreement may only be amended or modified by a written document executed by duly authorised representatives of both Parties”. The contract also imposed good faith and fair dealing obligations on the parties.

In the underlying arbitration proceedings, Kabab‑Ji claimed against KFG, a company which was not (originally) party to the agreement out of which the dispute arose. Kabab‑Ji argued that KFG had become party to the agreement even though the parties failed to follow the NOM procedure for amending the contractual terms.
Continue Reading No Oral Modification clauses

In a late 2020 judgment (Aegean Baltic Bank SA v Renzlor Shipping Ltd and Ors [2020] EWHC 2851 (Comm)), the High Court provided important guidance on the position of a bank under security documents relating to a loan agreement, and its obligations when exercising its rights as assignee to the insurance policies over a vessel. The case also highlights the intricacies of disputes involving multiple applicable laws, and the difficulties faced by a party in breach of its disclosure obligations and subject to an order pursuant to which they are not entitled to adduce or rely upon any factual or expert evidence.
Continue Reading Assignment of insurances: The secured lender’s obligation to obtain proper recovery