FIFTEENTH ANNUAL INTERNATIONAL MARITIME LAW ARBITRATION

MOOT COMPETITION 2014

IN THE MATTER OF AN ARBITRATION HELD AT HONG KONG

MEMORANDUM FOR THE CLAIMANT

Reliable Tankers Incorporated

CLAIMANT

Super Charters Incorporated

RESPONDENT

TEAM 21

ASHLEY CHANDLER

MARTIN RUSTAM

SAMUEL WALPOLE

CHRISTINE YASSA

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TABLE OF CONTENTS

LIST OF AUTHORITIES .............................................................................................................................. iv STATEMENT OF FACTS .............................................................................................................................. 1

SUMMARY OF ARGUMENT ....................................................................................................................... 2 SUBMISSIONS ................................................................................................................................................ 3

A) PROCEEDINGS WERE VALIDLY COMMENCED BY THE CLAIMANT ON 28 JANUARY 2012 ....................... 3

The Claimant transferred its rights and liabilities by way of universal succession ................................... 3

In the alternative, there was a clear misnomer in the notice of commencement ....................................... 4

The proceedings are not time barred .......................................................................................................... 5

The Claimant provided notice of a claim pursuant to the Clause 4 of the Charterer’s Standard Terms 6

The Claimant commenced the claim pursuant to the time bar ............................................................... 7

B) THE PARTIES ARE BOUND BY THE SIGNED VOYAGE CHARTER DATED 19 NOVEMBER 2011 AND THE

TERMS CONTAINED THREIN ........................................................................................................................... 7

The parties are in agreement as to the charterparty to which they are bound ............................................ 7

Clause 2 of the Owner’s Standard Terms released both parties from further obligations and liabilities .. 8

Rectification of the Charterparty is not warranted ..................................................................................... 9

C) THE RESPONDENT IS LIABLE TO PAY THE CLAIMANT USD4,935,268.75 BY WAY OF FREIGHT, OR

DAMAGES IN THE SAME AMOUNT ................................................................................................................ 10

The Respondent is liable to pay freight pursuant to Clause 4 of the Claimant’s Standard Terms .......... 10

The Claimant’s right to freight accrued in full upon the lifting of subjects ........................................ 10

The Claimant’s right to freight survived the cancellation of the Charterparty .................................... 11

The Respondent is not entitled to set-off sums counterclaimed against freight .................................. 12

In the alternative, the Respondent is liable to pay freight by way of damages for breach of contract .... 13

Clause 2 of the Claimant’s Standard Terms did not release the Respondent from the obligation to pay

freight ....................................................................................................................................................... 13

Interest is owed on the sum of USD4,935,268.75, from 19 November 2011 .......................................... 13

D) THE RESPONDENT IS NOT ENTITLED TO DAMAGES FOR THE BREACHES ALLEGED .............................. 14

The Claimant was not in breach of any obligation which gave the Respondent a right to damages ....... 14

The Claimant commenced the approach voyage at such a time as to enable the Vessel to meet the

laycan ................................................................................................................................................... 14

The Claimant proceeded with convenient dispatch ............................................................................. 15

The failure by the Claimant to meet the laycan does not give the Respondent a right to damages ..... 15

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Alternatively, the exclusion clauses contained in the Charterparty exempt the Claimant from liability

for loss or damage .................................................................................................................................... 15

Where the approach voyage has commenced, the Claimant can rely on the exclusions clauses in the

Charterparty ......................................................................................................................................... 15

Both exclusion clauses in the Charterparty have effect ....................................................................... 16

The Asbatankvoy Exclusion Clause excludes the Claimant’s liability for direct loss or damage ....... 16

The Claimant’s Standard Exclusion Clause excludes the Claimant’s liability for consequential loss or

damage ................................................................................................................................................. 17  

RELIEF SOUGHT ........................................................................................................................................ 18

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LIST OF AUTHORITIES CASE LAW A.E. Potts v Union Steamship [1946] NZLR 27 A/S Gunnstein & Co K/S v Jensen, Krebs and Nielsen (The “Alfa Nord”) [1977] 2 Lloyd’s Law Rep 434 Adams v National Bank of Greece SA [1961] AC 255 Adre & Cie SA v Orient Shipping (Rotterdam) BV (The “Laconian Confidence”) [1997] 1 Lloyd’s Rep Allison v Bristol Marine Insurance Co 111 (1875) 1 AC 209 AMB Generali Holding AG Manches Sprecher Grieg Halberstam Portner & Jaskel v SEB Trygg Liv Holding Aktiebolag Merrifield [2006] 1 Lloyd’s Rep 318 Antaios Compania Naviera SA v Salen Rederierna AB (The “Antaios”) [1985] AC 191 Aries Tanker Corporation v Total Transport Ltd (The “Aries”) [1977] 1 WLR 185 Bank of Boston Connecticut v European Grain and Shipping Ltd (The “Dominique”) [1989] AC 1056 Barker v Windle (1856) 18 CB (NS) 759 Bayoil SA v Seawind Tankers Corporation (The “Leonidas”) [2001] 1 Lloyd’s Rep 533 Baytur SA v Finagro Holding SA [1992] 1 Lloyd’s Rep 134 British Westinghouse Electric and Manufacturing Co v Underground Electric Railways Co [1912] AC 673 Cathiship SA v Allanasons Ltd (The “Catherine Helen”) [1998] 2 Lloyd’s Rep 511 Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101 Cheikh Boutros Selim El-Khoury v Ceylon Shipping Lines Ltd (The “Madeleine”) [1967] 2 Lloyd’s Rep 224 Cleobulos Shipping Co Ltd v Intertanker Ltd (The “Cleon”) [1983] 1 Lloyd’s Rep 586 Colonial Bank v European Grain and Shipping Ltd (The “Dominique”) [1987] 1 Lloyd’s Rep 239 Croudace v Cawood [1978] 2 Lloyd’s Rep 55 Elena Shipping Ltd v Aidenfield Ltd (The “Elena”) [1986] 1 Lloyd's Rep 425 Ellis Shipping Corporation v Voest Alpine Intertrading (The “Lefthero”) [1991] 2 Lloyd’s Rep 599 Eurosteel Ltd v Stinnes AG [2000] CLC 470 Eversa SA Commercial v North Shipping Co Ltd [1956] 2 Lloyd’s Rep 367 Front Carriers Ltd v Atlantic and Orient Shipping Corporation (The “Double Happiness”) [2007] 2 Lloyd’s Rep 131

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Glynn v Margetson & Co [1893] AC 351 Great Peace Shipping Co Ltd v Tsavliris Salvage (International) Ltd [2003] QB 679 Hadley v Baxendale (1854) 156 ER 145 Harper Versicherungs AG v Indemnity Marine Assurance Co Ltd [2006] 2 Lloyd’s Rep 263 Harrison v Garthorne (1872) 26 LT (NS) 508 Homburg Houtimport BV v Agrosin Private Ltd (The “Starsin”) [2003] 1 Lloyd’s Rep 571 Hudson v Hill (1874) 43 LJCP 273 Internaut Shipping v Fercometal (The “Elikon”) [2003] 2 Lloyd’s Rep 430 Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 All ER 98 Marbienes Compania Naviera SA v Ferrostaal AG (The “Democritos”) [1976] 2 Lloyd’s Rep 149 Millar’s Machinery Co Ltd v David Way and Son (1935) 40 Com Cas 240 Monroe v Ryan [1935] 2 KB 28 National Bank of Greece and Athens SA v Metliss [1958] AC 509 Pagnan v Tadax Ocean Transportation [1987] 2 Lloyd’s Rep 342 President of India v Hariana Overseas Corporation (The “Takafa”) [1990] 1 Lloyd’s Law Rep 536 Red Sea Tankers Ltd and Others v Papchristidis (The “Hellespont Ardent”) [1997] 2 Lloyds Rep 547 Republic of Kazakhstan v Istil [2006] 2 Lloyd’s Rep 370 Saint Line v Richardsons Westgarth & Co Ltd [1940] 2 KB 99 SEB Trygg Holding AG Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129 Smith v Dart & Son (184) 14 QBD 105 Swainland Builders Ltd v Freehold Properties Ltd [2002] 2 EGLR 71 Transworld Oil Ltd v North Bay Shipping Corporation (The “Rio Clara”) [1987] 2 Lloyd’s Law Rep 173 Unisys International Services Ltd v Eastern Counties Newspapers Ltd [1991] 1 Lloyd’s Rep 538 Vagres Compania Maritima SA v Nissho-Iwai American Corporation (The “Karin Vatis”) [1988] 2 Lloyd’s Rep 330 LEGISLATION Arbitration Act 1996 (UK)

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BOOKS Clare Ambrose and Karen Maxwell, London Maritime Arbitration (Informa, 3rd edition, 2009) David Joseph QC, Jurisdiction and Arbitration Agreements and their Enforcement, (Sweet & Maxwell, 2nd ed, 2010) David St John Sutton, Judith Gill and Matthew Gearing, Russell on Arbitration (Sweet & Maxwell, 23rd ed, 2007) John F Wilson, Carriage of Goods by Sea (Pearson Education Limited, 7th ed, 2010) Julian Cooke et al, Voyage Charters (Informa, 3rd ed, 2007) Kim Lewison, Interpretation of Contracts (Sweet & Maxwell, 2nd ed, 2004)

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STATEMENT OF FACTS THE PARTIES AND THE CHARTER AGREEMENT Reliable Tankers Incorporated (‘the Claimant’), agreed to charter the Reliable Butterfly (‘the Vessel’), to

Super Charters Incorporated (‘the Respondent’) on 19 November 2011. The agreement was in the form of a

fixture recap on an amended ASBATANKVOY form with rider clauses (‘the Charterparty’). Pursuant to

the Charterparty, the Vessel’s laycan was 5 December 2011.

VESSEL’S ARREST AND LAYCAN

The Vessel sailed Orangeland on 16 November 2011 and by 22 November 2011 had arrived at the Redland

bunker port where it was arrested by a third party. Consequently, the Vessel could not meet its laycan. Upon

the Respondent receiving notice of same, it invoked Clause 2 of the Owner’s Standard Terms (‘the

Cancellation Clause’).

CANCELLATION

The Charterparty was cancelled on 27 November 2011. On 28 November, the Claimant confirmed the

cancellation. On 29 November, the Respondent engaged two Suezmaxes to complete the voyage.

MERGER BY UNIVERSAL SUCCESSION

In late 2011, Reliable Tankers Incorporated merged by way of universal succession with Reliable Holdings

Incorporated, with Reliable Holdings Incorporated being the surviving entity.

COMMENCEMENT OF ARBITRAL PROCEEDINGS

On 28 January 2012, the Claimant referred the dispute to arbitration. On 12 February 2012, the Respondent

rejected the validity of the Claimant’s referral on the basis that the Claimant no longer existed. On the same

date the Respondent made its own reference to arbitration. Submissions were filed by the Claimant on 14

March 2012, and subsequently by the Charterers.

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SUMMARY OF ARGUMENT This arbitration concerns a dispute between Reliable Tankers Incorporated (‘the Claimant’) and Super

Charters Incorporated (‘the Respondent’) in respect of a voyage charter of the MT ‘Reliable Butterfly’.

Having merged with Reliable Holdings Incorporated in late 2011, the Claimant validly commenced

proceedings against the Respondent on 28 January 2012. The Claimant contends that the use of an out-dated

header on the Notice of Commencement was a simple administrative error or a mere misnomer that did not

invalidate the commencement of proceedings. The parties are bound by the amended ASBATANKVOY

form with rider clauses dated 19 November 2011 (‘the Charterparty’). Clause 2 of the Owner’s Standard

Terms released both parties from further obligations and liabilities upon the Respondent’s cancellation of the

charter on 27 November 2011. This clause should not be rectified as the alternative construction asserted by

the Respondent is identical. Notwithstanding the Respondent’s cancellation of the Charterparty, the

Claimant is entitled to USD4,935,286.75 by way of freight, or damages in the same amount. The Claimant

was not in breach of any obligation under the Charterparty. Alternatively the exclusion clauses exempt the

Claimant from liability. In the premises, the Tribunal should not award the Respondent damages.

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SUBMISSIONS

A) PROCEEDINGS WERE VALIDLY COMMENCED BY THE CLAIMANT ON 28 JANUARY 2012

The Claimant transferred its rights and liabilities by way of universal succession

1. The Civil Law doctrine of universal succession provides for the transfer of rights and obligations from

one entity to another without notice.1 The substantive law of the company’s domicile governs the

process and validity of a company’s succession.2 English law will recognise the effect of universal

succession conducted pursuant to the company’s domicile law.3

2. Under English law, the law of the forum, 4 the Claimant was under no obligation to provide notice of

succession to the Respondent. The provision of notice to parties to a contract and the arbitral tribunal

itself need only be provided where succession occurs after the commencement of arbitration

proceedings5 or the issuing of an award or partial award.6 The present dispute is not analogous as the

admitted evidence indicates that the Vessel’s owner, Reliable Tankers Inc, transferred its rights and

liabilities to Reliable Holdings Inc in December 2011,7 well before the commencement of arbitration

proceedings on 28 January 2012.8 The admitted expert evidence confirms that the substantive law of

Fruitland, the Claimant’s country of domicile, recognises the doctrine of universal succession. This

doctrine governed the transfer of rights and liabilities,9 and did not require the provision of notice to

contractual counter-parties.10

3. Upon completion of the merger, Reliable Holdings Inc automatically became subject to all rights,

property, liabilities, obligations and penalties accrued by Reliable Tankers Inc.11 In the premises, as

1 David St John Sutton, Judith Gill and Matthew Gearing, Russell on Arbitration (Sweet & Maxwell, 23rd ed, 2007) [3-016]; David Joseph QC, Jurisdiction and Arbitration Agreements and their Enforcement, (Sweet & Maxwell, 2nd ed, 2010) [7.27]. 2 Eurosteel Ltd v Stinnes AG [2000] CLC 470, 474 (Longmore J); National Bank of Greece and Athens SA v Metliss [1958] AC 509, 524-525 (Viscount Simonds). 3 SEB Trygg Holding Aktiebolag v Macnhes [2005] 2 Lloyd’s Rep 129, 134 (Gloster J); National Bank of Greece and Athens SA v Metliss [1958] AC 509, 524-525 (Viscount Simonds), 529-530 (Lord Tucker); Adams v National Bank of Greece SA [1961] AC 255, 276 (Viscount Simonds), 280 (Lord Reid); Eurosteel Ltd v Stinnes AG [2000] CLC 470. 4 Facts, p 49: Recap; Eurosteel Ltd v Stinnes AG [2000] CLC 470, 474, 476 (Longmore J); Baytur SA v Finagro Holding SA [1992] 1 Lloyd’s Rep 134, 151 (Lloyd LJ); SEB Trygg Holding Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129, 140-141 (Gloster J). 5 Baytur SA v Finagro Holding SA [1992] 1 Lloyd’s Rep 134. 6 Republic of Kazakhstan v Istil [2006] 2 Lloyd’s Rep 370, 378 (Steel J). 7 Facts, p 100: ‘Shipping Whispers’ article. 8 Facts, p 101: Claimant’s notice of appointment. 9 Facts, p 113: Expert Report of Tim Bowman; Eurosteel Ltd v Stinnes AG [2000] CLC 470, 474 (Longmore J). 10 Facts, p 113: Expert Report of Tim Bowman. 11 Facts, p 113: Expert Report of Tim Bowman.

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proceedings had not yet commenced, the Tribunal should find that the successor company was under no

strict requirement to provide notice of its merger to the Respondent in order to perfect the merger.

4. In the alternative, the Tribunal should find that the Respondent did receive notice of the Claimant’s

merger. In the absence of admitted evidence of express notification from the Claimant, the Respondent

should be taken to have received constructive or implied notice of the merger by virtue of commercial

knowledge and sensibilities and the disclosure of the merger into the public record by way of a

newspaper article dated 3 January 2012.12

5. In any event, the Tribunal should imply receipt of notice by way of the Respondent’s rejection of the

Claimant’s notice of commencement dated 12 February 2012 on the grounds that ‘Reliable Tankers no

longer exists as an entity’.13

In the alternative, there was a clear misnomer in the notice of commencement

6. The Tribunal is to make an objective determination, by reference to the notice of commencement and the

surrounding circumstances,14 as to whether the identity of the party commencing arbitration was clear

and was simply subject to an error in naming,15 or whether there was an intentional decision to

commence proceedings in the name of a non-existent entity.16 The question to be asked is ‘who would

reasonably have been understood by the party against whom the claim was asserted to be the entity

bringing the claim?’17

7. The Tribunal should find that upon receipt of the Claimant’s notice of appointment dated 28 January

2012,18 the Respondent was not under a misapprehension as to the identity of the party commencing

arbitration. Notwithstanding the subsequent merger of the owner company, the 28 January notice of

12 Facts, p 100: ‘Shipping Whispers’ article. 13 Facts, p 102: Respondent’s rejection of letter of commencement. 14 SEB Trygg Holding AG Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129, 139 (Gloster J); Unisys International Services Ltd v Eastern Counties Newspapers Ltd [1991] 1 Lloyd’s Rep 538, 550-551, 558-562 (Gibson LJ); Front Carriers Ltd v Atlantic and Orient Shipping Corporation (The “Double Happiness”) [2007] 2 Lloyd’s Rep 131, 137 (Langley J); Harper Versicherungs AG v Indemnity Marine Assurance Co Ltd [2006] 2 Lloyd’s Rep 263, 275, 277 (Tomlinson J). 15 SEB Trygg Holding AG Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129, 138 (Gloster J); Harper Versicherungs AG v Indemnity Marine Assurance Co Ltd 2 Lloyd’s Rep 263, 277 (Tomlinson J). 16 SEB Trygg Holding AG Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129, 138 (Gloster J); Internaut Shipping v Fercometal (The “Elikon”) [2003] 2 Lloyd’s Rep 430, 444-445 (Rix J); Harper Versicherungs AG v Indemnity Marine Assurance Co Ltd [2006] 2 Lloyd’s Rep 263, 278 (Tomlinson J). 17 AMB Generali Holding AG Manches Sprecher Grieg Halberstam Portner & Jaskel v SEB Trygg Liv Holding Aktiebolag Merrifield [2006] 1 Lloyd’s Rep 318, 331 (Buxton LJ). 18 Facts, p 101: Claimant’s notice of appointment.

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commencement was brought in the name of the original contractual counter-party. This is not a situation

where an entirely independent and unrelated party was named as party to arbitration proceedings.19

Rather, appointment was made in the name of an entity that was always party to the contract. Given that

the Respondent was involved in a dispute with the Claimant as to the Charterparty and freight and

damages arising thereunder, a reasonable person having regard to the names of the previous and current

owners of the Vessel and the exchange of communication between the parties would be under no

reasonable misapprehension as to who commenced proceedings.

8. In any event, the Respondent’s rejection of the Claimant’s notice of commencement, dated 12 February

2012,20 makes explicit reference to its knowledge that Reliable Tankers Inc no longer existed and, by

extension, its knowledge of the owner’s merger with Reliable Holdings Inc.

9. The admitted evidence does not provide any reasonable grounds for the Respondent to assert that the

Claimant made an intentional decision to commence proceedings in the name of a non-existent entity.21

Such a decision would render any proceedings void and any award issued a nullity.22 This would be

contrary to the Claimant’s interests, particularly given the Claimant’s knowledge of the strict time

limitations upon the commencement of claims against the Respondent.23

10. In the premises, the Respondent cannot assert that they were under a genuine misapprehension as to the

party commencing proceedings and the charter under which proceedings were being commenced. There

was a simple administrative error in utilising an out-dated corporate header, which amounted to a mere

misnomer. The Tribunal should therefore find that the first reference dated 28 January 2012 is valid.

19 Cf The Elikon [2003] 2 Lloyd’s Rep 430. 20 Facts, p 102: Respondent’s rejection of letter of commencement. 21 The Elikon [2003] 2 Lloyd’s Rep 430. 22 Baytur SA v Finagro Holding SA [1992] 1 Lloyd’s Rep 134, 152; SEB Trygg Holding Aktiebolag v Manches [2005] 2 Lloyd’s Rep 129, 138-139 (Gloster J); The Elikon [2003] 2 Lloyd’s Rep 430, 448 (Rix LJ). 23 Facts, p 88: Super Charters’ Standard Terms; Facts, p 91: Reliable Tankers Inc internal file note; see below at paragraph 11.

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The proceedings are not time barred

The Claimant provided notice of a claim pursuant to the Clause 4 of the Charterer’s Standard Terms

11. Pursuant to the time bar contained in Clause 4 of the Charterer’s Standard Terms (‘the time bar’), notice

of a claim was to be provided to the Charterer within ten days of when discharge would have occurred,24

and such a claim commenced within a further ten days. The admitted correspondence confirms the

estimated date of discharge to be 10 January 2012,25 rendering provision of notice of a claim due by 20

January 2012 and commencement of proceedings due by 30 January 2012.

12. The Tribunal should find notice of a claim was provided to the Respondent by way of email dated 20

November 2011.26 Notice does not need to adopt a particular form of words, ‘provided it is clear that a

claim is being made’27 and is not ‘merely intimated as some vague future possibility’. 28 Construed in the

circumstances, the reference to ‘freight remain[ing] outstanding’ in the email of 20 November 2011

amounts to notice of the claim that is being asserted by the Claimant. The notice of the claim

immediately followed a rejection of the Respondent’s claim, and must be read in the context of the email

exchange between the parties regarding the exercise of a cancellation clause and damages arising

thereunder.29

13. The Claimant’s request for an extension of the time bar on 20 November 201130 evidences its awareness

of the strict requirements imposed by the time bar and the consequences of non-compliance. In the

premises the Claimant should be taken to have had in its reasonable contemplation the swift resolution of

disputes and claims under the Charterparty. As such, the Tribunal should find that valid notice of a claim

against the Respondent was provided on 28 November 2011.

24 Facts, p 88: Super Charters’ Standard Terms. 25 Facts, p 89: Email from Reliable Tankers Inc to Super Charters. 26 Facts, p 97: Claimant’s notice of claim. 27 Cathiship SA v Allanasons Ltd (The “Catherine Helen”) [1998] 2 Lloyd’s Rep 511, 517. 28 The Catherine Helen [1998] 2 Lloyd’s Rep 511, 518. 29 Facts, p 95: Email from Reliable Tankers Inc to Super Charters; Facts, p 96: Super Charters’ Notice of Cancellation; Facts, p 97: Claimant’s notice of claim. 30 Facts, p 91: Reliable Tankers Inc internal file note.

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The Claimant commenced the claim pursuant to the time bar

14. The Claimant validly commenced arbitration proceedings under Clause 24 of the Asbatankvoy form31

through their letter of appointment, dated 28 January 2011, provided to the Respondent.32 As established

above at paragraph 10, the reference to the pre-merger entity, Reliable Tankers Inc was an administrative

error that does not prejudice the validity of commencement.

15. As the Claimant validly commenced proceedings on 28 January 2011, the time bar has no effect on the

present proceedings. There is no scope for the Respondent to seek its enforcement against the Claimant.

B) THE PARTIES ARE BOUND BY THE SIGNED VOYAGE CHARTER DATED 19 NOVEMBER 2011 AND THE TERMS CONTAINED THEREIN

16. The Claimant acknowledges a difference in terms of the fixture recap dated 17 November 201133 and the

fixture recap dated 19 November 2011.34 The amendment to Clause 4 of the Owner’s Standard Terms in

the 17 November 2011 recap35 is omitted from the 19 November 2011 recap.36 In the premises, the

Claimant concedes a common mistake as pleaded by the Respondent.37 However, it is the Claimant’s

case that upon a proper construction of the terms, rectification is not warranted.

The parties are in agreement as to the charterparty to which they are bound

17. The Claimant’s submissions dated 14 March 2012,38 at paragraph 5, plead the fixture recap dated 19

November 2011 on an amended ASBATANKVOY form with rider clauses as constituting the charter,

and at paragraph 6 admits the entirety of the terms of the Charterparty.39 Paragraphs 9 and 10 of the

Respondent’s defence and counterclaim to the first reference explicitly admit the same.40 Consequently,

the Tribunal should find that the parties are agreed that the relevant and binding terms are to be found

wholly and conclusively within the recap dated 19 November 2011.

31 Facts, p 56: ASBATANKVOY Part II, Clause 24. 32 Facts, p 101: Claimant’s notice of appointment; Arbitration Act 1996 (UK), s 14(4). 33 Facts, p 4: Recap dated 17 November 2011. 34 Facts, p 47: Recap dated 19 November 2011. 35 Facts, p 8: Recap dated 17 November 2011. 36 Facts, p 51: Recap dated 19 November 2011. 37 Great Peace Shipping Co Ltd v Tsavliris Salvage (International) Ltd [2003] QB 679; see below at paragraph 24. 38 Facts, p 105: Claimant’s Claim Submissions. 39 Facts, p 106: Claimant’s Claim Submissions, Paragraph 5. 40 Facts, p 110: Charterer’s Defence and Counterclaim, Paragraph 9.

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Clause 2 of the Owner’s Standard Terms released both parties from further obligations and liabilities

18. Clause 2 of the Owner’s Standard Terms41 (‘the Cancellation Clause’) is to be given the meaning

conveyed to a reasonable person having all the background knowledge of the parties in the

circumstances.42 The Cancellation Clause ought to be interpreted ‘sensibly’ in the context of the entirety

of the Charterparty,43 and should be given a construction consistent with business sensibilities.44 The

Tribunal ought not to place reliance upon prior negotiations and communication between the parties in

order to construe the clause as it stands.45 Each peculiar word of the clause must be considered

individually in order to ascertain the meaning of the clause’s entirety.

19. In its ordinary sense in a commercial contract, ‘recourse’ refers to the assertion and enforcement of a

legal right, inclusive of liabilities and obligations. The word’s natural meaning is expansive and is not

refined to a particular type of right or remedy at law or in equity. Legal recourse ought to be construed

widely, in a manner consistent with its plain meaning.

20. The phrase ‘to either party’ is not contentious. On an ordinary reading, it conveys that the prohibition on

recourse extends to both the Claimant and Respondent upon exercise of the Cancellation Clause.

21. As a matter of construction, ‘whatsoever’ is a term of expansive meaning that broadens the grounds

under which a claim may be made.46 The placement of the word at the conclusion of the phrase evinces

an intention to place a complete restriction on both the recourse available to parties and a limitation upon

both parties in preventing the assertion of legal rights, obligations and liabilities.

22. The Tribunal should therefore find that, upon the exercise of the Cancellation Clause by the Respondent

on 27 November 2011, both parties were released from further obligations, rights and liabilities.47

Consistent with commercial sensibilities, such a construction allocates risk and provides mutual

protection to both parties. The Respondent is provided with the option to cancel free from further

41 Facts, p 87: Reliable Tankers’s Standard Terms. 42 Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 All ER 98; Homburg Houtimport BV v Agrosin Private Ltd (The “Starsin”) [2003] 1 Lloyd’s Rep 571, 588 (Lord Hoffmann); Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101, 1112 (Lord Hoffmann). 43 Cheikh Boutros Selim El-Khoury v Ceylon Shipping Lines Ltd (The “Madeleine”) [1967] 2 Lloyd’s Rep 224, 238 (Roskill J). 44 Glynn v Margetson & Co [1893] AC 351, 359 (Lord Halsbury); Homburg Houtimport BV v Agrosin Private Ltd (The “Starsin”) [2003] 1 Lloyd’s Rep 571, 577 (Lord Bingham); Antaios Compania Naviera SA v Salen Rederierna AB (The “Antaios”) [1985] AC 191, 201 (Lord Diplock). 45 Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101, 1120-1121 (Lord Hoffmann). 46 Adre & Cie SA v Orient Shipping (Rotterdam) BV (The “Laconian Confidence”) [1997] 1 Lloyd’s Rep 139, 147, 151 (Rix LJ). 47 Facts, p 96: Super Charters’ Notice of Cancellation.

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liabilities,48 except for debts previously accrued,49 and the Claimant is protected from assertions of

further obligations of performance and from liabilities arising as a consequence of cancellation.

23. The construction proposed by the Respondent at paragraph 16 of its Defence and Counterclaim50 seeks

to sever the assertion of an obligation of future performance from the assertion of an obligation of future

liabilities. The Tribunal should not accept such a construction as it imports undue technical syntaxes and

flouts business commonsense. On its plain and ordinary meaning, the clause cannot be construed in such

a way.

Rectification of the Charterparty is not warranted

24. Alternatively, the Claimant is cognisant of the difference between the Charterparty signed and in force

between the parties, dated 19 November 2011, and the recap sent by the Claimant to the Respondent by

way of offer on 17 November 2011. In the premises, the Claimant concedes the existence of a common

mistake.51 Notwithstanding the existence of this mistake, the Tribunal should not exercise its power to

rectify52 the Charterparty as the rectification sought by the Respondent does not have the meaning and

effect so alleged.

25. The Cancellation Clause is to be construed subject to the same principles of contractual construction

stated above at paragraph 18. The key word in both clauses is ‘recourse’; the word’s ordinary meaning

as it appears in the recap dated 17 November 2011 will not be altered by the deletion of the subsequent

phrase ‘to either party whatsoever’. The effect of Clause 2 under this recap is identical to that of the

Cancellation Clause in the Charterparty dated 19 November 2011 in force between the parties. Both

clauses release the parties from future rights, obligations and liabilities. The words mistakenly omitted

from the Charterparty dated 19 November 2011 are superfluous and their deletion does not alter the

operation of the clause.53

48 Marbienes Compania Naviera SA v Ferrostaal AG (The “Democritos”) [1976] 2 Lloyd’s Rep 149, 152 (Lord Denning MR). 49 See below at paragraphs 32-34. 50 Facts, p 111: Charterer’s Defence and Counterclaim, Paragraph 16. 51 Great Peace Shipping Co Ltd v Tsavliris Salvage (International) Ltd [2003] QB 679. 52 As empowered under Arbitration Act 1996 (UK), s 48(5)(c); the Respondent will be required to satisfy the four elements stated by Gibson LJ in Swainland Builders Ltd v Freehold Properties Ltd [2002] 2 EGLR 71. 53 The Claimant has consistently maintained this position: Facts, p 3: Reliable Tankers Inc internal memo.

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26. In the premises, the Claimant contends that there is no utility to rectification of the Cancellation Clause

as its construction and effect will not be altered. The Tribunal should not rectify the contract.

C) THE RESPONDENT IS LIABLE TO PAY THE CLAIMANT USD4,935,268.75 BY WAY OF FREIGHT, OR DAMAGES IN THE SAME AMOUNT

The Respondent is liable to pay freight pursuant to Clause 4 of the Claimant’s Standard Terms

The Claimant’s right to freight accrued in full upon the lifting of subjects

27. As a matter of construction, Clause 4 of the Claimant’s Standard Terms54 (‘the Freight Clause’)

provided that:

1) the whole sum of freight was earned in full on the lifting of subjects;

2) 95 per cent of the freight was payable on the lifting of subjects; and

3) the five per cent balance of the freight was payable on the ‘completion of discharge and

disconnection of hoses’.55

28. The phrase ‘deemed earned’, well understood by commercial parties,56 expressly displaces the common

law presumption that a shipowner’s right to freight accrues on the delivery of goods.57 The words

‘freight deemed earned in full’ read together with ‘upon lifting of subjects’ provided that the Claimant’s

right to freight in full accrued upon the lifting of subject. Subjects were lifted on 19 November 2011 at

1700.58 Consequently, the full amount of freight became an accrued debt owed by the Respondent to the

Claimant. 59

29. The Freight Clause further specified the time at which payments for freight were to be made. Ninety-five

per cent was payable on the lifting of subjects, and the five per cent balance upon the ‘discharge and

54 Facts, p 87: Reliable Tanker’s Standard Terms. 55 This construction is supported by Bank of Boston Connecticut v European Grain and Shipping Ltd (The “Dominique”) [1989] AC 1056, 1098 (Lord Brandon). 56 Vagres Compania Maritima SA v Nissho-Iwai American Corporation (The “Karin Vatis”) [1988] 2 Lloyd’s Rep 330, 332 (Lloyd LJ). 57 John F Wilson, Carriage of Goods by Sea (Pearson Education Limited, 7th ed, 2010) 289; The Karin Vatis [1988] 2 Lloyd’s Rep 330, 332 (Lloyd LJ). 58 Facts, p 46: Email from Super Charters to Reliable Tankers. 59 This construction is supported by Ellis Shipping Corporation v Voest Alpine Intertrading (The “Lefthero”) [1991] 2 Lloyd’s Rep 599, 609 (Evans J) where it was held that in a similar clause, ‘freight deemed earned’ referred to the full amount (both the 95% sum and 5% balance); The Dominique [1987] 1 Lloyd’s Rep 239, 245 (Hobhouse J) (Commercial Court decision affirmed on Appeal).

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disconnection of hoses’.60 Whilst the debt accrued upon the lifting of subjects, the payment of the debt

was postponed.61

30. The Respondent made no payment for freight.62 On 28 November 2011, the Claimant reminded the

Respondent that ‘freight remain[ed] outstanding’ and was ‘unaffected by [the Respondent’s] subsequent

decision to cancel’.63

31. The Tribunal should find that the Claimant is entitled to 95 per cent of the freight, being

USD4,935,268.75.64 The Claimant does not pursue the five per cent balance deemed earned on the

lifting of subjects and payable on the completion of the voyage.65

The Claimant’s right to freight survived the cancellation of the Charterparty

32. The freight earned on the lifting of subjects remained payable even though the Charterparty was

cancelled. The Claimant’s ‘unconditionally acquired’66 right to freight deemed earned is ‘irrevocable’67

and ‘indefeasible’. 68 The right was not divested by termination of the Charterparty.

33. Advance freight, deemed earned in the early stages of a voyage, is accorded a special position under

English law described by Hobhouse J in the The Dominique as follows:

Advance freight is not adjustable according to what subsequently occurs, it is not repayable in whole

or in part even if the voyage is never completed. It is not treated as a contractual obligation to which

the rules of failure of consideration, or partial failure, apply in the same way as in other branches of

the law of contract. Once earned, advance freight is at the risk of the charterer and the subsequent

60 Facts, p 87: Reliable Tanker’s Standard Terms, Clause 4. 61 The Dominique [1987] 1 Lloyd’s Rep 239, 245 (Hobhouse J) (Commercial Court decision affirmed on Appeal). 62 Facts, p 93: Reliable Tankers Inc internal memo; Facts, p 97: Email from Reliable Tankers Inc to Super Charters. 63 Facts, p 97: Claimant’s notice of claim. 64 The parties are in agreement that the amount payable for freight, if any, is USD4,935,368.75, being 95 percent of the full sum. See Facts, p 107: Claimant’s Claim Submissions; Facts, p 112: Respondent’s Defence and Counterclaim. 65 The different times for payment of the 95 per cent sum and five per cent balance do not provide a basis for including one but excluding the other from the ‘freight earned’ provision: The Lefthero [1991] 2 Lloyd’s Rep 599, 609 (Evans J). Had the Claimant insisted on the five per cent balance, where the voyage was not completed, the Tribunal could have replaced the contractual timetable for payment on the completion of the voyage with a reasonable time: The Lefthero [1991] 2 Lloyd’s Rep 599, 610 (Evans J); The Karin Vatis [1988] 2 Lloyd’s Rep 330, 333 (Lloyd LJ). 66 The Dominique [1989] AC 1056, 1090 (Lord Brandon). 67 Allison v Bristol Marine Insurance Co 111 (1875) 1 AC 209, 254 (Lord Selborne). 68 The Dominique [1989] AC 1056, 1063 (Mustill LJ).

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incidents and misfortunes of the voyage do not entitle him to transfer any of that risk back to the

shipowners.69

34. The Freight Clause reflects the allocation of risk by the parties and evinces an intention that the

Respondent, from the lifting of subjects, was to be under an obligation in respect of the entire freight

payment, despite risks which may subsequently prevail.70 The Tribunal should therefore find that the

Claimant’s right to freight, accrued on the lifting of subjects, survived the cancellation of the

Charterparty.

The Respondent is not entitled to set-off sums counterclaimed against freight

35. If, which is denied, the Claimant committed any breaches under the Charterparty, the Respondent is not

entitled to claim a deduction against the freight due and owing for such breaches. The ‘rule against

deduction’ precludes the Respondent from set-off and is not open to challenge.73 The rule applies to all

categories of breach, including a failure to proceed with convenient dispatch74 and a repudiatory failure

to complete the voyage to the contractual destination.75

36. In commercial matters, where the parties have contracted on the basis of the existence of this rule it

should not be disturbed.76 It would be unjust to change, ex post facto, the legal basis on which the parties

contracted.77 A finding by the Tribunal that the Respondent is able to set-off its claim is contrary to the

express agreement of the parties as manifested in the Freight Clause.

69 The Dominique [1987] 1 Lloyd’s Rep 239, 246 (Hobhouse J) (Commercial Court decision affirmed on Appeal). 70 The Karin Vatis [1988] 2 Lloyd’s Rep 330, 335-336 (Slade LJ); Julian Cooke et al, Voyage Charters (Informa, 3rd ed, 2007) [1.85]. 73 The Dominique [1989] AC 1056, 1090-1100 (Lord Brandon); Aries Tanker Corporation v Total Transport Ltd (The “Aries”) [1977] 1 WLR 185, 189 (Lord Wilberforce); Cleobulos Shipping Co Ltd v Intertanker Ltd (The “Cleon”) [1983] 1 Lloyd’s Rep 586, 591 (Ackner LJ); A/S Gunnstein & Co K/S v Jensen, Krebs and Nielsen (The “Alfa Nord”) [1977] 2 Lloyd’s Law Rep 434, 436 (Roskill LJ). 74 Elena Shipping Ltd v Aidenfield Ltd [1986] 1 Lloyd's Rep 425, 427 (Justice Steyn); The Alfa Nord [1977] 2 Lloyd’s Law Rep 434, 436 (Lord Justice Roskill). 75 The Dominique [1989] AC 1056, 1109 (Lord Brandon). 76 The Aries [1977] 1 WLR 185, 190 (Lord Wilberforce); The Cleon [1983] 1 Lloyd’s Rep 586, 589 (Ackner LJ). 77 The Aries [1977] 1 WLR 185, 194 (Lord Simon).

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37. Equitable set-off does not apply as there is no ground for equitable intervention.78 There is no equity

sufficient to override the clear rule against deduction on the basis of which the parties contracted.

In the alternative, the Respondent is liable to pay freight by way of damages for breach of contract

38. The Respondent had a contractual obligation to pay 95 per cent of the freight on the lifting of subjects.79

The failure to do so amounted to a breach of contract by the Respondent for which the Claimant is

entitled to damages. In awarding damages, the Claimant should be placed in the same position as if the

contractual obligation had been performed.80 The Respondent is therefore liable to pay 95 per cent of

freight (USD4,935,268.75) by way of damages for breach of contract.

Clause 2 of the Claimant’s Standard Terms did not release the Respondent from the obligation to pay freight

39. As submitted above at paragraph 22, the Cancellation Clause released both parties from any further

obligations to perform the Charterparty and from further liabilities thereunder. Consequently, when the

Respondent exercised the Cancellation Clause on 27 November 2011,81 the parties were discharged from

performance and liabilities from that date forward.

40. The obligation of the Respondent to pay 95 per cent of the freight arose on 19 November 2011,82 being

before the cancellation of the Charterparty. The Tribunal should find that the Cancellation Clause did not

retrospectively discharge the Respondent from the obligation to pay freight, which accrued before the

exercise of the Cancellation Clause.

Interest is owed on the sum of USD4,935,268.75, from 19 November 2011

41. Pursuant to s 49(3) of the Arbitration Act 1996 (UK), the Tribunal should award compound interest in

respect of the unpaid freight from 19 November 2011, being the date on which the sum of

USD4,935,268.75 accrued as a debt owed to the Claimant.83

78 The Aries [1977] 1 WLR 185, 191 (Lord Wilberforce). 79 Facts, p 87: Reliable Tankers Inc Standard Terms, Clause 4. 80 British Westinghouse Electric and Manufacturing Co v Underground Electric Railways Co [1912] AC 673, 689. 81 Facts, p 96: Super Charters’ Notice of Cancellation. 82 See above at paragraph 28. 83 Clare Ambrose and Karen Maxwell, London Maritime Arbitration (Informa, 3rd edition, 2009) 296-7.

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D) THE RESPONDENT IS NOT ENTITLED TO DAMAGES FOR THE BREACHES ALLEGED

The Claimant was not in breach of any obligation which gave the Respondent a right to damages

The Claimant commenced the approach voyage at such a time as to enable the Vessel to meet the laycan

42. The approach voyage to the loading port begins when a vessel embarks upon the chartered service as

defined in the charter.84 The Vessel embarked on the chartered service on 19 November 2011 when

subjects were lifted, allowing sufficient time for the Vessel to meet her laycan of 5-6 December,85 which

was later narrowed to 5 December at the Respondents’ option.86 This is evidenced by the itinerary of the

Vessel contained in the Charterparty, which stated the Vessel ‘SAILED ORANGELAND 16

NOVEMBER, ETA REDLAND (BUNKERS) 22 NOVEMBER 2011, ETA LOADPORT 3

DECEMBER 2011’.87 In the premises, the parties intended that, as of 19 November 2011, the approach

voyage had commenced and the Vessel’s voyage from that date was to be governed by the Charterparty.

43. The fact that the Vessel bunkered at Redland on or around 22 December 2011 does not undermine the

Claimant’s assertion that the approach voyage commenced on 19 November 2011. The itinerary

expressly provided for bunkering at Redland before proceeding to the loading port.88 Further, the

Claimant was acting in accordance with Clause 2 of the Respondent’s Standard Terms by ensuring that

Vessel was fully bunkered to perform the chartered voyage.89 The bunkering activity was not an

intermediate engagement that prevented the approach voyage from commencing; it was within the

service defined by the Charterparty.

44. Where the approach voyage was commenced on 19 November 2011, the Claimant was not in breach of

the obligation to commence the voyage at such a time as to enable the Vessel to meet the laycan.

84 Barker v Windle (1856) 18 CB (NS) 759; Harrison v Garthorne (1872) 26 LT (NS) 508; Hudson v Hill (1874) 43 LJCP 273; Julian Cooke et al, Voyage Charters (Informa, 3rd ed, 2007) [4.17]. 85 Facts, p 47: the Charterparty. 86 Facts, p 92: Email from Super Charters to Reliable Tankers Inc. 87 Facts, p 47: the Charterparty. 88 Facts, p 47: the Charterparty. 89 Facts, p 88: Super Charters’ Standard Terms.

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The Claimant proceeded with convenient dispatch

45. The Claimant did not breach its obligation to ‘proceed as ordered to the Loading Port(s)’ ‘with all

convenient dispatch’,90 which required the Claimant to ‘get on with the voyage in a manner that [was]

not unreasonable’.91 The required speed was that which was convenient to the Claimant.92 The Vessel

sailed from Orangeland on 16 November 2011 and in accordance with the itinerary reached the bunker

port by 22 November. This constituted convenient dispatch. The arrest of the Vessel at the bunker port

by a third party cannot be said to be a breach of the obligation to proceed with convenient dispatch.

The failure by the Claimant to meet the laycan does not give the Respondent a right to damages

46. The Cancellation Clause did not amount to a promise by the Claimant that the Vessel would arrive at the

loadport at any certain date, a breach of which would give the Respondent a right to damages. Rather the

clause allowed the Respondent to cancel if the Vessel did not arrive by the laycan of 5 December 2011.93

The Tribunal should find that there is no entitlement to damages for loss purportedly suffered as a result

of the Respondent’s exercise of the Cancellation Clause in the absence of any breach by the Claimant.94

Alternatively, the exclusion clauses contained in the Charterparty exempt the Claimant from liability for loss or damage

Where the approach voyage has commenced, the Claimant can rely on the exclusions clauses in the

Charterparty

47. The Claimant recognises that exclusion clauses in a voyage charter do not apply to events occurring

before a vessel has started on the approach voyage dealt with by the charterparty.95 The voyage

commenced on 19 November 2011 when subjects were lifted, at which time the Vessel was proceeding

90 Facts, p 54: ASBATANKVOY Part II, Clause 1. 91 President of India v Hariana Overseas Corporation (The “Takafa”) [1990] 1 Lloyd’s Law Rep 536, 538 (Hirst J). 92 The Takafa [1990] 1 Lloyd’s Law Rep 536. 93 Smith v Dart & Son (184) 14 QBD 105, 110 (Justice Smith). 94 The Democritos [1976] 2 Lloyd’s Rep 149, 152 (Lord Denning MR). 95 Transworld Oil Ltd v North Bay Shipping Corporation (The “Rio Clara”) [1987] 2 Lloyd’s Law Rep 173, 177 (Staughton J); Monroe v Ryan [1935] 2 KB 28, 34 (Greer LJ); Eversa SA Commercial v North Shipping Co Ltd [1956] 2 Lloyd’s Rep 367, 373 (Devlin J).

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to the bunker port.96 There was no ‘subsidiary or intermediate’97 or ‘antecedent’98 unrelated voyage that

prevented the exclusion clauses from applying. The Vessel was engaged in a single voyage governed by

the Charterparty. The exclusion clauses in the Charterparty are therefore applicable to the purported

breaches allegedly occurring after 19 November 2011.

Both exclusion clauses in the Charterparty have effect

48. Clause 19 of the ASBATANKVOY Part II form99 (‘ASBATANKVOY Exclusion Clause’) excludes

the Claimant from liability for ‘any loss or damage, or delay or failure in performing’ arising from

(among other listed exclusions) ‘any other cause of whatsoever kind arising without the actual fault or

privity of the Owner’.

49. Clause 5 of the Owner’s Standard Terms100 (‘Claimant’s Standard Exclusion Clause’) provides that

‘in no event shall Owners be liable for any consequential damage unless caused by proven gross

negligence on the part of the Owners, their servants or agents’.

50. There is no inconsistency between the ASBATANKVOY Exclusion Clause and the Claimant’s Standard

Exclusion Clause. To be inconsistent ‘a term must contradict another term or be in conflict with it such

that effect cannot fairly be given to both clauses’.101

51. The Claimant’s Standard Exclusion Clause only applies to consequential damage. The

ASBATANKVOY Exclusion Clause, which applies to ‘any loss or damage’, excludes liability for direct

damage. In the circumstances, the two exclusion clauses are not inconsistent and effect should be given

to both.102

The ASBATANKVOY Exclusion Clause excludes the Claimant’s liability for direct loss or damage

52. If (which is denied) the Claimant was in breach of the Charterparty, the ASBATANKVOY Exclusion

96 See above at paragraph 41. 97 Monroe v Ryan [1935] 2 KB 28, 40 (Maugham LJ). 98 Monroe v Ryan [1935] 2 KB 28, 41 (Roche LJ). 99 Facts p, 55: ASBATANKVOY Part II, Clause 19. 100 Facts, p 87: Reliable Tanker’s Standard Terms. 101 Pagnan v Tadax Ocean Transportation [1987] 2 Lloyd’s Rep 342, 351; The Leonidas [2001] 1 Lloyd’s Rep 533. 102 Julian Cooke et al, Voyage Charters (Informa, 3rd ed, 2007) [1.115].

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Clause excludes the Claimant from liability for damages arising directly or naturally.103 The following

heads of damage claimed by the Respondent are direct: (1) the increase in freight in the amount of

approximately USD824,000 and; (2) USD100,000 owed to the loadport terminal/sellers for delayed

arrival.

53. The ASBATANKVOY Exclusion Clause excludes liability for ‘any loss or damage’ that arose from ‘any

other cause of whatsoever kind’. This catch-all exception ‘covers all manner of causes and not just those

having a character fashioned by the earlier rules, since there is no such character and there is no scope of

the ejusdem generis construction’. 104 The Tribunal should find that the wording of the

ASBATANKVOY Exclusion Clause is sufficiently broad to exclude the Claimant’s liability for damage

arising from the arrest of the Vessel by the bunker suppliers. The increase in freight and sum owed to the

loadport terminal and sellers claimed by the Respondent did not arise from the actual fault of the

Claimant.

The Claimant’s Standard Exclusion Clause excludes the Claimant’s liability for consequential loss or

damage

54. The reference to ‘consequential loss’ in the Claimant’s Standard Exclusion Clause exempts liability for

such loss as is recoverable under the second limb of the rule in Hadley v Baxendale;105 that is, damage

which the parties might reasonably have contemplated because of special knowledge at the date of the

contract. 106 The loss suffered by the disport terminal and buyers for the delay of the planned

maintenance work in the amount of USD300,000, is consequential loss. The planned refinery shutdown

was known to both of the parties at the date of the Charterparty.107 Where there was no gross negligence

on behalf of the Claimant,108 any liability for damages in respect of losses suffered from the delayed

planned maintenance work is excluded by virtue of the Claimant’s Standard Exclusion Clause.

103 Millar’s Machinery Co Ltd v David Way and Son (1935) 40 Com Cas 240 (Roche LJ). 104 A.E. Potts v Union Steamship [1946] NZLR 27. 105 Kim Lewison, Interpretation of Contracts (Sweet & Maxwell, 2nd ed, 2004) [12.14]; Julian Cooke et al, Voyage Charters (Informa, 3rd ed, 2007) [21.35]; Saint Line v Richardsons Westgarth & Co Ltd [1940] 2 KB 99, 104 (Atkinson J); Croudace v Cawood [1978] 2 Lloyd’s Rep 55. 106 Hadley v Baxendale (1854) 156 ER 145, 151 (Alderson B). 107 Facts, p 3: Reliable Tankers Inc internal memo. 108 Red Sea Tankers Ltd and Others v Papchristidis (The “Hellespont Ardent”) [1997] 2 Lloyds Rep 547, 584-5.

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RELIEF SOUGHT For all of the reasons submitted above, the Claimant respectfully requests the Tribunal to:

DECLARE that the proceedings before the Tribunal were properly commenced;

further,

DECLARE that the Charter was cancelled without recourse on 27 November 2011, by operation of the

Cancellation Clause;

further,

ADJUDGE that the Respondent is liable to pay the Claimant USD4,935,368.75 by way of freight, or

damages in the same amount; and

further,

DECLARE that the Claimant is not liable to the Respondent for the following amounts claimed:

a) USD824,000 for the increase in freight;

b) USD4,935,368.75 for freight due and owing to the Owners;

c) USD100,000 in respect of losses suffered from delayed arrival at the loadport; and

d) USD300,000 in respect of losses suffered from delayed planned maintenance work at the disport

terminal.