The "Alhani" - Hague Rules Time-Bar Applied to a Claim for Misdelivery |
June 2018 PDF Version |
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The English High Court has decided that a shipowner can rely on the one-year time bar contained in the Hague Rules, where incorporated into a bill of lading, to defeat a claim for wrongful misdelivery of the cargo without production of that bill of lading.
Events
The tanker “Alhani” (the "Vessel") loaded 4,844.901 tonnes of bunker fuel, of which some 499 tonnes was to be used as fuel for the vessel, and the balance was to be carried as cargo. A bill of lading was issued, which contained a clause paramount which had the effect of incorporating the Hague Rules into the bill of lading contract, and which incorporated the terms of a charterparty which was subject to the exclusive jurisdiction of the English High Court.
In compliance with charterers’ orders the “Alhani” discharged and delivered the cargo, without production of the bill of lading, by ship-to-ship transfer off West Africa, on 18 November 2011. Shippers, Monjasa A/S, did not receive payment for the cargo, and in April 2012 they arrested the vessel in Tunisia and brought proceedings before the Tunisian courts. In January 2017, Monjasa arrested the vessel again, in France, and commenced proceedings there. In February 2017 shipowners commenced proceedings at the High Court in London, seeking a declaration of non-liability. Monjasa then presented their claim for damages, in contract, bailment and conversion, in London.
Whether The Claim Was Time-Barred
David Foxton QC, sitting as a Deputy Judge in the High Court held that the one year time-bar at Article III rule 6 of the Hague Rules applied in this case, and that Monjasa’s claim was time-barred. He considered that:
Whether Commencement Of Proceedings in Tunisia Protected Time
The Judge reviewed the current status of English law on this point. He considered that the commencement of proceedings in a foreign court, in breach of an exclusive jurisdiction clause which agrees English law, will not normally protect time in accordance with the Hague Rules, although there might be some exceptions to this.
Comment
While we wait to see if the case is appealed to a higher court, this decision might be welcomed by shipowners, as it sets a limit on the time for a misdelivery claim against a shipowner. While the bill of lading was subject to the Hague Rules in this case, the same arguments should apply in the case of the Hague-Visby Rules.
It should be noted that the Hague or Hague-Visby time bar might not protect a carrier where the misdelivery takes place outside of the Hague or Hague-Visby Rules period of responsibility. See our article on the "MSC Amsterdam" for a case where it was decided that the delivery of a cargo, from a container terminal after the ship had discharged it, was outside of the Hague Rules period of responsibility.
We add our customary warning that delivery of cargo without production of a bill of lading prejudices the Members P&I cover.