Case by Case

Case: MSC Mediterranean Shipping Company SA v Conti 11 Container Schiffahrts-GmbH & Co KG MS “MSCFlaminia” [2025] UKSC 14

Guest: David Walsh KC, Essex Court Chambers

Luke Zadkovich and Calum Cheyne return this week to discuss MSC Mediterranean Shipping Company SA v Conti 11 Container Schiffahrts-GmbH & Co KG MS “MSCFlaminia” [2025] UKSC 14 with Counsel for the Respondent, David Walsh KC.

This decision arose out of an incident involving the “MSC Flaminia”, a container ship that exploded while en route from South Carolina to Antwerp, back in 2012, resulting in the death of three crew members.

The Owners of the vessel (Conti), obtained an arbitration award against the Charterers (MSC) for the amount of USD200 million in damages. Following this, Charterers sought to limit to their liability  under the Convention onLimitation of Liability for Maritime Claims 1976.

The Supreme Court considered whether the Charterers could do so, given that the limitation was sought with respect to claims brought by Owners, against the Charterers, for losses the Owners originally suffered themselves. In doing do, the Court also considered the scope of Article 2.1(a), (e) and (f) of the 1976 Convention.

Luke, Calum and David discuss the way in which the arguments evolved through the appeal process, and the ultimate rationale behind Lord Hamblen’s decision (withwhom Lord Hodge, Lord Briggs, Lord Leggatt and Lord Burrows agreed). Their discussion provides insightful guidance and clarity on what can be a complexarea of maritime law.

Guest: Jakob Reckhenrich of Quadrant Chambers

Case: The Stema Barge II [2025] EWHC 73 (Admiralty)

This week, Luke Zadkovich and Calum Cheyne sit down to discuss The Stema Barge II [2025] EWHC 73 (Admiralty) with Counsel for the successful Claimant/Second Appellant, Jakob Reckhenrich (Quadrant Chambers).

The dispute arose out of an incident with a dumb barge, the Stema Barge II. During a storm, she dragged her anchor across high voltage electrical cables between England and France, causing damage. As there were a variety of partiesinvolved, liability for the ensuing loss became the key issue.

After success as trial, the Respondent, Stema UK, failed to convince the Court of Appeal that they were entitled to limit their liability under Art 1(2) of the Convention on Limitation of Liability for Maritime Claims 1976 (The Stema Barge II [2021] EWCA 1880). When the Supreme Court refused to grant leaveto appeal , the Respondent attempted to re-frame their case, this time under Article 1(4) of the Convention. Interestingly, the submission was set out in skeleton arguments, but as the Court of Appeal expressed a number of concerns with the point as a line of argument, it was ultimately withdrawn.

The Claimant/Second Appellant argued that Stema UK’s Article 1(4) plea should be struck out on the basis that there was already a final Order on the issue, and that leave to appeal had been refused. In the alternative, cause of actionestoppel and/or the rule in Henderson v Henderson equally applied to prevent Stema UK from advancing the argument.

This discussion considers the principles of res judicata in the context of maritime law.  Calum, Luke and Jakob provide an in-depth analysis of the helpfully informative decision of Cockerill J, who ultimately found the Claimant/Second Appellant’s arguments persuasive.

TBC

Case: Fimbank Plc v KCH Shippping Co Ltd [2024] UKSC 38

With further reference to:

• Kamil Export (Aust) Pty Ltd v NPL (Australia)Pty Ltd [1996] 1 VR 538

• China Ocean Shipping Co Ltd v PS Chellaram and CoLtd (The “Zhi Jiang Kou”) (1990) 28 NSWLR 354

Guest: Matthew Harvey KC of Owen Dixon Chambers (Melbourne, Australia).In this episode, Luke Zadkovich had the privilege of sitting down with Matthew Harvey KC to discuss Fimbank Plc v KCH Shippping Co Ltd [2024] UKSC 38, a recent case of the UK Supreme Court, dealing with the time bar under Article 3(6) of the Hague/Hague-Visby Rules.

Luke and Matthew dissect Lord Hamblen’s sole judgment, which gives finality to the question of whether the one-year time bar to bring a claim under the Hague/Hague-Visby Rules applies to claims for misdelivery of cargo, which occur after the completion of discharge.

Fimbank argued that that the Rules only created a period of responsibility between loading and discharge, from ship’s rail to ship’s rail, so that claims arising outside of this period, would not be subject to the time bar.

Interestingly, Lord Hamblen, in reaching his conclusion, considered two diverging Australian judgments, one from the New South Wales Court of Appeal (Gleeson CJ, Kirby P and Samuels JA, China Ocean Shipping Co Ltd v PS Chellaram and Co Ltd), and another from the Appeal Division of the Victorian Supreme Court (Fullagar, Marks and Ormiston JJ, Kamil Export (Aust) Pty Ltd v NPL). This episode’s discussion considers the rationale behind all of these decisions, the practical implications for carriers, shippers and consignees alike, as well as touching on the broader principles of the interpretation of international law.

An episode with a distinct Australian flavour, not to be skipped!

Case: Ultra Deep Picasso Pte. Ltd. v. Dynamic Industries Saudi Arabia Ltd., 119 F.4th 437 (5th Cir. 2024)

Guest: Philip Vagin, Senior Associate at Floyd Zadkovich.

In this episode of Case by Case Luke Zadkovich and Calum Cheyne are joined by Philip Vagin, a senior associate with the firm, to discuss a recent US decision on Rule B attachments of bank accounts called Ultra Deep Picasso Pte. Ltd. v. Dynamic Industries Saudi Arabia Ltd. 

In this case the first instance federal court in Texas and then the Fifth Circuit Court of Appeals ruled against Ultra Deep’s motion to attach a bank account located outside of the US where the only connection of the bank with the country was that it had a foreign agency registered in Texas. As a fascinating technical twist, the underlying dispute arises out of a charterparty for a highly specialized diving support and construction vessel, which are used to assist diving operations during underwater repair projects.

Luke, Calum and Philip first discuss the background to the proceedings, which arose out of a hire payment dispute after Dynamic Industries failed to pay Ultra Deep for the services of M/V PICASSO used to repair underwater oil & gas projects in Saudi Arabia. Suing in Texas, Ultra Deep attempted to attach – or, technically speaking, garnish – any bank accounts that Dynamic had with Riyad Bank (based in Saudi Arabia) under Supplemental Rule B, as security for its claims in arbitration.

Like many non-US banks, Riyad did not have a full-service branch in the US but maintained a so-called “foreign bank agency” . This meant that Riyad could only provide limited banking services in the US, so that its US customers could not, for example, freely withdraw cash from Riyad’s agency location in Texas.

The discussion – and the US court opinions themselves – center around the requirements that a plaintiff must establish to successfully attach or garnish a bank account in the US. One of the key issues with which the courts grappled is whether it is enough for Rule B attachment that the US court may exercise some personal jurisdiction over the bank itself – or whether the plaintiff also needs to show that the bank account is actually located in the US court’s territory?

The decision in Ultra Deep will no doubt serve as great guidance for parties contemplating US security or enforcement proceedings against bank accounts of international banks.

Case: Euronav Shipping NV v Black Swan Petroleum DMCC [2024] EWHC 896 (Comm)

Guest: Oliver Caplin KC, Twenty Essex In this episode of Case by Case Luke Zadkovich and Calum Cheyne are joined by Oliver Caplin KC to discuss Euronav Shipping NV v Black Swan Petroleum DMCC [2024] EWHC 896 (Comm), a case of which Oliver Caplin was instructed on, acting on behalf of Black Swan Petroleum DMCC.

In this case the High Court of England ruled against Euronav's request for an unusual type of injunction known as an "anti-anti-arbitration injunction" (AAAI). The dispute arises out of a relationship of sub-bailment involving a cargo of crude oil stored aboard a vessel owned by Euronav.

The discussion is centred around Euronav’s attempt to seek an AAAI pursuing the discontinuation of an AAI from the High Court of Malaysia, which had prevented Euronav from continuing an arbitration in London. Black Swan Petroleum (BSP) had obtained the Malaysian order after Euronav (the court later held) voluntarily submitted to Malaysia’s jurisdiction in a related matter.

The court confirmed that to grant such an injunction, there must be a strong likelihood that both an arbitration agreement existed and that it was breached. While it found there was a high chance the parties had an arbitration agreement and that BSP may have breached it by obtaining the Malaysian order, the court ultimately chose not to grant the injunction. It cited several reasons - discussed in length during the podcast - including the importance of respecting the Malaysian court’s proceedings (comity), Euronav's delay in making the application, and the fact that Euronav had voluntarily submitted to the Malaysian court's jurisdiction.

The conversation highlights how party conduct, such as voluntary submission to another jurisdiction, can influence whether the court exercises its discretion to grant such remedies.

Case: Rhine Shipping DMCC v Vitol SA

Guest: Rufus Constable, Associate at Floyd Zadkovich

No Calum this week whilst he is away at Hong Kong Maritime week, however Luke is joined by Rufus Constable, Associate at Floyd Zadkovich.

This case addresses the impact of internal hedging practices used by commodities trading houses and their impact on the damages award in a related charterparty dispute.

Vitol, a major oil trader, voyage-chartered the MT DIJILAH from Rhine Shipping to transport 920,000 barrels of Brent Crude from West Africa to China. A six-day delay at the second loading port, Djeno (Congo), caused by Rhine, led to a rise in the Brent Dated index price. This increased the purchase price Vitol had to pay its seller, as the price was tied to dates linked to the bill of lading issuance.

The trial judge ruled that Vitol’s internal hedging (its practice of offsetting risks within its own trading system) did not reduce the damages due to it from Rhine, even where that internal hedging generated a notional gain in Vitol's books.

The issues on appeal were whether the judge was incorrect in excluding the effect of this internal hedging from the damages calculation, and whether Rhine was entitled to raise new arguments following the first instance ruling.

Case: UniCredit Bank vs. RusChemAlliance

Guest: Dr Paul Macmahon, Associate Professor of Law at the LSE Law School and the Director of the Executive LLM Programme

Episode Summary
In this episode of the podcast, hosts Luke Zadkovich and Calum Cheyne welcome Paul McMahon, an associate professor of law at LSE, to discuss the complexities of determining the governing law of arbitration agreements under English law following the UK Supreme Court decision in UniCredit Bank vs. RusChemAlliance. In this conversation, the speakers delve into this topic’s substantive and procedural complexities and practical effects. They focus on the Supreme Court considerations concerning the law of the main contract and the law of the arbitral seat. They also discuss the role of English law, forum non conveniens, and anti-suit injunctions concerning the nuanced topic of the applicable law to the arbitration agreement.

Guest's background:
Paul MacMahon is an Associate Professor of Law at the LSE Law School and the Director of the Executive LLM Programme. His primary interests are contracts, commercial law, and international arbitration. Before coming to the LSE, Paul taught at Harvard and Cambridge. He studied at Oxford (BA, BCL, DPhil) and Harvard (JD), and served as a law clerk in the United States for Judge Guido Calabresi and Judge John Gleeson. Paul also worked as a litigation lawyer at Skadden, Arps, Slate, Meagher & Flom LLP in New York City and remains a member of the New York Bar. In addition to teaching at LSE, Paul is a regular Visiting Professor at Católica Global School of Law in Lisbon. He has served as an expert on English law in foreign court proceedings.

Key Takeaways:

•  There is a lack of consensus on governing law among jurisdictions.
• Practitioners should explicitly state the governing law in arbitration agreements.
• Governing law for arbitration agreements often aligns with the main contract.
• The Enka decision introduced a caveat regarding governing law concerning the law of the seat of the arbitration.
• The proper place for claims seems to be determined by the context of the case.
• The English court's role is to enforce arbitration agreements effectively.
• International instability can influence arbitration disputes.
• The court's decision reflects a balance between legal and policy considerations.
• Future legislation may alter the current arbitration landscape.

Chapters

00:00: Introduction to the Podcast and Guests

02:53The Impact of LinkedIn on Legal Discussions

05:52Paul McMahon's Background and Interests

08:50The Popularity of International Arbitration Among Students

12:03Competition Among Jurisdictions for Dispute Resolution

14:54The Governing Law of Arbitration Agreements

18:13Case Study: UniCredit Bank vs. RusChm Alliance

30:00The Implications of Sanctions on Arbitration

33:05Judicial Perspectives on International Arbitration

37:25Understanding Jurisdiction and Governing Law

40:16The Enka Decision and Its Implications

47:27The Role of English Law in Arbitration Agreements

57:58Assessing the Proper Place for Claims

01:09:27Future Implications for Anti-Suit Injunctions

Keywords arbitration, governing law, international law, dispute resolution, legal education, LinkedIn, sanctions, jurisdiction, commercial law, contracts, jurisdiction, governing law, arbitration, English law, Enka decision, anti-suit injunctions, international arbitration, legal implications, arbitration agreements, Supreme Court

RTI Ltd (Respondent) v MUR Shipping BV (Appellant)On this episode Luke and Calum are joined by Alexander Wright KC - A great debate, with varying views and perspectives looking at whether or not a party was required to accept non-contractual performance to overcome a force majeure issue. This a salient case - which will be a reference point for many Force Majeure cases moving forward, as it sets down matters of general principle. In the case of RTI Ltd v MUR Shipping BV, the central issue was whether a force majeure clause in a contract requires the affected party to accept non-contractual performance to mitigate the event's effects. The High Court ruled that it does not unless explicitly stated. However, the Court of Appeal, with a majority decision, held that in certain circumstances, the clause might require accepting such performance. The dissenting opinion agreed with the High Court. The case is now being appealed to the Supreme Court for a final decision.

This case involves an appeal and cross-appeal arising from two Grain and Feed Trade Association (GAFTA) appeal awards related to Cost & Freight free out (C&FFO) Mundra sales of pulses. The primary issues revolve around the jurisdiction of the court on appeals from arbitration awards under the Arbitration Act 1996.

Appeal by Viterra BV:

• The appeal challenges the jurisdiction of the court concerning appeals from arbitration awards.

• Viterra BV contends that the Court of Appeal made errors in:

- Amending the question of law for which permission to appeal had been granted.

- Deciding a question of law that the GAFTA Appeal Board was not asked to determine and on which it did not make a decision.

- Making findings of fact on matters on which the GAFTA Appeal Board had made no findings.

Cross-Appeal by Sharp Corporation Ltd:

• The cross-appeal addresses the GAFTA Appeal Board’s award of damages to Viterra BV.
• The damages were awarded based on the estimated C&FFO Mundra value of the goods under GAFTA Contract No 24 Default Clause.
• Sharp Corporation Ltd argues that damages should have been awarded based on the "as is, where is" value, which refers to the estimated ex-warehouse Mundra value of the goods. This is because, at the date of default, the goods had already been landed, warehoused, and customs cleared in Mundra.

There are two main themes explored in this podcast:

• The procedural safeguard on court appeals from arbitration decisions; and

• How mitigation and the compensation principle interrelate for quantum.

How is it that the Supreme Court and the Court of Appeal can differ so significantly?

And yet, was there a better, appropriate way to get to the same answer?

How to frame a question for appeal without leaving it susceptible to attack?

And, on the flipside, how to attack an appeal on procedural grounds?

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