The High Court had found the Britannia LOU, despite its inclusion of a sanctions clause potentially suspending payment, to be in a form “reasonably satisfactory to the other” as required by the agreed ASG 2 form; nevertheless it found the Respondent under no obligation to accept it. The CA disagreed. On proper construction the ASG2 was to operate instead of an arrest and there was no right of arrest once security in in satisfactory form had been provided. An opposite finding, which would have allowed a beneficiary to seek better or alternative security elsewhere, was held contrary to Admiralty practice and the “clear purpose and…language of ASG 2”. The appeal was allowed.

Charterers (BP), holding B/Ls at the time, novated the charterparty to cargo buyers who thereafter took delivery without production of B/Ls. BP subsequently indorsed the B/Ls in favour of the Claimant cargo financiers who claimed against Owners for misdelivery. In siding with Owners, the Court held the B/Ls did not contain the contract of carriage post-novation nor was this the parties’ intention. The Claimant’s financing scheme would in any event have permitted delivery without B/Ls, and the Claimant’s loss was found not to have been caused by the delivery without B/Ls.

Owners made pre-contractual speed/consumption representations, which were included in the t/c warranties, save as for the statement “above…is based on..last 3 voys”. In addition to deducting for over-consumption, Charterers alleged misrepresentation, then fixed the Vessel for a considerable voyage (UK-Malaysia) before purporting to rescind/ terminate the t/c. The CA, upholding the decision below, held there was no misrepresentation; statements of past performance were not representations of future performance, nor had they induced the contract. Further, despite Charterers reserving their rights, ordering the Vessel on that long voyage had affirmed the contract.

The Respondent Receivers of cargo on board the unmanned Stema Barge II sought to limit their liability to RTE, owners of an underwater cable, damaged when the barge dragged anchor during a storm off Dover. The Receivers relied on their personnel’s operation of the barge’s machinery as rendering them “manager or operator”, entitling them to limit under Art.1(2) of the Limitation Convention. Reversing Teare J, the CA held the term “operator” must “entail more than mere operation of machinery” or provision of crew and a higher level of operation involving “management or control” was required for Receivers to avail themselves of the limitation. The appeal was allowed.

The M.T. “Polar” laden with cargo pursuant to a voyage charter, was seized by pirates in the Gulf of Aden until a ransom was paid on behalf of Owners. The C/P, which was incorporated into the B/Ls, contained a “Gulf of Aden” clause making charterers liable for additional war risk premiums (‘awrp’). Resisting Owners’ claim for GA contribution, the defendant Cargo Interests argued that the effect of the “Gulf of Aden” Clause on the B/L was that Owners could look only to their insurers and not Cargo Interests for recovery of the ransom. The CA upheld the High Court, ruling that although the clause was incorporated into the B/Ls for other purposes, it did not make Cargo Interests liable for awrp and could not therefore have the effect of contended for, so as to excuse them from GA contribution.

Owners claimed that Charterers’ failure to discharge within laytime, gave rise not only to demurrage but also a cargo deterioration claim against Owners by Receivers. The CA, reversing Baker J’s decision, held that demurrage was Owners’ sole remedy – it “liquidates the whole of the damages arising from… failing to complete cargo operations within the laytime”. Breach of a separate obligation was required to claim additional damages for delay and as Owners failed to plead it, recovery of such damages was precluded.