25/01/2012

Pacific Basin IHX Ltd v Bulkhandling Handymax AS

This is an important decision because it is the first case in which the High Court has considered the Conwartime Clause 1993. The dispute arose out a trip time charter under which the charterers had ordered the ship to sail from Europe to China, via Suez. Fearing attack by Somali pirates, the owners refused to go through the Gulf of Aden and sent the ship instead via the Cape of Good Hope. The arbitrators held that they had been entitled to do so under the Conwartime Clause. On appeal against the award, the Court was asked to address the question: how serious must the risk of pirate attack be in order to justify refusing a voyage order? What level of risk triggers the right to reject an order? The answer, the Court held, is that the master or owner must reasonably believe that there would be at least a real likelihood that the ship would be in danger from acts of pirates if she complied with the charterers' order. Julian Kenny was instructed by Ince & Co for the respondent owners