MVV ENVIRONMENT DEVONPORT LTD V NTO SHIPPING GMBH & CO KG MS “NORTRADER”

[2020] EWHC 1371 (Comm), Commercial Court, Queen’s Bench Division, His Honour Judge Pelling QC, 4 June 2020

Contracts of carriage – Bill of lading – Whether claimant a party to the contract of carriage evidenced by the bill of lading – Agency – Express or implied actual or ostensible authority to enter into contract of carriage for claimant

The defendant’s motor vessel Nortrader had on 12 January 2017 been chartered by a third party, RS, for the purpose of transporting waste from a plant in the UK to RS’s processing facility in the Netherlands under a contract between RS and the claimant. On 13 January 2017, an explosion on board caused personal injury and the defendant suffered losses of €676,561.46, €45,000 and US$840. The defendant claimed the losses from the claimant in arbitration on the basis of an alleged contract of carriage to which the claimant was alleged to be a party evidenced by the bill of lading and on the basis that an arbitration agreement had been incorporated by reference into the bill of lading. The claimant denied the claims on the basis that it was not the shipper and was not a party to the contract of carriage evidenced by the bill of lading and had been erroneously named as such. The claimant was a company specialising in converting waste products to electricity, in the process creating a waste product known as "unprocessed incinerator bottom ash" ("UIBA"). It disposed of its UIBA under a contract between it and RS made on 26 November 2013 for the transport by RS of the UIBA to its plant in the Netherlands and for its treatment, recycling and disposal by RS in consideration of a monthly payment based on the weight of UIBA removed each month ("IBA Contract"). The contract was not an agency agreement but was a principal to principal contract. It was not one of sale but of disposal of a waste product for which the claimant paid RS a fee. Subject to that, the obligations of the parties were closely akin to an Ex Works sale agreement. RS was responsible for arranging the shipments of the UIBA to its plant. This included chartering a vessel for the purpose, procuring the shipment aboard the relevant vessel of the UIBA and the issue of a bill of lading for what had been shipped. In 33 prior shipments, the bill of lading showed the claimant rather than RS as the shipper. In bills of lading following the incident leading to the present proceedings, RS was shown as the shipper. On each occasion, after the relevant documents had been generated and the shipment of the UIBA aboard whichever ship was being used, the shipping agent sent a copy of the shipping documentation to a variety of different addressees – not including the defendant – under cover of an email in standard terms, attaching notices of readiness, statements of facts, a non-negotiable copy bill of lading and documentation relating to the transboundary movement of waste. In arbitration, the defendant relied on the 33 prior transactions and the transmission of the copy documentation to the claimant as precluding the claimant from arguing as against the defendant that it was not in fact the shipper. The tribunal concluded that they had jurisdiction. The claimant sought the setting aside of the arbitration award, challenging the tribunal’s jurisdiction under section 67 of the Arbitration Act.