Petroleo Brasiliero SA v Mellitus Shipping Inc and Ors (The “Baltic Flame”) - Court of Appeal (Potter, Sedley and Jonathan Parker LJJ) - 29 March 2001

Contribution proceedings brought by third party time-charterers against fourth party shippers claiming right to contribution under Civil Liability (Contribution) Act 1978 - Court permitting contribution claims to be served on fourth party out of jurisdiction - Right of contribution would not be recognised in courts of fourth party - Whether permission to serve out should be set aside

Saudi Arabian Marketing & Refining Company (“Saudi Aramco”) were the shippers of cargoes of propane on board the vessel Baltic Flame in April and November 1993. The shipowners and carriers under the bills of lading were Mellitus Shipping Inc (“Mellitus”). The vessel was on time-charter to Fortum Oil and Gas (“Fortum”). The cargoes had been tested on loading and found to be “on specification”. However, when they arrived at their intended ports of discharge, the cargoes failed copper strip corrosion tests. As a result, the cargoes had to be carried on to other discharge facilities and sold at a discount by their intended receivers, Petroleo Brasiliero SA (“Petrobras”). Also, as a result of the apparent contamination of the shipments, Mellitus lost time and incurred expenses at the discharge ports and elsewhere, and incurred further costs in cleaning and removing residues of the cargoes from the vessel’s tanks after each carriage.