This Quarterly recently published a note by Mr B. J. Davenport, Q.C.3, which considered and reviewed in some detail the jurisprudential developments in the cases from Allen v. Sir Alfred McAlpine & Sons Ltd. 4 to The Leonidas D 5 and discussed the issues and problems raised. The Golden Bear may have produced yet another unruly weed in this field. Certainly it has vividly illustrated the consequences of one party relying on the silence and inactivity (perhaps even apathy) of the other as a basis for saying that an agreement has been created by conduct.

The facts of the case were that two disputes, a cargo claim and a demurrage claim, arose in connection with the discharge of cargo carried by the vessel the Golden Bear in April 1975. The owners had referred each claim separately for arbitration by the same arbitrators, although at no time prior to 1983 had any single person in the owner’s organization had knowledge of both disputes. The demurrage arbitration was completed in 1980, but the charterers heard nothing more of the cargo claim until October 1983.

It was held that the parties had in effect agreed to abandon or rescind the arbitration agreement or the reference to arbitration by their mutual silence and inaction over eight years. In his judgment Staughton, J., made the following points:-