Lloyd's Maritime and Commercial Law Quarterly


Paul MacMahon*

The Newcastle Express
Arbitral authority usually requires consent. Parties typically express that consent in a clause found in a larger contractual document. In such cases, the arbitration clause is treated for some purposes as a separate agreement from the “main” contract. This internationally accepted principle of separability received explicit statutory recognition in English law through s.7 of the Arbitration Act 1996 and was underscored by the House of Lords in Fiona Trust.1 Separability means that arbitral jurisdiction is typically unaffected by a defect in the main contract. To resist arbitral authority, one must impugn the alleged arbitration agreement itself.
The separability principle, however, does not dispense with the need for the parties to have made an arbitration agreement. According to the Court of Appeal, that fundamental requirement for arbitral jurisdiction was lacking in DHL Project & Chartering Ltd v Gemini Ocean Shipping Co Ltd (The Newcastle Express).2 In that case, the parties to a proposed voyage charterparty agreed a full set of terms, including an arbitration clause, subject to the approval of shippers and receivers. But the charterer never communicated an approval by any shipper or receiver. The owner contended that the parties had agreed to arbitration, but the Court of Appeal disagreed. The arbitration clause was, like all the other proposed terms, only binding on the fulfilment of conditions that never occurred.

The facts

The putative charterer sought a vessel to carry 130,000 metric tons of coal from Newcastle, Australia to Zhoushan, China; the owner had recently purchased the Newcastle Express. The parties agreed on detailed terms, evidenced by a fixture recap email from a broker on 25 August 2020. The recap required the Newcastle Express to be approved by RightShip, a vetting system for coal-bearing vessels. Clause 17 selected arbitration in London with English law to apply, while cl.20 stated that, to the extent consistent with the recap, the


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