MEMORANDUM FOR CLAIMANT

Transcription

1 NINETEENTH ANNUAL INTERNATIONAL MARITIME LAW ARBITRATION MOOT 2018 MEMORANDUM FOR CLAIMANT TEAM NO.2 Sri Lanka Law College ON BEHALF OF CERULEAN BEANS AND AROMAS (CLAIMANT) AGAINST DYNAMIC SHIPPING LLC (RESPONDENT) COUNSEL THANUJA MEEGAHAWATTE SACHINTHA GUNARATNE ISURI JAYAWARDENA IMASHA YOSHINI 1

2 TABLE OF CONTENTS ABBREVIATIONS Page 4 STATEMENT OF ADMISSIONS Page 5 STATEMENT OF ISSUES Page 6 ARGUMENTS 1. THE TRIBUNAL HAS JURISDICTION TO DETERMINE DISPUTE WITH Page 8 RELATION TO THE ALLEGED BREACH OF VOYAGE CHARTER PARTY ENTERED INTO BETWEEN CLAIMANT AND RESPONDENT? 2. ARBITRAL TRIBUNAL HOLDS KOMPETENZ-KOMPETENZ IN THE RULING ON Page 12 THE QUESTION OF ITS OWN JURISDICTION: 3. ARBITRAL TRIBUNAL HAS JURISDICTION TO DETERMINE ISSUE 10 Page 13 (MARITIME LIEN) 4. THE LAW GOVERNING THE VOYAGE- CHARTERPARTY ENTERED INTO Page 13 BETWEEN THE CLAIMANT AND RESPONDENT. 5. RESPONDENT WERE UNABLE TO MEET THE DELIVERY DATE AND TIME OF Page 19 7PM, 28TH JULY CARGO WAS DELIVERED BY THE RESPONDENT TO THE CLAIMANT ON THE Page ST OF JULY AT APPROXIMATELY 1:17 PM. 7. RESPONDENT LIABLE FOR DELAYS IN DELIVERY OF THE CARGO TO THE Page 21 CLAIMANT. 8. CARGO WAS DAMAGED ON DELIVERY Page RESPONDENT CANNOT LIMIT LIABILITY ON DAMAGE TO CARGO PURSUANT Page 24 TO INTERNATIONAL CONVENTION? 10. THE THIRD PARTY WITH WHOM THE CLAIMANT HAD CONTRACTED FOR Page 26 THE SUPPLY OF COFFEE SUFFERED LOSS AND DAMAGE AS A RESULT OF THE 2

3 CLAIMANT S BREACH OF CONTRACT. 10. CLAIMANT HOLDS AN EQUITABLE MARITIME LIEN OVER MADAM Page 27 DRAGONFLY? 11. CLAIMANT IS NOT LIABLE TO PAY THE SUMS OF MONEY TO RESPONDENT Page 28 AS PER THE INVOICE ISSUED ON OR AROUND 1ST AUGUST PRAYER FOR RELIEF Page 32 3

4 ABBREVATIONS CHARTER CLAIMANT CONSIGNEE CHARTERPARTY CBA COGSA (UK) COGSA (AUS) NEW YORK CONVENTION PARTIES RECORD RESPONDENT DS VESSEL / SHIP FIRST CAUSE OF DELAY SECOND CAUSE OF Cerulean Beans and Aromas Ltd. Cerulean Beans and Aromas Ltd. Cerulean Beans and Aromas Ltd. The Voyage Charter party between CLAIMANT and RESPONDENT Cerulean Beans and Aromas Carriage of Goods By Sea Act United Kingdom Carriage of Goods By Sea Act- Australia Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 10 June 1958) CLAIMANT and RESPONDENT 2018 International Maritime Law Arbitration Moot Scenario Dynamic Shipping LLC Dynamic Shipping LLC Madam Dragonfly Disruption of the Communication and Navigation Systems of the Madam Dragonfly due to Solar Flares. Storm at Dillamond DELAY 4

5 STATEMENT OF ADMISSIONS 1. The RESPONDENT is the Owner of the Madam Dragonfly. 2. The Madam Dragonfly is a commercial cargo ship flagged in Cerulean. 3. Pursuant to a voyage charter party, (made on or around the 22 nd of July 2017) the CLAIMANT chartered the vessel from the RESPONDENT. 4. Pursuant to the Charterparty the Madam Dragonfly was to depart the Port of Cerulean on 24 th July 2017, sale to the Port of Dillamond by the most direct route and discharge 1000 bags of coffee (Cargo) at the Port of Dillamond by 7pm on 28 th July The damaged cargo was worth USD 15,750, The CLAIMANT made a replacement coffee payment of USD 9,450,000 and a settlement payment of USD 5,000, CLAIMANT paid the amount of US $ 100,000 on account of wages which would become payable to the crew of Madam Dragonfly following her voyage from the Port of Dillamond into a special bank account to the RESPONDENT established for that purpose. 8. The RESPONDENT has not paid the crew of the Madam Dragonfly wages due for the voyage. 9. The RESPONDENT has not repaid the US $ 100,000 (as mentioned in Admission 7) to the CLAIMANT. 5

6 STATEMENT OF ISSUES PROCEDURAL ISSUES 1. Does the Arbitral Tribunal have jurisdiction to hear and determine the dispute with relation to the alleged breach of Voyage Charter party entered into between CLAIMANT and RESPONDENT? 2. Does Arbitral Tribunal hold Kompetenz-kompetenz in the ruling on the question of its own jurisdiction? 3. Does the Arbitral Tribunal have jurisdiction to determine Issue 10 (Maritime Lien)? SUBSTANTIVE ISSUES 4. Was Cargo delivered by the RESPONDENT to the CLAIMANT on the 31 st of July at approximately 1:55pm(as alleged by CLAIMANT) or on the 29 th of July 207 at 8:42 pm (as alleged by the RESPONDENT)? 5. Is the RESPONDENT liable for any delays in delivery of the Cargo to the CLAIMANT? 6. Was the Cargo damaged on delivery? 7. Can the RESPONDENT limit liability on damage to cargo pursuant to International Convention? 6

7 8. Did the third party with whom the CLAIMANT had contracted for the supply of coffee suffer loss and damage as a result of the CLAIMANT s Breach of Contract? 9. Is therespondent liable to make the following payments as damages to the CLAIMANT? 1. USD 15, 750,000 on account of damaged cargo 2. USD 9450,000 for the Replacement Coffee Payment 3. USD 5,000,000 on account of Settlement Payment. 10. Does the CLAIMANT hold an equitable maritime lien over Madam Dragonfly? 11. Is the CLAIMANT liable to pay the following sums of money to RESPONDENT as per the invoice issued on or around 1 st August 2017? 1. Freight 2.Agency Fees at the Port of Spectre 3.Cost of Repairs to damage caused to Madam Dragonfly when avoiding dangerous weather conditions. 4.Agency fees at the Port of Dillamond 5.Demmurage 6.Use of Electronic Access systems at the Port of Dillamond. 7

8 BODY OF ARGUMENTS PROCEDURAL ISSUES 1. ARBITRAL TRIBUNAL HAS JURISDICTION TO HEAR AND DETERMINE THE DISPUTE WITH RELATION TO THE ALLEGED BREACH OF VOYAGE CHARTER PARTY ENTERED INTO BETWEEN CLAIMANT AND RESPONDENT. The Arbitration Clause Section 27 of the Voyage Charter party can be identified as the Arbitration Clause of the Contract. The Arbitration Rules of London Maritime Arbitrators Association (LMMA) governs the arbitration agreement Section 27 (a) of the Voyage Charter party states as follows: (a) Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity, or termination, shall be referred to arbitration in London by a tribunal of three arbitrators in accordance with the Arbitration Rules of the London Maritime Arbitrators Association (LMAA). Section 27 (a) is clear in its reference to the specific rules which will be governing the Arbitration proceedings. Thus, it is the position of the CLAIMANT isthat the law governing the Arbitration Proceedings is to be identified by referring the LMAA Rules Applicability of the LMAA Rules 2017 First and foremost, the CLAIMANT establishes that the LMAA 2017 Rules are applicable to the dispute arising from the alleged breach of the Voyage Charter party, as per Section 4 and 5 of the LMAA Terms

9 Section 4 and 5 of the LMMA Rules state as follows; 4. These Terms apply to arbitral proceedings commenced on or after 1st May These Terms shall apply to an arbitration agreement whenever the parties have agreed that they shall apply Law Applicable to the Arbitration Agreement is English Law Furthermore, it is stated in the LMAA Terms, in Section 6 In the absence of any agreement to the contrary, the parties to all arbitral proceedings to which these Terms apply agree: (a) that the law applicable to their arbitration agreement is English and; (b) that the seat of the arbitration is in England. According to the Voyage Charterparty, the PARTIES have expressly identified that the seat of Arbitration is London 1, in England. Therefore, the seat of Arbitration is not in conflict with the LLMA Terms, Section 6(b). As there is no agreement present to the contrary, the CLAIMANT further submits that the law applicable to the arbitration agreement is English law, as per Section 6(a) of the LMAA Terms. However, the CLAIMANT wishes to submit that the application of English Law is restricted to only the Arbitration Agreement and not to the Voyage Charterparty. The Arbitration Clause Contains a Pre-Condition to engaging in Arbitration Proceedings. Section 27 (e) of the VOYAGE-CHARTRPARTY, read together with 27(d), and 27(f) of the same, contains the following pre-condition to entering into Arbitration. 1 Page 12 of the Record; Section 27 (a) of the Voyage Charter party. It states therein as follows: Any dispute arising out of or in connection with this contract.shall be referred to Arbitration in London. 9

10 (d) However, any dispute as to technical matters arising out of or in connection with this contract shall be referred to expert determination by an independent Master Mariner. 2 (e) A party may not commence legal proceedings (including arbitral proceedings under this clause) in respect of dispute unless clause (d) has been complied with first. 3 (f) Any person appointed under clause (d) must act as an expert and not as an arbitrator, and the expert's written determination will be conclusive and binding on the parties. 4 (g) In this clause, "technical matters" means matters surrounding the technical aspects of the performance of the charterparty, such as the vessel's route, loading and unloading of cargo, storage conditions and other matters which can reasonably be considered to be within the expert technical knowledge of a Master Mariner. 5 In addition to the aforementioned preconditions, there also lies a further pre-condition in the form of an Issue of a Notice of Dispute. Section 26 of the Chaterparty states as follows: Any claim that the Masters or Owners consider that they may have one the charter or Shippers arising at a port of loading and/or discharge shall be notified in writing by the Masters to the Charters or Shippers as the case maybe before sailing from the port at which the claim arose. However, this Section is to be adhered by the RESPONDENT in any claim they may have against the CLAIMANT, and not vice versa. The Tribunal Has Jurisdiction as the Pre-Condition to Arbitration Proceedings have been complied with. 2 Section 27 (d) Voyage Charterparty 3 Section 27(e) Voyage Charterparty 4 Section 27(f) 5 Section 27(g) 10

11 Disputes with Regard to Technical Matters Been Addressed by an Independent master Mariner Section 27 (d), (e), (g), been Complied With : It is stated in 27(e) that parties cannot commence arbitral proceedings unless the disputes relating to technical matters are referred to the expert determination of an independent Master Mariner. Technical matters have been identified in Section 27 (g) as matters surrounding the technical aspects of the performance of the Charterparty (vessels route, loading and unloading of cargo, storage etc.). 1) Vessels Route No Technical expertise is required to see if vessel deviated from the said route, as it has been admitted by the RESPONDENT 6 in its communication to the CLAIMANT. The CLAIMANT further submit the route that the RESPONDENT were instructed to follow. 7 2) Loading and Unloading of Cargo: There is no dispute that has arisen with regard to the Loading of Cargo. It has been stated on the Dock receipt that the there was no damage observed on receipt 8, which clears any doubt that the cargo suffered damages prior to loading. With Regard to the offloading of cargo too, there appears to be no dispute which requires expert technical determination. 3) Storage: No dispute has arisen with regards to the storage of cargo which requires expert technical determination. 4) Extent of Damage to Cargo: DSM Surveyors have submitted a Final Inspection Report for the purpose of ascertaining the extent of the damage onboard the vessel on the 2 nd of August from Mr.M. Simpson (Dynamic Shiping ) to Mr. J Mizzone 27 th July 2017 ; 7:17 am. Page 18 of the Record 7 Annexure A : Map of Route from Port of Cerulean to Port of Dillamond ; Page 39 of Record. 8 Page 16 of the Record : Dock Receipt 11

12 A limited survey was conducted. The result of the survey was that the coffee inside three containers was completely water damaged. This Inspection by DSM Surveyors conforms to the requirements of Article 27 (e) of the Charter party; as the report was obtained prior to the CLAIMANT applying for Arbitral proceedings. 5)Time of Damage of Cargoand Cause of Water Damage to Cargo: Statement of Expert Opinion of Simon Webster (Maritime Engineer specializing in the safe carriage of rare cargo), as at 1 st December The Arbitral panel has jurisdiction in determining the dispute as the Pre-Condition has been complied with. 2. ARBITRAL TRIBUNAL HOLDS KOMPETENZ-KOMPETENZ IN THE RULING ON THE QUESTION OF ITS OWN JURISDICTION. The Arbitration Agreement is governed by the UK Arbitration Act of 1996, as per the LMAA Rules 9. Section 30 the Act discusses the Competence of the Tribunal to rule on its own jurisdiction. It states therein as follows; (1)Unless otherwise agreed by the parties, the arbitral tribunal may rule on its own substantive jurisdiction, that is, as to (a)whether there is a valid arbitration agreement, (b) whether the tribunal is properly constituted, and (c) what matters have been submitted to arbitration in accordance with the arbitration agreement. (2)Any such ruling may be challenged by any available arbitral process of appeal or review or in accordance with the provisions of this Part. 9 LMAA Terms 2017 : Section 6 (a) In the absence of any agreement to the contrary, the parties to all arbitral proceedings to which these Terms apply agree: (a) that the law applicable to their arbitration agreement is English 12

13 With regard to this present dispute, the Arbitral Panel does have competence to rule on its own jurisdiction, as the dispute concerning jurisdiction comes within the ambit of Article 30 (c) of the UK Arbitration Act. 3. ARBITRAL TRIBUNAL HAS JURISDICTION TO DETERMINE THE CLAMANTS CLAIM OF AN EQUITABLE MARITIME LIEN? In the CLAIMANT Statements of Claim 10 ; Section 13 (b)whichdiscusses the damages claimed, one such damage aimed by the CLAIMANT is that they hold an equitable maritime lien over the Madam Dragonfly. As it is a matter that has been submitted to the Tribunal as per Section 30 (c) of the 1996 UK Arbitration Act (as a matter that has been submitted to arbitration in accordance with the arbitration agreement), the CLAIMANT hold that the Tribunal has the jurisdiction to determine the issue of Maritime Lien. APPLICABLE LAW 4. THE LAW OF NEW SOUTH WALES LAW AND AUSTRALIAN FEDERAL LAW GOVERNS THE VOYAGE CHARTERPARTY: Section 28 of the Voyage Charter party directs us to the law governing the Charter party; This Charterparty shall be governed by the laws of New South Wales, Australia. Incorporating Clause Paramount: Owners to have benefit of Article 4(5). It is clear that the parties have stated a Choice of Law in the governance of the Charter party, and this is the law of New South Wales. However, the CLAIMANT wish to analyze if the Law of New South Wales is applicable in the determination of the extent of the liability of the CLAIMANT and RESPONDENT. 10 Page 37 of the Record 13

14 THE LAW OF NEW SOUTH WALES There are only two major acts which could possibly govern the Charterparty according to the laws of New South Wales. They are the Sea-carriage of Goods (State) Act 1921 No 5 and the Sea-Carriage Documents Act 1997 No 92. The Sea Carriage of Goods (State) Act 1921 cannot be applied to govern this Charter party as it is clearly mentioned that the Act shall apply only in relation to ships carrying goods from any one place in the State of New South Wales to any other place in the said State, and in relation to goods so carried, or received to be so carried, in those ships. The shipment of goods was between two European Ports so this State Act cannot apply. The Sea Carriage Documents Act of 1997 does apply. However it is not relevant to the case in question, as it serves to extend the contractual rights to persons to whom delivery of goods is made under a sea waybill or ship s delivery order, which are commonly used instead of bills of lading in the carriage of goods by sea. 11 Thus, this Act may not be relevant for the dispute at hand as the Shipper and the Consignee are one and the same. In the absence of an substantial law of New South Wales governing the Voyage Charterparty in question; the CLAIMANT move to an examine the Australian Federal Law which would be in effect in New South Wales; and thus governing the Charterparty. AUSTRALIAN LAW 11 Sea Carriage Documents Bill 1997 : Explanatory Note 14

15 Two federal acts are relevant to the dispute at hand. These two acts are the Navigation Act of 2012 and the Carriage of Goods By Sea Act (COGSA- 1991). DOES COGSA 1991 (AUS) APPLY TO THE CHARTERPARTY? Section 8 of the COGSA states that, Subject to section 10, the amended Hague Rules have the force of law in Australia.. Therefore, it is required of the PARTIES to examine Article 10 of the COGSA to check for its applicability in the determination of the present dispute. Section 10 (1) 12 of the COGSA 1991 states that; The amended Hague Rules only apply to a contract of carriage of goods by sea 13 that (a) is made on or after the commencement of Schedule 1A 14 and before the commencement of Part 3; and (b) is a contract (i) to which, under Article of the amended Hague Rules, those Rules apply; or (1A) and 10 (2) are not relevant to the present case. 13 A contract of carriage has been defined in Schedule 1A Schedule of Modifications The Amended Hague Rules as follows: Article 1(1) (b) : Contract of carriage means a contract of carriage covered by a sea carriage document (to the extent that the document relates to the carriage of goods by sea), and includes a negotiable sea carriage document issued under a charter party from the moment at which that document regulates the relations between its holder and the carrier concerned. Article 1 (1) (g) defines Sea carriage document as, (i) a bill of lading; or (ii) a negotiable document of title that is similar to a bill of lading and that contains or evidences a contract of carriage of goods by sea; or (iii) a bill of lading that, by law, is not negotiable; or (iv) a non-negotiable document (including a consignment note and a document of the kind known as a sea waybill or the kind known as a ship s delivery order) that either contains or evidences a contract of carriage of goods by sea. In the Record, it is identified that no Bill of Lading has been issued. However, the Dock Receipt as well as the Electronic Access Pass serves as Non- Negotiable instruments which evidences a contract of carriage of goods by sea. Thus, the first requirement that the rules are to only apply to a contract of carriage of goods by sea for has been fulfilled, as per Article 1 (1) (g) (iv). 14 The Contract is further entered into after the Commencement of Schedule 1 A, so the second requirement for the application of the amended Hague Rules has been fulfilled. 15

16 (ii) subject to subsections (1A) and (2) for the carriage of goods by sea from a port in Australia to another port in Australia; 16 or (iii) contained in or evidenced by a non-negotiable document (other than a bill of lading or similar document of title), being a contract that contains express provision to the effect that the amended Hague Rules are to govern the contract as if the document were a bill of lading. 17 Section 11 of the COGSA furtheroutlines the Construction and jurisdiction of the Act. It states as follows; Section 11(1), COGSA 1991 (AUS) : All parties to: (a) a sea carriage document relating to the carriage of goods from any place in Australia to any place outside Australia; or (b) a non-negotiable document of a kind mentioned in subparagraph 10(1)(b)(iii), relating to such a carriage of goods; are taken to have intended to contract according to the laws in force at the place of shipment. The CLAIMANT and RESPONDENT, who are parties to the Dock Receipt and the Electronic Access Pass, as identified as the Non- Negotiable documents, are taken to have intended to contract according to the laws of in force at the place of shipment. The laws exercised at the place of shipment are UK Laws 18. Furthermore, it seen in Section 11 (2) of the COGSA as follows; 15 ARTICLE 10 (AMMENDED HAGUE RULES COGSA 1991) is not applicable as the cargo is shipped between two ports in Europe, and has nothing to do with shipment to, from or within Australia. 16 Not Applicable as Goods are being shipped between two European ports. 17 Dock Receipt and the Electronic Access Pass are both Non- negotiable instruments. The Voyage Charter party which is the Contract is evidenced by these documents. Furthermore, the Voyage Charter party contains express provision that the Law of New South Wales is to apply; an furthermore states that Cause Paramount : Owners to have benefit of Article 4(5) which is an expresses implication that Hague Visby does apply. 18 Page 45 of the Record : Background Information and Assumptions : Cerulean and Dillamond have adopted all laws of the UK. 16

17 (2) An agreement (whether made in Australia or elsewhere) has no effect so far as it purports to: (a) Preclude or limit the effect of subsection (1) in respect of a bill of lading or a document mentioned in that subsection. However, the CLAIMANT submit that although Section 11 (2) imposes a mandatory rule upon the Tribunal, that this mandatory rule should be overlooked on the following grounds; 1) According to Section 46 (1) of the UK Arbitration Act, it is stated that the arbitral tribunal shall decide the dispute (a) In accordance with the law chosen by the parties as applicable to the substance of the dispute. There is a clear and express choice of law present; therefore it is the duty of the Arbitral tribunal to apply such law. (2) Secondly, Section 46 (2) of the UK Arbitration Act states that for this purpose the choice of the laws of a country shall be understood to refer to the substantive laws of that country and not its conflict of laws rules. 19 The CLAIMANT submit that Section 11(2) of the COGSA 1991 (AUS) is a procedural matter 20, which attempts to introduce the concept of Renvoi, (which is a Conflict of Law Rule). The UK Arbitration Act through Section 46(2) aims to stop the introduction of Conflict of Law Rules such as Renvoi when identifying the law governing the contract, when there is a clear choice of law that is available UK No. 92, Dallah Real Estate and Tourism Holding Company v. The Ministry of Religious Affairs, Government of Pakistan, Supreme Court, 3 November 2010 Yearbook Commercial Arbitration Volume XXXVI (van den Berg (ed.); Jan 2011) 20 Sonmez Denizcilik Ve Ticaret Anomin Sirketti v The MV "Blooming Orchard" (Unreported: Supreme Court of NSW, Carruthers J, 20/12/90) which held the section is concerned with jurisdiction and not choice of law: 21 Audley Sheppard, English Arbitration Act (Chapter 23), Part I, The Award, Section 46 [Rules applicable to substance of dispute] : Quote : Choice of a national law does not include its conflict of laws rules, which avoids the application of concepts such as renvoi(i.e. a conflict of laws rule in the applicable legal system which directs that another legal 17

18 3) Although Section 11(2) is seen as a Mandatory Rule 22, it can be overlooked as the directing the dispute to be decided upon Australian Hague Visby principles is not inconsistent with international public policy (no illegal or immoral act is permitted simply because the parties decide the dispute overlooking the Mandatory Rule. ) 23 4) There is no basis for a tribunal to ignore the express choice of theparties because it determines that there is a contrary mandatory rule in one of these nationallaws. 24 5) The fact that both parties wanted the COGSA 1991 (AUS) to be applicable to the dispute can be seen in Clause 28 of the Voyage Charter party, which references Clause Paramount; owners to have the benefit of Article 4(5). This reference is to Article 4(5) of the COGSA 1991, which attempts to restrict the liability of the Owners. system's substantive law should apply to the dispute). 22 Ibid : Quote : Mandatory rules are those imperative rules of law that cannot be excluded by agreement of the parties. They might be found in the law of the seat, the governing substantive law, the law governing the arbitration agreement, the law of the parties' domicile or incorporation or place of business, the law of the place of performance, the law of a supranational legal system, and international law. 23 Chapter 17 Determination of Applicable Law', in Julian D. M. Lew, Loukas A. Mistelis, et al., Comparative International Commercial Arbitration, ( Kluwer Law International; Kluwer Law International 2003) pp Ibid,

19 SUBSTANTIVE ISSUES 5)RESPONDENT WERE UNABLE TO MEET THE DELIVERY DATE AND TIME OF 7PM, 28TH JULY 2017 Definition of Delivery, according to the COGSA 1991 (AUS) : Article 1(2) of the Amended Hague Rules state as follows; For these Rules, goods are taken to be delivered to the consignee when they are delivered to, or placed at the disposal of: (a) the consignee; or (b) an authority to which the goods are required by law to be delivered; or (c) a person authorized by the consignee to take delivery of the goods. Agreed Date and Time of Delivery : The CLAIMANT and RESPONDENT in their communications 25 have expressly contracted for the Cargo to be delivered to the Port of Dillamond by 7pm on Friday, 28 th July After the vessel set sail, the RESPONDENT further expressed to the CLAIMANT of their expectation that the goods will be delivered by 5pm 26 on Friday, 28 th of July Date and Time of Delivery was a Fundamental Provision of the Contract RESPONDENT were unable to meet the Delivery Date and Time of 7pm, 28th July Letter by Cerulean Beans and Aromas: 22n July 2017: Page 2 of the Record. Letter by Dynamic Shipping: 22 nd July 2017: Page 14 of the Record. 26 Letter by Dynamic Shipping 24 th July 2017: Page 15 of the Record. 19

20 It is not disputed by either party that the RESPONDENT were unable to meet this deadline. On this ground, the CLAIMANT seeks damages for the breach of contract by failing to deliver on the agreed delivery date, and other consequential damages arising from such breach 6) CARGO WAS DELIVERED BY THE RESPONDENT TO THE CLAIMANT ON THE 31 ST OF JULY AT APPROXIMATELY 1:17 PM. In calculating the amount of damages that can be claimed by the CLAIMANT, the question of what is meant by the term DELIVERY comes into question. There are several alternate dates that can be identified as delivery; Saturday, the 29 th of July at 8:42 pm, when RESPONDENTstates that the ship has docked and that the cargo is available for collection. 27 Sunday, the 30 th of July at 12:02 am, when the RESPONDENThad handed over the cargo to an access gate as the CLAIMANT was unable to collect the Cargo due to congestion at the port. Monday, the 31 st of July 2017 at 1:17 pm when the CLAIMANT was able to take custody of the cargo at 1:17 pm on the 31st of July The CLAIMANT submit that actual delivery, as per Article 1(2) of the COGSA 1991 occurred on the 31 st of July 2017 at 1:17 pm. The reasoning for such submission is that delivery must be made to the person entitled to delivery, ie, the named consignee. 28 In support of this submission, the CLAIMANT cites the case ofsze Hai Tong Bank Ltd v Rambler Cycle Co Ltd (1950) AC Dynamic Shipping to Cerulean beans 28 Module Carriage of goods by sea (revised 21/9/6) 29. Case Facts : In Bicycle parts where shipped from England to Singapore under bill of lading containing the following provision: 20

21 In its ratio,lord Denning held that For the contract, as it seems to their Lordships has, as one of its main objects, the proper delivery of the goods by the shipping company, unto order or his or their assigns, against the production of the bill of lading. It would defeat this object entirely if the shipping company was at liberty, at its own will and pleasure, to deliver the goods to somebody else, to somebody not entitled at all, without being liable for the consequences. The CLAIMANT thus respectfully submits that the RESPONDENT should be held liable for damages arising from the delay from the 28 th of July 2017 to the 31 st of July THE RESPONDENT IS LIABLE FOR DELAYS IN DELIVERY OF THE CARGO TO THE CLAIMANT There were several causes for the delay which occurred in delivering the goods to the CLAIMANT. 1 st Cause of Delay: RESPONDENT had not replaced the Hard Copy Navigation Maps, which caused them to divert from the most direct route to Dillamond as the communications and satellite systems they were relying on for navigation were knocked out by Solar Flares. The VESSEL set sail from Cerulean on the 24 th of July 2017 at 9 am 30, with the expectation that the vessel would reach the Port of Dillamond in 4 days and 8 hours 31 (28 th July, 5pm), if they were to 2(c) the responsibility of the carrier, whether as carrier or custodian or bailee of the goods shall be deemed to cease absolutely after they are discharged from the ship Shippers drew a bill of exchange on the receivers. The bill of exchange was delivered to shippers bank in Singapore with instructions to make payment upon presentation of the original bill of lading. Upon arrival in Singapore the goods were discharged and placed in storage on the harbour premises. Receivers obtained possession of the goods from the shipowners without producing the bill of lading by providing shipowners with an indemnity from receivers bank. Receivers never paid shippers who sued shipowners for the price of the goods. Owners joined the receivers and their bank as third parties. 30 Procedural Order No. 2 ; Clarification No Procedural Order No. 2 ; Clarification No. 7 21

22 travel without any deviations. On the 26 th of July (two days prior to the expected date of delivery), the RESPONDENT informs via that, after 17 hours of no contactthey have finally received word from the VESSEL. 33 TheRESPONDENT inform that the VESSELS communications and satellite systems had been knocked out by Solar flares. The disruption to the satellite systems had led the VESSEL to deter from the most direct route to Dillamond and head to the Port of Spectre. 34 As at the 27 th of July, 7:17 am, the VESSEL was still at the Port of Spectre 35. It is the CLAIMANT submission that this delay would not have occurred had the hardcopy maps been replaced 36. The CLAIMANT submits that replacement of the hardcopy maps is a duty of the RESPONDENT, in furnishing a sea- worthy vessel. It can be assessed that owing to the disruption caused by the Solar flares and the RESPONDENT lack of due diligence in mitigating its effect, the PARTIES lost the time period starting (approximately )from 9:30 pm 37 on the 25 th of July to around 7:30 am 38 on 27 th of July ( 34 hours ). The CLAIMANT further submit that had this delay of 34 hours not occurred, the VESSEL would not have had to face the SECOND CAUSE OF DELAY which is the storm which was about to hit Dillamond on the 28 th of July at approximately 4:58 pm Page 17 of Moot Problem : RESPONDENT to CLAIMANTS : 26 th July, 2:32 pm 33 Page 17 of the Record : RESPONDENT TO CLAIMANTS : 26 th JULY 2017 ; 2:32 pm. 34 Page 18 of the Record: RESONDENTS TO CLAIMANTS: 27 th July, 7:17 am. 35 Ibid ; , 27 th July, 7:17 am, Page 18 of the Record. 37 Estimation of time, calculated 17 hours prior to the 26 th of July, 2:32 pm. 38 Vessel had not yet left the Port of Spectre at 7:17 am. However, it was to leave the Port shortly. Therefore, a rough estimated value was given for the time of departure from the Port of Spectre. 39 Page 19 of the Record: , RESPONDENT TO CLAIMANTS; 28 th July, 4:58 pm. 22

23 The CLAIMANT submission is supported by the fact that the PARTIES had in their contemplation that the ship would arrive at the Port of Dillamond on the 28 th of July at 5pm 40, if it sailed on the most direct route, thus avoiding the storm completely. If the vessel had arrived at Dillamond by 5pm, as contemplated by the PARTIES, the cargo would have been collected by the CLAIMANT, who were stationed at the Port of Dillamond from 4:30 pm on the 28 th of July 41 to the next day morning 42. Such a speedy delivery of goods would have also caused the cargo to be delivered without water damage. As the delay was caused by the negligence of the RESPONDENT, the CLAIMANT submit that the RESPONDENT cannot seek to escape liability for the delay on the grounds of Force Majure. 2 nd Cause of Delay: Storm which was to hit Dillamond The second cause of the delay is that the storm which was about to hit Dillamond on the 28 th of July at 4:58 pm 43. Due to the impending storm, the vessel could not move past its current location. The storm had rolled in suddenly and the crew did not see it on the radar until about 30 minutes prior. As stated before, the RESPONDENT could have avoided the storm had they gone on the most direct route. 3 rd Cause for Delay:Absence of a place to berth VESSEL As at the 29 th of July 2017, 7:00 am 44, the storm has caused delays at the port and there was nowhere for the ship to Berth. The vessel at such time was stuck 100 nautical miles from Dillamond. 40 Page 15 of the Record: Letter RESPONDENT TO CLAIMANTS: 24 th July Page 19 of the Record : CLAIMANT TO RESPONDENT 28 th July :11:45 pm 42 Page 20 of the Record: CLAIMANT TO RESPONDENT: 29 TH JULY: 7:04 am. 43 Page 19 of the Record: , RESPONDENT TO CLAIMANTS; 28 th July, 4:58 pm. 44 Page 20 of the Record, RESPONDENT to CLAIMANTS, 29 th July, 8:58 am 23

24 Once again, the CLAIMANT submit that had the VESSSEL taken the most direct route, they would not have faced this delay. 4 th Cause of Delay : Inability to Access Cargo by CLAIMANT due to congestion at the Port Although the VESSEL finally docked and the cargo was available for collection on the 29 th July at 8:42pm 45, the CLAIMANT wasonly able to access the Cargo left at Dillamond on the 31 st of July at approximately 1:17 pm, due to the congestion at the port. The CLAIMANT submits that had the VESSEL travelled upoun the most direct route, the Cargo would have arrived on the Port of Dillamond on the 28 th of July at 5pm 46 and the cargo would have been collected by the CLAIMANT, who was stationed there from 4:30 pm on the 28 th of July 47 to the next day morning 48.The delay of the CLAMANTS to obtain the Cargo till the 31 st of July is reasonable, as there was great flooding in Dillamond from the 28 th of July onwards, as evidenced by the news reports published of the storm CARGO WAS DAMAGED ON DELIVERY. The Cargo was delivered to the CLAIMANT on the 31 st of July 2017 at 1:17 pm, as established by the CLAIMANT 50. According to the Expert Opinion of Mr. Simon Webster, the cargo was damaged sometime in the 24 hours from 4:30 am on 30 th July Therefore, the CLAIMANT holds that the Cargo was damaged on delivery. 9.RESPONDENT CANNOT LIMIT LIABILITY ON DAMAGE TO CARGO PURSUANT TO INTERNATIONAL CONVENTION Page 15 of the Record: Letter RESPONDENT TO CLAIMANTS: 24 th July Page 19 of the Record : CLAIMANT TO RESPONDENT 28 th July :11:45 pm 48 Page 20 of the Record: CLAIMANT TO RESPONDENT: 29 TH JULY: 7:04 am. 49 Page 36 of the Record : 1 st August 2017 ; The Dillamond Times ; Flooding After The Storm : Food events ; 350 ml of rain fell in the 24 hours from 1 am on Saturday morning and have not eased much since. 50 Argument No. 6, Page 22 of the Memorandum. 51 Page 43 of Record ; Expert Opinion of Simon Webster 24

25 RESPONDENTcannot exclude nor limit it s liability under the Force Majeure clause nor under Hague Visby Rules. Both exceptions require the RESPONDENT to establish the exercise of due diligence. The Charterparty states that all [force majeure] exceptions are conditional on the exercise of due diligence to ensure the ship is seaworthy. Further the application of Article 4 Rule 5 of Hague Visby depends on whether the RESPONDENT had exercised due diligence when providing a seaworthy ship at the beginning of the voyage. As discussed earlier 52 the RESPONDENT had not exercised due diligence when providing a seaworthy ship. Madam Dragonfly had no hardcopy maps that were relevant for the voyage in question. This on its own amounts to providing an unseaworthy ship. Further media reports had foreshadowed disruptions to radio and satellite communications by solar flares as much as a week in advance. Nevertheless the RESPONDENT did not taken any precautions to mitigate disruptions that could be caused by such a solar flare. Therefore RESPONDENT cannot limit nor exclude its liability. In any event limitation of liability must be in accordance with established principals. The value of the coffee had been declared to the RESPONDENT. Nevertheless limitation under Article 4 rule 5 of HV must be based on per kg basis. Article 4 Rule 5(a) states that the shipper can only limits its liability to an amount not exceeding units of account per package or unit or 2 units of account per kilogramme of gross weight of the goods lost or damaged, whichever is the higher. A unit of account is equivalent to a Special Drawing Right (SDR) as defined by the International Monetary Fund. 52 Argument 7, Page 23 of the Memorandum 25

26 In this instance the per package unit of account must be calculated based on the number of bags of coffee used. In Sea Tank Ship AS v. Vinnlustodin HF 53 the Court of Appeal in UK treated a unit as a physical item of cargo or a shipping unit. A physical item of cargo in this instance amounts to a bag of coffee. Scrutton on Charter parties 54 had defined a shipping unit as the physical unit as received by the carrier from the shipper. The CLAIMANT handed over to the RESPONDENT the cargo in the form of bags 55. Therefore both an item of cargo and a shipping unit refer to one bag of coffee. Although the final voyage carter party as well as dock receipt has been amended to refer to 4 containers of coffee beans this amendment was made by the RESPONDENT to enter voyage data into their database 56. In River Gurara 57 the English Court of Appeal held that to define a container as a package of unit strains the natural meaning of that word. Thus it is submitted here that a container cannot amount to a package of unit. Therefore the calculation of the SDR rate at per kilogramme would be 105,000 SDR. Further SDR calculation at the per package unit rate would be 500,002.5SDR. Since the greater of the two should apply, the relevant limitation in this instance would be the per package unit rate. The actual conversation rate of SDR would be according to the relevant exchange rate published by the IMF. 10. THE THIRD PARTY WITH WHOM THE CLAIMANT HAD CONTRACTED FOR THE SUPPLY OF COFFEE SUFFERED LOSS AND DAMAGE AS A RESULT OF THE CLAIMANT S BREACH OF CONTRACT. 53 Sea Tank Shipping AS (formerly known as Tank Invest AS) v (1) Vinnlustodin HF [2018] EWCA Civ 276) 54 (18 th edition (1974) at pp ) 55 Letter, 22 nd July 2017 ; CLAIMANT TO RESPONDENT, Page 2 of the Record 56 Letter, 22 nd July 2017 ; RESPONDENT to CLAIMANT, Page 14 of the Record 57 (River Gurara v Nigerian National Shipping Line Ltd [1998] QB 610). 26

27 The 3 rd Party referred to in this contract is COFFEES OF THE WORLD LTD. The CLAIMANT was compelled by the Breach of Contract with the THIRD PARTY to pay USD 5,000, Furthermore, the CLAIMANT was compelled to secure replacement coffee, worth USD 9, 450, The Coffee Festival that the THIRD PARTY had contracted for with the CLAIMANT ran from midday 29 July 2017 midnight 31 July The RESPONDENT was to deliver the Cargo to the CLAIMANT on the 28 th of July, by 7 pm. However, as the RESPONDENT failed in the performance of her duty, the CARGO was only delivered to the CLAIMANT by the 31 st of July at 1:17 pm. The failure of the CLAIMANT to deliver the Cargo to the 3 rd PARTY cost them two and a half days of profits. This breach of CONTRACT is directly attributable to the RESPONDENT who failed to uphold their contract with the CLAIMANT. 11. DOES THE CLAIMANT HOLD AN EQUITABLE MARITIME LIEN OVER MADAM DRAGONFLY? The CLAIMANT conferred a benefit on the RESPONDENTS As conceded by the RESPONDENTS, the CLAIMANTs transferred USD 100,000 to an account under the RESPONDENTS in order to secure the crews wages for the voyage in question. Not only did this ensure that the RESPONDENTS were able to complete another voyage but also secured their credit position. Since the funds transferred had been spent by the RESPONDENTS it is submitted a benefit had conferred on them. 58 Page 29 of the Record ; Letter by COFFEES OF THE WORLD to CLAIMANT ; 1 st AUGUST Ibid, Procedural Order No.2 ; Clarification No. 6 27

28 The circumstances warrant the recognition of an equitable maritime lien The transfer of funds was with respect to the payment of wages of the crew. Under the law of Australia 61 the crew of the ship would have a right in rem to claim a lien over the ship. Millett LJ held [Boscawen v Bajwa [1996] 62 that subrogation is a remedy, not a cause of action. It is submitted that following general principals of English Law, had the funds been utilized to pay the crew wages, the CLAIMANTS would gain the remedy of surrogating the crew in their maritime lien claim. On this premise it is submitted that the CLAIMANT has a right of equitable lien over the ship. 12. CLAIMANT IS NOT LIABLE TO PAY THE FOLLOWING SUMS OF MONEY TO RESPONDENT AS PER THE INVOICE ISSUED ON OR AROUND 1 ST AUGUST 2017: a. Freight of USD 125,000/ container = USD 500,000 The RESPONDENT had failed to observed and fulfil its obligations under the Charterparty. The Charterparty required to deliver the cargo on the 28th of July at 7pm in time for the CLAIMANT to deliver the cargo to be sold at the Coffee Festival. The RESPONDENT had not only failed to fulfil but also delivered three fourth of the cargo in a water damaged state. It is submitted here therefore the object of the voyage had been totally defeated as a result 63. Neither was a substantial portion of the cargo in good condition nor were they available on time. Hence the CLAIMANT can forego payment of freight to the RESPONDENT. b. Agency Fees at the Port of Spectre : USD 75,000 : The Port of Spectre was a devation that was made by the RESPONDENT, and therefore the CLAIMANT are not liable for the payment of Agency fees at such port. 61 [Section 15, Admiralty Act No. 39 of 1988] 62 [Boscawen v Bajwa [1996] 62 1 WLR 328, [1995] 4 All ER 769] 63 The Isabella Jacobson (i8oi, Adm.) 4 C. Rob. 77, The Appum (1917, S.D. N. Y.) 243 Fed. 230, 28

29 c. Cost of Repairs to damage caused to Madam Dragonfly when avoiding dangerous weather conditions. : USD 875,000 The York-Antwerp Rules define general average as existing when, and only when, any extraordinary sacrifice or expenditure is intentionally and reasonably made or incurred for the common safety for the purpose of preserving from peril the property involved in a common maritime adventure 64 It is submitted here that the burden is on the RESPODNENT to show an extraordinary sacrifice that had been made which resulted in the damage to the ship. It is submitted that the damage to the hull was not as a result of any extraordinary event. The ship encountered this situation as a result of the storm, which it could have avoided had the most direct route to Dillamond been taken. Where the ship has deviated from the voyage route without the consent of the contracting party, and the deviation caused the general average act, it is established that there need not be a general average contribution to the owner 65. It is further submitted that as discussed, the RESPONDENTS have failed to provide a seaworthy ship. 66 Therefore the CLAIMANT can forego contribution to the repairs to the Hull. d. Agency fees at the Port of Dillamond : USD 50,000 Clause of the Charterparty provides that [f]reight to be calculated in full of all port charges, pilotages, light dues and all other dues usually paid by vessels. All port charges implies that the agency fees at Dillamond had been contemplated when calculating freight. Additionally, Clause provides that the [o]wners shall pay any dues or charges levied on the ship by reason of cargo being on board and all other dues or charges whatsoever. Therefore it is submitted that the CLAIMANT can forego the payment of Agency fees at Dillamond. 64 [Rule A, York-Antwerp Rules 2016]. 65 [Hain SS Co Ltd v Tate & Lyle Ltd (1936) 41 Com Cas 350]. 66 [Sunlight Mercantile Ltd v Ever Lucky Shipping Co Ltd (2004) 2 Lloyd s Rep 174; Schloss v Heriot (1863) 14 CB (NS) 59]. 67 [pg 11] 68 Ibid, 65 29

30 Notwithstanding this position it is submitted that as with freight, since the RESPONDENT had failed to fulfil its obligations under the Charterparty, the CLAIMANT can also forego the payment of Agency fees at Dillamond. e. Demmurage: USD 100,000 CLAIMANT submits that the RESPONDENT didn t discharge the cargo until approximate to 8 :42pm on the 29 July 2017.The CLAIMANT further submits that the RESPONDENT hadn t entered the port until the ship is berthed at the port of Dillamond. Madam Dragonfly waiting to be berthed wouldn t constitute as being berthed and she is only berthed when she arrives at the port of shipment. The case Stolt Tankers Inc v Landmark Chemicals SA held that the obligation of Charterers to pay demurrage depended on ship-owners fulfilling a qualified obligation to have the vessel ready and able to give discharge in accordance with the contract. If the vessel was not available to load or discharge through the voluntary acts of the owners demurrage wasn t payable and the lay time didn t run. In this case Charterers did let of their obligation to have the vessel ready on time and thereby the cargo was ready to be discharged of passed the relevant time i.e. 7pm on Friday 28 July 2017.The cargo was ready to be discharged only when it arrived at the port of Dillamond at 8:42 pm on the 29 July 2017.Madam Dragonfly waiting to berth the ship wouldn t have the cargo ready as the cargo cannot be discharged when it is waiting to berthed. The vessel needs to be berthed in order to discharge the cargo. The CLAIMANTs aren t liable to pay demurrage to the RESPONDENT as there s no demurrage as demurrage isn t payable and lay time didn t run as decided in the case of Stolt Tankers Inc v Landmark Chemicals SA. 30

31 f. Use of Electronic Access systems at the Port of Dillamond :USD 10,000.: The CLAIMANT had not authorized the use of Electronic Access Passes at the Port of Dillamond. The reason for this is that it was expected that therespondent were to deliver the cargo to the CLAIMANT themselves. Therefore, the CLAMANST are not liable to pay the USD 10,

32 PRAYER FOR RELEIF THE COUNSELS FOR THE CLAIMANT, CERULEAN BEANS AND AROMAS SUBMIT TO THE TRIBUNAL TO MAKE AN AWARD FINDING; 1. The RESPONDENTS, Dynamic Shipping LLC in Breach of Voyage Charterparty entered into between the CLAIMANT and RESPONDENT on the 22 nd of July As a result of such Breach of Voyage Charterparty, the RESPONDENT to be held liable to make the following payments as damages to the CLAIMANT : I. USD 15, 750,000 on account of damaged cargo II. III. USD 9450,000 for the replacement coffee payment USD 5,000,000 on account of settlement payment. 3. To grant the CLAIMANT the award of an Equitable Maritime Lien of the Vessel, the Madam Dragonfly. 4. To release CLAIMANT from any Counter- Claims those are submitted by the RESPONDENT. 5. Any other relief that the Arbitral tribunal sees proper, just and conducive for the resolution of this dispute. 32