Andromeda Marine SA v OW Bunker & Trading A/S

Article 17 of the Brussels Convention requires agreement to a jurisdiction clause to be clearly and precisely demonstrated. A person who was not party to the underlying contract cannot accept its jurisdiction clause selectively. Acceptance requires an offer capable of acceptance, and ordinarily involves acceptance of the contract as a whole.

Article 17 may apply where a contracting party seeks a declaration that the contract is void. That principle does not assist a person who maintains that they were never a party to the contract. A third-party-rights statute does not apply where the contract confers no relevant benefit on the third party.

Andromeda Marine SA, owner of the vessel MV Mana, sought negative declaratory relief against OW Bunker & Trading A/S concerning liability for bunkers supplied to the vessel’s time charterer.

OW Bunker challenged the jurisdiction of the English court. Andromeda relied on a contractual jurisdiction clause and argued that the clause could bind it, although it denied being party to the bunker supply contract. The dispute also involved an asserted maritime lien and proceedings in Portugal and the United States.

The central issues were whether Article 17 of the Brussels Convention applied and whether the Contracts (Rights of Third Parties) Act 1999 conferred relevant rights on Andromeda.

1. Jurisdiction. The court held that it had no jurisdiction to hear the claim for negative declaratory relief. If brought at all, the claim should have been brought in Denmark.
2. Article 17. Applying Corek Maritime GmbH v Handelsveem BV and Others [2000] ECR 1-09337, agreement to a jurisdiction clause must be clearly and precisely demonstrated. The court may consider all the circumstances, not merely the words of the contract.
3. A person who was not party to the original contract may be bound by its jurisdiction clause if, under the applicable national law, that person succeeded to the original party’s rights and obligations. If not, the court must determine whether the person actually accepted the clause. Acceptance cannot involve selecting the jurisdiction clause while rejecting the remainder of the contract. There must have been an offer capable of acceptance.
4. The principle in Francesco Benincasa v Dentalkit Srl [1997] Case No. C-269/95, that Article 17 can apply where a contracting party seeks a declaration that the contract is void, did not assist Andromeda. Andromeda’s case was that it had never been a party to the contract.
5. On the evidence, OW Bunker had not actually asserted that Andromeda was contractually liable. Its communications principally concerned a maritime lien, which did not depend on a contract. Andromeda therefore had no proper basis for bringing proceedings to deny contractual liability which was not in fact being advanced.
6. The court rejected reliance on the Contracts (Rights of Third Parties) Act 1999. The supply contract imposed an obligation to pay on the buyer, while the jurisdiction clause conferred one-sided rights on OW Bunker. Neither amounted to a relevant benefit conferred on Andromeda.
7. Had it been necessary to decide the point, the court would have assessed jurisdiction when the challenge came before it and on the material then before the court. That observation was unnecessary to the result.