Golden Endurance Shipping SA v RMA Watanya SA & Ors

A party does not submit to a foreign court merely by appearing to contest jurisdiction or to seek a stay or dismissal in favour of arbitration. The question is determined under English law by objectively assessing whether the party abandoned its jurisdictional objection, having regard to all the circumstances. A party may defend the merits in the alternative where the foreign procedure makes that necessary.

For the Hague Rules one-year time bar, foreign proceedings constitute valid suit where brought before a competent court and pursuing the cargo claim promptly. The proceedings need not apply the Hague Rules. A carrier’s own claim for a declaration of non-liability does not constitute suit sufficient to stop time running on a cargo claim against the carrier.

The claimant’s vessel carried wheat bran pellets to Morocco under three bills of lading. The cargo was damaged, and the insurers commenced proceedings in Morocco against the Master and the claimant’s security provider. The claimant subsequently brought English proceedings seeking declarations of non-liability and an anti-suit injunction.

The Moroccan court awarded damages in respect of cargo carried under two bills. The issues were whether that judgment should be recognised on the basis that the claimant had submitted to the Moroccan jurisdiction, and whether either the Moroccan proceedings or the claimant’s English claim constituted valid suit under Article III rule 6 of the Hague Rules.

1. The preliminary issue was determined for the claimant. The Moroccan judgment was not entitled to recognition because the claimant had not submitted to the Moroccan courts.

2. Under Civil Jurisdiction and Judgments Act 1982, section 33(1)(b), appearance to contest jurisdiction or to seek dismissal or a stay in favour of arbitration does not, by itself, amount to submission. The question remains whether, objectively, the party abandoned its challenge.

3. The claimant’s primary contention in Morocco was that the dispute should be referred to arbitration. Moroccan procedural law required an admissibility challenge based on the arbitration agreement, and that procedure required an alternative defence on the merits. The claimant therefore had not chosen to succumb to the Moroccan jurisdiction. Its inconsistent positions under Moroccan and English law did not amount to the extreme inconsistency condemned in Express Newspapers or Benedictus.

4. The issue of submission involved a question of mixed law and fact with a single answer, not the exercise of a discretion. Conduct in the English proceedings could not, without more, establish submission in the foreign proceedings.

5. Article III rule 6 of the Hague Rules has a broad and purposive construction. Its purpose is to secure prompt pursuit of cargo claims and protect carriers from stale claims. Proceedings in a foreign court are valid suit if brought before a competent court and directed to the carrier’s liability. The fact that Morocco applied the Hamburg Rules did not make its courts incompetent or deprive the proceedings of their effect.

6. The Moroccan proceedings were commenced within the one-year period and constituted valid suit. The claimant’s own negative-declaration claim did not: Article III rule 6 operates by requiring claims against the carrier to be commenced within the specified period. Summary judgment was therefore refused.

First-instance decision. The judgment records earlier proceedings before Burton J, who granted a limited anti-suit injunction and refused relief concerning the Owendo and Takoradi bills: [2014] 1 Lloyd's Rep 266.