National Bank of Fujairah (Dubai Branch) v Times Trading Corp

Under section 12 of the Arbitration Act 1996, the court may extend an agreed arbitration time bar where the respondent’s positive conduct materially contributed to the claimant’s failure and it would be unjust to enforce the bar. The conduct need not be wrongful, blameworthy, or the sole cause of the failure, but a causal nexus is required. The court retains a discretion after the jurisdictional threshold is met. Culpable delay by the claimant is relevant to that discretion but does not automatically defeat the application, particularly where the respondent’s continuing conduct contributed to the delay.

National Bank of Fujairah applied under section 12 of the Arbitration Act 1996 for an extension of time to commence arbitration against Times Trading Corp. The claim concerned alleged misdelivery of cargo discharged without production of bills of lading. The bills required London arbitration, and the applicable one-year Hague Rules time bar was assumed for the purposes of the application.

NBF had commenced arbitration against the registered owner within time, but later learned that Times might have been the bareboat charterer and carrier. NBF argued that correspondence and conduct attributable to Times had reinforced its mistaken belief that the registered owner was the appropriate defendant and had contributed to the missed time bar and subsequent delay. The central issues were whether section 12(3)(b) was satisfied and, if so, whether relief should nevertheless be refused in the discretion of the court.

1. Jurisdiction under section 12(3)(b). The court adopted the principles summarised in FIMbank Plc v KCH Shipping Co Ltd [2020] 1765 (Comm) and Haven Insurance v Elephant Insurance [2018] EWCA Civ 2494. A claimant must establish positive conduct by the respondent which makes reliance on the time limit unjust. The conduct need not be wrongful or the predominant cause, but a causal nexus must exist.
2. Times was responsible for communications which implied that the relevant representatives acted for the carrier under the bills of lading. After Times became aware of the bareboat charter, the continued failure to disclose its involvement reinforced that impression. The conduct was materially misleading and contributed to NBF’s failure to commence arbitration against Times within time.
3. The fact that Times discharged the cargo without receiving a directly addressed letter of indemnity was insufficiently connected with the time bar. Nor were communications attributable merely to other charterers. The alternative case under section 12(3)(a) failed because conduct by persons not acting for Times was not outside the parties’ reasonable contemplation in the relevant statutory sense.
4. Meeting the jurisdictional threshold did not compel an extension. The court retained a discretion. NBF’s culpable delay, particularly after it was told that Times might be the carrier, was a significant factor but was not determinative. Times’ refusal to provide the bareboat charter continued to contribute to the delay, and Times was already aware of the claim and arbitration.
5. The court therefore granted the extension sought under section 12. The parties were directed to draw up an order reflecting that conclusion.