Sea Consortium Pte Ltd and Others v Bengal Tiger Line Pte Ltd and Others [2024] EWHC 3174 (Admlty) – Admiralty Division (Andrew Baker J) – 12 December 2024

Killiney Shipping and Sea Consortium (the Charterers) entered into a Bareboat and a Time Charter, respectively with EOS RO (the Owners). Multiple contract agreements existed between the Parties, including a Transport Services agreement between the Claimants and Maersk beginning July 1, a Fixed Slots Contract between Sea Consortium and Bengal Tiger, and a Connecting Carrier Agreement between Sea Consortium and MSC Mediterranean. When the vessel laden with cargo under these multiple contracts caught fire, a limitation ruling was publicized, resulting in subsequent claims. In question was who was considered the Charterer and who the shipowners with regard to the losses and liability.

Voyage Details

On May 20, 2021, the chartered vessel, X-Press Pearl, caught fire.  By June 2, the vessel sank off the coast of Sri Lanka while laden with containerized cargo under multiple contracts. Both the vessel and the cargo were lost. The tribunal approved the claimants’ request for a limitation fund on Feb. 21, 2022. £19,990,325.57 for claims related to the fire/loss of the vessel and containers were covered by the limitation fund. The next day, the London Steam-Ship Owners’ Mutual Insurance Association submitted a letter of undertaking.

Relevant Clauses

The Admiralty Registry used Article 6 of the Convention on Limitation of Liability for Maritime Claims 1976 to justify granting limitation of liability to the London Steam-Ship Owners’ Mutual Insurance Association Lt. The limitation ruling was then publicized, and subsequent claims were filed against the limitation fund.

The Democratic Socialist Republic of Sri Lanka brought arbitration against the claimants residing in Singapore, arguing the claimant was not entitled to limit liability based on Article 4 of the Convention, which states: “A person liable shall not be entitled to limit his liability if it is proved that the loss resulted from his personal act or omission…” because the vessel’s casualty and the loss of cargo caused the damages. 

MSC, Bengal Tiger, and Maersk filed for limitation of liability based on  Article 1 of the Convention which states “shipowners” are entitled to limit their liability. Article 1.2 further defines “shipowner” as “owner, charterer, manager and operator of a seagoing ship.”

Discussion

According to Metvale Ltd v Monsanto International Sarl (The MSC Napoli) [2009] 1 Lloyd’s Rep 246, the Claimants were “charterers” based on their status as slot charterers, which are considered “shipowners” under the Convention. Following precedent, the Charterers were not required to control the entire cargo capacity. Article 1.2 states that a party “to whom space on a ship is contracted” will generally be considered a “charterer”, undermining Sri Lanka’s argument that the claimants were not entitled to limit their liability.

Decision/Award

The claimants qualified as “charterers” because the Agreement for Transport Services was properly applied, and allowed for hiring “slots”. Bengal Tiger, as a Fixed Slot Charterer, was given the right to limit liability under the precedent set in the The MSC Napoli decision. Maersk, as a carrier, provided the necessary cargo space to fulfill its contractual obligations. Further, Maersk was only responsible for the container transport services performed, not for the use of “slots”, regardless of whether or not they were used.