TWELVETH ANNUAL INTERNATIONAL MARITIME LAW ARBITRATION MOOT COMPETITION 2011

IN THE MATTER OF AN ARBITRATION HELD AT SINGAPORE (Under the ..)

MEMORANDUM FOR THE CLAIMANT ON BEHALF OF: Neuland Petroleum Refinery Company Ltd 48 King Street Makai City Neuland

.. Respondent

AGAINST: Blue Sky Holdings Inc. Level 22 80 Greater South Street Panama City Panama

. Claimant

TABLE OF CONTENTS .................................................................................................................................... I LIST OF ABBREVIATIONS ................................................................................................................... ......... IV TABLE OF AUTHORITIES ......................................................................................................................... ...... V SUMMARY OF FACTS .................................................................................................................................... ARBITRATION ARGUMENTS ........................................................................................................................ PROCEDURAL LAW ....................................................................................................................................... I. THE ARBITRAL PROCEDURE IS GOVERNED BY. A. B. C. SUBSTANTIVE LAW ....................................................................................................................................... II. A. JURISDICTION OF THE ARBITRAL TRIBUNAL ......................................................................................... III.

ARGUMENTS AS TO MERITS ...................................................................................................... 10 IV. THE RESPONDENT IS NOT LIABLE FOR THE CLAIM BY BLUE SKY HOLDINGS ................................................................................................................... ............ 10 A. THE CLAIMANT IS LIABLE FOR ALL LOSSES ARISING ON VIRTUE OF BEING A CARRIER........................................................................... 10

B. FURTHER THE CLAIMANT HAS BREACHED ITS DUE DILIGENCE OBLIGATIONS................................................................................................. 11 1. The Claimant has not exercised due diligence ................................................................................................ 12 C. FURTHER THE CLAIMANT HAS BREACHED ITS OBLIGATIONS UNDERTHECHARTERPARTYAGREEMENT...... ............................................................... ..... 14 1. The Claimant is under an obligation to deliver the goods to the respondents. ................................................................................................................ 14 2. The Claimant is unable to show it has undertaken all safety standards and measures is therefore liable (no sign).............................................................................................................. 15 D. THE CLAIMANT CANNOT RELY ON CLAUSES 1-5 OF THE BILL OF LADING FOR BLUR SKY HOLDINGS CLAIM AS IT HAS NO CONRACTUAL FORCE .................. 16 1. The bill of lading is not capable of creating binding obligations on the Respondent as there are no clear offer or acceptance of its terms ............................................ 16 2. Alternatively the terms of the bill of lading are void18 E. ALTERNATIVELY, EVEN IF THE BILL OF LADING HAS CONTRACTUAL FORCE, NO CONTRACTUAL WARRANTY HAS BEEN BREACHED. ................................................... 19 F. ALTERNATIVELY, IF THE PROVISIONS OF CLAUSES 1-5 OFTHE BILL OF LADING WERE ACCEPTED, THE CLAIMANT HAS SUFFERED NO LOSS AS A RESULT OF THE NEGLIGENT ACTION OF THE RESPONDENTS.... ............................................ 19

V. THE RESPONDENT IS NOT LIABLE FOR THE PROSPECTIVE CLAIM BY BLUE SKY HOLDING .. 20
A. THE CLAIMANT HAS BREACHED ITS OBLIGATION OF HADING OVER THE GOODS TO THE RESPONDENTS.............. 20 B. FURTHER AND IN THE ALTERNATE, THE CLAIMANT HAS BREACHED ARTICLE 3(2) OF THE HAGUE-VISBY RULES IN FAILING TO PROPERLY MAN, EQUIP AND SUPPLY THE SHIP BY FAILING TO ENSURE THAT THE

MANIFOLD REDUCERS WERE ADJUSTED CORRECTLY ......................................................................................................... 21 THE RESPONDENT IS NOT LIABLE FOR LOSS OF VESSEL TO THE AMOUNT OF U$2.75 MILLION AND DAMAGES FOR LOSS OF USE OF VESSEL IN THE AMOUNT OF U$955,967 ....... 22 VI. CLAIMS FOR LOSS OF VESSEL DUE TO THE ACCIDENT ARE CONSEQUENT UPON BREACH OF OUTLINED DUTY (NO SIGN) .................................................. 22 VII. FURTHER AND ALTERNATIVELY THE CLAIMANT HAS FAILED TO MAKE OUT CONTRACTUAL CONDITIONS PRECEDENT TO ESTABLISH A BASIS FOR A DAMAGES CLAIM.. ................................................................................................................... 23 1. The losses suffered by the claimant are not governed by any contract and/or damages are not payable...................................... 23 2. Further and alternately, the claimant has agreed to the payment of contingent losses and has failed to establish conditions giving rise to a damage claim 24 3.The claimant has failed to show breach of implied warranty.........................................................................................................25 PRAYER FOR RELIEF ............................................................................................ ...........

LIST OF ABBREVIATIONS

TABLE OF AUTHORITIES
ARTICLES/BOOKS/REPORTS:

Seddon, N C and Ellinghaus M P, Cheshire and Fifoots Law of Contract (9th ed, 2008). Redfern, A, et al, Law and Practice of International Commercial Arbitration (4th ed, 2004). Ambrose C and Maxwell K London Maritime Arbitration (2nd edition, 2002), Davies M and Dickey A, Shipping Law (3rd edition, 2004) Girvin, S, Carriage of Goods by Sea, (1 edition, 2007) Redfern A Hunter M Law and Practice of International Commercial Arbitration (5th edition, 2003) Tetley, W, Marine Cargo Claims, (3rd edition, 1988) Gerard McMeel, 'The Rise of Commercial Construction in Contract Law' [1998] LMCLQ 382. Maritime Law Association of Australia and New Zealand Rules

LEGISLATION: Arbitration Act 1996 (UK). International Arbitration Act 1974 (Upsilon) including Schedule 1 (UNCITRAL Model Law) Carriage of Goods by Sea Act 1991 (Upsilon) including Schedule 1A (Hague Visby Rules as amended)

CASE LAW:

SUMMARY OF FACTS 1. The Claimant, namely Blue Sky Holding Inc., is a company incorporated under the laws of the Republic of Panama and carries on the business of a ship owner. The Claimant also is the owner of the ALPHA STAR. 2. The Respondent, namely Neuland Petroleum Refinery Company Ltd., is a company incorporated under the laws of Neuland and carried on the businesses of an oil importer. The respondent is the holder of a bill of lading dated 11 July 2005. 3. Far East Maritime Petroleum Transport Co., is a company which is a regular supplier of gas cargoes to Neuland Petroleum Refinery Company by virtue of an agreement entered into by them. In April 2005 Neuland Petroleum Refinery Company invited all interested parties to offer for the supply of 53,000 metric tones of LPG mixture plus or minus 25%. The supply period would run from May to October 2005. A tender offer was made on the 10th April 2005, by Far East Maritime Petroleum Transport Co and Brit Pertroleum. 4. On the 27th April 2005, the tender was accepted by Neuland Petroleum Refinery Co. The letter provided, among others, that the bills of lading issued for each shipment must be dated not more than 10 days before the date of arrival of the carrying vessel(s) to Makai port. 5. On 10th January 2005, Far East Maritime Petroleum Transport Co entered into a Time Charterparty (codenamed-SHELLTIME 4) with Blue Sky Holdings Inc ordering the vessel Alpha Star to load consignments of LPG mixture on 12 May 2005, 12 June 2005 and 11 July 2005 for discharge at Makai Port, Neuland. 6. On 11 July 2005, The Standard form Far East Maritime Petroleum Transport Company Bill of lading, bearing documentary credit number 7759AAQ2005964753, was entered into by the master of the ship on behalf of the charters i.e. Far East Maritime Petroleum Transport Co. In the bill of lading the respondents were the consignees. On arrival the parties to be notified were stated as Neuland Petroleum Refinery Co i.e. the respondents. Thus by virtue of this document, the claimants were entrusted to ship 4491.334 metric tons (in air) of LPG mixture on board the LPG carrier Alpha Star.

7. On the fifth shipment made pursuant to the supply agreement performed by the Alpha Star, carried against a standard Far East Maritime Petroleum Transport Company bill of lading dated 11 July 2005, 4,491.334 metric tons (in air) was delivered by Far East Maritime Petroleum Company to and received by Neuland Petroleum Refinery Company. 8. Specifically, on the fifth shipment, the bill of lading was first endorsed on the reverse side in the first instance to Horizon Bank PLC and in the second from Horizon Bank PLC to Neuland Petroleum Refinery Company.

9. On 27th July 2005, the ship reached the Makai Port safely and intimated the respondents. A notice of readiness and an arrival report was prepared by the master of the vessel. The ships Owners technical managers also carried out an extensive ship/shore safety check list. A Before Discharge Agreement was also entered into. 10. However after commencing the discharge operations, an initial small cloud of white gas escaped from the vessels rail side of the manifold reducer. There present were a terminal employee and a vessel crew member. The terminal employee on seeing this incident, removed a spanner and approached the manifold reducer which was the cause of the gas leak, however as he bend over, a non-intrinsically safe metal cased torch fell from his pocket. This torch struck the manifold drip tray (the top edge of which is about 60 centimeters above the main deck) and caused a spark which caused the explosion. 11. After the fire was controlled and damaged assessed, the claimant faced a loss of the vessel, the loss of the use of the vessel, and also contingent costs.

ARBITRATION ARGUMENTS

PROCEDURAL LAW
I.

THE ARBITRAL PROCEDURE IS GOVERNED BY.

SUBSTANTIVE LAW
II.

JURISDICTION OF THE ARBITRAL TRIBUNAL I.THIS TRIBUNAL DOES NOT HAVE JURISDICTION TO ENTERTAIN THE PRESENT DISPUTE An arbitration proceeding can only be commenced when there is an agreement to arbitrate.1 The absence of such agreement renders an arbitration tribunal no jurisdiction to settle a dispute arising out of the contract. The Respondent contends that this tribunal does not have jurisdiction over this case since there was never an arbitration agreement in the first place.
A. This tribunal cannot be established by virtue of Cl. 5 of the bill of lading dated 21st August 2005. Clause 5 of the said bill of lading states that5. LAW-ARBITRATION The contract evidenced by this Bill of Lading shall be governed by English Law and any disputes hereunder shall be determined in Singapore according to English Law to the exclusion of the jurisdiction of the Court of any other Country. Any and all differences and disputes arising out of this Bill of Lading shall be decided by Arbitration in Singapore in accordance with the AMTAC Rules current at the time when the arbitration proceedings are commenced. The party demanding Arbitration shall notify the other party of the name of his Arbitration in writing at the Principal place of business of the party. The other party shall appoint his Arbitrator and notify the first party in his Principal place of business of the appointment of such Arbitrator. In the event that the party against whom the claim is being made does not appoint the Arbitrator within 21 days from receipt of notice, it shall be open to the first party to appoint his Arbitrators as Sole Arbitrator to hear and determine such disputes.
1 Arbitration Act 1996, Section 30; Ambrose, London Maritime Arbitration (2nd ed.), Sweet & Maxwell, 2002, page. 25.

1. The arbitration clause within the bill of lading was never sufficiently incorporated

into the bill of lading. The present arbitration proceedings are instituted upon the arbitration clause in the bill of lading dated 21st day of August 2005. The arbitration clause within the bill of lading was never sufficiently incorporated into the bill of lading. The incorporation clause on the front of the bill of lading was merely an empty reference to clauses 1-5 which did not exist.

ARGUMENTS AS TO MERITS IV. THE RESPONDENT IS NOT LIABLE FOR THE CLAIM BY BLUE SKY HOLDINGS A. THE CLAIMANT IS LIABLE FOR ALL LOSSES ARISING ON VIRTUE OF BEING A CARRIER
The carrier has to come to the court with clean hands, doing what he is required to do under the contract. If he fulfills his obligations, then and only then he can rely on the immunities and exceptions offered by the Common Law or the Hague-Visby Rules. The position of the limitation provision in the Hague-Visby Rules is not totally clear. The carrier can be discharged from liability in respect of claims brought against him, even in the situation that he did not provide a seaworthy ship or deviated from the agreed route in view of the word whatsoever, while he cannot take advantage of the package or unit limitation when he did not perform his obligation. Acc. to Hague Visby rules Art. III (2) subject to the provisions of Article 4 the carrier shall properly and carefully load, handle stow, carry, keep, care for and discharge the goods carried. This was particularly overlooked by the ships crew who saw the cloud and knowing the consequences, still did not shut down the operation, but willingly continued the operation which led to the ignition of the gas Due to this negligence and breach of contract, Neuland has lost the value of 4,491.334 metric tons of LPG

B. FURTHER THE CLAIMANT HAS BREACHED ITS DUE DILIGENCE OBLIGATIONS 1. The Claimant has not exercised due diligence
According to the time charter party clause 4 Para 3; Charterers shall use due diligence to ensure that the vessel is only employed between and at safe places (which expression when used in this charter shall include ports, berths, wharves, docks, anchorages submarine lines, alongside vessels or lighters and other locations including locations at sea) where she can safely lie always afloat. Notwithstanding anything contained in this or any other clause or this charter, Charterers do not warrant the safety of any place to which they order the vessel and shall be under no liability in respect thereof except for loss or damage caused by their failure to exercise due diligence as aforesaid. Subject as above, the vessel shall be loaded or discharged at any places as Charters may direct, provided that Charterers shall exercise due diligence to ensure that any ship-to-ship transfer operation shall conform to standards not less than those set out in the latest published edition of the ICS/OCIMF Ship-to Ship Transfer Guide. If any place of discharge is or becomes a place of peril, and no orders have been received from Charterers or their agents within 48 hours after dispatch of such messages, then Owners shall be at liberty to discharge the cargo or such part of it as may be affected at any place which they or master may in their or his discretion select within the trading limits of this charter and such discharge shall be deemed to be due fulfillment of Owners obligations under this charter so far as cargo so discharged is concerned.

C. FURTHER THE CLAIMANT HAS BREACHED ITS OBLIGATIONS

UNDERTHECHARTERPARTYAGREEMENT 1. The Claimant is under an obligation to deliver the goods to the respondents.
Ship owners obligation can be categorized under three distinct groups. Ship owners Obligation before commencement of the voyage, ship owners obligation during the voyage (after the commencement of the voyage), and ship owners obligation after the voyage when the ship reaches its destination. The third group requires ship owners when the vessel reaches its destination to discharge the goods from the vessel properly and carefully by moving the cargo from the hold to the ship side, to deliver them in the same order and condition in which they have been received to the person entitled to be delivered upon representation of the Bill of Lading, and in the case no one claiming the cargo they must allow a reasonable time to the consignee of the cargo for taking delivery after which ship owners may land and warehouse it at the consignees expense. In general terms ship owners must do anything which is necessary for the performance of their contract. Exemption clauses whether specific or general, agreed upon or introduced by the Common Law or the Hague-

Visby Rules can exempt the ship owner from their liability. Until clear interpretation of the wording of the Act 2, what the authors of the Hague-Visby Rules had in mind when they drafted these provisions, I can say that the ship owner is in breach of his obligations and he cannot rely and take the advantage of the Hague-Visby Rules. In calculation of monetary terms a L/C wired transfer of money took place at the sight of the ship prior to the discharge, further, the ships owners or the carriers are liable for any loss till the discharge or passing of the gas from the ships manifold flange which did not take place rendering the goods not delivered.

2. The Claimant is unable to show it had undertaken all the prescribed safety standards and measures necessary.(no sign
It would appear from the documents provided that the terminal did not employ a 'ship/shore safety checklist; the one being competed appears to have been issued by the vessel's Owners technical managers. Before cargo transfer starts, the responsible officer should be satisfied that the precautions set out in Chapters 2and 3 are being observed. The use of safety check lists, appropriately adapted for the specific ship, is strongly recommended. The pre-arrival checks have to be made by the Master:3

Ship / Shore Safety Checklist The above checklist shall be completed correctly and signed by both the Chief Officer and the shore terminal representative. Each shall retain one copy of the check list. For items that need to be periodically verified, suitable intervals shall be decided and entered at the initial stage.

Pre Arrival Checks The pre-arrival cargo gear and other equipment checks are to be conducted as and details entered into the deck log book. The Tanker Loading Checklist and the Tanker Discharging Checklist were to be completed as required. Ship specific Checklist for Preparation for Entering Port and other ship controlled documents should be prepared and approved for use and distributed onboard for efficient compliance.

D. THE CLAIMANT CANNOT RELY ON CLAUSES 1-5 OF THE BILL OF LADING FOR BLUR SKY HOLDINGS CLAIM AS IT HAS NO CONRACTUAL FORCE 1. The bill of lading is not capable of creating binding obligations on the Respondent as there is no clear offer or acceptance of its terms
On 10th Jan 2005 in London the claimant blue sky holding inc. of panama entered into a time charter party with femptc in respect of the marine transport LPG carrier alpha star. The said vessel was delivered to 2 Article III Rule (6), Article IV Rule (5)(a) 3 Facts pg. 69-71

femptc on 1st march 2005 for a hire rate of USD 2800000 per calendar year. The said time charterparty provides for arbitration which is found at clause 42 and 57 of the carter party the salient features of both these clauses are that the governing law is the English law, the arbitration to proceed in terms of the arbitration act 1950 with seat in London. This timecharter contract enumerates the rights and duties obligations and benefits arising out of the contract vis--vis blue sky holdings Inc. (claimants) and FEMPTC The respondent Neuland petroleum refinery co advertised tender seeking invitations for logistics in respect of sale and delivery of LPG In this tender document clause 28 stipulates that disputes and arbitration are subject to the laws of Neuland and place of arbitration is Worchester, Neuland FEMPTC responded to the tender by making an offer at 10 April 2005 at Worchester Neuland. Clause 11 of the offer accepts the applicable law as Neuland law with a stipulation in case buyers/ sellers prefer arbitration in Neuland and, Neuland law to apply, buyers and sellers to discuss further Neuland law details with their legal advisors. On 1342005 Neuland petroleum ref (respondent) confirmed the offer of FEMPTC and on 1542005 femptc accepted all the changes from 1-10. On 25/4/2005 femptc sought to amend 2 clauses of the offer and on 2742005 Neuland awarded the contract to the Joint venturebetween brit petroleum and femptc. In the award ref was made at clause i. to arbitration acc to Neuland laws and nothing else. It is pertinent to note that in all this correspondence and contact that blue sky holdings (claimant is not a party nor ref is anywhere made to it. It is also that the time charter party is between blue sky holding inc. and femptc and not the joint venture of brit petroleum and femptc. The bill of lading are by the masters of the vessel and Neuland; the bill of lading being a standard form contract on the letter of femptc. It will be evident form all these docs/ contracts there is no contractentered into by the claimants and respondent and there is no obligation and. /or duty to perform any duty by the respondents vesting in the claimants.

2. Terms of the clauses 1-5 in the bill of lading are not applicable. The provisions contained in clauses 1-5 were not mentioned in the bill of lading. The respondents neither were aware of the contents of the clauses or neither did they expressly agree to the terms. In the bill of lading on the reverse side no provisions were mentioned.

E. ALTERNATIVELY, EVEN IF THE BILL OF LADING HAS CONTRACTUAL

FORCE, NO CONTRACTUAL WARRANTY HAS BEEN BREACHED

A breach of contract in legal terms amounts to a broken promise to do or not do an act.

i. Under the Hamburg rules the carrier is liable for loss

Article 4 The responsibility of the carrier for the goods under this Convention covers the period during which the carrier is in charge of the goods at the port of loading, during the carriage and at the port of discharge. The carrier is deemed to be in charge of the goods until the time he has delivered the goods. Article 5 The carrier is liable (i) for loss of or damage to the goods or delay in delivery caused by fire, if the claimant proves that the fire arose from fault or neglect on the part of the carrier, his servants or agents; (ii) for such loss, damage or delay in delivery which is proved by the claimant to have resulted from the fault or neglect of the carrier, his servants or agents, in taking all measures that could reasonably be required to put out the fire and avoid or mitigate its consequences. In the present case, the crew member had opportunity to shut the transfer of the LPG by pressing the EDS button on seeing the white cloud caused by the leak, but due to his negligence of overlooking the cloud which caught fire causing the loss of the goods. Article 8 Loss of right to limit responsibility

i.

The carrier is not entitled to the benefit of the limitation of liability provided for in article 6 if it is proved that the loss, damage or delay in delivery resulted from an act or omission of the carrier done with the intent to cause such loss, damage or delay, or recklessly and with knowledge that such loss, damage or delay would probably result.

ii.

Notwithstanding the provisions of paragraph 2 of article 7, a servant or agent of the carrier is not entitled to the benefit of the limitation of liability provided for in article 6 if it is proved that the loss, damage or delay in delivery resulted from an act or omission of such servant or agent, done with the intent to cause such loss, damage or delay, or recklessly and with knowledge that such loss, damage or delay would probably result.

A. ALTERNATIVELY, IF THE PROVISIONS OF CLAUSES 1-5 OFTHE BILL

OF LADING WERE ACCEPTED, THE CLAIMANT HAS SUFFERED NO LOSS AS A RESULT OF THE NEGLIGENT ACTION OF THE RESPONDENTS 1. Claimants own negligence.

Negligence is defined as the breach of duty to take care that it is imposed by either Common Law or Statute 4. Three essential requirements must be present in order to be in negligent conduct. A duty of care which is implied in the Contract of Affreightment thatthe ship owner use due care and skill in navigation of the vessel and in carrying the goods, a breach on part of the ship owner who will be contracted with other ship owners and a resulting damage which will compensate the cargo owner in case of breach on partof the ship owner. The effect of negligence on the ship owners liability is the same as the effect of breach of the undertaking of seaworthiness which will deprive the ship owner from relying on the exemption clauses if negligence was established and attributed directly to the loss or damage occurred to the shipper or cargo owner.

Check Operational Conditions and Training of Crew the Master and Chief Engineer shall ensure that the concerned crew is well acquainted with the mechanism and its operation. They shall also ensure that the equipment and machinery is inspected and maintained in its operational readiness before use. The Chief Officer is responsible for the training of all crew directly involved in oil cargo transfer operations. He shall train all such personnel to be familiar with the proper operation of all equipment and machinery related to oil cargo transfer operations. The Chief Officer is also responsible for assuring that the below equipment is inspected and checked for operational condition prior to the commencement of any Cargo Oil Transfer operation. Valves. Pumps. Inert gas system. Level gauges. High level alarm unit. Hydraulic unit. The manufacturers instruction manuals should be used for reference.5

V. THE RESPONDENT IS NOT LIABLE FOR THE PROSPECTIVE CLAIM BY BLUE SKY 4 Charles Worth and Percy on Negligence, London, Sweet and Maxwell, (1997): negligence is also defined as
a tort which involves a person breach of duty that is imposed upon him to take care resulting in damage to the complaint. See also Lord Denning inLochgelly Iron and Coal v MMulan[1934] A. C. where he said negligence is the Failure to use the requisite amount of care required by law in the case where a duty of care exists see also the unfair contract term 1977 in S1 (1) 5The International Safety Guide for Oil Tankers and Terminals (ISGOTT) makes recommendations for the safe carriage and handling of petroleum cargoes, which is seen as a fundamental part of overall Tanker Safety

A. THE CLAIMANT HAS BREACHED ITS OBLIGATION OF HADING OVER THE GOODS TO THE RESPONDENTS
In calculation of monetary terms a L/C wired transfer of money took place at the sight of the ship prior to the discharge, further, the ships owners or the carriers are liable for any loss till the discharge or passing of the gas from the ships manifold flange which did not take place rendering the goods not delivered. Acc. to Hague Visby rules Art.III (2) subject to the provisions of Article 4 the carrier shall properly and carefully load, handle stow, carry, keep, care for and discharge the goods carried. This was particularly overlooked by the ships crew who saw the cloud and knowing the consequences, still did not shut down the operation, but willingly continued the operation which led to the ignition of the gas

B. FURTHER AND IN THE ALTERNATE, THE CLAIMANT HAS BREACHED

ARTICLE 3(2) OF THE HAGUE-VISBY RULES IN FAILING TO PROPERLY MAN, EQUIP AND SUPPLY THE SHIP BY FAILING TO ENSURE THAT THE MANIFOLD REDUCERS WERE ADJUSTED CORRECTLY
Acc to Hague Visby rules Art.III (2) subject to the provisions of article 4 the carrier shall properly and carefully load, handle stow, carry, keep, care for and discharge the goods carried. In the statement of claim made by the claimant the allegation is that the respondent Failed to take reasonable care in/ about the discharge of the cargo. The cargo was shipped on cfr basis. In this context notice of readiness was furnished on 27.7.2005the master had communicatedthat all the safety checklists of the terminal at Neuland and femptc were completed and signed. The master made available checklist of the checking done by trident overseas Inc. And the before discharge agreement was also executed It would appear from the documents provided that the terminal did not employ a 'ship/shore safety checklist; the one being competed appears to have been issued by the vessel's Owners technical managers. Before cargo transfer starts, the responsible officer should be satisfied that the precautions set out in Chapters 2and 3 are being observed. The use of safety check lists, appropriately adapted for the specific ship, is strongly recommended. The pre-arrival checks have to be made by the Master:6

In Silver v Ocean Steamship Co. Ltd7, the case concerned a claim brought bay cargo owner against a ship owner in respect of damage to the cargo resulted from the negligence on part of the ship owner. The ship owner relied on the Hague-Visby Rules

THE RESPONDENT IS NOT LIABLE FOR LOSS OF VESSEL TO THE AMOUNT OF U$2.75 MILLION AND DAMAGES FOR LOSS OF USE OF VESSEL IN THE AMOUNT OF U$955,967
6 Facts pg. 69-71 71930], KB. 416, quoted in Carvers Carriage by SeaVol. (1), London, Stevens and Sons, (1982)

VI.CLAIMS FOR LOSS OF VESSEL OF THE CLAIMANTS ARE CONSEQUENT UPON THE BREACH OF OUTLINED DUTY BY THE RESPONDENT (NO SIGN) i.
To establish the existence of a duty of care, the requirement of proximity and foreseeability are subject to the consideration of fairness, justice and reasonableness.8 Hedley Byrne & Co. Ltd. v. Heller & Partners Ltd.9 It was held that three requirements must be fulfilled in order to establish a duty of care:

The Plaintiff must rely on the Defendants skill and judgment, or his ability to make careful inquiry; The Defendant knew, or ought reasonably to have known, that the Plaintiff was relying on him; It was reasonable in the circumstances for the Plaintiff to rely on the Defendant.

In the present case, Neuland being the receivers of the goods, did not owe a duty of care towards blue sky who are the owners of the ship, instead it was blue sky who owes a duty of care towards the receivers of the goods who are meant to receive the goods in the same manner as they were loaded onto the ship. In Dunn v Bucknall he Brothers10. A case related to a breach of duty by the ship owner who promised to deliver the goods at a certain time. The ship owner failed to do so as a result of permitting to load enemies goods, which were liable to confiscation. The ship owner wanted to rely on the exemption clause contained in the Bill of Lading, which will exempt him. For loss or delay occasioned by restraint of princes, the court held that as a result of negligence on part of the ship owner he could not rely on the exemption clause, consequently he was made liable.

VII. FURTHER AND ALTERNATIVELY THE CLAIMANT HAS FAILED TO MAKE OUT CONTRACTUAL CONDITIONS PRECEDENT TO ESTABLISH A BASIS FOR A DAMAGES CLAIM.. 1.The losses suffered by the claimant are not governed by any contract and/or damages are not payable
The Claimant has to recover its claim from the Charterer who was required to insure the said ship against such casualties and in all probabilities would have received the claimed amount from the insurers and thus the claim of the Claimant is subrogated to the insurers and the claimant has no locus standi to make further claim.

8Marc Rich & Co. AG v. Bishop Rock Marine Co. Limited [1995] 3 W.L.R. 227; Donoghue v. Stevenson [1932] A.C. 562; Caparo Industries Plc v. Dickman [1990] 2 W.L.R. 358.
9 [1964] A.C. 465 10[1907] 2KB. 614, quoted in Carvers Carriage by Sea Vol. (1), London, Stevens and Sons,(1982)

2. Further and alternately, the claimant has failed to establish conditions giving rise to a damage claim against the respondent.
In calculation of monetary terms a L/C wired transfer of money took place at the sight of the ship prior to the discharge, further, the ships owners or the carriers are liable for any loss till the discharge or passing of the gas from the ships manifold flange which did not take place rendering the goods not delivered.

PRAYER FOR RELIEF

For the reasons submitted above, the Claimant respectfully requests this Arbitral Tribunal to: DECLARE that all members of this Arbitral Tribunal are not entitled to hear this dispute; and Further, ADJUDGE that the Respondent is not responsible for the damage to the ship and thus not required to compensate the claimant. And therefore. DECLARE the following conclusions stated below:
1. The present reference to arbitration be held to be invalid and so dismissed; in the alternative 2. It be held that there was no breach and or failure of duty by the \respondents to the Claimant 3. That it be held that the claimant be held accountable for the foisting of this vexatious claim on the Respondent and 4. For the costs, claims and damages as set out in the counter-claim be awarded to the Respondent.

Counsel for the Respondent