TTMI challenged the decision of an arbitrator to strike out its claim against Statoil ASA (Statoil) on the ground that there was no contract between the two parties and therefore no arbitration agreement. TTMI Sarl v Statoil ASA (2011)
The claim had been brought under a charterparty on the Shellvoy 5 form, clause 43(c) which provided for London arbitration; however no charterparty was drawn up, nor signed.
TTMI relied upon a fixture recap email, which mistakenly recorded Sempra Energy, TTMI's ultimate parent company, as the vessel's time-charterer.
TTMI's case was that, notwithstanding the mistake, there was a binding charterparty or alternatively that a contract was formed by performance and payment of freight. Statoil denied that there was a contract between it and TTMI as it believed that the contract was with Sempra Energy and that the charterparty was performed by them.
It was held that a recapping email is not a contractual document naming the parties but is instead a recapitulation of what had previously been agreed orally. There was no evidence that a contract was made prior to the recap. The recap was the only document evidencing the parties' agreement and therefore could for material purposes be regarded as the charterparty.
The Court found that the contract was formed between Statoil and TTMI by performance. Statoil dealt with TTMI throughout, based on the fact that TTMI instructed the vessel to take on Statoil's cargo, the Notice of Readiness identified TTMI as the time charter, there was full performance of the voyage, and there was payment due to TTMI into TTMI's bank account. The contract was deemed to have been formed when the freight was paid, if not when the first Notice of Readiness identified TTMI as the time charter was accepted by Statoil's managing agents.
The award was set aside and the matter remitted to the arbitrator.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.