ENGLAND AND WALES HIGH COURT | Legal battles

 

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Delos Shipholding SA & Ors v Allianz Global Corporate and Specialty SE & Ors [2024] 

The incident involving the Capesize bulk carrier WIN WIN highlights a unique case where maritime regulations and insurance complexities intersect in unexpected ways. What began as an alleged infraction—anchoring just inside Indonesian territorial waters—escalated into prolonged legal battles, with the vessel detained for nearly a year and its Master facing prosecution. This has brought to light crucial issues surrounding insurance coverage for war risks, detainment, and the intricacies of constructive total loss claims.

The broader implications of this case shed light on the challenges faced by shipowners, insurers, and legal authorities when navigating such disputes. Readers interested in exploring the details of this fascinating case, the legal arguments presented, and the impact on maritime insurance practices are encouraged to visit the link provided for a comprehensive breakdown.

The First Claimant ("Delos") was the registered owner of the Vessel. Delos is an SPV registered in the Marshall Islands. Its sole nominee director was Mr Evangelos Bairactaris, a Greek maritime lawyer and registered member of the Piraeus Bar Association. He is the managing partner and principal fee earner of a firm which has provided external legal services to the NGM group of companies (the "NGM Group") for many years and he was also the sole director on a similar nominee basis of a number of other ship-owning SPVs within the group.

The Second Claimant ("NGM") and Third Claimant ("FML") were respectively the commercial and technical managers of the Vessel. The Fourth Claimant was the mortgagee of the Vessel and the loss payee under the Policy. Delos and NGM were part of the NGM group which is a well-known and successful Greek shipping group founded by Mr Nikolaos Moundreas. The group is entirely owned and controlled by Mr Nikolaos Moundreas and his three children but while he remains the ultimate decision-maker in the group, day-to-day activities are supervised and monitored by his son, Mr Georgios Moundreas. Unless otherwise indicated, references to Mr Moundreas in this judgment are to Mr Georgios Moundreas.

The Vessel's war risks insurance had been placed with GAREX since 2008. GAREX is an underwriting agency based in Paris which specialises in marine war risks and underwrites for a pool of insurers, including, so far as relevant to this case, the Defendants ("Insurers"). The Policy was renewed for the 2018/2019 year on 29 June 2018 for the period 1 July 2018 to 30 June 2019.

In late 2018, the Vessel discharged a cargo of iron ore at Bayuquan in China following which she proceeded to Zhoushan for repairs. On 1 December 2018, she was joined there by a new Master, Captain Kumar. Captain Kumar had previously been employed by V-Ships and this was his first command for FML. Following completion of operations in China, the Vessel was ordered to Singapore to take on bunkers. Bunkering was completed on 13 February 2019 and on the same day NGM's Operations Department ordered her to proceed to Singapore OPL, where she was to find a safe anchorage and drop anchor awaiting further instructions. The email of instruction continued: "Recommended anchoring position to be around the following area: Lat: 01.25N / Long: 104.34E." It is common ground that these co-ordinates lay within Indonesian territorial waters.

On 14 February 2019, the Vessel left Singapore having been cleared to proceed to "High Seas". It is not in dispute that a passage plan was prepared which identified a different anchoring position. The Master explained in both his written and oral evidence that he did not use the position recommended by NGM because in his view it was too close to the traffic separation system in operation in the Straits of Singapore. The Straits of Malacca and Singapore is one of the busiest shipping lanes in the world and vessels coming from all directions are subject to a traffic separation scheme (the "TSS") which requires them to pass through a designated channel before peeling off again when they exit the channel at the other end. In the Master's view, NGM's suggested anchoring area was too close to the TSS for comfort given that the WIN WIN was a large vessel and, once anchored, would not be able to move quickly in the event of an incident occurring.

Please learn more by clicking the link below:

https://www.bailii.org/ew/cases/EWHC/Comm/2024/719.html

By, Zadock Zenas (compiled text)

Slovenia

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