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Star Axe v. Royal Alliance [2023] EWHC 2784 (Comm)
This case dealt with the question of which edition, 1994 or 2016, of the York-Antwerp Rules (YAR) should apply. The claimant issued 7 Congenbills bills of lading in 2021. On 03 November 2021, the vessel with cargo onboard struck an unknown submerged object and sustained damage. The claimant declared a general average. The defendant (the cargo interests) issued General Average Guarantees. The bills of lading contained the following clause: ‘General average shall be adjusted, stated and settled according to YAR 1994, or any subsequent modification thereof, in London unless another place is agreed in the Charter Party’. A dispute arose regarding the edition of the YAR that applies to the bills of lading. The question was whether the wording ‘any subsequent modification thereof’ covers YAR 2016.
The claimant argued that the relevant wording did not cover either YAR 2004 or YAR 2016 since they were new sets of rules and not modifications of the 1994 edition. In support of their proposition, the claimant referred to the CMI conference minutes, textbooks, and monographs, which discussed the relevant issues.
The defendant stated that when the Congenbill 1994 was drafted, it was clear that there should be other versions of the YAR. So, the disputed wording clearly covered the new editions of the YAR. Moreover, it was the exact reason for choosing such wording in the form. Otherwise, the development of modern commerce could not be properly reflected. Also, the editions of the YAR did not alter the essential features of the Rules.
Butcher J. found in favour of the defendant. He stated that there is no difficulty in interpreting the ordinary meaning of the wording ‘any subsequent modifications’ as referring to the 2004 and 2016 editions of the YAR. The Judge referred to two cases where the same conclusion was made regarding the Hague-Visby Rules as the modification of the Hague Rules.
Next, Butcher J. stated that this interpretation of the relevant clause is consistent with its primary purpose, i.e., ensuring that the Congenbill 1994 reflects the most modern changes in shipping commerce in relation to the adjustment of the general average. After that, the Judge declines the references submitted by the claimant and explains why they are not material for the case or do not reflect the claimant’s position.
As seen from the structure of the parties’ arguments, this issue of interpreting Congenbill 1994’s clause on the general average is far from clear. The position reflected in the doctrine and court practice is inconsistent. One of the aspects of the case is that the YAR is rather a technical tool for the general average adjustment. It is not a set of legal rules or, at least, it does not position itself as one. So, in my opinion, the argument on the reflection of the most modern shipping commerce trends seems even more reliable. The parties agree on the tool but do not determine the legal rules regulating their relations. In either case, this position is not undisputable. I would not be surprised if Butcher J’s is criticised in shipping, primarily from the perspective of the parties’ expectations.
