Judgment of the 9th Court of Appeal of 15.07.2020, case № А40-207804/18

(AGL LLC v. Al Khubub LLC)

Facts: in this second iteration of the dispute concerning Libyan barley, AGL (shipowners, carriers) demanded that Al-Khubub (voyage charterers, consignees) pay additional demurrage accumulated in the discharge port (Sevastopol) in the amount of 7.9 million rubles. The owners also applied to the court to enforce their right of retention against the barley and set the initial sale price.

The charterers objected that the claim for additional demurrage should be rejected, since the carriers breached the contract of carriage – they allegedly failed to deliver and release the cargo to the consignee and, on the basis of a forged bill of lading, disposed of the cargo as their own. In addition, the charterers sought the amount of demurrage to be reduced, since delays in unloading were caused by weather conditions and the degassing of the vessel (interruptions during discharge due to these reasons do not count as laytime).

Alternatively, the charterers argued that the amount of demurrage should also be reduced by half, since the ship carried cargoes of equal weight owned by two charterers, and demurrage is paid in proportion to the weight of the cargo carried. The owners have no right to enforce their right of retention of the barley under Art. 160(2) KTM in connection with non-payment of additional demurrage and to put the cargo up for sale - since the owners lost their right to claim demurrage by failing to comply with the procedure for its recovery agreed in the charter.

Moscow Commercial Court: the owners’ claim for demurrage was allowed. The charterers’ objection regarding the breach of the voyage charter was dismissed. Transshipment of barley by the owners from The Volgo-Balt-106 to The Yara J was not a breach of charter - since the operator of the storage facility (SSK-Trade) had the same cargo of identical quality and quantity in its warehouse, and the carrier was ready to hand it over to the charterers.

The charterers’ objection to the amount of additional demurrage (7.9 million) was dismissed on the same grounds as his previous claims for the refund of prepaid demurrage (see Judgment of the 9th Court of Appeal, case A40-175069/2018 immediately above). In addition, the charterers objections were similar to their already litigated and rejected claims in case A40-175069/2018. However, the owners’ claims to enforce their retention rights in the barley and set the initial sale price were rejected because the owners failed to provide sufficient and reliable evidence of the location of the barley.

9th Court of Appeal: decision upheld with similar reasoning. ■