EMEA News
Vessel Owners Get Second Chance to Appeal After OW Bunker Wins First "Who to Pay" Arbitration Case
Vessel owners have been given a second chance to appeal a ruling in favour of O.W. Bunker & Trading A/S (OW Bunker) and ING Bank N.V. (ING) who earlier this month won the first test case in a London arbitration over who a vessel should pay for bunkers in the wake of OW Bunker's collapse last year, Gard reports.
When the case was first arbitrated, on July 14 owners appealed the result in English High Court, which "largely upheld" the tribunal's findings.
However on July 15, 2015 owners were granted leave to continue their appeal.
The arbitration case was sparked after a subsidiary of OW Bunker in Malta supplied bunkers to vessel owners prior to OW Bunker's bankruptcy announcement.
No payment was made by the vessel owners due to a lack of clarity around who was entitled to be paid for the bunker supply.
OW Bunker also did not pay the physical supplier.
The owners' had argued that OW Bunker and ING were not entitled to payment under the supply contract because they had failed to transfer title of the bunkers to the owners.
However the judge held that payment was due to OW Bunker/ING because the bunker supply contract fell outside the scope of the Sale of Goods Act due to a combination of OW Bunker's standard terms and conditions, and general market practice and expectation.
Gard noted that under English law, the vessel owners were not contractually obligated to make payment to the physical supplier, as the debt was owed by the vessel owners to OW Bunker/ING once the credit period had expired.
"The issue may impact all suppliers of consumables provided upon credit terms," said Gard.
In December, it was reported that ING was pursuing a list of several hundred carriers for outstanding bunker payments to OW Bunker.
In April, it was also reported that ING was also pursuing a vessel through a U.S. court that it said owes OW Bunker $262,931.76 in unpaid fuel bills.
