Trans Trade RK SA v Sebat Shipping and Trading Company

This is an application to challenge a finding made in an Arbitral Award (“the Award”). The Award was made on 24th March 2025, and amended pursuant to section 57 of the Arbitration Act 1996 on 16th May 2025, by the Arbitral Tribunal comprising Mr Jonathan Elvey and Ms Daniella Horton (“the Tribunal”).

Arbitration proceedings had been commenced by the Defendant (“the Owners”) against the Claimant (“the Charterers”) in respect of a voyage charterparty concluded on 9th April 2022 to carry a cargo of Ukrainian origin barley in bulk on a voyage from Constanta in Romania to Brake in Germany on board the vessel Sebat (“the Vessel”).

In the arbitration proceedings, the Owners claimed demurrage at the loadport of Constanta and demurrage at the discharge port of Brake. The Owners made an additional or alternative claim for an indemnity and for discharge port expenses under clause 11 of the Charterparty. The Charterers made a counterclaim in the arbitration proceedings.

By the Award, the Tribunal upheld the Owners’ claim for demurrage in the sum of US$844,131.25 (US$4,114.06 at Constanta and US$840,017.19 at Brake) and the claim for discharge port expenses in the sum of €21,616.40. The Tribunal dismissed the Owners’ claim for an indemnity and the Charterers’ counterclaim.

The challenge is made by way of an appeal on two points of law pursuant to section 69 of the Arbitration Act 1996. The two questions of law as formulated in Dias J’s order dated 13th October 2025 granting permission to appeal are as follows:

In her reasons for granting permission to appeal, Dias J said that the Tribunal’s decision on the first question of law was “obviously wrong” and that as regards the second question of law, being closely allied to the first question, “it is further arguable that the Tribunal was obviously wrong”.

The factual background as found by the Tribunal in the Award is as follows.

The Charterparty was evidenced by a recap dated 9th April 2022. The Charterparty contained the following provisions:

The Synacomex 2000 form (Continent Grain Charterparty) incorporated into the Charterparty contained the following provisions:

The Vessel loaded a cargo of 14,756.96 metric tons of barley (“the Cargo”), which was fumigated on completion of loading, at Constanta. By reason of the quantity of the Cargo loaded, the laytime for discharge was accordingly 3 days 18 hours and 36 minutes.

The Vessel proceeded to Brake where, on Tuesday 10th May 2022 at 1000 hours, at the end of the sea passage, the Vessel’s Master tendered a Notice of Readiness (“the NOR”) at the Brake pilot station. The Vessel then anchored either at the pilot station at 1100 hours (according to the Brake Statement of Facts) or at 1450 hours at an anchorage (according to the Vessel’s log).

Because the NOR was tendered before the Vessel was an “arrived ship”, the Tribunal held that the NOR was invalid (the Award, para. 61). No further notice of readiness was tendered by the Owners thereafter.

On Friday 13th May 2022, the Vessel proceeded from anchorage to berth.

During the morning of Saturday 14th May 2022, the Vessel’s hatches were opened in preparation for discharge of the Cargo. However, tests for gas showed phosphine levels were substantially in excess of the levels at which the port would permit discharge. The Tribunal was unable to reach a conclusion as to why the fumigant did not disperse more quickly (the Award, para. 155).

The Vessel was ordered to leave the berth and to return to the anchorage on the same day.

Despite ventilation of the holds at the anchorage, the phosphine levels remained high for a considerable period of time. The phosphine levels were still substantially above the recommended, acceptable and safe levels until at least 28 July 2022 (the Award, para. 89).

The Vessel did not berth again until 27th July 2022. The Vessel completed discharge just before 2000 hours on 30th July 2022.

The Owners were the claimants and the Charterers were the respondents in the arbitration.

The Tribunal was constituted in June 2022 (the Award, para. 10). There followed an exchange of statements of case, disclosure and witness evidence. The parties informed the Tribunal that no oral hearing was required. The Tribunal accordingly determined the issues in dispute by reference to an exchange of written closing submissions.

The Tribunal made the Award on 24th March 2025.

As mentioned above, the Tribunal allowed the Owners’ claim for loadport demurrage in the sum of US$4,114.06. The Charterers do not seek to challenge that decision.

Each party alleged that the other was responsible for the delay at the discharge port, Brake. As recorded in para. 53 of the Award, the differences between the parties focussed on which party was liable for the very substantial delay in discharging the Cargo at Brake. The Parties were also in disagreement as to whether the NOR tendered was in fact valid, whether laytime ever commenced and, if so, when.

The Tribunal set out in the Award a statement of the parties’ competing arguments, at para. 53-60:

The Tribunal found that the Owners were not at fault under the terms of the Charterparty so as to interrupt the incurring of demurrage at Brake. The Tribunal also found that the Owners failed to prove that the Charterers were in breach of the Charterparty with respect to the application of the fumigant (the Award, para. 150, 162-165).

At para. 61-63 of the Award, the Tribunal determined the Owners’ claim for discharge port demurrage as follows:

The Owners had presented a claim for an indemnity under Clause 11 of the Charterparty in circumstances where the Charterers undertook to pay all the necessary expenses incurred because of the fumigation, alternatively the fumigation had been undertaken in breach of Clause 11. The Tribunal disposed of this claim under Clause 11 as follows:

On 15th April 2025, the Charterers issued an Arbitration Claim Form in support of their application for permission to appeal from the Award on questions of law.

On 21st April 2025, following publication of the Tribunal’s Award and notification of the Charterers’ application for permission to appeal, the Owners sent to the Tribunal a request under section 57 of the 1996 Act for clarification of para. 63 of the Award as follows:

On 22nd April 2025, the Charterers wrote to the Tribunal indicating that they objected to the application made by the Owners under section 57 of the 1996 Act. There followed a number of exchanges between the parties, during which the Owners submitted that “Owners’ request is for clarification of existing wording which appears in the Award, namely the reference to “trite law” in para. 63. The Tribunal can, and we submit should, clarify what it meant by these words, in particular by reference to the Court of Appeal’s decision on waiver in The Happy Day”.

On 28th April 2025, the Charterers submitted to the Tribunal that there was no ambiguity in the Award so that there was no basis upon which the Owners could invoke section 57 of the Arbitration Act 1996, and further that even if there were an ambiguity, the Owners’ application was not in essence an application for the clarification of an ambiguity but “rather to say that you reached the conclusion that time started running when cargo operations started on a basis that was not pleaded, not proved and not argued. Had you done that, you would have been in serious breach of your obligations of fairness under section 33. We are confident that you would not have breached those obligations”. Further, the Charterers submitted that they had no opportunity to meet any case based on waiver of the invalidity of the NOR with evidence and that the Owners did not refer to The Happy Day and did not argue that it was authority for the proposition that “the commencement of cargo operations amounts to a waiver by a charterer of its right to argue or rely upon the invalidity of the NOR”.

On 7th May 2025, the Owners submitted that:

On 16th May 2025, the Tribunal dealt with the Owners’ application under section 57 of the 1996 Act as follows:

On 16th May 2025, the Tribunal made its amended Award, which included the following revision to para. 63:

The footnote (no. 1) after the words “trite law” in para. 63 of the Award referred to “The Happy Day [2002] 2 Ll.Rep.487”.

On 15th April 2025, the Charterers issued an Arbitration Claim Form seeking permission to appeal on the questions of law referred to above pursuant to section 69 of the Arbitration Act 1996 on the following grounds:

On 13th October 2025, Dias J granted permission to appeal on the two specified questions of law and gave the following reasons for her decision:

To repeat, the questions of law which give rise to the current appeal are:

The second question arises only if it is held that laytime, as a matter of law, had begun to run. The second question arose in circumstances where cargo operations began on a Saturday but the Charterparty required the NOR to be tendered between 0800 hours and 1700 hours Monday to Friday and during the office hours of the port. The Tribunal held that laytime commenced at 0800 hours on Monday 16th May 2022. The Charterers submitted that laytime should have been held to start at 0800 hours on Tuesday 17th May 2022. By the time of the hearing, the Owners conceded that the Tribunal erred in this respect on the second question.

Accordingly, only the first question of law arose for determination by the Court on this appeal.

As is apparent from the parties’ submissions set out below, the curious feature of this case is that there appears to have been no dispute between the parties that the answer to the first of the above questions as formulated is that laytime would not run at all. The parties’ submissions focussed on the allied, but distinct, question whether the Tribunal found that the Charterers had waived the invalidity of the NOR tendered by the Owners so as to allow laytime to commence.

Mr Michael Nolan KC on behalf of the Charterers submitted that the appeal should be allowed for the following reasons:

Mr Sean O’Sullivan KC, who appeared with Mr Thomas Steward, on behalf of the Owners, submitted that the appeal should be dismissed or the matter should be remitted to the Tribunal, for the following reasons:

The Charterers’ challenge to the Award is made under section 69 of the Arbitration Act 1996, being an appeal on a point of law. There is no challenge to the Tribunal’s Award on any other ground, in particular serious irregularity pursuant to section 68 of the 1996 Act.

Being a challenge based on a point of law, it is not open to the Court to assess the correctness of the Tribunal’s findings of fact. That said, such findings which the Tribunal has made may be relevant to identifying the legal findings of the Tribunal and determining whether those findings are correct.

Given the nature of the arguments advanced by the parties, I propose to address this appeal by consider the following issues:

When addressing an appeal based on a question of law under section 69 of the Arbitration Act 1996, the question of law must be one “arising out of the award” so that the appeal must be argued by both parties by reference to what is said and found in the Award itself (Cottonex Anstalt v Patriot Spinning Mills Ltd [2014] EWHC 236 (Comm); [2014] 1 Lloyd's Rep 615, para. 32).

The jurisdiction of the Court under section 69 is engaged where there has been an error of law, not where it is unclear whether there may have been such an error. If it is unclear whether there has or has not been an error of law, upon a review of the award, the applicant does not thereby prove the ingredients necessary to engage the section (Bulk Ship Union SA v Clipper Bulk Shipping Ltd (The Pearl C) [2012] EWHC 2595 (Comm); [2012] 2 Lloyd's Rep 533, para. 29). If there is an ambiguity or a lack of clarity, the appropriate course of action for an applicant is to seek clarification under section 57 of the Arbitration Act 1996 and, if no such application is made, then section 70(2) would prevent any appeal under section 69 being pursued (The Pearl C [2012] EWHC 2595 (Comm); [2012] 2 Lloyd's Rep 533, para. 29-34).

Therefore, the review of the arbitration award is a critical aspect in deciding whether there has been an error of law for the purposes of section 69. In The Pearl C [2012] EWHC 2595 (Comm); [2012] 2 Lloyd's Rep 533, para. 22-23, Popplewell J said:

In Reliance Industries Ltd v The Union of India [2018] EWHC 822 (Comm); [2018] 1 Lloyd's Rep 562, Popplewell J further explained the position at para. 56 as follows:

Accordingly, in reviewing the Award to determine what findings were made by the Tribunal as a matter of law, the Court must review and interpret the Award in a “reasonable and commercial way” (Zermalt Holdings SA v Nu-Life Upholstery Repairs Ltd [1985] 2 EGLR 14; MRI Trading AG v Erdenet Mining Corporation LLC [2013] EWCA Civ 156; [2013] 1 Lloyd's Rep 638, para. 23).

There is, therefore, a policy - represented by the Arbitration Act 1996 as a whole - in favour of upholding the arbitration process, by reason of the parties’ agreement to refer to disputes to arbitration, and any award made by an arbitral tribunal. Having regard to this policy, the Court should not be pre-disposed to find any errors in the legal reasoning in the Award and should start with the benevolent assumption that there is no error of law on a fair reading of the Award unless the Tribunal’s finding as a matter of law is clearly set out and the basis of the Tribunal’s error can be clearly discerned. If the reasoning and decision of the Tribunal are not clearly identified, the Court should not assume that there has been error of law by reason of the Tribunal’s silence, unless it can safely be concluded that an error of law has been made, for example where the Tribunal’s decision cannot stand as being consistent with the correct legal position.

In Unipolsai Assicurazioni SpA v Covéa Insuranceplc [2024] EWHC 253 (Comm); [2025] Lloyd’s Rep IR 254, at para. 5, Foxton J addressed the position where there was a question of mixed fact and law:

There are limits to how much benefit of the doubt is to be accorded to a tribunal’s award, bearing in mind the duty upon the tribunal under section 33 and the requirement that the award shall contain reasons for the tribunal’s decision (section 52(4)). Thus, the award shall not be given a meaning which plainly was not intended by the tribunal (Bunge SA v Nibulon Trading BV [2013] EWHC 3936 (Comm); [2014] 1 Lloyd's Rep 393, para. 35-36).

The Charterers submitted that the Tribunal made an error of law in concluding that laytime commenced even though an invalid NOR was tendered.

The Owners submitted that the Tribunal held that, though the NOR was held to be invalid when tendered, the Charterers had waived that invalidity by election or by a principle of “deemed waiver” so that laytime began to run (and thereafter demurrage began to accrue) upon the commencement of cargo operations (or soon afterwards). The Charterers disagree, observing that there was nothing in the Award to suggest that the issue of waiver was raised at all before the Tribunal.

In this case, there is no suggestion that there was a contrary agreement. Nor did I understand it to be contended that there had been a promissory estoppel (as one form of waiver) or an estoppel by convention which had a part to play. The debate between the parties circled around the meaning and implication of Potter LJ’s judgment in The Happy Day [2002] EWCA Civ 1068; [2002] 2 Lloyd's Rep 487. In any case, the essential elements of such estoppels were not separately addressed by the parties.

I shall first consider how the Tribunal dealt with the issue at hand, and then I shall consider whether the Tribunal erred as a matter of law in reaching its decision.

The question I have to ask is what legal issue the Tribunal determined and what decision it came to on that legal issue. In particular, did the Tribunal determine the demurrage claim in the manner as submitted by the Charterers without regard to the issue of waiver or did the Tribunal base its decision on the Charterers having waived the invalidity of the NOR?

Having regard to the principles of a benevolent assumption discussed above, in my judgment, the Tribunal decided that, as a matter of law, where an invalid NOR was tendered because it was premature, having been tendered before the Vessel was an “arrived ship” (see para. 61 of the Award), i.e. before the Vessel arrived at its contractual destination and/or was ready to discharge, laytime began to run from the commencement of cargo operations as if a valid NOR had been tendered at that point of time. The Tribunal was not determining an issue of waiver, however such a waiver might be described.

This conclusion results from a clear, reasonable and commercial reading of para. 63 of the Award, both in its original and revised form. It is also supported by the following considerations:

Having decided that the Tribunal held that laytime commenced notwithstanding that the NOR as tendered by the Owners was invalid, without regard to any issue of waiver, in my judgment, there has been an error of law made by the Tribunal as explained by Mustill LJ in The Mexico I [1990] 1 Lloyd's Rep 507, 513 and by Potter LJ in The Happy Day [2002] EWCA Civ 1068; [2002] 2 Lloyd's Rep 487, para. 38.

In The Mexico I [1990] 1 Lloyd's Rep 507, a notice of readiness was tendered at a time when the cargo of maize being carried under the relevant charterparty was not accessible for discharge because it was over-stowed by other cargo. The cargo did not become accessible until later, after which the cargo was discharged. The shipowner claimed demurrage.

At pages 509-510, Mustill LJ said that:

At page 513, Mustill LJ held that:

In The Happy Day [2002] EWCA Civ 1068; [2002] 2 Lloyd's Rep 487, Potter LJ said at para. 38:

I do not accept the Owners’ submission that the Tribunal determined that the Charterers waived the invalidity of the NOR by reason of actual or deemed waiver.

Indeed, I did not understand the Owners to dispute that an invalid NOR is incapable of triggering the commencement of laytime in the absence of a waiver, estoppel or contrary agreement.

If, contrary to my decision above, I had decided that the Tribunal had determined that there had been a waiver, it must have been on the basis of a supposed principle of “deemed waiver”, rather than any principle of “actual waiver”, because that is the basis on which the application under section 57 of the 1996 Act was made by the Owners and because that was the basis on which the Owners opposed the Charterers’ application for permission to appeal.

I should point out that the application for permission to appeal was not presented on the basis that there had been an erroneous determination of the question whether there had been a (deemed) waiver. Although it was submitted by the Charterers that it is permissible for the Court to refine the question of law to be considered under section 69 of the 1996 Act, that is so only if the “the substance of the question of law remains the same” (Sharp v Viterra [2024] UKSC 14; [2024] 1 Lloyd's Rep 568, para. 55).

I was initially of the view that the effect of the invalidity of the NOR was substantially different from the actual waiver of such invalidity. However, as the case is advanced on the basis of a supposed “deemed waiver”, which is a principle - if it existed - directly related to the effect of the invalidity of a notice of readiness, and as the point was fully argued by the parties, I propose to address the question whether there was such a deemed waiver applicable in the case of invalid notices of readiness, in case I am wrong in my decision that the Tribunal did not base its decision in the Award on waiver.

The principles relating to a waiver by election are well established. Such a waiver requires unequivocal conduct on the part of the waiving party which is inconsistent with that party asserting a particular right (assuming it has an election to make). On the basis of such conduct, that party will be taken to have waived that right, provided that it had actual knowledge of the circumstances giving rise to its legal right and of the legal right itself (see recently URE Energy Ltd v Notting Hill Genesis [2025] EWCA Civ 1407, para. 39-41, 48).

As discussed above, if a notice of readiness is invalid when tendered, it is incapable of triggering the commencement of laytime unless the parties agree otherwise or conduct themselves on the basis that the notice is valid, whether by means of waiver or estoppel. The commencement of laytime required a notice of readiness to be tendered and that notice had to be valid at the time of tender. There may be a number of reasons why a notice of readiness is not valid, for example because it does not comply with the formal or other requirements of the governing charterparty or because it is tendered at the discharge port before the vessel has arrived at the destination and is ready to discharge (Carver on Charterparties (3rd ed., 2024), para. 9-054).

In The Mexico I [1990] 1 Lloyd's Rep 507, the Court of Appeal held that there was no waiver, estoppel or agreement which overrode the invalidity of a notice of readiness. However, in that case, the charterers conceded that laytime began to run upon the commencement of discharge.

In The Happy Day [2002] EWCA Civ 1068; [2002] 2 Lloyd's Rep 487, the relevant charterparty provided that “Laytime at loading … ports shall commence … if written notices of readiness to load is given” and further provided that if the vessel was unable to enter the port by reason of congestion, the Master may give notice of readiness “whether in berth or not, whether in port or not”. When the vessel arrived at the relevant port, it was unable to enter the port immediately because it missed the tide, but notwithstanding the Master purported to tender a notice of readiness. The vessel resumed the voyage into the port on the next tide. No further notice of readiness was tendered. As the charterparty was a berth charter and as there was no congestion, the notice of readiness was invalid.

The Court’s inquiry was into whether laytime had begun to run, even though the notice of readiness was invalid, by reason of waiver or estoppel. At para. 66-70, Potter LJ stated that:

The Court then considered these principles in light of the facts as found by the arbitral tribunal, holding that it was properly open to the tribunal to conclude that, as at the time when discharge commenced, the charterers had waived any reliance on the invalidity of the notice of readiness served upon the receivers or their agents in accordance with the requirements of the charterparty as a means of deferring operation of laytime.

At the conclusion of the judgment, Potter LJ stated at para. 85 that:

Therefore, a notice of readiness which is tendered but not in accordance with the requirements of the relevant charterparty, because for example the vessel is not ready to load or discharge cargo, is invalid and will not result in the running of laytime and the incurring of subsequent demurrage, even after the commencement of cargo operations (see Schofield on Laytime & Demurrage (8th ed., 2022) para. 3.382). Even if the notice of readiness is valid in one or more respects, but is invalid in another or other respects, the notice of readiness will not be operative for laytime and demurrage purposes. This is so even though all of the requirements of a valid notice of readiness are satisfied only after the tender of the notice of readiness. The notice of readiness must be valid in all respects at the time of tender.

This state of affairs is of course open to be modified by the parties’ contrary agreement or by means of an effective waiver or estoppel. The agreement, waiver or estoppel may be effected by a party’s agent provided that that agent has the requisite authority.

There is, in my judgment, no principle of “deemed waiver” insofar as it rests upon a less rigorous test of waiver than an actual waiver, in particular as regards the knowledge required on the part of the waiving party. That is, although Potter LJ in The Happy Day did not expressly refer to the requirement of the waiving party’s knowledge of the circumstances giving rise to and relating to the invalidity of the NOR in his summation at para. 85 of his judgment (unless it was compendiously referred to by Potter LJ in the phrase “to the knowledge of the charterers”), that does not mean that such knowledge is not a critical requirement of an effective waiver of the invalidity of the NOR by the Charterers so as to allow the subsequent running of laytime.

I must admit to some initial uncertainty by reason of Potter LJ’s statement that “the charterers may be deemed to have waived reliance upon the invalidity of the original notice”. I do not understand what is meant by the charterers being “deemed” to have waived the invalidity of the notice: either there has been a waiver established by the satisfaction of the requirements set out in para. 68 of Potter LJ’s judgment or there has not. It might be that Potter LJ was stating that the charterers’ act of discharging cargo with actual knowledge of the invalidity of the notice of readiness, and without any express reservation or rejection being communicated to the owners, is “deemed” to constitute an unequivocal assertion which can give rise to a waiver. In any case, I did not understand that Potter LJ’s summation at para. 85 was intended to detract from what the learned Lord Justice said earlier in his judgment.

The Owners relied on three LMLN reports of arbitration (14/15, 5/15, 21/07), where the relevant findings of the arbitral tribunal were recorded in a manner which might be thought, on one reading, to support the principle of deemed waiver in reliance on The Happy Day, but I gain no assistance from those reports as they are no more than a brief summary of the tribunals’ findings and do not explain the basis of their reasoning.

The law is correctly stated in Scrutton on Charterparties (25th ed., 2024) where the editors say at para. 9-081:

Similarly, the editors of Carver on Charterparties (3rd ed., 2024) discussed The Happy Day at para. 9-102 after considering the decision of Mustill LJ in The Mexico 1:

For the reasons explained above, in my judgment, the Tribunal erred as a matter of law in concluding that laytime began to run upon the commencement of cargo operations even though, as it held, the NOR was invalid when it was tendered.

I also conclude that the Tribunal did not decide the issue of the commencement of laytime on the basis of the application of any principles of waiver. If I am wrong in this respect, and the Tribunal resolved the issue of the commencement of laytime, on the ground of a supposed “deemed waiver”, there is in my judgment no such legal principle insofar as it differs from an actual waiver, whose conditions were authoritatively set out in para. 68 of Potter LJ’s judgment in The Happy Day. If the Tribunal so found, it erred on a question of law in this respect.

I have therefore concluded that the Charterers succeed in their appeal against the Award insofar as the Tribunal held that the Charterers were liable to the Owners for discharge port demurrage.

The question now arises whether various issues should be remitted to the Tribunal as submitted by the Owners.

Section 69(7) of the Arbitration Act 1996 provides that:

Upon a successful appeal from an arbitral award on a question of law, the Court should first consider whether the Award should be remitted to the Tribunal. This is because the parties have agreed to have their dispute resolved by arbitration, not by the Court (Maurice J Bushell & Co v Born [2017] EWHC 2227 (Ch), para. 23-26).

The Owners have identified three possible matters which should be remitted to the Tribunal:

Before addressing each of these matters, the principles governing remission should be considered. Remission of an arbitration award is a direction by the Court that the arbitral tribunal (whose office has been discharged in respect of the particular issue disposed of by the award) should reconsider the relevant issue in light of the Court’s correction of any legal finding made by the tribunal; it is not an invitation to address the reference afresh or any wider or different issue (The Avala (No. 2) [1996] 2 Lloyd's Rep 311, 316; Alegrow SA v Yayla Agro Gida San Ve Nak AS [2020] EWHC 1845 (Comm); [2021] 1 Lloyd's Rep 565, para. 76).

In The Happy Day [2002] EWCA Civ 1068; [2002] 2 Lloyd's Rep 487, at para. 55, Potter LJ said that:

In Alegrow SA v Yayla Agro Gida San Ve Nak AS [2020] EWHC 1845 (Comm); [2021] 1 Lloyd's Rep 565, at para. 76-77, Henshaw J said:

However, if an issue was not canvassed before the Tribunal by reason of one party not advancing a case before the Tribunal, remission would not be appropriate in those circumstances (Alegrow SA v Yayla Agro Gida San Ve Nak AS [2020] EWHC 1845 (Comm); [2021] 1 Lloyd's Rep 565, para. 78). As both parties accepted, if the relevant legal argument was not advanced by the respondent in the arbitration proceedings, remission does not provide an opportunity for further findings of fact to be made in support of such a legal argument (Olam Global Agri Pte Ltd v Holbud [2025] EWHC 3187 (Comm), para. 139).

On the other hand, if the relevant facts have been determined by the arbitral tribunal already, and the Court is able to answer how the correct legal principles should be applied to those facts, there is no need for remission and the Court is able to vary the Award accordingly (Fence Gate Ltd v NEL Construction Ltd [2001] 82 Con LR 41, para. 92-93; The Johnny K [2006] EWHC 134 (Comm); [2006] 1 Lloyd's Rep 666; Fehn Schiffahrts GmbH & Co KG v Romani SpA [2018] EWHC 1606 (Comm); [2018] 2 Lloyd's Rep 385).

As to the first of the three issues identified by the Owners as requiring remission, namely the remission for the purposes of applying the correct legal principles to the facts in order to determine whether the Charterers waived the invalidity of the NOR, as I have held that the Tribunal was not addressing an issue of waiver, there is no need to resort to remission. I would have reached the same conclusion had the Tribunal decided the claim for discharge port demurrage on the basis of the existence of a supposed, but erroneous, principle of “deemed waiver”.

As a result, the Award should be varied in paragraphs A and C of the Tribunal’s disposition of the claims so that these paragraphs read as follows:

It may be that there are further variations to be made. This can be addressed as part of the consequential issues.

As regards the Owners’ alternative claim under clause 11 of the Charterparty, the Tribunal dismissed that claim on the ground that there was a viable demurrage claim by reason of the delay in discharging the Cargo. As I have held that such demurrage is not recoverable, the question arises whether this issue should be remitted to the Tribunal for reconsideration in light of the Court’s decision that the Tribunal erred in law in holding that demurrage was recoverable.

In principle, such an issue should be remitted to the Tribunal (Alegrow SA v Yayla Agro Gida San Ve Nak AS [2020] EWHC 1845 (Comm); [2021] 1 Lloyd's Rep 565, para. 83-86), unless there were a good reason not to remit this issue to the Tribunal. Claims or counterclaims which were rejected by the arbitral tribunal, but on the basis of conclusions which have been undermined on appeal, generally fall to be remitted to the tribunal for further consideration (Alegrow SA v Yayla Agro Gida San Ve Nak AS [2020] EWHC 1845 (Comm); [2021] 1 Lloyd's Rep 565, para. 79-86).

After I circulated a draft judgment to the parties on this appeal, an issue arose whether the claim under clause 11 could or should be remitted to the Tribunal in the absence of the Owners applying for permission to appeal or raising the issue by way of a respondent’s notice. After considering further written submissions on this issue, I have decided that the issue should be addressed as a consequential issue by way of a short oral hearing.

As to the issue of costs, it seems to me that the Tribunal is better placed than the Court to address the ultimate disposition of the costs of the arbitration, having regard to the success and failure of each party of the various issues argued before the Tribunal and which were not considered by the Court. The Court’s decision was limited to one claim, albeit a substantial claim, but the various factors which are to be considered in the assessment of costs may well go beyond the ultimate decision on the claim for discharge port demurrage and the proportion of the Owners’ surviving successful claim as compared to the overall claim.

For the reasons explained above, I have determined the Charterers’ application as follows:

The issue whether the Owners’ claim under clause 11 of the Charterparty is to be remitted to the Tribunal is to be determined after I have heard the parties on this issue at a consequential issues hearing.

I am very grateful to both counsel for their helpful and thoughtful submissions.