In Quiana Navigation SA v Pacific Gulf Shipping (Singapore) Pte Ltd  EWHC 3171 (Comm), a partial final award was the subject of an appeal between the owners of a vessel and the charterers, in relation to a BIMCO Non-Payment of Hire Clause for Time Charter Parties. The Owners were granted permission to appeal on the basis that the BIMCO Clause was a standard form clause, which meant the question of law was of general public importance and because the decision of the arbitral tribunal was open to serious doubt.
Following a hearing, the Court dismissed the appeal and upheld the finding in the partial final award.
Herbert Smith Freehills review the decision, concluding:
“The Court’s decision to dismiss this s69 appeal serves as a helpful reminder of the very limited circumstances in which parties will be allowed to appeal arbitral awards on points of law under the Act. Although permission to appeal was granted on the basis that the question of law was one of general public importance and that the Tribunal’s decision was open to serious doubt, the Commercial Court agreed with the Tribunal’s reasoning and dismissed all of the Owners’ arguments. Had the clause not appeared in a standard form contract (and the issue not been of general public importance), the Owners would probably have struggled to establish that the construction was “obviously wrong“, as would have been required in order to obtain permission to appeal.”
“The case has provided clarity on the meaning of the BIMCO Clause, which is discussed at length in the judgment and is also a reminder that courts and tribunals will not only interpret clauses by reference to the natural meaning of words, but will also take into account the broader commercial context in which the contract was concluded. In particular, caution should be taken when drafting payment clauses, and the contract should specify whether remedies for non-payment are available only for a specific period of time, or for so long as the payment is outstanding.”