The claimant was the holder of bills of lading with an arbitration clause relating to a cargo of timber. After the cargo was discharged to third parties without production of the bills of lading, the holders alleged that the carrier, who owned the vessel, had misdelivered it. The holder issued a writ in the Singapore High Court for the arrest of a sister ship of the vessel, which was subsequently effected, and more than a year after the alleged misdelivery, the holder commenced arbitration proceedings. The arbitral tribunal found that the claim was time-barred pursuant to article III, rule 6 of the Hague-Visby Rules, which provided that “the carrier … shall … be discharged from … liability … in respect of the goods unless suit is brought within one year of their delivery or … when they should have been delivered”. The holder appealed against the tribunal’s decision, contending that the Singaporean proceedings constituted a “suit” for the purposes of article III, rule 6.
On the holder’s claim—
Held, claim refused. The meaning of “suit” for the purposes of article III, rule 6 of the Hague-Visby Rules referred to proceedings that could decide the claim. If time was to stop running, substantive proceedings to establish liability were required. A determination on the merits of the holder’s claim for misdelivery required arbitration. Proceedings for security were not within the ordinary meaning of “suit” for the purposes of article III, rule 6, as such proceedings did not decide the claim. Accordingly, as the Singaporean proceedings were for security, it did not fall within the meaning of “suit” (paras 16–18, 21, 43).
Nigel Eaton KC and Helen Morton (instructed by Preston Turnbull LLP) for the holder.
Chris Smith KC, Maya Chilaeva and Sam Mitchell (instructed by Holman Fenwick Willan LLP) for the carrier.