IN THIS ISSUE
1. Dissipation of Assets and a Mareva Injunction: Hong Kong Court Finds for Charterers
2. Aircrash Investigators
3. Paradise Papers
4. Signal Case Turned Down
5. Why do Clocks Run Clockwise?
6. People and Places
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1. Dissipation of Assetts and a Mareva Injunction: Hong Kong Court Finds for Charterers
The latest edition of Chans Advice, the newsletter of Hong Kong’s Sun Mobility contains a note on the case of
Crete Maritime Corporation v. Emirates Shipping Line  9 HKJC 198 which appeared recently before the Hong Kong High Court and which ran a rule over the dissipation risk applicable to a fairly substantial Emirati charterer. The court gave relatively short shrift to the owner’s arguments. Read the note here:-
2. Aircrash Investigators
Your editor got to know a few aircrash investigators and adjusters a few years ago. They mostly seemed to be laconic, careful and immersed in their specialism. The editors of Wired who have an admirable tendency to treat transport as a crucial subject of study in our changing times, recently ran this article by Jack Stewart on the training for those who search for cause in air crashes.
3. Paradise Papers
The massive hack and leak of documents from Bermuda demonstrates that not even royalty, heads of state and the well to do are immune from their data being liberated by hackers and circulated within a wide public domain. Strange how the Sued – Deutsche Zeitung makes the running in both cases. Taking also into account the previous grand hack and leak case involving Panama-based services providers Mossack Fonsec, observers might be tempted to think that lawyers are a weak link in the data security walls of international finance. Sam Chambers over at Splash 24/7 has already pointed out the first shipping aspect involving US Commerce Secretary Wilber Ross and the shipping firm Navigator but we imagine there will be many more. Bermuda and Applebys being ubiquitous in the setting up of marine insurance offshoredom.
4. Signal Case Turned Down
The latest case note sent to us by Jason Minkin of BatesCarey in Chicago reports on the unavailing efforts of the Signal Mutual to recover damages from doctors:-
Admiralty law confers an implied warranty of workmanlike performance on parties who enter into “maritime contracts.” The U.S. District Court for the Northern District of California recently examined the scope of this implied warranty, observing that it does not apply unless the contract in question has the “primary purpose” of “affecting or protecting maritime commerce.” Signal Mutual Indemnity Association, Ltd. v. Dignity Health, 2017 WL 4176438 (N.D. Cal. Sept. 21, 2017).
A group self-insurer, Signal Mutual Indemnity Association, Ltd. (“Signal”), asserted a breach of contract claim against Dignity Health, a hospital. Signal asserted that a surgeon at the hospital had an implied warranty of workmanlike performance while operating on a sidepick operator who was employed by one of Signal’s member companies at the Port of Oakland. The employee suffered injury while working at the port, and ultimately died from surgery complications. Signal claimed that it was obligated under the Longshore and Harbor Workers’ Compensation Act (“LHWCA”) to pay death benefits to the employee’s heirs. Accordingly, Signal sued the hospital and two of its doctors for breach of contract, among other claims, arguing that the defendants breached the implied warranty of workmanlike performance as result of the complications from the surgery. The defendants moved to dismiss, claiming they had no contract with Signal, and that even if they did, it would not contain an implied warranty of workmanlike performance under admiralty law.
Signal argued in response that an onshore medical operation performed on an off-duty longshore worker could give rise to an implied warranty of workmanlike performance under admiralty law because the worker was a “maritime worker” whose work entailed “maritime commerce,” and who was working at a maritime location adjacent to a navigable waters (i.e., a port). Signal further argued that the defendants breached that warranty through their allegedly negligent medical care, substantially contributing to the decedent’s death and thereby giving rise to a duty to indemnify Signal for the death benefit payments it made. Signal asserted this claim under a theory of implied contractual indemnity, as well as under the U.S. Supreme Court’s decision in Federal Marine Terminals v. Burnside Shopping, 394 U.S. 404 (1969), which authorized indemnity claims by employers or insurers against third parties.
The court sided with the defendants, concluding that Signal’s breach of contract claim failed on two grounds. First, the court found that, under California law, there was no express contract between Signal and the defendants regarding the deceased employee’s medical treatment. The court rejected Signal’s argument that an authorization for the medical procedure given by its claims adjuster evidenced a contract, observing that this is a common form of pre-service utilization review, not consideration for services that would demonstrate the existence of a contract. The court similarly concluded that Signal’s payments to the defendants did not establish an express contract, because Signal was required by law to pay for the employee’s work-related injuries in any event.
Second, the court concluded that even if there were a contract, Signal’s allegations could not prove that the contract was a “maritime contract,” such that it would carry an implied warranty of workmanlike performance under admiralty law.
Citing controlling precedent from the U.S. Ninth Circuit Court of Appeals, the court observed that, to be a “maritime contract,” the contract must have the “primary purpose of protecting or affecting maritime commerce.” The court concluded that the alleged contract with Signal did not in fact have such a purpose. The court treated as analogous cases where courts found no “maritime contract” arose from medical services provided on land to seamen who had previously been injured at sea or from a stevedore company’s contract for insurance against liability for injuries to stevedores under the LHWCA. Since the surgery was performed on an off-duty longshoreman at an onshore hospital, the court reasoned that the impact on maritime commerce would have been no greater than if the employee had been injured in a car accident. Thus, the alleged contract between Signal and a private onshore medical provider was not a maritime contract.
Signal Mutual underscores the limits of the implied warranty of workmanlike performance under admiralty law. While this doctrine provides certain unique benefits and obligations to parties who enter into “maritime contracts,” there must be a sufficient nexus to maritime commerce. In the view of this court, a land-based medical procedure on an off-duty longshoreman does not qualify, even if the longshoreman’s injuries were sustained while working at a port.
[Authors Jason P. Minkin and Jonathan A. Cipriani, BatesCarey]
5. Why do Clocks Run Clockwise?
Courtesy of the Browser we read this think piece by Jack Forster which appeared in Hodinkee. Our readership has more than its fair share of individuals who have studied the stars and the movement of time and who might apply their minds to the question:-
Why do clock hands turn clockwise? What was that direction called before the invention of clocks? The answer to the first is probably that “clockwise” follows the movement of a sundial’s shadow in the northern hemisphere, where the first clocks were made, but there is no evidence of this causality. As to the second: “The idea that one would need to specify motion one way or the other around a circle doesn’t seem to have been widespread prior to the development of clocks”
6. People and Places
Maersk Container Industry (MCI) has appointed Sean S. Fitzgerald as Chief Executive Officer to lead the A.P. Moller – Maersk’s Transport & Logistics division in its development of refrigerated and dry containers.
The maritime charity Sailors’ Society’has appointed Jonathan Martin as new port chaplain for Southampton. Jonathan Martin brings three decades of chaplaincy experience, including acting as chaplain to the Royal Navy and HMS Victory.
Sailors’ Society, which has its headquarters in Southampton but operates in 91 ports around the world, celebrates its 200th anniversary next year.
Last year, the charity’s chaplains and ship visitors reached out to more than 400,000 seafarers, providing support such as Wi-Fi hotspots, transportation and a listening ear.
Carey Lo of the Hong Kong Maritime and Port Board writes-
Being both international financial centre and international maritime business centre, Hong Kong is in a uniquely advantageous position to drive shipping-related financial and insurance services. To explore and further develop the business opportunities in the maritime sector, the Financial Services Development Council (FSDC) and the Hong Kong Maritime and Port Board (HKMPB) will join hands to organise a forum in the afternoon of 24 November (Friday).
The Forum will provide a platform for industry practitioners to share views and explore business opportunities arising from global and regional economic development in ship finance and marine insurance. Apart from exchanging insights on industry trends, panelists/speakers will also explore various measures to further enhance Hong Kong’s role as a leading ship finance centre and marine insurance hub. Dr Raymond So Wai-man BBS JP, Under Secretary for Transport and Housing,will give welcoming remarks and Mr Joseph H. L. Chan, Under Secretary for Financial Services and the Treasury,will give closing remarks at the Forum.
Event details are as follows:
Date : 24 November 2017 (Friday)
Time : 3 p.m. – 6 p.m. (two panel discussions followed by a networking cocktail)
Venue : Auditorium, Hong Kong Monetary Authority, 56/F, Two International Financial Centre, Central
Language : English / Putonghua (simultaneous interpretation services will be provided)
Fee: Free of charge
Details of the event are set out in the event website at:-
please register by 15 November 2017 (Wednesday).
Should you have any enquiry, please feel free to contact Ms Carey Lo of the HKMPB Secretariat
telephone no. 3509 8264 or email at:-
From the Avo Archive
The website of this newsletter contains all the editorial material since the inception of the Maritime Advocate as a print based quarterly in 1997 under the founding aegis of John Guy, Chris Hewer and Manfred Arnold. Readers can go to the site and search the database on the home page in its entirety. If you are looking for an old case, an old controversy or you would just like to see how many times you and your firm have featured in our annals feel free to access the archive. It is like this e-zine, free to Readers and we always appreciate the support of advertisers and sponsors.
Looking for early references to Mareva Injunctions, we found these musings from our esteemed predecessor Chris Hewer on the effect of the Woolf Reforms. The musings appeared in the old paper Back Issue – 7 – April 99
By any other name
SOME familiar terms have disappeared along with the advent of Lord Woolf’s changes. Plaintiffs are now to be referred to as claimants in the English courts. Fair enough. The writ becomes the claim form. No argument there. Discovery becomes disclosure. I don’t care. A pleading becomes a statement of case. Ha! But there are some changes which I am not too happy about.
Why, for example, change a wonderful word like ‘subpoena’ for the plainly inferior ‘witness summons’? And what did Woolf have against proper names? Is a Part 36 offer really any substitute for the romance of a Calderbank offer? Gone, too, is dear old Anton Piller, thrown over for the mundane ‘search order’. And, saddest of all for shipping interests, the Mareva injunction has been frozen out in favour of – you’ve guessed it – a freezing injunction. Henceforth, we must protect our Himalaya clauses and our bumbershoots from judicial meddling. If we don’t, life will become unbearably literal.
A missionary heard about a tribal elder who had five wives.
“You are violating a law of God,” he said, “so you must go and tell four of those women you can no longer live here or consider you their husband.”
The elder thought a few moments, then said, “Me wait here. You tell ’em.”
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