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OW Bunker ruling raises more questions: UK Defence Club

OW Bunker ruling raises more questions: UK Defence Club
A judgment in favour of OW Bunker/assignee ING last week has failed to provide clarity and raise more questions, according to the UK Defence Club.

Last week’s appeal judgment ruled that the bunkers onboard the Product Shipping & Trading vessel Res Cogitans still belonged to OW Malta.

The judgment said, “It is a contract under which goods are to be delivered to the owners as bailees with a licence to consume them for the propulsion of the vessel, coupled with an agreement to sell any quantity remaining at the date of payment, in return for a money consideration which in commercial terms can properly be described as the price.”

Kieron Moore, senior director of claims for the UK Defence Club, commented:“Under this reasoning, as the bunkers had been consumed, the Member was obliged to pay for the bunkers as licensee, notwithstanding a retention of title clause in the underlying contract.As a consequence, an owner may be obliged to pay twice for the same bunkers.”

He said the judgment failed to address what happened if some of the bunkers were unconsumed, and also raised the question what would happen in a quality dispute after some of the fuel had been used.

“What we have here is a decision which, far from providing clarity, raises more questions than answers and we believe the industry deserves better,” Moore stated.