The Court of Appeal has decided that it is possible to constitute a limitation fund in England and Wales under the 1976 Limitation Convention by means of a guarantee in the form of a P&I Club letter of undertaking (“LOU”).
The decision arose out of the loss of the bulk carrier “Atlantik Confidence” on 30 March 2013. The Owners of the vessel sought to constitute a limitation fund by way of an LOU and were directed to apply at an oral hearing. Simon J heard the application and concluded that a limitation fund could not be constituted by an LOU (see  2 Lloyd’s Rep. 535). The Court of Appeal allowed the Owners’ appeal against the decision.
Michael Collett QC acts on behalf of certain cargo claimants who did not participate in the appeal (instructed by Ben Macfarlane & Co).