11/02/2011

Star Reefers Pool Inc. v JFC Group Co. Ltd.

This was an application by the Defendant, a Russian company, disputing the Court’s jurisdiction to hear the claims brought by the Claimant against it. The claims were for substantial sums said to be due under two contracts of guarantee relating to the obligations of a third party under two long term charterparties.

The case concerned the approach to be taken to determining the governing law of a contract of guarantee under the Rome Convention in circumstances where the underlying contract contains an express choice of law clause, and the question whether cases decided prior to the Rome Convention such as Broken Hill v Xenakis [1982] 2 Lloyd’s Rep 304 were still good law.

In dismissing the Defendant’s application, Mr Justice Andrew Smith held that, while the cases decided prior to the Rome Convention were no longer authoritative, in the circumstances of the present case the fact that the charterparties were expressed to be governed by English law, coupled with the close connection of the Defendant and the charterer, allowed the court to infer with reasonable certainty that the contracts of guarantee were also intended to be governed by English law.

Charles Kimmins QC and Luke Pearce appeared on behalf of the Claimant.