Teekay Tankers has prevailed in a dispute with STX Offshore & Shipping over options that could have led to a massive $680m newbuilding deal.
The options could have turned an order for four 113,000-dwt tankers contracted for $170m into a 16 ship deal.
A contract was signed in April 2013 but STX failed to provide the required refund guarantees so in December Teekay terminated the deal alleging there had been a repudiatory breach by the South Korean builder.
Teekay is taking the dispute to arbitration in London but STX is challenging English jurisdiction.
The challenge came before London High Court judge, Justice Hamblen, who has ruled on multiple ground that England is the appropriate forum for the resolution of the dispute.
STX argued that Teekay’s claim form had not been validly served, or alternatively that England was a ‘forum non conveniens’ and South Korea was a more suitable place to resolve the dispute.
STX claims that the provision of refund guarantees was not a provision of the contract and there was a ‘drop hands’ agreement that the contract would be regarded as frustrated or terminated if refund guarantees could not be obtained.
The shipbuilder contended that the London office where the claim was served was originally a space sub-let by the Clarksons shipbroking group and subsequently only a liaison office for STX Corp which was a different corporate entity to STX Offshore & Shipping.
But Justice Hamblen ruled that “in all the circumstances I am satisfied....that England is clearly and distinctly the most appropriate forum for trial in the interests of the parties and for the ends of justice.”
The judge found that the claims form had been validly served but even if it had not been he would have granted out of jurisdiction permission for the claim to be served on STX’s head office in South Korea.
Click on the document in the related media column to the right to read the judgment in full.
