This case arose out of the grounding of the Tai Hunter, owned by Tai Shing Maritime Co SA (the plaintiff), while it was carrying nickel ore to Ningde, Fujian, China. The accident caused water ingress and a list, and the vessel, cargo, and bunkers were exposed to a common danger. The plaintiff took a series of measures to preserve the vessel, cargo, and bunkers, and declared general average (GA). Relying on the GA clause on the reverse side of the bill of lading (BL), the plaintiff appointed Richards Hogg Lindley in London to adjust the GA under the York-Antwerp Rules 1994 (the Rules). The adjustment found that the cargo interest should contribute USD 228,853.23. Tsingshan Holding Group Co Ltd (the defendant) refused to provide GA security or pay the contribution, and the plaintiff brought proceedings.

The plaintiff argued that the measures were intentionally and reasonably taken for the common safety of the vessel, cargo, and other property, and therefore satisfied the requirements of GA. It also argued that the BL provided for GA to be adjusted in London under the Rules, and that the London adjustment should therefore be used to determine the amount of contribution. The adjustment also referred to art 12 of the Salvage Convention 1989 to describe the emergency operations as acts to assist a vessel or other property in danger.

The defendant argued that the plaintiff was not the proper claimant, that the claim was time-barred, and that the Rules did not bind the cargo interests. The defendant also argued that the maritime investigation report and the London adjustment lacked a sufficient factual basis, and that the salvage, pollution prevention, barging, port, crew wage, bunkers and stores, legal, expert, and adjustment costs should not be allowed in GA.

Held: The claim is allowed in part.

The Court held that the grounding gave rise to GA. It also held that the bill of lading clause providing for GA to be adjusted in London under the Rules was valid and binding on the defendant. The London adjustment could be used as a basis for the Court's review of the contribution, but the Court still had to examine whether each item satisfied the requirements of GA. The Court held that USD 1,205,788.57 could be allowed in GA, and that the cargo interest should contribute USD 159,694.33.

The Court confirmed that the plaintiff, as owner of the Tai Hunter, was entitled to claim GA contribution from the cargo interest. The Court also held that the claim was not time-barred. Although the case was formally filed on 9 February 2022, the plaintiff had already sent the statement of claim to the Court before 19 March 2021. Formal filing was delayed by the Covid-19 epidemic. The claim was therefore brought within the one-year limitation period for GA contribution claims.

As to the Rules, the Court held that the bill clearly provided for GA to be adjusted in London under the current Rules or any later amendment. The clause was workable and consistent with shipping practice. Although it was a standard term on the reverse side of the bill, it was different from a jurisdiction clause or a governing law clause. It did not deprive the cargo interest of substantive or procedural rights, nor did it unfairly increase the cargo interest's liability or exclude its main rights. The Court therefore held that the clause was valid and binding on the defendant.

As to art 12 of the Salvage Convention 1989, the Court noted that the London adjustment referred to that article when explaining the nature of the emergency operations. The Court did not apply art 12 as an independent basis for the decision. Instead, it treated it as background for understanding the nature of the salvage and emergency operations, and then examined the recoverability of the expenses under the Rules and Chinese law.

Relying on rr A, 6, 10.a, 10.b, 20, and 21 of the Rules, the Court held that reasonable expenses incurred for guarding the vessel in danger, carrying out temporary repairs, lightering cargo, escorting the vessel into port, completing discharge, and removing the common danger could be allowed in GA. The Court did not fully accept the London adjustment. It held that the pollution prevention costs and legal fees had not been proved to have been directly incurred for the common safety. They were therefore excluded from GA, and the related interest and commission also had to be deducted.