Monjasa A/S v. Volgodon LLC, Kent Shipping And Chartering Ltd

At a glance

Parties

Monjasa A/S (Denmark) v. Volgodon LLC (Russia) and Kent Shipping and Chartering Ltd (United Kingdom)

Case no.

Kyiv Court of Appeal, Case No. 796/50/2018 (proceeding No. 2-k/824/2/2018)

Court

Kyiv Court of Appeal (Київський апеляційний суд), Judge I.M. Verbova, sitting alone

Underlying award(s)

Award of 15 January 2016, arbitration in New York under the rules of the Society of Maritime Arbitrators

Forum and rules

Application for recognition and enforcement under the New York Convention 1958, the Ukrainian Law on International Commercial Arbitration and the Civil Procedure Code of Ukraine

Sector

Marine fuel supply (bunkering)

Outcome

Recognition and leave to enforce refused (3 December 2018).

Amount

Award: USD 188,973.08 in total (principal USD 122,490, interest, legal costs and the arbitration fee). Nothing enforced.

The dispute

Monjasa A/S, a Danish company, made bunker supply contracts with Kent Shipping and Chartering Ltd for the vessels Loukhi and Chalna. Monjasa said Kent acted as agent for the ships' owner, Volgodon LLC. The bunker requests and confirmations were exchanged between December 2013 and January 2014. The confirmations incorporated the Monjasa Group General Terms and Conditions (January 2012 edition), and clause 16 of those terms provides for arbitration in New York under the rules of the Society of Maritime Arbitrators. Monjasa said the fuel was never paid for. It won an award on 15 January 2016 against Volgodon and Kent for USD 188,973.08. In March 2018 Monjasa applied in Kyiv to have the award recognised and enforced against Volgodon, whose property was in Ukraine. Volgodon objected that it had no contract or arbitration agreement with Monjasa, and that it had not been properly notified of the appointment of the arbitrator or of the arbitration.

Key holdings

1. The party resisting enforcement must prove the grounds for refusing recognition and enforcement. These grounds are set out in Article V of the New York Convention, Article 36 of the Law on International Commercial Arbitration and Article 478 of the Civil Procedure Code. p. 4
2. The Odesa Region Commercial Court (judgment of 3 August 2018) and the South-Western Commercial Court of Appeal (8 November 2018), in case No. 916/417/18, had dismissed Monjasa's debt claim against Volgodon. Those decisions established that there was no fuel supply contract and no arbitration agreement between Monjasa and Volgodon. Under Article 478(1)(1) of the Civil Procedure Code, this is a ground to refuse recognition. p. 4
3. The case file contained no evidence that Volgodon was properly notified of the appointment of the arbitrator or of the New York arbitration. This is a separate ground for refusal under Article 478(1)(1) of the Civil Procedure Code. p. 4
4. The court refused recognition of the award of 15 January 2016 and refused leave to enforce it. The ruling could be appealed to the Supreme Court within thirty days. p. 5

Procedural history

1. December 2013 – January 2014Bunker requests and confirmations for the vessels Loukhi and Chalna are exchanged.
2. 15 January 2016Award in the New York arbitration under the Society of Maritime Arbitrators rules: USD 188,973.08 in Monjasa's favour.
3. 6 February 2018In case No. 916/184/18, the Odesa Region Commercial Court orders the arrest of Volgodon's vessel PUDOZH as a security measure.
4. March 2018Monjasa applies to the Kyiv City Court of Appeal for recognition and enforcement of the award.
5. 3 August 2018The Odesa Region Commercial Court dismisses Monjasa's debt claim against Volgodon (case No. 916/417/18) and lifts the arrest of the vessel.
6. 8 November 2018The South-Western Commercial Court of Appeal dismisses Monjasa's appeal in case No. 916/417/18.
7. 3 December 2018The Kyiv Court of Appeal refuses recognition and enforcement. The full text is dated 4 December 2018, and the ruling became final on 4 January 2019.

Tribunal, counsel and experts

Decided by

• I.M. Verbova Judge, Kyiv Court of Appeal

For the claimant

M.H. Selivanov

For the respondent

M.M. Kapelist

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Keywords

• New York Convention
• recognition and enforcement
• refusal of enforcement
• Article V(1)
• lack of notice
• arbitrator appointment
• existence of arbitration agreement
• bunker supply
• marine fuel
• Society of Maritime Arbitrators
• New York arbitration
• agency
• Ukraine
• Civil Procedure Code Article 478
• vessel arrest

Summary generated with AI from the published documents — refer to the award for the authoritative text.