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Arbitration case of “ Wooyang Honey”

Release Date:2013-02-25 Hits:

On 12th June 1988, Yunfu Pyrite Enterprise Group Corp.(charterer) and Wooyang Shipping Co. LTD (owner) Entered into voyage charter for the carriage of 5,500 ton of pyrite conventrate in bulk from HuangPu PRC to Onsan South Korea on the vessel “Wooyang Honey”. During the voyage, the vessel was heavily listed due to liquification of the cargo. The captain failed to restore balance of the vessel by pumping water into ballast tanks. The vessel sank with the cargo on board. After the accident, Wooyang Shipping submitted the case to the Hong Kong International Arbitration Center ( HKIAC), claiming loss and damage of 2,550,735.89 US $ against the charterer.

 

There is a precedent case almost identical to the current case, in which Yunfu Pyrite Enterprise was sued on the similar ground as charterer for shipping dangerous cargo, and Yunfu was held liable for the loss. It has cost Yunfu a huge sum of compensation. The condition in the current case is as adverse to Yunfu as the former case according to the primary evidence. Both parties spared no effort in defending their cases. Experts and professors are invited to give expert evidence. Legal teams from both sides are formed by Queen’s Counsels and prestigious British Solicitors. The arbitration has lasted for 8 year and came into a standoff between the parties.

 

June 2005, Mr Xu Guangyu was invited by Yunfu to join the legal team. Mr Xu set about re-estimating and re-analyzing the evidence from professional and innovative aspects. Mr Xu proposed that the major points of dispute would be, firstly, whether Yunfu fulfilled their responsibility of notice as charterer; secondly, what is the immediate cause of the sinking of “Wooyang Honey”. Evidence was not only supplemented to be more detailed and more supportive, but also particularly re-organized from four aspects: investigation reports、expert evidence、witness evidence and case precedent.

 

As to issue of governing law, Mr Xu insisted that, though the case was subject to English law, it involved the application and interpretation of Chinese administrative law and international conventions. Therefore it would be significantly important to proceed the case with proper understanding of relevant law. Amicable cooperation was carried between Mr Xu and British Lawyers. Breakthroughs were achieved on organization of evidence and application of law which led to the breaking of deadlock and the reverse of unfavorable situation.

 

Award in favor to Yunfu was given: the unseaworthiness of “Wooyang Honey” and the misconduct of captain in response to accident are the major reasons of sinking. Thus WooYang are liable to the accident and their claim is denied.

 

Complete success in the arbitration has been achieved, which is immensely crucial to Yunfu, a nation-owned company with a long history. The company which has 4000 employers had once been put to the edge of bankruptcy, fortunately, it survives after pulling through the bitter dispute. Yunfu highly praise the pivotal role of Mr Xu and appreciate to his devotion to the case. Moreover, Mr Xu has earned respect among foreign lawyers with his efficient and meticulous work.

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