The Court of Appeal has today handed down judgment in a case likely to be of interest to shipowners, cargo interests and financing banks, Unicredit Bank A.G. v Euronav N.V. [2023] EWCA Civ 471.

The essential question for the Court was whether a shipowner, Euronav, was liable to the Bill of Lading holder, Unicredit, for delivering a cargo of oil from the vessel Sienna without production of the Bill of Lading.

The Facts

The Sienna had initially been voyage chartered by BP Oil International Limited (“BP”) from Euronav.  A Bill of Lading was issued by Euronav with BP named as shipper. Following the sale of the cargo by BP to Gulf Petrochem FZC (“Gulf”), Euronav, BP and Gulf entered into a novation agreement by which Gulf became the voyage charterer in place of BP.  

Unicredit had financed Gulf’s purchase of the cargo from BP. Gulf had, at Unicredit’s request, asked BP to indorse the Bill of Lading and send it to Unicredit.  However, due to COVID restrictions, that had not happened by the time of discharge. Rather BP remained in possession of the Bill of Lading.

Gulf instructed Euronav to discharge the cargo by STS transfer to two vessels in Oman which Euronav duly did.

Unicredit was not repaid by Gulf the sum whichit had financed for the purchase of the cargo. Therefore, when the Bill of Lading was subsequently indorsed to Unicredit, it brought a claim against Euronav alleging a breach of contract contained in or evidenced by the Bill of Lading by reason of the delivery of the cargo without production of the Bill of Lading