Supreme Court judgment favours bunker suppliers – The Res Cogitans

For those who have not followed the bunker saga, the brief issue considered in the Supreme Court judgment is this: the contract under which bunkers were supplied contained a combination of clauses resulting in property in the bunkers not being passed to the shipowner at any point. Did the contractual bunker supplier then have the right to sue for payment? An arbitration panel, the first instance judge and the Court of Appeal had all said that they did, but this required some legal aerobatics.

None of this would have happened if OW Bunker had not become insolvent. As a result of that event, the long chain of bunker intermediaries broke and the question became who should be stuck with the loss. The OW subsidiary in this case had contracted for the bunkers with its parent company, which had become insolvent and therefore had failed to pay its supplier, a Rosneft subsidiary.