G2 Ocean AS v Tokio Marine Brasil Seguradora SA (The “Tanchou Arrow”)
DMC/Arbn/26/07
England
G2 Ocean AS v Tokio Marine Brasil Seguradora SA (The “Tanchou Arrow”)
English Commercial Court: HHJ Mark Pelling KC: [2026] EWHC 997 (Comm): 23 April 2026
Judgment Available on BAILII @ https://www.bailii.org/ew/cases/EWHC/Comm/2026/997.html
James Watthey and Neil Dowers (instructed by Hill Dickinson LLP) for G2 Ocean (Contractual Carriers)
Tokio Marine Brasil (Cargo Insurers) was not represented because this was a without notice application by Contractual Carriers
ANTI-SUIT INJUNCTION: BILLS OF LADING: BOOKING NOTES: LONDON ARBITRATION AGREEMENTS: CARGO CLAIMS: WHETHER INTERIM CONTRACTUAL ANTI-SUIT INJUNCTION SHOULD BE GRANTED AGAINST CARGO INSURERS WHO COMMENCED BRAZILIAN COURT PROCEEDINGS AGAINST CONTRACTUAL CARRIERS CONTRARY TO LONDON ARBITRATION AGREEMENTS IN BOOKING NOTES INCORPORATED INTO BILLS OF LADING: FORM AND AMOUNT OF SECURITY TO BE PROVIDED TO SECURE CONTRACTUAL CARRIERS’ CROSS-UNDERTAKING IN DAMAGES: WHETHER TO GRANT PERMISSION TO SERVE PROCEEDINGS OUT OF ENGLISH JURISDICTION BY ALTERNATIVE MEANS WHEN BRAZIL A STATE PARTY TO HAGUE SERVICE CONVENTION
DMC Rating: Confirmed
Summary
In granting an interim contractual anti-suit injunction in favour of Contractual Carriers against Cargo Insurers, who commenced Brazilian court proceedings contrary to agreements in the contracts of carriage contained in or evidenced by bills of lading to resolve disputes in London arbitration, the High Court held that:
1. The bills of lading related to 4,500mt of bagged urea cargo shipped on board the vessel pursuant to two booking notes which included London arbitration and English law clauses and which by the express terms of the bills of lading had been incorporated into the contracts of carriage;
2. The Cargo Insurers were bound to exercise rights, subrogated from cargo interests, under the bills of lading against Contractual Carriers subject to the London arbitration agreements as incorporated, thus the Brazilian court proceedings were brought in breach of those agreements;
3. There was no significant delay or other strong reason to justify refusing the anti-suit relief sought, when Cargo Insurers could have commenced but did not commence London arbitration before the limitation period expired;
4. Contractual Carriers had to provide an LOU from their P&I club’s London office, to fortify the cross-undertaking in damages; and
5. Alternative service of the proceedings by email was granted, to give Cargo Insurers prompt notice and enough time to prepare for the return date hearing.
Case note contributed by Jim Leighton, LLM (Maritime Law), LLB (Hons), BSc (Hons), Solicitor Advocate of England & Wales, IMI Qualified Mediator, LMAA Supporting Member and Deputy Editor of DMC’s CaseNotes
Background
G2 Ocean, as Contractual Carriers under bills of lading, were the disponent owners of the bulk carrier Tanchou Arrow, on which a cargo of bagged urea was shipped in China for discharge in Brazil pursuant to two booking notes dated 12 June 2024, one note for the carriage of 500mt and the other note for 4,000mt, in relation to which two bills of lading were issued on the CONGENBILL 2016 form.
The cargo was insured by cargo interests with Tokio Marine Brasil, as Cargo Insurers, who, after the discharge of the cargo in Brazil, indemnified cargo interests under the cargo insurance policy and commenced legal proceedings before the Brazilian courts to pursue their subrogated rights against Contractual Carriers.
The bills of lading on their face (at page 1) identified a “charterparty” dated 12 June 2024 and stated that the conditions of carriage were to be found on page 2 on the reverse side. On page 2 at paragraph 1 the terms, conditions, liberties and exceptions of the charterparty identified overleaf, including the law and arbitration clause of that charterparty, were said to be incorporated into the bills of lading.
The two booking notes at paragraph 18 contained an English governing law and London arbitration agreement that required any disputes under the contracts to be referred to arbitration in London in accordance with the Arbitration Act 1996 or update thereof. The arbitration was to be conducted in accordance with the LMAA Terms.
Contractual Carriers, on the advice of their Brazilian lawyers, entered an appearance before the Brazilian courts solely for the purpose of objecting to the Brazilian courts having jurisdiction to hear Cargo Insurers’ alleged claim under the bills of lading.
Contractual Carriers also made a without notice application to the High Court in London to seek the granting of an order for a contractual anti-suit injunction against Cargo Insurers, in order to oblige Cargo Insurers to pursue their subrogated rights in accordance with the London arbitration agreements incorporated into the bills of lading, despite the one year claim limitation period having already expired.
Judgment
The Judge identified that the issues applicable to this sort of application are well-established by the case law. The applicant must show to a relatively high degree of certainty that the arbitration agreement relied on has been incorporated into the contract between the parties and that the underlying dispute comes within the scope of the arbitration agreement as a matter of its interpretation. Where that has been established, then an injunction would normally be granted unless there are strong countervailing reasons not to grant the injunction.
While the contractual arrangements that applied in this case were, on their face, slightly less certain than in many other cases, the Judge was satisfied that Contractual Carriers had made good their case to the relevant high standard in relation to incorporation. The quantities of cargo shipped on board the vessel matched with the quantities stated in the two booking notes. The dates of those notes also corresponded with the date stated for the “charterparty” which had been incorporated by reference into the bills of lading. Each bill of lading also constituted a contract of carriage or evidence of it between the parties to it. That made it relatively easy for the Judge to conclude that the booking notes, while not called “charterparties”, were nonetheless very likely to be the documents referred to in the bills of lading that were relevant to the present dispute.
The Judge recognised that the claim in Brazil had been brought by Cargo Insurers of the original consignee, who sued on the basis that they had been subrogated to the consignee’s rights in relation to the cargo. However, the Judge highlighted, as a matter of English law, that it is well established that where a party becomes subrogated to another party’s rights, those rights are taken subject to the qualifications which apply to those rights in the hands of the original contracting parties. So, said the Judge, Cargo Insurers, if they were to enforce their subrogated rights, were necessarily obliged to advance such a claim in London arbitration, as agreed in the contracts of carriage by the incorporation of the arbitration clause in the booking notes. This reflected that underwriters cannot be in any better position in relation to subrogated rights than the insured (fn.1).
On the above basis, the Judge was satisfied that the claim being brought by Cargo Insurers in the Brazilian court proceedings was a claim being brought in breach of the arbitration agreement contained in the booking notes which had, in turn, been incorporated by reference into the contracts of carriage contained in or evidenced by the bills of lading, to which Cargo Insurers had become bound by becoming subrogated to the rights of the consignee against Contractual Carriers. There could also be no dispute that the subject of the Brazilian proceedings came within the scope of the arbitration agreement as a matter of interpretation, because the arbitration agreements were in the usual extremely wide terms.
That left over for consideration whether or not it could be said that there had been such a delay or some other strong reason so as to justify not granting the injunction sought. The English court was to feel no diffidence in granting the injunction in such circumstances provided it was sought promptly and before the foreign proceedings had become too far advanced (fn.2). The Brazilian proceedings so far had got no further than an as yet unresolved jurisdiction challenge brought on the advice of Contractual Carriers’ Brazilian lawyers, which did not amount to a submission to the jurisdiction of the Brazilian courts. Therefore, that was not a good reason to refuse to grant the injunction.
While the contractual limitation period applicable to the claims under the bills of lading had by this time expired, that was also not a strong reason for not granting the injunction. The Judge said that this was because it could not credibly be asserted by Cargo Insurers that, in the circumstances, they were not or could not, with reasonable diligence, have become aware of the existence of the arbitration agreements. So, the Judge was satisfied that Contractual Carriers had acted sufficiently promptly so as not to justify refusing the relief sought.
Because Contractual Carriers were a foreign company with no assets in the English court’s jurisdiction, and as a cross-undertaking in damages is required from an applicant for the relief sought, the Judge considered it was appropriate for the cross-undertaking to be strengthened by the provision of security. The Judge was content for an LOU to be provided by the London office of Contractual Carriers’ P&I club. The value of the LOU was set at USD85,000 to reflect the expected legal costs of Cargo Insurers obtaining legal advice and representation at the return date hearing, when the injunction and security would be reconsidered.
Finally, while Brazil is a state party to the Hague Service Convention, the Judge recognised that service other than pursuant to that convention, which involves a slow process conducted through each state's diplomatic channels, was justified if there were exceptional reasons for making such an order. Service by alternative means was justified in this case for a number of reasons. First, it was necessary so that Cargo Insurers could be left in no doubt that an order had been made by the English courts precluding them from taking particular steps or requiring them to take particular steps in a fixed time. Second, the interim injunction was being granted on a without notice basis and so, therefore, service of process needed to be made promptly to enable Cargo Interests to obtain representation and to prepare before the return date hearing took place. On that basis, the Judge was prepared to direct service by alternative means by email on Cargo Insurers, which was understood not to be illegal under Brazilian law.
Comment
This judgment is a good example of how the English courts are able to support the resolution of disputes that are subject to London arbitration agreements.
The English courts use contractual anti-suit relief to enforce against the party in breach the negative undertaking not to resolve disputes other than as agreed.
While anti-suit injunctions are not necessarily effective in all cases, they are an important weapon in the armoury of those who have agreed to London arbitration.
In the present case, counsel for Contractual Carriers has indicated that the anti-suit injunction was continued at the return date hearing on 12 May 2026.
The Brazilian supreme court is also understood to have ruled recently that the Brazilian courts lack jurisdiction where there is a London arbitration clause.
Footnote 1: The “Jay Bola” [1997] 2 Lloyd’s Rep 279
Footnote 2: The “Angelic Grace” [1995] 1 Lloyd’s Rep 87
