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Denmark: Supreme Court upholds Monjasa victory in São Tomé bunker cargo dispute

17 Feb 2021

Disclaimer: An online translation service was used in the production of the current editorial piece.

The Supreme Court of Denmark on Tuesday (16 February) backed a decision previously made by the High Court that bunker supplier Monjasa will not be liable to pay USD 6.5 million as compensation in a lawsuit initiated by Stena Oil over the sale of bunker fuel cargo in the State of São Tomé and Príncipe in 2013.

Two vessels were allegedly found trying to remove the bunker fuel from a vessel destined for Stena Oil without legal clearance from the Saotomese authorities. As part of legal proceedings, the bunker fuel cargo, then belonging to Stena Oil was confiscated by the state and was later sold to Monjasa.

Stena Oil then filed a court case for Monjasa to relinquish profits it made from the fuel in question as it sees itself to be the owner of the confiscated cargo and claims the event to be a form of state-sponsored piracy.

The Supreme Court, found that it must be assumed that the confiscation of the oil cargo and the subsequent sale of the oil to Monjasa have been decided and carried out by the competent Saotomese authorities, and that there is a legal basis for confiscation in São Tomé and Príncipe law.

“There must be completely extraordinary circumstances in order for the buyer, who supports the right to the confiscation decision, with reference to views on public order, to be held liable to the original owner of the confiscated item,” stated the Court in its ruling.

“The Supreme Court finds that Stena Oil has not established the existence of such exceptional circumstances in the present case […] it cannot therefore justify liability for Monjasa that the majority of the arbitral tribunal found that the sanctions imposed were overall unreasonable and disproportionate under the Convention on the Law of the Sea.”

A full copy of the ruling by the Supreme Court of Denmark is available here.

Photo credit: Wikimedia
Published: 17 February, 2021

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