Itochu Canada Ltd. v. The "Fu Ning Hai"

In Arbitration/Jurisdiction Clauses in Maritime Law on (Updated )

This was an application for a stay of proceedings based on a Korean jurisdiction clause in the bill of lading. The stay was refused. The factors that led the court to deny the stay were many. First, the proceeding was against multiple Defendants, only one of whom requested the stay. The court considered that a stay would result in a multiplicity of proceedings with the possibility of inconsistent decisions. Second, the court found there was sufficient reason to refuse the stay in the fact that the Defendant had not agreed to waive the time bar that would otherwise apply to any Korean action. Third, the court considered that the lack of formal discovery procedures in Korea was a substantial point against allowing a stay. Fourth, the court noted that counsel for the Defendant had initially requested and been given a time extension to file a defence and had further advised the Plaintiff that they would make an application for late filing of their Statement of Defence. The court considered that this raised an estoppel and was a strong reason to deny the stay. Finally, the court noted that the Defendant’s delay in bringing the stay application was also a strong reason to deny the stay.