The English Supreme Court decision in the RES COGITANS case is unlikely to have any significant impact in the UAE because it is not binding on the UAE courts, and so the threat of a vessel being arrested in the UAE either by the physical supplier and/or ING/OW Bunker remains a live issue.
To date, the UAE courts have taken inconsistent approaches in cases being pursued by physical suppliers in the UAE.
In the Emirate of Dubai, the Court of First Instance, in one case, found that the debt owed to the physical supplier was owed by OW Bunker under the contract that OW Bunker had with the physical supplier, and not by the shipowner under the bunker delivery note. The case is the subject of an appeal.
On the other hand, the Court of First Instance in Fujairah (another Emirate of the UAE) and the Court of Appeal in Khorfakkan (falling under the Emirate of Sharjah) found that the debt was owed to the physical supplier by the shipowner because the bunker delivery note constituted a contract between the vessel/its owner and the physical supplier.
Most recently, the Federal Supreme Court (Dubai has its own Supreme Court) found that the debt is owed to OW Bunker and not to the Physical Supplier where the contract for the supply of the bunkers was entered into between an owner and OW Bunker, who in turn entered into a contract with the physical supplier.
Given there is no system of binding precedent in the UAE, and judgments of the Federal Supreme Court are only persuasive, every case will be decided on its own merits/facts, and the courts might continue to hand down differing decisions.
OW Bunker A Global Overview: UAE
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