A time charter party was concluded in 1973 between two companies subsequently succeeded by the claimant (charterer) and the respondent (shipowner), both Belgian companies. The time charter party was to last 20 years with a possibility of extension. The claimant took delivery of the chartered vessel in October 1978. However, the vessel could not be used immediately as neither the substance to be transported nor the facilities where the substance was to be unloaded were ready. In 1981, the parties entered into a further agreement supplementing the charter party ('First Supplement'). The First Supplement contained a provision relating to the extension of the charter party after its expiry in 1998. In 1996, the parties began negotiating a possible extension of the charter party. In 1998, considering these negotiations to have been inconclusive, the claimant exercised an option to purchase the vessel, which it believed it had been given by a provision in the First Supplement that amended clause 2 of the charter party. The respondent objected and withdrew the vessel from the claimant, which initiated court proceeding to recover possession of the vessel. The charter party contained an arbitration clause and a choice-of-law clause providing for the application of Belgian law except for matters of general average, which were subject to the 1950 York/Antwerp Rules and, where these were insufficient, the laws and usages at the port where the vessel was registered. The claimant brought arbitration proceedings in which it requested the tribunal to declare that it had validly exercised the purchase option and to order various consequences resulting from this change of ownership. The respondent, in return, claimed for hire charges alleged to be due and unpaid, and damages for the claimant's failure to redeliver the vessel in accordance with the charter party. The respondent also claimed that the claimant's request was inadmissible under Belgian shipping law. The arbitral tribunal rendered a partial award in which it held that the parties had reached agreement on the extension of the charter party, that the claimant had not validly exercised the purchase option to which it claimed to be entitled, and ordered them to seek a negotiated settlement of outstanding monetary claims. Failing agreement between the parties, the arbitral tribunal rendered a further, final award in which, in addition to ruling on the monetary claims, it also addressed the respondent's allegation that it lacked jurisdiction.

Une charte-partie à temps a été signée en 1973 entre deux sociétés auxquelles ont par la suite succédé la demanderesse (l'affréteur) et la défenderesse (l'armateur), deux sociétés belges. La durée de la charte-partie était fixée à 20 ans, avec possibilité de prolongation. La demanderesse a pris livraison du navire affrété en octobre 1978. Celui-ci n'a cependant pas pu être immédiatement mis en service car ni le produit à transporter ni les installations où il devait être déchargé n'étaient prêts. En 1981, les parties ont conclu un accord additionnel complétant la charte-partie (appelé « First Supplement » (premier avenant)). Le premier avenant contenait une disposition relative à la prolongation de la charte-partie après son expiration en 1998. En 1996, les parties ont commencé à négocier une éventuelle prolongation de la charte-partie. En 1998, considérant que ces négociations n'avaient pas abouti, la demanderesse a exercé l'option d'achat du navire que lui accordait selon elle une disposition du premier avenant modifiant la clause 2 de la charte-partie. La défenderesse a fait objection et retiré le navire à la demanderesse, qui a engagé une action en justice afin d'en reprendre possession. La charte-partie contenait une clause compromissoire et une clause de droit applicable prévoyant l'application de la loi belge, sauf pour les questions relatives aux avaries communes, qui étaient soumises aux règles d'York et d'Anvers de 1950 et, au cas où celles-ci seraient insuffisantes, aux lois et usages du port d'immatriculation du navire. La demanderesse a engagé une procédure d'arbitrage et demandé au tribunal arbitral de déclarer qu'elle avait valablement exercé l'option d'achat ainsi que de déterminer les diverses conséquences du transfert de propriété. La défenderesse, en réponse, a réclamé les loyers considérés par elle comme dus et impayés, ainsi que des dommages-intérêts pour la non-remise du navire par la demanderesse conformément à la charte-partie. La défenderesse a également fait valoir que la demande de la demanderesse était irrecevable au regard du droit maritime commercial belge. Le tribunal arbitral a rendu une sentence partielle dans laquelle il a considéré que les parties étaient parvenues à un accord sur la prolongation de la charte-partie et que la demanderesse n'avait pas valablement exercé l'option d'achat dont elle se prévalait et a ordonné aux parties de rechercher un accord négocié sur les demandes pécuniaires en suspens. Faute d'un tel accord, le tribunal arbitral a rendu une autre sentence, finale, dans laquelle il a non seulement tranché les demandes pécuniaires, mais également statué sur l'exception d'incompétence soulevée par la défenderesse.

Una póliza de fletamento por tiempo se concluyó en 1973 entre dos compañías que fueron más tarde sucedidas por la demandante (fletador) y la demandada (armador), ambas compañías belgas. La póliza de fletamento por tiempo debía durar 20 años con posibilidad de prórroga. La demandante recibió la entrega del buque fletado en Octubre de 1978. Sin embargo, el buque no se podía usar inmediatamente ya que ni la sustancia a transportar ni las instalaciones en que se debería descargar esa sustancia estaban preparadas. En 1981, las partes concluyeron un nuevo acuerdo suplemento de la póliza de fletamento ("Primer Suplemento"). El Primer Suplemento contenía una disposición relativa a la prórroga de póliza de fletamento tras su vencimiento en 1998. En 1996, las partes empezaron a negociar una posible prórroga de la póliza de fletamento. En 1998, considerando que estas negociaciones no habían dado resultados, la demandante ejerció su opción de compra del buque, que creía que le había sido dado por una disposición del Primer Suplemento que enmendaba la cláusula 2 de la póliza de fletamento. La demandada se opuso y retiró el buque de manos de la demandante, quien inició un proceso judicial para recuperar la posesión del buque. La póliza de fletamento contenía una cláusula arbitral y una cláusula de determinación de derecho que fijaba la aplicación del derecho belga excepto en asuntos de avería general, que quedaban sometidas a las Reglas de York/Amberes de 1950 y, en aquello que éstas no fueran suficiente, las normas y los usos del puerto en que el buque estuviera registrado. La demandante inició el proceso arbitral en que reclamaba del tribunal que declarara que había ejercido válidamente la opción de compra y que ordenara varias consecuencias derivadas de este cambio de titularidad. La demandada, por su parte, reclamaba cargos de fletamento que afirmaba que estaban pendientes y sin pagar, y dalos por la no reentrega del buque por parte de la demandante según la póliza de fletamento. La demandada también alegaba que la petición de la demandante era inadmisible dentro del derecho naval belga. El tribunal arbitral dictó un laudo parcial en que mantuvo que las partes habían llegado a un acuerdo sobre la prórroga de la póliza de fletamento, que la demandante no había válidamente ejercido la opción de compra a la que decía tener derecho, y ordenó a ambas partes a buscar un solución negociada de las reclamaciones monetarias destacadas. Al no haber acuerdo entre las partes, el tribunal arbitral dictó otro, un laudo final en que, además de decidir sobre las reclamaciones monetarias, también trataba la alegación de la demandada de que carecía de jurisdicción.

'The opinion of the Arbitral Tribunal

32. The Arbitral Tribunal will first deal with Respondent's preliminary defence . . .

33. Article 9 of the Belgian Maritime Code provides that any claim in respect of the property of a sea-going vessel is admissible only after it has been registered. The registration of Claimant's claim-as Claimant has acknowledged-took place on 9 March 1999, i.e. after the Request for Arbitration was lodged.

34. However, the fact that the registration thus indeed took place after that the Request for Arbitration was lodged does not mean that the Request for Arbitration is not formally admissible and should therefore be rejected.

It appears from the discussions in the parliament that Article 9 of the Belgian Maritime Code is a mere application to ships of the rule contained in Article 3 of the mortgage law.

Now the Supreme Court held, in a judgment of 17 February 1984 (Pas. 1984, 1, no. 342, p. 706) that the only consequence of a default of inscription of the claim is that no award can be given as long as the inscription has not taken place.

In other words, the non-observance of Article 9 of the Belgian Maritime Code can therefore also take place after the submission of a Request for Arbitration as in the case at hand. This defence is therefore rejected.

35. The defence that the Purchase Option could not be exercised because the Parties decided, in the beginning of May 1998, to go "off the record" in their negotiations is also rejected. The letter pertaining to this matter-Claimant's letter of May 8, 1998, Common Bundle no. 88-said the following:

2. It is our common understanding that any, discussions or negotiations between [Respondent] and [Claimant] concerning the aforementioned counterproposal shall be strictly off the record and without prejudice to the rights and obligations of [Respondent] and [Claimant], in particular with respect to the provisions of clause 2 of the Charter Party dated October 31, 1973, as amended, and that accordingly any such discussions and negotiations, if unsuccessful, will be deemed not to have taken place and the parties shall be deemed to be in exactly the same position as they were at the time of signing this document.

This understanding cannot be construed in another way than that:

(i) the negotiations had not been successful so far,

(ii) if the negotiations would not be successful during the off-the-record phase, the parties could take the same position as per 8 May 1998.

The main effect-if not the only effect-of the off-the-record character is, in the opinion of the Arbitral Tribunal, that the Parties could not be bound by statements or concessions made during the (off-the-record) negotiations.

36. Obviously, the negotiations on the extension of the Charter party during the off-the-record phase were not entirely successful. But, in the opinion of the Arbitral Tribunal, the conclusion would not be different if one would find that no agreement was reached between the parties on 30 October 1998 or on 8 May 1998: in both cases the Purchase Option pursuant to Article VIII of the First Supplement could in principle have been triggered.

37. Also the defence referred to [previously] that the incorporation of a purchase option in the Extended Charter party was impossible per se is rejected. Even if Respondent is right in arguing that the scope of the negotiations was "by definition" limited-which is denied by Claimant-the Arbitral Tribunal is of the opinion that, in principle, it is allowed for a party to try and extend such scope-also in a situation where, as in the present case, certain elements of the contract to be extended had been fixed already. Negotiations of the type at hand are commercial negotiations between experienced and sophisticated parties. Any party may, in principle, defend or try to defend its business interests as such party sees such interests, also by submitting certain proposals for negotiation. It is a different matter if the other party should accept or should have to accept any such proposal.

38. The said principle is limited, under the applicable Belgian law, by the general principle of reasonability or good faith, which has to be observed by parties in their contractual relationship. There is, in the opinion of the Arbitral Tribunal, no evidence that the mere fact that Claimant brought up the matter of the new purchase option as it did, within the framework of the negotiations on the extension of the Charter Party, was unreasonable or against good faith. It is another matter if Claimant was entitled to try and force this request on the Respondent by exercising the Purchase Option, in case of refusal of the request pertaining to the new option by Respondent. Thereon, and on the other defences submitted by Respondent, the Arbitral Tribunal is of the following opinion.

39. Indeed, it can be established that Claimant, in the negotiations with Respondent on the extension of the Charter Party, asked for a purchase option that went beyond the Purchase-Option in the existing Charter Party.

39.1 As stated herebefore, the Purchase Option granted to Claimant under Clause 2 of the Charter Party, as amended in the First Supplement, reads as follows:

If no agreement can be reached upon the other conditions of this extension of the Charter Party, then Charterer will have the option to buy the Vessel at a price corresponding to the scrap value of the Vessel.

39.2 In the negotiations between the parties in the years 1996-1998, Claimant asked for a purchase option in the Charter Party-if extended-in wordings different from those of Clause 2 (as amended). During the said negotiations, 7 drafts for a new or extended Charter Party were submitted by Claimant to Respondent. The first draft was handed to Respondent at a meeting on 23 May 1997, the 7th (and last one during these negotiations) shortly before 30 October 1998. It follows from the various drafts that it was not only Claimant's wish to get an option to purchase the Vessel in the situation where the negotiations on another extension of the Charter party might fail, as was the case under the existing Charter Party, but also in the situation where the Charter Party would be terminated earlier before the end of the agreed extended term (which, eventually, was 30 October 2014).

39.3 The value at which the option were to be exercised differed in the various drafts.

In the first draft, the proposed purchase-option clause read as follows: "At the termination of this charter, Charterer shall have the option to buy the Vessel at a price corresponding to one BEF..." (Clause 4, second paragraph of the first draft . . .).

In the 7th draft, the proposed option clause read as follows: "(i) On 31st October 2014 or the date of any earlier termination or cancellation this charter, Charterers shall have the option to purchase the Vessel at a price corresponding to the scrap value of the Vessel at the time of termination or cancellation. (ii) The scrap value of the Vessel shall correspond to the mean value of three (3) written quotations provided by reputable shipbrokers." (Clause 58 of the seventh draft . . .).

39.4 Thus, it can indeed be said that the new option that the Claimant requested to be incorporated in the Extended Charter Party went beyond the Purchase Option in the existing Charter Party.

40. Also in this respect however, the Arbitral Tribunal is of the opinion that the mere fact that Claimant thus asked for an option that went beyond the existing Purchase Option was not against good faith. Also here, the observation made under no. 38 is valid. But the rejection by Respondent of this request cannot be considered against good faith either. . . .

41. The next-and crucial-question is if, subsequently, Claimant could for this reason-i.e. Respondent's refusal to accept Claimant's request for the new purchase option (hereafter: "the New Purchase Option")-exercise the existing Purchase Option.

42. The Arbitral Tribunal is of the opinion that this question should be answered in the negative. There is no evidence that Respondent acted in bad faith by rejecting this request.

43. Claimant has argued that it had a good reason to extend the circumstances in which the New Purchase Option should be exercisable and, therefore, to try and enforce it. Notably, Claimant has argued that the New Purchase Option should be exercisable in case of bad management by Respondent and/or money spent needlessly.

44. It may have been a reason from Claimant's point of view to try and obtain a new and more compelling option but the fact that Respondent did not accept this reason and the request for such an expanded purchase option cannot be considered to be against good faith, as Claimant's concerns could be adequately covered by other remedies. If there would be a situation, under the Extended Charter Party, of bad management or money spent needlessly, Claimant could seek recourse against that in law.

45. In the light of these considerations, Claimant was not entitled to exercise the Purchase Option as it did on October 30, 1998.

46. However, if Claimant's request for a purchase option also in the Extended Charter Party should be read as a request to maintain-mutatis mutandis-the existing Purchase Option, such a request cannot be considered against good faith and a refusal thereof by Respondent could not be considered in accordance with the principle of good faith. Respondent had accepted such a purchase option in the First Supplement. There is no good reason why a similar option would be unreasonable at the end of the term of the Extended Charter Party, if negotiations on another extension would fail. Further, the Arbitral Tribunal agrees with Claimant that it again could have a reasonable interest in maintaining some possibility of access to the Vessel after the end of the extended term, if negotiations on another extension would fail.

With respect to the price, it is undisputed that Claimant had paid all capital cost of the vessel already at the end of the first term of the Charter Party. If, in that light, the scrap value of the vessel was considered to be a reasonable price under the existing Purchase Option, the Arbitral Tribunal fails to see why that price would not be a reasonable price under a purchase option in that Extended Charter Party.

47. The Arbitral Tribunal is of the opinion that the parties have reached agreement on all terms of the Extended Charter Party, as evidenced by the document Hearing Exhibit No. 3 [last draft of the extended charter party agreement as annotated to reflect the status of the parties' negotiations on 30 October 1998], except on the New Purchase Option. There is no convincing evidence that the parties have not negotiated in good faith during the two years of their negotiations in this respect.

48. Claimant has argued that the agreement reached on the other elements was conditional, on its part, on Respondent accepting the New Purchase Option as requested by Claimant. Claimant has added that it would never have been prepared to agree to a term of Charter until only 2014 absent the inclusion of the Purchase Option, since otherwise it could not have been sure of maintaining access to [the vessel] after that date.

49. Claimant did not sufficiently prove that it expressed this condition clearly and unambiguously enough. Moreover, in the opinion of the Arbitral Tribunal, this is not relevant: if Claimant would have based this condition on the element in its request for the New Purchase Option that went beyond the scope of the existing Purchase Option, that would have been against good faith and hence not effective under the applicable Belgian law. On the other hand, Respondent would have to accept, in good faith, an extension, mutatis mutandis, of the existing Purchase Option.

50. The applicable Belgian law recognizes the possibility of completing an agreement in the light of good faith, notably in a situation where parties have a certain contractual relationship (see S. Stijns, J.T. 1996, no. 35, p. 702). This solidarity duty is even more demanding in the event, as in the case at hand, of a long-time contractual relationship between parties and when the contract fosters a common interest of the parties (see Fontaine: Bonne foi, contrats de longue durée, contrats relationnels in Liber Amicorum Van Gerven, p. 541). The spirit of the long-time contractual relationship between the parties implies that the use of the Vessel be reasonably secured to Claimant as long as it needs it and performs its obligations.

51. On the ground of good faith, the agreement reached between the parties on the Extended Charter party as evidenced by Hearing Exhibit No. 3, should be deemed completed by the incorporation, mutatis mutandis, of the existing Purchase Option in the thus Extended Charter party. This (mutatis mutandis) also includes that the capital cost element will still be excluded also at that stage from the hire rate. Or, in so many words, with a purchase option of the following text:

After the extension period now agreed upon and if required by Charterer two years before the end of the extended period, Owner and Charterer will meet to negotiate an extension of the Charter party for a period to be agreed upon and according to the Classification Societies' requirements, and if allowed by same, taking into account that the capital cost element/fixed part of the hire: [sum of money]/ m3/day will again be excluded of the hire rate during this period. Any expenses of classification works required to allow the Vessel to trade thereafter will be borne by Charterer. If no agreement can be reached upon the other conditions of such extension of the Charter party the Charterer will have the option to buy the Vessel at a price corresponding to the scrap value of the Vessel.

52. It follows from these considerations:

A) that Claimant's request for relief . . . and all further claims . . . and based upon the Claimant validly having exercised its option under clause 2 of the Charter party should be rejected;

B) that all counterclaims relating to the redelivery of the Vessel and for hire and other payments where such counterclaims are not in accordance with the terms of the Extended Charter party should also be rejected.

53. It follows equally that the other amounts claimed by both parties can be awarded only insofar as this is in accordance with the Extended Charter party . . . The Arbitral Tribunal expects the parties to reach agreement thereon in light of this Award. Respondent will have to reimburse Claimant such part of the hire it received pursuant to the provisional order granted by the President of the Commercial Court of [city] which exceeds the amount of the hire pursuant to the Charter party evidenced by Hearing Exhibit No. 3. Wherever appropriate, interest for late payments should be calculated at a reasonable rate under the circumstances.'