In trading disputes, it is tempting to use the email address already visible in the operational correspondence. If the person dealt with the vessel or the laytime calculation, the address feels familiar. That is not the same as authority to receive an arbitration notice on behalf of the company.
In Glencore Agriculture B.V. v Conqueror Holdings Ltd [2017] EWHC 2893 (Comm), the dispute concerned demurrage on the vessel AMITY, carrying corn from Ukraine to Egypt.
The owners commenced LMAA arbitration and sent the arbitration documents to the work email address of a Glencore employee. The notice of arbitration, appointment of the arbitrator and procedural directions all went to that address.
Glencore did not take part in the arbitration. It learned of the proceedings when it received an award for about USD 43,000 plus costs.
Glencore applied to the English court under section 72 of the Arbitration Act 1996. That route is available to a party that has not participated in the arbitration and wishes to challenge the tribunal’s jurisdiction.
The problem was not email as a method of communication in the abstract. The problem was the recipient. The employee was a junior member of the operations team and had no authority to accept service of an arbitration notice for the company.
The court agreed. Service was not effective under section 76 of the Arbitration Act 1996. The tribunal had no jurisdiction, and the award was set aside.
A person may discuss the vessel, laytime or figures without being authorised to receive documents that commence legal proceedings against the company.
If a notice is sent to a particular employee, the sender must be able to justify why that person had actual authority, or at least apparent authority, to receive it. Ordinary operational correspondence will often fall short of that.
The risk is practical. A party may complete an arbitration, obtain an award and then find that the process never properly began because the notice was served on the wrong person.
Arbitration does not start with a strong argument on the merits. It starts with effective notice. Sending the notice to a convenient operational email address may be cheaper in the moment, but it can be expensive if the award later disappears.