The Star Antares – YAR 1994 or 2016?

In the “Star Antares” (Star Axe I LLC v Royal and Sun Alliance Luxembourg S.A. – Belgian Branch and others)ⁱ, the English High Court ruled on which version of the York Antwerp Rules (1994 or 2016) applied to a Congen 94 Bill of Lading (“B/L”) to adjust General Average (“GA”). The Congen 94 B/L provides for GA to be adjusted as per the York Antwerp Rules 1994 (“YAR 1994”) or any subsequent modifications thereofⁱⁱ. Commentary on this judgement has been written by various law firms, some of which can be viewed at the links provided belowⁱⁱⁱ. It is not our intention to repeat what has been stated already and therefore we will focus on the effect of this judgment.

1. Appeal: We understand that while permission to appeal was granted^iv, it was not taken up by the Owners such that the decision stands. This being the case, if there are similar wordings such as provided in Congen 94, then the latest version of the YAR would apply (which presently is the 2016 version).
2. Effect of YAR 2016: Some of the changes brought about by the YAR 2016 are^v:
   1. Commission on funds: The YAR 2016 does not provide for any commission on GA disbursements. Rule XX of the YAR 1994 on the other hand allows for a commission of 2% on all disbursements except for wages & maintenance and fuel & stores not replaced during the voyage.
   2. Interest on losses allowed in GA: Rule XXI of YAR 2016 provides for the 12-month ICE Libor^vi increased by four percentage points to be the interest on losses allowed in GA. The YAR 1994, on the other hand, provides for 7% interest. When interest rates are low, then the provisions of the YAR 1994 are of benefit to parties who have suffered GA losses. The advantage of YAR 2016 is that the interest rates have a co-relation to the actual interest rate and therefore they appear to be more “fairer”.
3. Time bar in Rule XXIII: We note Chirag Karia KC’s comment in his article on the Star Antares decision that the time bar provided in Rule XXIII of the YAR 2016 poses a serious risk^vii. We do not subscribe to this view given that the time bar provision only applies after the GA adjustment has been issued (in which case, parties would have been invited by the Average Adjuster to provide details of their loss). In any event, delays in GA settlements should be avoided as it is not of benefit to any of the parties involved in the adventure.
4. B/L wordings:
   1. Bulk cargo:
      1. We note from BIMCO’s website that all their B/L wordings post 2016 provide for YAR 2016. This is indeed welcome given that the YAR 2016 came out of the successful negotiation between all of the interests. However, if the B/L form used is of an edition prior to 2016, then the wordings of the GA Clause would then determine which edition of the YAR would apply.
      2. It appears to us that Owners/Operators continue to use forms which are pre 2016 such that the YAR 2016 are not incorporated. In fact, in the case at hand, 7 Congen Bills 1994 were issued for shipments effected in Sep/Oct 2021. Additionally, anecdotal evidence suggests that the use of post 2016 forms is yet to gain wide acceptance by Owners/Operators such that it is rare for YAR 2016 to be contractually incorporated. This is understandable given that the previous editions of YAR 1974/1974 are more favorable to Owners. 
   2. Liner Bills of Lading: In the liner industry, there is no standard format being used and instead various lines issue their own wordings. We have reviewed the wordings of the top 5 Shipping Lines by Volume (carrying approximately 65% of the liner volumes) and note that all of them provide for YAR 1994 to deal with the adjustment of GA.
5. Given that the wordings of the YAR 2016 was reached by a compromise between the various interests, the absence of it being used in any of the Bs/L is indeed both surprising and concerning. This being the case, it does appear to us that future revisions of the YAR would have no effect unless there is a provision, say similar to “tacit acceptance” as is the case for SOLAS Convention 1974^vii. Otherwise, having further revisions of the YAR may actually not result in any change^ix in the ground! Instead, it may only lead to creation of more literature for the consumption of maritime students/academics and professionals having an interest in GA. Accordingly, we would suggest that prior to considering any further changes to the YAR, the community at large including CMI should work out a modality on the use of the latest wordings of YAR and only then consider any further revisions of the YAR. 
6. Conclusion:
   1. The decision of the English Court gives judicial pronouncement on the application of YAR 2016 to Congen 1994 Bs/L.
   2. If the intention is to have updated versions of the YAR to deal with the adjustment of GA, then they must be incorporated into the Bs/L.

^i. [2023] EWHC 2784 (Comm)
^ii. See Clause 3 of the Congen 1994 BL. The Congen 2016 BL expressly provides for YAR 2016 to apply for adjustment of GA’s.
^iii. Article of Clyde & Co, Pennington Manches Cooper, Norton Rose Fulbright, Chirag Karia KC in The Marine Insurer issue 16 published in Jan 2024.
^iv. See LinkedIn post of Richard Sarll, the successful barrister representing the cargo interests in this matter. Incidentally, Richard Sarll was also involved in another GA matter, The Longchamp, which went all the way to the English Supreme Court.
^v. For a detailed note, please see Article by Charles Taylor “York Antwerp Rules 2016 compared with 1994 and 2004 Rules”.
^vi. The ICE Libor rate for 12 months in Jan 2024 is 6.0414%. Accordingly, the interest rates allowed under R XXI for incidents occurring in 2024 would be 10.0414% and which is more than the previously allowed 7% per annum in YAR 1994.
^vii. See the second last para in the article published by Chira Karia KC in the The Marine Insurer issue 16 published in Jan 2024.
^viii. See International Convention for the Safety of Life at Sea (SOLAS), 1974 (imo.org).
^ix.  For instance YAR 2004 is generally of no relevance given that it is rarely ever considered by Owners/Operators.