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SAMSUN CORP. v. KHOZESTAN MASHINE KAR CO.

May 29, 1996

SAMSUN CORPORATION, as Owner of the PRABHU DAYA, Petitioner, against KHOZESTAN MASHINE KAR CO., as Charterer, Respondent.


The opinion of the court was delivered by: HAIGHT

 HAIGHT, Senior District Judge:

 This is a petition pursuant to the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq, to compel arbitration of commercial disputes in New York. The respondent opposes the petition on the ground that the parties did not agree to New York arbitration. Subject matter jurisdiction in this Court arises out of the underlying maritime contract of charter party.

 Background

 Petitioner Samsun Corporation ("Samsun"), a Korean corporation, is the owner of the motor vessel PRABHU DAYA. Samsun alleges that on March 9, 1995, it entered into a voyage charter party with respondent Khozestan Mashine Kar Corporation ("KMK"), an Iranian corporation, for the carriage of a part cargo of steel plates from a port in Iran to Bangkok, Thailand. The voyage was performed. Samsun claims that KMK is indebted to it for demurrage and detention. KMK rejects those claims. Samsun says that KMK agreed in the charter party to arbitrate such disputes in New York before a three-arbitrator panel, one arbitrator to be appointed by each party and the third chosen by the two arbitrators thus appointed. KMK says that it did not so agree. Samsun appointed its arbitrator and, upon refusal of KMK to follow suit, brought this petition to compel arbitration under 9 U.S.C. § 4. Where the making of an arbitration agreement is in issue, the Court resolves the matter. Id.

 The parties have submitted a number of affidavits, more than one from certain individuals, and many exhibits. They differ with each other in certain areas. But the following facts are undisputed.

 Following the custom of the industry, Samsun and KMK were represented by chartering brokers with authority to negotiate the terms and conditions of the charter party. *fn1" Samsun's broker was Nimble Shipping Division, a division of Nimble (UK) Ltd. of London, England ("Nimble"). KMK's broker was Seas Ark, S.A. of Tehran, Iran ("Seas Ark").

 By fax dated March 4, 1995, KMK asked Seas Ark to attempt to charter a vessel to carry the steel shipment from Iran to Bangkok. Also on March 4, Seas Ark passed on that inquiry to Nimble, which on the same day telexed a proposal that the PRABHU DAYA be chartered for the voyage. Nimble's March 4 telex included a proposed freight rate and demurrage and despatch rates, and concluded: "after fixing main terms other Gencon." "Gencon" is the code name for a printed charter party form issued by the Baltic and White Sea Conference, a maritime trade association.

 A series of faxes and telexes were then exchanged between the chartering brokers, containing counter-offers and responses to them. I need not describe them all in detail. It does bear noting, however, that in a telex Nimble sent to Seas Ark on March 5, agreeing on behalf of Samsun to certain main terms but refusing others, Nimble concluded by omitting any reference to the Gencon form, saying instead: "o/wise owns c/p details."

 In fax and telex exchanges on March 6 and 7, the chartering brokers continued to negotiate on main charter party terms such as lighterage expenses, demurrage charges, laydays and cancelling date, and the freight rate. These negotiations resulted in agreement on March 9. In a telex during the morning of that day, Nimble "bid firm" to Seas Ark on certain open terms, and then said: "o/wise as previous." Seas Ark passed that telex on to KMK. In the afternoon of March 9, KMK telexed Seas Ark: "we hereby confirm yr freight rate and other conditions in yr am tlx," and added a request about the order of loading of the part cargo consigned to Bombay. Seas Ark at once passed on the text of KMK's telex to Nimble. Nimble telexed back to Seas Ark on March 9, recapitulating the main charter party terms agreed upon during the brokers' negotiations and adding: "o/wise as per owners c/p."

 The PRABHU DAYA loaded the cargo covered by the charter party at the Iranian port of Bandar Iman Khomeini. According to the vessel's documents, laytime commenced on March 9, 1995. Loading was delayed because of intermittent unavailability of cargo. It began on March 11 and was completed on April 1. Samsun says that the vessel went on demurrage on March 12 and on detention on March 19. Thereafter the PRABHU DAYA performed the voyage called for by the charter party.

 On March 17, 1995, Nimble faxed to Seas Ark a typed-up Gencon form charter party with additional typed clauses added by Samsun. Rider Clause 23 contains a provision for arbitration of disputes in New York. Seas Ark faxed a copy of the form to KMK on March 19. But on March 22, Nimble faxed Seas Ark an instruction not to pass on the typed-up charter to KMK for execution because Samsun had proposed some additional language relating to demurrage. On April 5, Nimble faxed to Seas Ark another typed-up charter party. The arbitration clause was not changed. Seas Ark faxed that charter to KMK on April 5. KMK has never signed the completed charter party.

 Discussion

 Arbitration is a matter of contract. Haviland v. Goldman, Sachs & Co., 947 F.2d 601, 604-05 (2d Cir. 1991), cert. denied, 504 U.S. 930, 118 L. Ed. 2d 591, 112 S. Ct. 1995 (1992). A party cannot be compelled to submit to arbitration if it has not agreed to do so. AT&T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 648, 89 L. Ed. 2d 648, 106 S. Ct. 1415 (1986). Samsun, alleging an agreement by KMK to New York ...


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