Final Booking Note Excludes Arbitration Clause Despite Earlier Emails Providing London Arbitration; Delhi High Court Stops LMAA Proceedings, Says Written Contract Prevails
Can Earlier Emails Supply Arbitration Clause Missing From Final Contract? Delhi High Court Says No, Grants Anti-Arbitration Injunction
Facts
The dispute arose from transportation of military cargo for the United Nations Peace Keeping Force from New Delhi to Sudan. The cargo was to travel from Delhi and thereafter be shipped from Nhava Sheva Port, Mumbai, to Port Sudan.
During negotiations, the appellants’ broker and the respondent’s booking agent exchanged emails and a Fixture Recap dated 4 April 2023. Clause 23 of the Fixture Recap expressly contemplated “English law and London arbitration.”
The parties thereafter executed a final Booking Note dated 4 April 2023, signed on 5 April 2023.
This final document became crucial because its Special Terms incorporated only additional rider Clauses 20–41. The arbitration provision, however, appeared only in Clause 43, which provided for the BIMCO dispute-resolution clause subject to English law and LMAA terms.
On 18 April 2023, the United Nations issued an advisory declaring cargo movement through Sudanese ports unsafe. The appellants cancelled the Booking Note invoking force majeure. Argo Coral Maritime Ltd. thereafter invoked arbitration under Clause 43.
Two arbitration references ultimately proceeded before the London Maritime Arbitrators Association (LMAA).
By a majority partial award dated 18 October 2025, two members of the tribunal held that the parties had agreed to English law and London arbitration. The majority treated the reference to “20–41” in the Booking Note as a typographical error that should be rectified to “20–43.”
SARR Freights approached the Delhi High Court seeking an anti-arbitration injunction. The learned Single Judge refused interim relief on 13 March 2026, holding that an arbitration agreement could be gathered from the Fixture Recap and that “20–41” was an inadvertent error.
The appellants challenged that order before the Division Bench.
Issues
The Division Bench framed three principal questions:
- Whether the Delhi High Court had territorial jurisdiction.
- Whether the final signed Booking Note governed the parties, or whether earlier emails and the Fixture Recap could be used to modify its terms.
- Whether an arbitration agreement actually existed and, consequently, whether the LMAA arbitration should be restrained.
Appellants’ Arguments
SARR Freights argued that the Booking Note was the final and complete agreement between the parties.
It expressly provided that its terms would prevail over previous arrangements. Therefore, the earlier Fixture Recap could not be relied upon to insert a term deliberately absent from the final written agreement.
The appellants stressed the precise drafting:
Additional rider clauses 20–41 were incorporated.
Clause 43 contained the arbitration provision. Therefore, stopping at Clause 41 necessarily excluded Clause 43.
They further argued that all the rider clauses appeared on the same page and the fact that the parties’ signatures appeared below Clause 43 could not override the express incorporation of only Clauses 20–41.
Relying upon Sections 91 and 92 of the Indian Evidence Act, 1872, they argued that prior negotiations could not be used to contradict, vary, add to or subtract from the clear terms of a subsequently executed written contract.
Respondent’s Arguments
Argo Coral Maritime contended that the Fixture Recap and Booking Note formed part of the same commercial transaction and should be read together.
The Fixture Recap expressly provided for English law and London arbitration, and the Booking Note followed from that arrangement.
According to Argo, “20–41” was merely a typographical mistake and should have read “20–43.”
It also argued that because the parties signed the page containing Clause 43, the arbitration clause formed part of their contractual arrangement.
Analysis of the Law
1. Delhi High Court Had Jurisdiction
The Court first rejected Argo’s territorial-jurisdiction objection.
The appellants were based in Delhi, the Booking Note was signed in Delhi, the cargo was initially required to move from Delhi, and enforcement against the appellants would also take place there.
The Court held that the existence of jurisdiction in Mumbai did not eliminate Delhi’s jurisdiction where a substantial part of the cause of action had arisen in Delhi.
2. Clear Written Contract Cannot Be Rewritten Using Earlier Negotiations
This formed the core of the judgment.
After examining Sections 91–95 of the Evidence Act and Supreme Court precedents, the Division Bench held that once parties reduce their agreement into a clear, unambiguous, signed written document, prior negotiations, correspondence and communications cannot ordinarily be relied upon to:
- contradict;
- vary;
- add to; or
- subtract from
the final written terms.
Extrinsic material becomes relevant where contractual language is ambiguous, defective or does not meaningfully apply to existing facts.
The Court therefore disagreed with the approach adopted by both the learned Single Judge and the majority of the arbitral tribunal.
3. Indian Law Distinguished From English Common Law
An important part of the judgment is the Court’s discussion of Indian codified evidence law versus English common-law principles of rectification.
The Court noted that English law may, in appropriate circumstances, examine prior negotiations and communications to determine whether a written instrument incorrectly recorded the parties’ earlier common intention and may rectify the instrument accordingly.
But the Court held that the position under Indian codified law is materially different where the subsequently executed agreement is clear and unambiguous.
Accordingly, English authorities could not be used to circumvent the settled position under Indian law.
Precedent Analysis
Govind Rubber and Trimex International
The Single Judge had relied upon these authorities for the proposition that an arbitration agreement can be inferred from correspondence exchanged between parties.
The Division Bench distinguished both.
It held that those cases involved circumstances where there was no subsequent signed written agreement. Here, by contrast, the parties ultimately executed a signed Booking Note which expressly superseded previous arrangements.
Therefore, the earlier correspondence could not control the final written agreement.
Union of India v. Kishorilal Gupta
The Court relied upon the principle that where an earlier contract is superseded by a subsequent agreement, an arbitration clause forming part of the earlier contractual arrangement does not automatically survive.
Young Achievers v. IMS Learning Resources
This authority similarly supported the proposition that an arbitration clause contained in an earlier agreement cannot survive where that agreement is superseded by a later comprehensive agreement which does not preserve the arbitration clause.
Joshi Technologies
The Court relied upon this judgment to reinforce the significance of an entire-agreement/supersession clause. Where parties expressly agree that the final document supersedes earlier understandings, courts cannot ordinarily return to prior correspondence to reconstruct the bargain.
Court’s Reasoning
The Court closely examined the actual drafting of the Booking Note.
The Special Terms expressly stated:
“As per additional rider clause 20–41 in attached.”
This was significant because the arbitration provision appeared in Clause 43.
The Court rejected the theory that “41” was an accidental typographical error.
It found that the parties had not mechanically signed a standard form. They had consciously modified several commercial terms, including vessel specifications and detention provisions, demonstrating that the Booking Note resulted from active negotiation and reconsideration of the earlier terms.
Further, Clause 23 of the Fixture Recap merely referred to “English law and London arbitration,” whereas Clause 43 of the riders contemplated the more specific BIMCO dispute-resolution mechanism subject to English law and LMAA terms and procedures. They were therefore not identical provisions.
Most importantly, the Booking Note itself expressly stated that it would prevail over previous arrangements.
The Division Bench therefore held that there was:
no mistake, no ambiguity, no defective language, and consequently no arbitration agreement between the parties.
Anti-Arbitration Injunction
Once the Court found that no arbitration agreement existed, the foundation of the LMAA proceedings disappeared.
The Court held that this constituted one of the exceptional circumstances in which an Indian court may grant an anti-arbitration injunction.
The principle of competence-competence did not prevent the Court from examining the foundational question of whether the parties had ever consented to arbitration at all.
Conclusion
The Delhi High Court allowed the appeal and set aside the Single Judge’s order dated 13 March 2026.
It held that the final signed Booking Note incorporated only Clauses 20–41. Since the arbitration provision appeared in Clause 43, there was no arbitration agreement between the parties.
The earlier Fixture Recap providing for London arbitration could not be imported into the subsequent final written agreement, particularly when the Booking Note expressly superseded previous arrangements.
The Court accordingly granted an anti-arbitration injunction restraining Argo Coral Maritime Ltd. from continuing, pursuing or taking any steps in the LMAA arbitration against SARR Freights Ltd./SARR Freights Corporation.
Case Details
Case: SARR Freights Corporation & Anr. v. Argo Coral Maritime Ltd.
Court: Delhi High Court
Case No.: FAO(OS) 40/2026 & CM APPL. 19846/2026
CNR: DLHC010124872026
Coram: Justice Vivek Chaudhary and Justice Renu Bhatnagar
Reserved: 2 June 2026
Decision: 18 September 2026
Result: Appeal allowed; Single Judge’s order set aside; no arbitration agreement found; Argo Coral Maritime restrained from continuing the LMAA arbitration.
