Navios Corporation v. The Ulysses II

Navios Corporation (plaintiff) entered into three charterparty agreements (the contracts) with the owners of The Ulysses II (the owners) (defendants) for time charters of three boats. Each of the contracts contained a clause that said the contract could be cancelled “If war is declared against any [North Atlantic Treaty Organization] countries…” In November 1956, hostilities erupted between Egypt, France, and the United Kingdom (the UK) over the nationalization of the Suez Canal by Egypt’s President Nassar. Between October 29 and November 5, Anglo-French planes bombed Egypt, diplomatic relations between Egypt and the UK and France were severed, and the United Nations General Assembly called an emergency session to call for a cease fire between the nations. On November 1, President Nassar gave a fiery speech in which he indicated that Egypt would fight and never surrender. President Nassar also took a number of other emergency measures, including closing the canal and declaring a state of emergency. On November 5, the owners notified Navios that they were invoking the war cancellation provisions of the contracts and cancelling them. Navios later filed suit against the owners in the district court, alleging that there must be a declaration of war to invoke the war cancellation provision and that the hostilities that were happening when the clause was invoked did not constitute war.