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It's Official - America's Cup - 12 March 2009

by Richard Gladwell, Sail-World on 13 May 2008
Justice Herman Chan has ruled that the 33rd America’s Cup be sailed in Valencia, or some other venue to be announced at six months notice. BMW Oracle Racing © Photo Gilles Martin-Raget http://www.bmworacleracing.com

Justice Herman Cahn has issued a Decision and an Order in the America's Cup, which sets the dates for the 33rd America's Cup as being in 10 months time from the date of the order which means the first race will be held on 12 March 2009. In his ruling he sets down Valencia as the venue, or some other place determined by the Defender.

However this timing and venue contravene the Deed of Gift which allows no racing in the Northern hemisphere between 1 November and 1 May. So it would seem, that if this ruling is not appealed, then the 33rd America's Cup should be sailed in early May, or later by mutual consent. However 'mutual consent' will be required to sail in the Northen Hemisphere on the dates specified.

In a further Order, Societe Nautique de Geneve is reequired to give six months notice of the venue for the 33rd America's Cup.

Reaction from Golden gate YC was muted, issuing the following statement:

'Today the New York State Supreme Court issued an order that the next America’s Cup match should take place in March next year, ten months from now, and that the Defender should disclose the venue six months prior to that. 'We are pleased that the Court has advanced the process and required the Defender to confirm the venue,' Golden Gate Yacht Club spokesman Tom Ehman said. 'We will now be considering the order to determine our next steps.'

Alinghi had not yet issued a statement, but were very pleased with the ruling, however indications were that they would not be dropping their Appeal.

The full Decision text is as follows:

This decision addresses a supplemental issue pertaining to the decisions rendered in this action, dated November 27, 2007 and March 17, 2008.
The essential facts underlying this action have been described at length in those decisions, including an analysis of the Deed of Gift, dated October 24, 1887, which provides, in relevant part:

The Challenging Club shall give ten months’ notice, in writing, naming the days for the proposed races.... Accompanying the ten months’ notice of challenge there must be sent the name of the owner and a certificate of the name, rig, and following dimensions of the challenging vessel, namely, length on load water-line; beam at load water-line and extreme beam; and draught of water, which dimensions shall not be exceeded; and a custom-house registry of the vessel must also be sent as soon as possible (emphasis added).

The July 11, 2007 Notice of Challenge, issued by Golden Gate Yacht Club (GGYC), the Challenger of Record, designated July 4, 2008 as the date of the first race, and July 6, 2008 and July 8. 2008 as the respective dates for the second and third races. if necessary. thereby satisfying the ten-month notice requirement provided for in the Deed of Gift. This litigation intervened. however, in that ten-month period, thereby creating an issue as to what effect, if any, this action should have on that ten-month period.

GGYC contends that the ten-month notice period should be deemed to have commenced when the first decision was issued on November 27, 2007. The defending champion, Société Nautique de Genève (SNG), argues that the ten-month notice period should be deemed to have commenced when the second decision was issued, on March 17, 2008.

GGYC commenced the litigation, and the subsequent opposition to GGYC’s claim as the Challenger of Record prolonged the uncertainty. Thus, it would be inequitable to deprive SNG of the benefit of a full ten-month period in which to prepare its racing vessel. The ten-month period should commence when the Court’s order is final, after the uncertainty created by this litigation has been resolved. Indeed, as this Court noted in its March 17, 2008 decision and order, these legal proceedings 'interrupted' the ten-month period, albeit it did not invalidate the Notice of Challenge. And as stated by the Court of Appeals in Mercury Bay Boating Club v San Diego Yacht Club (76 NY2d 256, 268 [1990]):

Because the deed allows a challenge to be mounted upon 10 months’ notice, the defender of the Cup is allowed only this short time to construct a defending vessel although the challenger has had unlimited time to mount a challenge and thus may have taken years designing and constructing its challenging vessel.

Because I do not deem this litigation, nor any of the motions made therein, to have been frivolous, the appropriate date for the commencement of the ten-month period should be no earlier than the disposition of the last motion made. Indeed, the latest decision fully addressed the issue of GGYC’s status as the official Challenger of Record, and the determination is reflected in the order issued in conjunction with the decision. The ten-month period should commence when a binding decision has been entered. In New York practice that is when an order has been made by the Court. Only such an order triggers finality, for example the right to appeal. Such an order has been simultaneously signed.

Dated: May 12, 2008

The Orders

(extract of the actual Orders which relate to a series of Recitals)

ORDERED that the Motion, sequence number 001 for preliminary injunction and expedited discovery and an expedited trial, is denied as moot; and it is further

ORDERED that the Motion, sequence number 002 for leave to file an amici curiae brief, is granted; and it is further

ORDERED that Defendant SNG’s Motion to Dismiss and for Summary Judgment in sequence number 003 is granted to the extent it dismisses GGYC’s breach of fiduciary duty cause of action, and Plaintiff GGYG’ s Cross-Motion for Summary Judgment in sequence number 003 is granted; and it is further

ORDERED that the Motion, sequence number 004 by CNEV for Summary Judgment and to Dismiss GCYC’s claims, is denied; and it is further

ORDERED and adjudged that CNEV’s challenge is invalid, and CNEV is not a valid Challenger of Record pursuant to the Deed of Gift; and it is further

ORDERED and adjudged that GGYC’s challenge is valid, and GGYC is the Challenger of Record pursuant to the Deed of Gift; and it is further

ORDERED that the dates for the challenge match races shall be the date ten calendar months from the date of service of a copy of this order, with notice of entry, upon the attorneys who have appeared herein, unless said date is a Sunday or legal holiday, in which case the next day shall be the first date of the challenge match races. The second date shall be two business
days thereafter and the third date, if necessary. shall be two business days after the second race. Notwithstanding the above, the parties may mutually agree in writing to other dates.

ORDERED that the location of the match shall be in Valencia, Spain or any other location selected by SNG, provided SNG notify GGYC in writing not less than six months in advance of the date set for the first challenge match race of the location it has selected for the challenge match races; and it is further

ORDERED that GGYC and SNO may engage in a mutual consent process and make any arrangement satisfactory to both as to the dates, courses, number of trials, rules and sailing regulations, and any and all other conditions of the challenge match races in accordance with the Deed of Gift; and it is further

ORDERED that the Clerk of Court is directed to enter judgment accordingly.
Dated: May 12, 2008

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