The Snow Bunting

8/2/14 6:18 am ENGLISH SHIPPING LAW
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Collisionnarrow channel ruleThames Navigation Licensing and General Byelaws 1993, Byelaw 31(a)Collision Regulations 1972, r.1(b)
B, an experienced rower, was completing a training session on the River Thames and returning downriver to the Reading University Boat Club. The weather conditions were fine
and visibility was clear. Having passed under Caversham Bridge, B intended to turn across the river in order to reach the rowing clubs landing stage. She stopped near the
southern bank, looked over her right shoulder and observed that the upstream channel was clear. She then turned partly to port, which was when she saw the Snow Bunting, a
49-ft narrowboat canal and river cruiser, then about eight metres away. B heard the narrowboat sound its horn as the scull was struck amidships on the starboard side by the
Snow Buntings bow, which rode over the scull. B argued that, since she had not seen the Snow Bunting when she looked over her right shoulder, it must have been travelling on
the wrong side of the river. The evidence of the Snow Bunting was that it was keeping to the right and had altered to starboard before the collision.
Decision: Claim allowed.
Held: (1) The International Regulations for Preventing Collisions at Sea 1972, to which effect was given by the Merchant Shipping (Distress Signals and Prevention of Collisions)
Regulations 1996, provided by r.1(b) that local rules should conform as nearly as possible with the International Regulations. (2) The International Regulations were likely to be
applied by a court as representing a safe and sensible system for general application. (3) The Thames Navigation Licensing and General Byelaws 1993 were the applicable local
rules, but the byelaws, in relation to how vessels were to be navigated in narrow channels, derived from the previous version of the International Regulations, which only required
vessels to keep to the starboard side of the centre line of the channel, and not the latest version of those Regulations, which required vessels to keep as far to the starboard side
of a narrow channel as was practicable. (4) The byelaw should be construed so as to be consistent with the latest version of the International Regulations. (5) On the evidence,
* Faculty of Law, National University of Singapore.
1. [2012] EWHC B22 (Admlty); [2012] 2 Lloyds Rep 647 (Jervis Kay QC).
2. SI 1996/75.
3. Rule 9 of the Regulations. See, generally, S Gault (ed.), Marsden on Collisions at Sea, 13th edn (Sweet & Maxwell, London, 2003), [6.226].
INTERNATIONAL MARITIME AND COMMERCIAL LAW YEARBOOK
the Snow Bunting was being navigated to the left of the centre of the river and failed to keep as far to starboard as practicable. (6) The vessels were approaching nearly end on,
requiring the Snow Bunting to make an early alteration to starboard, but the starboard turn by the Snow Bunting did not commence until the two vessels were very close. (7)
Either the person in charge of the Snow Bunting failed to keep a proper lookout or ignored the dangerous situation which had been created. (8) To turn across the river in the face
of oncoming traffic was contrary to the byelaws, which required a particularly careful lookout before a vessel turned across the river. (9) B looked over her right shoulder and did
not see the Snow Bunting because it was not navigating on its own side of the river; if she had looked over her left shoulder, she would probably have seen it. (10) B failed to keep
a proper lookout and was at fault, but that fault was not causative and the Snow Bunting was therefore wholly to blame for the collision.
Comment: Most collision cases referred to in IMCLY over the years have involved collisions which have occurred on the high seas. This case is relatively unusual in that it
involved a collision on the River Thames, not that such cases have not occurred before. The consequences of this collision were indeed unfortunate; an experienced and
accomplished rower, said to have prospects of attending the next Commonwealth Games, was injured in the collision and subsequently gave up rowing. For maritime lawyers, the
interest in the case lies in the consideration of the intersection of local byelaws and the International Regulations and it is submitted that the Admiralty Registrar correctly took the
view that the byelaws should be construed so as to be consistent with the latest version of the International Regulations.
Voyage charterpartyfreightBPVOY4whether overage freight payable
T chartered the tanker Target to BP on an amended BPVOY 4 form. The charterparty provided for a minimum cargo of 80,000mt of fuel oil, and that freight was to be payable at
the Worldscale 135 rate if discharge was in the US Gulf. The fixture recap stated that freight was payable at 50 per cent on overage for Euromed discharge only. The Target
loaded 86,821mt at Odessa before proceeding to Marmara, where a further 26,050mt was loaded. The cargo was discharged at Galveston and Houston and T invoiced BP for
freight at the Worldscale rate in respect of the total 112,871mt carried.
4. See, eg, the notorious case of The Bowbelle [1990] 1 Lloyds Rep 532 (though not concerned with the collision but its limitation consequences under LLMC 1976) and The
Goring [1988] AC 831 (which concerned the question of salvage in non-tidal watersremarkably, at the same place that the events in The Snow Bunting occurred).
5. Ie, the Thames Navigation Licensing and General Byelaws 1993. See also the Code of Practice for Rowing on the Tidal Thames above Putney 2009 (published by the Thames
Regional Rowing Council and the Port of London Authority): www.pla.co.uk/pdfs/maritime/THE_ROWING_CODE.pdf.
6. [2013] EWCA Civ 196; [2013] 1 Lloyds Rep 561 (Ward, Longmore & Moses LJJ); rvsg in part [2012] EWHC 1590 (Comm); [2012] 2 Lloyds Rep 245; [2012] 2 CLC 336
(QBD: Andrew Smith J).
7. See Stephen Girvin, Carriage of Goods by Sea, 2nd edn (2011), [22.10].
ENGLISH SHIPPING LAW 115
BP paid the invoice but subsequently argued that, on a correct interpretation of the charterparty, this envisaged payment of a lump sum freight or, in the case of a voyage to US
ports, freight at a percentage of the Worldscale rate on the minimum cargo quantity of 80,000mt. BP also argued that freight was payable only on overage for Euromed discharge,
and not on overage for discharge in the US, and sought to recover the overpaid sum as having been paid by mistake.
At first instance, the judge held that T were not entitled to freight at the Worldscale rate based on the entire quantity shipped, but that BP were not entitled to pay nothing in
respect of overage. He held that, since the parties had not expressly agreed the amount due on overage in the case of discharge in the US, there would have to be an inquiry into
what would be a reasonable figure for T to recover.
On appeal, BP submitted that freight was payable only on overage for discharge in the Euromed and that, since the relevant cargo was discharged in the US, no overage freight
was payable. The owners argued that the freight rate was always W135.
Decision: Appeal allowed; cross-appeal dismissed.
Held: (1) In the absence of any agreement to the contrary, BP and T agreed that overage was to be at 50 per cent of the freight rate. (2) If the parties had wanted to agree that
no overage was to be payable, they would have said so in terms. (3) The parties had not expressly said that there would be no freight payable when discharge was not in the
Euromed and so BPs construction of the charterparty and recap was incorrect. (4) The charterparty did not require and the parties had not intended that any inquiry as to
reasonable freight should be made. (5) The freight provisions, if not extensive, were apt to cover the relationship between the parties and, since BPs construction was impossible,
the only reliable alternative was that the agreed Worldscale freight rate applied to all cargo for the relevant voyage. (6) The parties had not specifically referred to overage other
than for Euromed discharge and so the Worldscale rate was the applicable rate. (7) That was the natural construction of the charterparty and recap, and was why BP had originally
paid the invoice.
Comment: The agreement of the contracting parties to the freight payable is one of the core clauses in most voyage charterparties. In this case there was a lack of clarity as to
the freight payable, namely the amount due for overage, being the amount due and payable once more than a minimum cargo had been loaded. The fixture recap made such
provision, but that was for Euromed discharge only, whereas actual discharge was made at various US Gulf ports. BP originally paid the full amount assessed on W135 terms but
then sought to recover the overpaid amount as having being paid by mistake. While it was agreed that BP should have to pay freight for the additional cargo shipped, the question
on appeal was how that should be assessed. The first instance judge suggested that this should be by reference to a reasonable figure, which would have to be assessed, but the
Court of Appeal disagreed and held that, as a matter of construction, the agreed freight rate, W135, was payable throughout.
8. Though not a lack of detail. See the freight terms agreed in the recap: [2013] EWCA Civ 196, [8].
9. Ie, a surplus, an excess, an additional amount: [1].
[2013] I.M.C.L.Y 113 Lloyd's Maritime and Commercial Law Quarterly
ENGLISH SHIPPING LAW
Stephen Girvin
*
CASES
126. Barnes v The Charterers of the Motor Vessel Snow Bunting (The Snow Bunting)
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2
3
114
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127. BP Oil International Ltd v Target Shipping Ltd (The Target)
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7
8 9
Bills of ladingapparent good order and conditionsteel pipes damaged by rust Retla clausedamages for fraudulent misrepresentationtitle to sue
A consignment of steel pipes were shipped on the Saga Explorer from Ulsan (Korea) to various ports on the west coast of North America (Los Angeles, San Francisco, and
Vancouver) in September and October 2008. The bills of lading, which contained an English jurisdiction clause and incorporated the US Carriage of Goods by Sea Act 1936, stated
that the goods were shipped in apparent good order and condition. They also contained a so-called Retla clause similar to that in Tokio Marine & Fire Insurance Co v Retla SS
Co:
RETLA CLAUSE: If the Goods as described by the Merchant are iron, steel, metal or timber products, the phrase apparent good order and condition set out in the preceding
paragraph does not mean the Goods were received in the case of iron, steel or metal products, free of visible rust or moisture or in the case of timber products free from warpage,
breakage, chipping, moisture, split or broken ends, stains, decay or discoloration. Nor does the Carrier warrant the accuracy of any piece count provided by the Merchant or the
adequacy of any banding or securing. If the Merchant so requests, a substitute Bill of Lading will be issued omitting this definition and setting forth any notations which may
appear on the mates or tally clerks receipt.
The surveyors who attended the Saga Explorer soon after discharge noted extensive oxidation, described as moderate to severe and severely oxidised. Although the mates
report noted that the cargo was received in the condition noted in the surveyors report, the bills of lading did not and were signed by shipowners agents, S, without being
claused. The shippers, N, provided the shipowners with a letter of indemnity in exchange for them issuing clean bills of lading. K, the consignee and notify party was indemnified
against its loss by German insurers represented by B, a German insurance agent.
B submitted that the Retla clause did not render the words apparent good order and condition meaningless and only excluded surface rust which was likely to be found in any
normal cargo and which would not detract from its overall quality and affect its merchantability. It sought damages from the owners on the basis that the bills of lading contained a
fraudulent representation as to the condition of the pipes on shipment. The shipowners argued that there was no misrepresentation in the bills of lading and that the effect of the
Retla clause was to exclude all surface rust of whatever degree from the representation of apparent good order and condition.
The issues before the court were: (1) the nature of the representation as to the condition of the pipes on shipment and whether it was relied on; (2) whether B was entitled to
recover damages in its own name and whether its claims would be admitted under German law.
Held: (1) If there had been no Retla clause, the statement in the bills of lading that the cargo was shipped in apparent good order and condition would amount to a
10. [2012] EWHC 3124 (Comm); [2013] 1 Lloyds Rep 401 (QBD: Simon J).
11. [1970] 2 Lloyds Rep 91 (9th Cir).
12. As to how this occurs, see eg A Sparks, Steel Carriage by Sea, 3rd edn (LLP, London, 1999), 40.
representation of fact which could be relied on as reflecting the reasonable judgement of a reasonably competent and observant master. (2) The Retla clause could and should be
construed as a legitimate clarification of what was to be understood by the representation as to the appearance of the cargo upon shipment. (3) The Retla clause should not be
construed as a contradiction of the representation about the cargos good order and condition, but as a qualification that there was an appearance of rust and moisture of a type
which might be expected to appear on any cargo of steel. (4) It followed that the Retla clause did not apply to all rust, of whatever severity, as such a construction would rob the
representation as to the good order and condition of the steel cargo on shipment of all effect. (5) The Tokio Marine case had not been consistently followed and had been
subjected to unfavourable analysis on several occasions. (6) In the instant case, it was clear that the surveyors reports and the mates receipts described the appearance and
condition of the cargo, which was not reasonably and honestly represented by the bills of lading as signed. (7) The cargo was not shipped in a normal and unexceptional condition
for that type of cargo, and did not otherwise fall within the Retla clause. (8) The decision to issue and sign clean bills of lading involved false representations by S, which were
known to be untrue and intended to be relied on. (9) The representation was not an honest and reasonable non-expert view of the cargo as it appeared, but a deceitful calculation
made to the prejudice of those who would rely on the contents of the bills of lading. (10) S had failed to rebut the presumption that K had been influenced to its detriment by their
fraudulent representation and it was highly unlikely that K would have taken delivery of the cargo if the bills of lading had been claused. (11) B was entitled to bring proceedings in
its own name under the agreement, which gave it authority to settle claims and conduct proceedings on behalf of insurers. (12) Under German law, Bs claims would be admitted
on the basis of a procedural agency.
Comment: This case highlights the very real danger for shipowners who permit bills of lading to be issued stating that the cargo has been shipped in apparent good order and
condition, when it is known that this is not the case. Requests to issue so-called clean bills of lading typically reflect the desire of shippers to avoid endorsements, particularly
when an underlying sale contract is financed by a documentary credit from a bank, and often involve the shipper (or buyer) offering a letter of indemnity (LOI). Though
routinely used in the trade, their usage is fraught with difficulty, particularly when it is known that the statements made in the bills of lading are false. In this case the context
was the combination of such an LOI with a Retla clause in the bills of lading. Although the shipowners argued that the Retla clause excluded all surface rust of whatever degree
from the representation of apparent good order and condition, the judge concluded that such clauses should be limited to superficial rust which would be present on any steel
cargo. The court recognised that oxidation was a normal consequence of exposure to the atmosphere and it would cause widespread interference with international trade if visible
rust were to result in the clausing of bills of lading. To hold otherwise would rob the
13. As to this, see The David Agmashenebeli [2003] 1 Lloyds Rep 92.
14. See supra, fn.11.
15. See UCP 600, Art.27 (Clean Transport Document).
16. Also sometimes known as letters of undertaking (LOUs) or back letters.
17. See the leading case, Brown, Jenkinson & Co Ltd v Percy Dalton (London) Ltd [1957] 2 QB 621 (CA).
18. [2012] EWHC 3124 (Comm), [24].
representation as to apparent good order and condition of the steel cargo on shipment of all effect. Finally, it may be noted, the court recognised that the Tokio Marine case
had not always been consistently followed.
Time charterpartyutmost dispatchslow steamingoff-hireNYPE
B, the owners of the Pearl C, a bulk carrier, chartered the vessel to C on amended NYPE terms, for a period of about nine to 12 months. Clause 8, the standard clause NYPE clause
on dispatch, provided that the captain shall prosecute his voyages with the utmost dispatch but cl.15 was amended to read:
That in the event of the loss of time from deficiency, sickness, strike, accident or default of Master, Officers or crew, or deficiency of men or stores, fire, breakdown or damages to
hull, machinery or equipment, grounding, detention by average accidents to ship or cargo, dry docking for the purpose of examination or painting bottom or by any other cause
preventing the full use of the vessel to the Charterers, the payment of hire shall cease for the time thereby lost; and all directly related proven extra expenses incurred including
bunkers consumed during period of suspended hire shall be for Owners account. [first part] and if upon the voyage the speed be reduced by defect in, or breakdown of, any part
of her hull, machinery or equipment the time so lost and the cost of any extra fuel consumed in consequence thereof and all extra expenses shall be deducted from the hire.
[second part] Provided always the reason that resulted in any of the above events is not due to an act or default or omission of the Charterers, their servants or agents whether by
way of negligence or otherwise.
Clause 29 provided that:
(B) SPEED AND CONSUMPTION
1. BALLAST SPEED: ABT 13 KNOTS
LADEN SPEED: ABT 13 KNOTS
SPEED AND CONSUMPTIONS IS GIVEN FOR GOOD WEATHER CONDITIONS UP TO BEAUFORT SCALE 4 AND DOUGLAS SEA
STATE 3 AND NO ADVERSE CURRENTS
The Pearl C performed 16 laden or ballast voyages during the currency of the charterparty. C claimed for slow steaming in respect of seven of those voyages. The arbitral tribunal
upheld Cs claim in respect of three of the voyages and deducted US$118,974.69 from the amount claimed by B.
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128. Breffka & Hehnke GmBH & Co KG v Navire Shipping Co Ltd (The Saga Explorer)
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11
12
13
14
15 16
17
18
118
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129. Bulk Ship Union SA v Clipper Bulk Shipping Ltd (The Pearl C)
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21
22
The present appeal from the decision of the arbitral tribunal related, in part, to issues arising under the Arbitration Act 1996, s.69, and under the Late Payment of Commercial
Debts (Interest) Act 1998, s.68. However, the final strand of the appeal concerned an argument by B that the arbitrators had found underperformance on the three voyages
solely by virtue of a failure to achieve the speed warranted in the charterparty, and had
19. See supra, fn.11.
20. [2012] EWHC 2595 (Comm); [2012] 2 Lloyds Rep 533 (QBD: Popplewell J).
21. Emphasis supplied to indicate the part of cl.15 in issue.
22. Christopher Spencer and John Schofield.
23. Those issues will not, however, be considered in this comment.
24. In cl.29B.
made an impermissible leap to reach the conclusion that there had been a default by the vessels crew which had resulted in a net loss of time.
Decision: Claim dismissed.
Held: (1) A fair reading of the award did not support Bs criticisms of the deductions from the award relating to performance. (2) As to cl.8, the tribunal reached its decision that
there was a failure to proceed with utmost dispatch not only on the basis of a failure to achieve the warranted speed on each of the three voyages, but also on the basis that there
was no other realistic explanation for a vessel which was capable of achieving the warranted speed at the moment she was delivered into the charterparty failing to achieve that
speed on the subsequent voyages. (3) Moreover, the tribunal expressly found that the Pearl C was not operated in a manner which allowed her to proceed with the utmost
despatch. (4) The tribunal had referred to The Hill Harmony and had correctly identified the dichotomy between a breach of cl.8 which involved a deliberate decision not to
proceed with utmost despatch (to which the exception in the Hague-Visby Rules, Art.IV, r.2(a) did not apply), and a negligent error in the navigation or management of the ship
concerning a matter of seamanship, to which the exception did apply. (5) As to the off-hire clause, cl.15, the owners submission that the tribunal had made the impermissible leap
from a failure to achieve the speed described in the performance warranty to reach the conclusion that there had been a default of master, officers or crew resulting in a net loss of
time under the first part of the off-hire clause would be rejected for the same reasons as those given for rejecting the similar argument advanced in relation to the cl.8 claim. (6)
The tribunal was correct to hold that a slow steaming claim fell within the first part of the amended form of cl.15.
Comment: The practice of slow steaming, initially in the liner trades, has become a prevalent feature in shipping, with the impact of the severe economic downturn on freight
rates and volatile bunker prices. The impact of the practice led to the drafting of BIMCO clauses to assist owners and charterers. These clauses were not, however, incorporated
in this charterparty and so, for the first time, the court had to consider the impact of slow steaming in the context of the fundamental obligation to proceed with reasonable
dispatch and in relation to an amended off-hire clause. In finding against B on both grounds, the judge highlighted the importance of the performance clause and noted the
failure of the vessel to achieve the warranted speed on each of the three relevant voyages. The tribunal had correctly reached its decision that there was a failure to proceed with
utmost dispatch, not only on the basis of a failure to achieve the warranted speed on each of the three voyages but also on the evidence before it in relation to this vessel and the
conditions which this vessel encountered. In relation to the off-hire clause, cl.15, the judge noted that this was a net loss of time clause, which could cover the additional time by
which the service has been extended in cases where there has not been a total interruption
25. [2000] 1 AC 638; digested S Girvin & H Bennett, English Maritime Law 2000 [2002] LMCLQ 76, 104.
26. BIMCO Slow Steaming Clause for Time Charter Parties 2011; BIMCO Slow Steaming Clause for Voyage Charter Parties 2012.
27. Generally, see Girvin, Carriage of Goods by Sea, 2nd edn (Oxford University Press, 2011), ch.26.
28. Which in effect operates as an exception to the charterers primary obligation to pay hire continuously throughout the charter period.
29. As to which, see Girvin, Carriage of Goods by Sea, 2nd edn (Oxford University Press, 2011), [33.69]. See also Minerva Navigation Inc v Oceana Shipping AG (The Athena),
post, 146.
to the service. It was difficult to see why it should be inapposite to apply the clause to a deficient performance so far as speed is concerned, which involved the continuation of the
charter service but a loss of time because the duration of that service has been extended.
Time charterpartyvessel damaged in course of time-chartered servicecost of repairs exceeding sound market value of vesselfrustrationNYPE 1946
The Kyla, a Capesize bulk carrier, was on time charter to B for a period of 12 to 15 months at Bs option. By cl.41, K, her owners, warranted that the Kyla would be fully covered
throughout the charterparty against hull and machinery risks in the sum of US$16 million. Soon after delivery, however, the Kyla was damaged while in berth loading a cargo of
soya beans at Santos (Brazil); another ship, the Zhen Hua 27, struck her port side causing her to make contact with the UBC Tampico.
Over a period of months, K obtained quotations for repairs but it appeared that the cost of repairs of US$9 million would far exceed the sound value of the vessel of US$5.75
million. K accordingly tendered notice of abandonment to the hull and machinery insurer asserting that the Kyla was a constructive total loss and informed B that the charter was
frustrated. The hull and machinery underwriters rejected the notice of abandonment and K subsequently sold the vessel for scrap for US$3,300,000.
The arbitrator found, as K submitted, that there was a general principle that a charterparty would usually be frustrated where the vessel was damaged such that the cost of
repair exceeded the value of the vessel and that a very clear provision would be required to oblige an owner to repair in such circumstances. He accordingly held that the charter
had been frustrated at the date of the collision.
On appeal, B submitted that, even if there was such a principle in cases where there was no warranty as to the level of hull insurance, the warranty in the present charter was
part of a scheme whereby K was obliged to repair the vessel up to the insured value of US$16 million, which was far more than the cost of repair, and K could not rely on the fact
that the cost of repair exceeded the sound value as a matter which frustrated the charter.
Held: (1) The earlier cases were capable of being subsumed within the modern doctrine of frustration and should be treated not as establishing an inflexible rule that, where the
cost of repair exceeded the value of the vessel, the charter would be frustrated but, rather, as an application of a principle that if a vessel was a commercial loss the charter would
generally be frustrated, just as it would be if the vessel was physically lost. (2) The tendency in the modern law of frustration had been to move away from inflexible rules, such
as cost versus value, to a multi-factorial approach. (3) The correct approach was to
30. [2012] EWHC 2595 (Comm), [67].
31. [2012] EWHC 3522 (Comm); [2013] Lloyds Rep 565; [2012] 2 CLC 998 (QBD: Flaux J).
32. Simon Rainey QC.
33. See Kulukundis v Norwich Union Fire Insurance Soc Ltd (No 1) [1937] 1 KB 1; Blane Steamships Ltd v Minister of Transport [1951] 2 KB 965.
34. See Edwinton Commercial Corp v Tsavliris Russ (Worldwide Salvage & Towage) Ltd (The Sea Angel) [2007] EWCA Civ 547; [2007] 2 Lloyds Rep 517, [67].
consider whether the contract provided for the event or contingency which had occurred or allocated the risk of that event or contingency to one or other of the parties. (4)
Clause 41 was a comprehensive insurance provision which went a good deal further than cl.1 and cl.26 of the standard NYPE 1946 form in relation to the insurance obligations of
the owner. (5) It was clear that K was warranting that full hull and machinery cover would be in place throughout the charter in the sum of US$16 million. (6) The fact that the
charter contained an express continuing warranty as to the hull insurance and its amount made it impossible for K to contend that there had been a frustrating event where the
cost of repairs was substantially less than the insured value. (7) The charter allocated to K the risk that, if a casualty occurred and the cost of repair was within the insured value,
the vessel required repair. (8) The presence of the insurance warranty also meant that K could not argue that repairing the vessel and continuing with the charter were
commercially impossible or that the vessel was a commercial loss. (9) At the date of the collision a reasonable person would have taken the view that the casualty did not make
performance by K radically different from what it had promised, because it had warranted that hull insurance up to an insured value of US$16 million would be in place and it was
in place and the cost of repairs would be amply covered by that insurance. (10) Accordingly, contrary to the arbitrators conclusion, the contract was not frustrated, as cl.41
created an assumption of risk and responsibility on Ks part to repair the hull damage up to the insured figure of US$16 million.
Comment: It has been said that the doctrine of frustration is not lightly to be invoked to relieve contracting parties of the normal consequences of imprudent commercial
bargains. This case confirms that the courts will always look carefully at the agreed allocation of risk as expressly reflected in the charterparty terms and will be loath to permit
the parties to walk away from performance simply because performance has become much more commercially onerous for one of them.
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24
25
26
27 28
29
120
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130. Bunge SA v Kyla Shipping Co Ltd (The Kyla)
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32
33
34
35
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131. Carboex SA v Louis Dreyfus Commodities Suisse SA
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Voyage (berth) charterpartyWIBONstrike clausedemurrageAmWelsh form
C entered into a contract of affreightment (COA) on amended AmWelsh voyage terms with L, owners of the Co-op Phoenix, Alpha Glory, C Young and Royal Breeze, for the
transportation of coal from Indonesia to Spain. The contract provided that C was liable to pay demurrage if the discharge of cargo took longer than the specified rate of discharge.
At port of discharge if the berth is not available when vessel tenders Notice of Readiness, but provided vessel/Owners not at fault in relation thereto, then laytime shall commence
twelve (12) hours after first permissible tide, Notice of Readiness received and accepted, whether in berth or not, whether in free pratique or not, whether in customs clearance or
not, unless no customs clearance
35. Applying The Sea Angel, [6871].
36. BTP Tioxide Ltd v Pioneer Shipping Ltd (The Nema) [1982] AC 724, 752 (Lord Roskill); Tsakiroglou & Co Ltd v Noblee Thorl GmbH [1962] AC 93, 124 (Viscount Radcliffe).
37. [2012] EWCA Civ 838; [2013] 2 WLR 754; [2012] 2 Lloyds Rep 379; [2012] 2 CLC 416; [2012] 2 All ER (Comm) 1039 (CA: Lord Neuberger of Abbotsbury MR, Moore-Bick
& Toulson LJJ); affg [2011] EWHC 1165 (Comm); [2011] 2 Lloyds Rep 177; [2011] 1 CLC 954; [2011] 2 All ER (Comm) 365 (QBD: Field J); noted S Girvin [2012] IMCLY 172.
or no free pratique due to vessels fault, unless sooner commenced in which case only time actually used to count.
In Case of strikes, lockouts, civil commotions or any other causes included but not limited to breakdown of shore equipment or accidents beyond the control of the Charterers
consignee which prevent or delay the discharging, such time is not to count unless the vessel is already on demurrage.
At the discharge port, Puerto de Ferrol (Spain), C served notices of readiness (NOR) but discharge was delayed because other vessels were ahead in the line-up for discharge
owing to a strike at the port. The arbitrators found that C could not rely on cl.9 because the strike had ended by the time the vessels berthed. Pursuant to the ejusdem generis
rule, the words other causes in the last sentence of cl.9 did not include congestion caused by strikes.
On appeal, the court held that the words in case of strikes beyond the control of the Charterers which prevent or delay the discharging in cl.9 covered delay in discharging
caused by congestion due to the after-effects of a strike that had ended and also covered delay in discharging caused by congestion due to a strike where the vessel arrived after
the strike had ended. The arbitral tribunal had erred in law in deciding that C did not have the protection of cl.9.
L appealed, submitting inter alia that the case of Central Argentine Railway v Marwood was binding authority on the meaning and effect of cl.9; alternatively, that cl.9
operated only during the continuation of the strike and did not extend to delay caused by congestion.
Decision: Appeal dismissed.
Held: (1) The purpose of including the expression WIBON (whether in berth or not) in a berth charter was to transfer the general risk of congestion from the owner to the
charterer, but it was equally true to say that its function was to start the laytime clock running. (2) However, the establishment of a general regime of that kind did not give rise to
a presumption that the parties did not intend to transfer the risk of delay from specific causes back to the owner. (3) Clause 40 did not point to a narrower construction of cl.9 than
it would naturally bear. (4) Clause 9 was clearly intended to transfer the risk of some delay caused by strikes from the charterer to the owner and there was nothing in the
language of the clause to indicate that its operation was restricted to time lost while the vessel was alongside the berth. (5) Even if the discharging was to be understood as
referring to the physical operations involved in handling cargo, those could be delayed just as much by a strike which prevented the vessel getting into berth as by one which
interrupted the handling of cargo. (6) The natural meaning of cl.9 showed that it was concerned only with the consequences of the excepted causes, not with their duration, and
there was nothing in cl.9 to support the conclusion that its operation was limited to interruptions and delays occurring during the period of the excepted causes. (7) Central
38. The underlined words were inserted in type in the printed form.
39. [1915] AC 981.
40. See Leonis Steamship Co Ltd v Joseph Rank Ltd (No 2) [1908] 1 KB 499; Reardon Smith Line Ltd v Ministry of Agriculture, Fisheries and Food [1962] 1 QB 42 (CA).
41. See London and Northern Steamship Co Ltd v Central Argentine Railway Ltd (1913) 108 LT 527.
Argentine Railway Ltd v Marwood was authority for the proposition that such time in cl.9 meant time lost to the vessel in completing discharging by reason of one of the
excepted causes. (8) In order to obtain the protection of cl.9, the charterer had to establish that the event on which he relied fell within the clause and was the effective cause of
delay to the vessel. (9) The case was not authority for the proposition that cl.9 protected the charterer only once the vessel had reached the discharge berth. (10) The owners in
that case did not argue for such a narrow construction and it would be surprising if their Lordships had intended to decide such an important question without inviting argument
and without making it clear in their speeches that they intended to do so. (11) Accordingly, if and to the extent that C could establish that the strike was the effective cause of
delay to the discharge of any of the vessels, the time lost as a result would not count against laytime. (12) Whether the strike was the effective cause of delay was a question of
fact and the necessary causal connection could be established even in relation to vessels arriving after the strike had ended, as had occurred in Leonis Co Ltd v Joseph Rank Ltd.
Comment: As was noted in last years IMCLY, congestion can have a critical impact on employments of vessels but, until now, the intersection of strike clauses and laytime
clauses in this context has been relatively little explored. The Court of Appeal has confirmed that a waiting delay at the loading or discharging port does not preclude the
invocation of a strike clause, even where laytime has already started to run. On the facts of the case, the strike was causative of the delay (even though it was over) and so C
could rely on the exception.
Bills of ladingHague Rulesdue diligencedelaydamage to goods
The Devon was chartered to carry a consignment of corn belonging to C from Bulgaria to Spain. The bills of lading for the carriage incorporated an amended Synacomex 90
charterparty, which provided, by cl.3, for the vessel to proceed with all convenient speed to one safe port Barcelona-Cadiz range and was expressly governed by English law.
There was also a General Paramount Clause (also incorporated into the charterparty) and so the Hague Rules applied to the carriage.
Shortly after leaving the loading port, Varna (Bulgaria), the vessel suffered a main engine breakdown. She was towed back to Varna the next day, but the necessary repairs took
seven weeks to complete. The Devon eventually arrived in Tarragona (Spain) 59 days later than she would have done in the absence of an engine breakdown. The effect of the
delay was that some of the corn arrived at its destination caked and mouldy. C sought damages from the Devons owners, F, for the corns diminution in value.
C contended that F were responsible for their loss because the Devons breakdown was attributable to unseaworthiness at the start of the voyage by reason of the poor condition
of its engine lubrication and lubrication cooling systems. Accordingly, they had failed to exercise due diligence within the meaning of the Hague Rules, Art.III, r.1 and there was
42. [1915] AC 981.
43. [1908] 1 KB 499.
44. [2012] IMCLY 172.
45. [2012] EWHC 3747 (Comm) (QBD: Cooke J).
46. See generally Girvin, Carriage of Goods by Sea, 2nd edn (Oxford University Press, 2011), [19.52].
a failure to proceed with the voyage with all convenient speed as required by the contract of carriage. F submitted that the loss claimed was irrecoverable because the damage to
the corn was so limited that it should have been mixed with sound grain and sold without any diminution in price at all.
Held: (1) On the evidence, the Devon had been unseaworthy at the commencement of the voyage by reason of the condition of the saltwater cooling system and its dirty and
partially blocked state, which led to a failure in the low-temperature freshwater cooler which manifested itself within three hours of sailing in the form of high temperatures in the
luboil for the main engine. (2) F had no system in place for the proper monitoring of temperatures in the engine luboil or pressures in the saltwater cooling system and inspection
in the three hours preceding the incident should have revealed the developing problem. (3) The Devon was unseaworthy by virtue of that lack of system also, which meant that
the cooling system was prone to fail and the luboil to heat. (4) Cs allegations as to the poor condition of the vessels engine lubrication and lubrication cooling systems were made
out: there was a lack of adequate systems on board to ensure that the temperature of the engine lube oil was properly regulated, the cooling system did not become blocked, and
the engine was adequately lubricated. (5) The same feature that constituted unseaworthiness also constituted lack of due diligence in that respect, to which the owners had no
122
38
39
40
41
42
43
44
132. CHS Inc Iberica SL v Far East Marine SA (The Devon)
45
46
124
defence. (6) Given that finding, it was unnecessary to determine whether there had been a failure to proceed with all reasonable speed as required by the contract of carriage. (7)
The repairs which were undertaken had been necessary for the prosecution of the voyage and there was no unreasonable delay in effecting them. (8) The cause of the delayed
voyage was the breakdown of the vessel which resulted from her unseaworthiness and that was the operative causative breach which led to delay on the voyage and cargo
damage. (9) The only practical way to have mixed the damaged corn with sound grain would have been by moving the damaged grain to a bulk silo of sufficient capacity to
accommodate it and enough sound grain to dilute it. (10) Even then, the mixed grain could not have been sold as good corn and in the absence of any buyer being prepared to
offer a price with a discount for the substandard features, the only option had been the competitive salvage sale which had taken place. (11) The price subsequently obtained
properly reflected the damaged cargo. (12) C had incurred extra expense from additional stevedoring and warehouse costs, charges for the salvage sale, and Spanish lawyers fees
for arresting the vessel in order to obtain security for the claim and those losses, together with the corns diminution in value, were recoverable as a foreseeable and sufficiently
direct consequence of Fs breach.
Comment: This was a reasonably straightforward case on unseaworthiness and the due diligence obligation under the Hague (and Hague-Visby) Rules. Much of the case was
concerned with the assessment of the evidence as to the damage but the court concluded that the Devon was unseaworthy at the commencement of the voyage because of the
condition of the saltwater cooling system and the fact that the owners had no system in place for the proper monitoring of temperatures in the engine. None of the Hague Rules,
Art.IV, r.2 defences raised availed the owners.
47. Art. IV, r.2(p) and r.2(q). As to these, see Girvin, Carriage of Goods by Sea, 2nd edn (Oxford University Press, 2011), [29.41; 29.45].
Collisioncatamaran colliding with Westminster Bridgeliability in negligence of the bridge owner
C were the operators of a passenger catamaran, the Millennium City. One night, as the Millennium City passed downstream under the centre arch of Westminster Bridge, she made
contact with one of the piers under the arch and sustained a serious gash to her starboard side. After the collision, a piece of jagged steel was found to be protruding from the
buttress of the pier. C argued that the damage to the vessel had been caused by Ts negligence or breach of duty in that T had failed to properly maintain the bridge, or to mark or
light it so as to enable vessels to line up with the arch. C further claimed that T was responsible for the protruding piece of steel and that it had failed to give any warning of its
presence. In addition, C claimed that T ought to have fendered the bridge. T denied any negligence or breach of duty, claiming that the accident had been caused by the masters
negligent navigation of the Millennium City and that the protruding piece of steel had not been there before the accident.
The issues before the Admiralty Registrar were: (1) when and how the vessel had collided with the bridge; (2) who, if anyone, was responsible for the collision; (3) whether the
existence of the protruding piece of steel had materially increased the nature of the damage suffered; (4) how the steel had come into existence; and (5) whether, if the steel had
pre-existed the accident, it should have been noticed and rectified.
Held: (1) When a moving object collided with a stationary one, there was a rebuttable presumption that the responsibility lay with those in charge of the moving object. (2)
The evidence of the master of the Millennium City was confused, and it was seriously doubtful that he had a clear or coherent recollection of the events leading up to the collision.
(3) The court could not accept that he had properly lined up the vessel to pass under the arch and the Millennium City had passed under the arch at a speed that was greater than
was sensible or acceptable. (4) That was poor seamanship on the part of the master because it reduced the amount of time he had to ensure that the Millennium City was properly
aligned and was causative of the collision: the evidence showed that the vessel had been on a broadly straight course but had moved to her starboard before passing under the
arch. (5) There was no evidence of a current or eddy that had caused the Millennium City to drift to her starboard but, even if there had been, that would not have helped C to
establish liability on Ts part. (6) As far as lighting or markers to assist in navigation under the bridge were concerned, that was the responsibility of the Port of London Authority
and not T. (7) Even if there had been a failure to mark or light the bridge, it was not causative of the accident, the bridge being clearly marked on local charts. (8) Whether or not
the accident had been caused or contributed to by the masters negligence, the question remained whether the damage had been exacerbated by the protruding piece of steel. (9)
It had not and C had failed to prove that the steel was in place prior to the collision. (10) Rather, it was probable that it had been formed during the collision. (11) Moreover, there
was insufficient evidence to show that the bridge had been
48. [2012] 1 Lloyds Rep 471 (Jervis Kay QC).
49. Bowditch (Owners of the) v Owners of the Po [1991] 2 Lloyds Rep 206.
in such a state as to have materially affected the level of damage to the Millennium City, and T had demonstrated that it operated a reasonable system of inspection at the
material time it. (12) Cs fendering argument was unrealistic as there was no credible evidence that underwater parts of bridges should be fendered and, in any event, fendering
was not designed to offer any protection at the type of speed that the vessel had been doing in the instant case.
Comment: In this case the root cause of the collision involving contact damage between the Millennium City and Westminster Bridge was the poor seamanship of her master. It is
long established that there is a general duty to use reasonable skill and care in navigating ships at sea or in navigable rivers and this would certainly extend to ensuring that a
vessel is being navigated at a safe speed.
Sale of shipsimplied term as to satisfactory qualitySale of Goods Act 1979, s.14(2)Norwegian Saleform 1993, cl.11
D, the owners of the Calafuria, a tanker built in 1994, entered into an MOA with M, her buyers, for her purchase for US$7m. The first sentence of cl.11 (condition on delivery) of
the Saleform provided that the tanker, now renamed Union Power, was to be delivered and taken over as she was at the time of inspection, fair wear and tear excepted. A month
after delivery of the Union Power her main engine broke down because of a defective crankpin. The arbitrators held that the engine had been likely to fail within a short period of
normal operation after delivery, that there was a breach of the implied term as to satisfactory quality implied into the sale contract by the Sale of Goods Act 1979, s.14(2), as
amended, and that M was entitled to damages accordingly. On appeal, D submitted that the s.14(2) term was excluded by virtue of s.55(2), because it was inconsistent with
cl.11, which provided that the vessel was sold as she was.
Held: (1) The correct starting point was that the s.14 implied terms would apply to the sale contract as to any other English law contract, unless the parties had contracted out of
s.14. (2) Second-hand ships were goods within the Act like any other piece of machinery or equipment; and, if commercial parties did not want to be subject to the statutory
implied terms, they could contract out of them, as provided for by s.55(1). (3) The words as she was in the first sentence of cl.11 were a necessary part of a sentence which
recorded the obligation to deliver the vessel in the same condition as she was when inspected. (4) However, those words did not say anything about what Ds obligations were,
either on inspection or delivery, as regards the quality of the vessel, and
50. Brown v Mallett (1848) 5 CB 599; 136 ER 1013.
51. See the Collision Regulations, Rule 6.
52. [2012] EWHC 3537 (Comm); [2013] 1 Lloyds Rep 509; [2013] 2 All ER 870 (QBD: Flaux J).
53. Simon Crookenden QC, Michael Baker-Harber, and Simon Gault.
54. This provides that where the seller sells goods in the course of a business, there is an implied term that the goods supplied under the contract are of satisfactory quality.
55. This provides that an express term does not negative a term implied by this Act unless inconsistent with it.
56. See line 219 of Saleform 1993.
57. Behnke v Bede Shipping Co Ltd [1927] 1 KB 649.
so they did not exclude the implied term as to satisfactory quality under s.14(2). (5) The words as she was, in context, were incapable of bearing the same meaning as the free-
standing words as is, where is in a sale contract, assuming that those words did exclude the statutory implied terms. (6) Even if a possible meaning of the words as she was
was to exclude the implied terms, that was not their only meaning in context, and the fact that they had more than one meaning was fatal to Ds case, since it could not be said
that they were inconsistent with the implied term, as s.55(2) required. (7) The obligations in the second sentence of cl.11 relating to class complemented or supplemented the
obligation to deliver the vessel in a satisfactory condition rather than being inconsistent with it. (8) The first sentence of cl.11 did not exclude the implied term as to satisfactory
quality. (9) It was not necessary to decide whether the first sentence of cl.11 should be read down as excluding the right to reject the vessel whilst not precluding M from claiming
damages for breach of the implied term as to satisfactory quality, but the court would have accepted that argument. (10) Nor was it necessary to decide whether the words as
is were apt to exclude the statutory implied terms, but it was difficult to see how, in the absence of some customary meaning, the words as is could be said to be sufficiently
clear and unequivocal to exclude them.
47
133. City Cruises Plc v Transport for London
48
49
126
50
51
134. Dalmare SpA v Union Maritime Ltd (The Union Power)
52
53
54 55
56
57
58
59
Comment: This important case, recognised by the judge as being one on which there was no decision of the courts directly on the point, provides a buyer-friendly outcome in
an area which has always been regarded as controversial. Nevertheless, the conclusion that the words as she was did not exclude the implied terms of the Sale of Goods Act
1979 is likely itself to be controversial and may be contrary to market expectations. Moreover, the judges further, obiter view, that as is, where is was not sufficiently clear to
exclude the statutory implied terms, is likely to be of wider interest in sale of goods cases generally. Shipowner sellers of second-hand ships might avoid the difficulties created by
this case by using Saleform 2012, cl.11 of which is similar to its counterpart in Saleform1993, but which also expressly excludes all implied terms.
Voyage charterpartydelaydemurragefrustrationGencon
D were the voyage charterers and S, owners, of the Andra. The charterparty was fixed on the Gencon form for the carriage of a cargo of frozen chicken from a loadport in the US
to St Petersburg. During discharge, when the Andra was already on demurrage because of a delay in berthing, certain cargo in the No 2 hold was found to be stained and wet from
gasoil, which had leaked from an adjacent deep bunker tank. At St Petersburg discharge
58. See Ashington Piggeries Ltd v Christopher Hill Ltd [1972] AC 441.
59. Mariola Marine Corp v Lloyds Register of Shipping (The Morning Watch) [1990] 1 Lloyds Rep 547; Indigo International Holdings Ltd v Owners of the Brave Challenger
[2003] EWHC 3154 (Admlty).
60. [2012] EWHC 3537 (Comm), [58]. See too Malcolm Strong & Paul Herring, Sale of Ships, 2nd edn (Sweet & Maxwell, London, 2010), [14.10].
61. Although, as the judge himself noted, the market did not speak with one voice: [30].
62. Cf cl.4 of the Singapore Ship Sale Form 2011 (SSF 2011).
63. See cl.18 of Saleform 2012.
64. [2012] EWHC 1984 (Comm); [2012] 2 Lloyds Rep 587 (QBD: Popplewell J); refd NYK Bulkship (Atlantic) NV v Cargill International SA (The Global Santosh) [2013] EWHC
30 (Comm); [2013] 1 Lloyds Rep 455 (to be discussed in [2014] IMCLY).
was completed, apart from the cargo in the No 2 hold. From this point, Ds liability for demurrage was interrupted because the delay was due to Ss fault, namely the
unseaworthiness of the vessel.
The cargo receivers demanded a cash settlement of US$2 million in relation to the damaged cargo and S offered security in the form of a P&I Club letter of undertaking. The
Russian veterinary authority then imposed a suspension on movement of the remaining cargo. Six months later, S agreed to pay the receivers a cash settlement of US$2.3 million.
The veterinary service granted permission authorising the re-export of the cargo and the Andra left St Petersburg.
The arbitrators found that the gasoil leak was caused by the unseaworthiness of the Andra, for which S were responsible under the terms of the charter, irrespective of the
exercise of due diligence. They also found that the receivers should have been prepared to agree to a P&I Club letter of undertaking within about 10 days from discharge of the
vessel; until the end of that period Ss breach was still causative and D was not liable for demurrage. Ss breach had foreseeably caused the intervention of the veterinary service
but the latter could reasonably have been expected to resolve the position within about three weeks. After the end of that further period, the delay was not the fault of S and the
vessel was on demurrage. The arbitrators concluded that the charterparty was not frustrated by the continuation of the veterinary services order suspending movement of the
cargo.
D submitted that, on the proper interpretation of the award, the tribunal had found that the charterparty had been frustrated by reason of the veterinary services order, but had
held that the plea of frustration failed on the basis that such frustration was self-induced in that the charterers were vicariously liable for the acts of the receivers in insisting upon
a cash settlement. That was an error of law because the receivers conduct was to be characterised as pursuing their own commercial interests, or preventing re-export of the
cargo, as opposed to its discharge. Where delay was caused by receivers acts or omissions other than in carrying out discharge, they were not to be attributed to the charterers
so as to make what would otherwise be a frustrating event self-induced.
Held: (1) If the continued existence of the veterinary order would otherwise have been a frustrating event, D was not entitled to rely on it, because it was the conduct of the
receivers, being unwilling to procure its lifting, which was the effective cause of it remaining in place. (2) The relevant conduct of the receivers, which precluded the veterinary
services order operating as a frustrating cause, was their failure to discharge the cargo for so long as they were maintaining an attempt to be paid US$2 million or more in respect
of the alleged damage to the cargo. (3) The charterparty provided for the cargo to be discharged by D or its agents and they were under a non-delegable duty to discharge the
cargo, however they chose to fulfil it. (4) D would be liable in demurrage or damages for detention if the cargo was not discharged, notwithstanding that the function of
discharging had been delegated to the receivers as its agent. (5) The instant case was not one in which the vessel was prevented from sailing away or the delay was caused by
something preventing the re-export of the cargo. (6) The receivers failure to discharge
65. See generally Lauritzen AS v Wijsmuller BV (The Super Servant Two) [1990] 1 Lloyds Rep 1 (CA).
66. Distinguishing Adelfamar SA v Silos E Mangimi Martini SpA (The Adelfa) [1988] 2 Lloyds Rep 466.
the cargo prevented D from relying on what would or might otherwise have been a frustrating event that relieved it from the obligation to pay demurrage.
Comment: In this second case involving an argument as to frustration in the year under review, the argument as to frustration was again turned down by the court. The case
underlines the importance of the charterers obligation to discharge the cargo even where, as in this case, discharge fell on the receivers, who declined to discharge until they were
paid for the alleged damage to the cargo. Though the outcome was in the owners favour, it was ultimately to their cost, having incurred a liability to the receivers of US$2.3
million (following a claim of just S$2 million).
Time charterpartywithdrawal for failure to pay hirelien on sub-freights and sub-hireNYPE 1946
D was the owner, and C the time charterer, of the Bulk Chile. D chartered the vessel, on Cs account, to an intermediate charterer, K, on back-to-back terms. Clause 18 of the NYPE
1946 charterparty provided that the Owners shall have a lien upon all sub-freights for any amounts due under this Charter . K sub-chartered the Bulk Chile to F for a time
charter trip and F sub-sub-chartered her to M on voyage charterparty terms.
M, the voyage charterer of the Bulk Chile, was also the shipper of 47,000mt of steel products from Sevastopol and Odessa to Jakarta and Klang. The terms of their voyage
charterparty provided at cl.30 that bills of lading were to be marked Freight Prepaid, and that Charterers were authorised to issue Bill(s) of lading on behalf of master, subject
freight payment. Three bills of lading on the Congenbill 1994 form were issued, stating that Freight payable as per Charterparty dated 19.01.11, while the reverse side contained
the standard Congenbill term incorporating all terms and conditions, liberties and exceptions of the Charter Party, dated as overleaf . The bills of lading also stated freight
prepaid on their face, but none had been.
K became insolvent and was unable to pay outstanding hire charges to D. D sent a first notice to F and M on 1 February 2011, claiming a lien over any balance of freight(s)
and/or hire(s) due under any charters, bills of lading, or other contracts of carriage relating to the voyage(s) and cargo(es) covered by the above bills of lading. In a subsequent,
second notice, dated 5 February, D extended the lien to the cargo. D withdrew the Bulk Chile from Ks service on 26 February. F gave D notice of redelivery, instructed the master
of the vessel to continue the voyage, and discharged the cargo at Jakarta. M paid freight to F on 12 April.
D brought a series of claims: (1) bill of lading claims against M, claiming freight under the bill of lading contracts; (2) lien claims, in which they claimed hire from F and
freight from M in respect of the period to 26 February; and (3) post-withdrawal claims, in which they argued that F and M were liable in respect of the period after the withdrawal
67. See Bunge SA v Kyla Shipping Co Ltd (The Kyla), ante, 130.
68. [2013] EWCA Civ 184 (CA: Pill, Toulson, & Tomlinson LJJ); affg [2012] EWHC 2107 (Comm); [2012] 2 Lloyds Rep 594; [2013] 1 All ER (Comm) 177 (QBD: Andrew Smith
J).
of the vessel up to 10 March, either because they agreed to pay hire for the voyage to be completed or by way of a quantum meruit claim in unjust enrichment.
The court allowed Ds bill of lading and lien claims against M, and allowed a claim against F for use of the Bulk Chile after its withdrawal.
60
61
62 63
135. DGM Commodities Corp v Sea Metropolitan SA (The Andra)
64
128
65
66
67
136. Dry Bulk Handy Holding Inc v Fayette International Holdings Ltd (The Bulk Chile)
68
130
The issues on appeal were: (1) whether D was entitled to require M to pay bill of lading freight direct to it, even though the bills of lading directed payment to F; (2) whether Ds
notices were effective to require payment of bill of lading freight to D; (3) whether Fs notice of redelivery and message to the Bulk Chiles master constituted a request to
complete the voyage, such as to oblige it to pay reasonable remuneration to D. Decision: Appeal dismissed.
Held: (1) It had long been recognised that a shipowner could intercept and claim freight direct from the shipper at any time before it was paid. (2) If the shipowner permitted
his charterer to commit him to contracts of carriage made with cargo interests, it was hardly surprising that he should reserve to himself the right to receive the contractual
remuneration for those obligations. (3) Construing the contract evidenced by the bill of lading directing payment to a third party as one to pay the third party or to pay as the
owner might direct seemed intuitively correct. (4) There was no reason why the contract should preclude the shipowner from cancelling his agents authority to act on his behalf
in receiving the freight, before such payment had been made, and requiring it to be made to himself. (5) As between the shipowner and the shipper, it could not be suggested that
the shipowners right to require payment to himself was conditional upon default by an intermediate charterer. (6) A time charterer who was not in default could, arguably, restrain
a shipowner from demanding direct payment on the ground that, until there was a default, the shipowner had, by reason of cl.8 of the NYPE form, agreed to delegate collection of
freight to the charterer. (7) Ds two notices were sufficient to put M on notice that they were required to pay freight to D and not to F. (8) The first contained two requests, one for
confirmation of any amount due from M under any bills of lading or other contracts of carriage relating to the voyage and cargo covered by the bills of lading, and the other for
payment of any such freights due directly to D. (9) Both were repeated in the second notice and, together with a warning in the first notice about running the risk of being obliged
to pay twice, they could scarcely have been more explicit. (10) The redelivery notice was consistent only with F treating itself as entitled to give instructions as to the employment
of the ship, having been sent in the knowledge that the ship had been withdrawn from Ks service. (11) The message to the vessels master was even more explicit and both
messages had to be read in the context of Ds having made it clear that it expected the sub-charter hire to be paid to it. (12) It was no impediment that D was contractually
obliged to carry the cargo to destination and discharge it. (13) There was no reason why a request, giving rise to a right to remuneration, could not be made for performance of
services that the recipient of the request was obliged to perform under a contract with a third party.
Comment: This case (and its appeal) is one of two in the year under review involving the invocation of the NYPE lien clause by the shipowner. In a strong endorsement of the
shipowners rights under a time charterparty, the Court of Appeal confirmed what has long
69. At [13].
70. Tradigrain SA v King Diamond Marine Ltd (The Spiros C) [2000] 2 Lloyds Rep 319 (CA).
71. See Western Bulk Shipowning III A/S v Carbofer Maritime Trading APS, post, 151.
been regarded as hornbook law, namely that a shipowner can intercept and claim freight direct from the shipper at any time before it is paid. As Tomlinson LJ expressed it, it was
hardly surprising that a head owner would reserve the right to receive the contractual remuneration for obligations which he had agreed to undertake. He agreed with Rix LJ
in Tradigrain SA v King Diamond Marine Ltd (The Spiros C) that it was possible for the shipowner to require payment of freight to himself where there was no default on the part
of the intermediate charterer, provided that it was made before the freight was paid to that charterer. In an obiter comment, he suggested that it was arguable that a time
charterer not in default might restrain the shipowner from collecting bill of lading freight because by NYPE, cl.8 the shipowner had agreed to delegate the collection of freight to the
charterer.
Voyage charterpartydemurragewhether delay caused by mechanical breakdown or government interferenceSugar Charter Party 1999, cl.28
E were the voyage charterers of the Ladytramp, a bulk carrier, and T, her owners. The charterparty was on the Sugar Charter Party 1999 and provided that the vessel should sail
and proceed to 12 safe berth(s), 1 safe port (intention Santos) but not south of Paranagua . Clause 28 of the charterparty provided that:
In the event that whilst at or off the loading place the loading of the vessel is prevented or delayed by any of the following occurrences: strikes, riots, civil commotions, lock
outs of men, accidents and/or breakdowns on railways, stoppages on railway and/or river and/or canal by ice or frost mechanical breakdowns at mechanical loading plants,
government interferences, vessel being inoperative or rendered inoperative due to the terms and conditions of appointment of the Officers and crew time so lost shall not count as
laytime.
On the date of the fixture, E declared Paranagua (Brazil) as the loading port. The CBL terminal where E had initially scheduled the Ladytramp to load had, however, suffered fire
damage which destroyed the conveyor belt system linking it to the warehouse and rendering the terminal inoperable. The Ladytramp tendered notice of readiness (NOR) at 23.30
on 20 June 2010 but, in the absence of an available berth, remained off the port until 14 July, when she weighed anchor and entered the inner roads of the port awaiting berthing
instructions. On 15 July she berthed and loaded at an alternative terminal, the Centrosul terminal.
The tribunal upheld Ts claim for demurrage in respect of a one-month period when the vessel had had to wait at the loading port. The tribunal held that E had been obliged,
when
72. [2013] EWCA Civ 184, [24].
73. Described ibid, along with Colman J at first instance ([1999] 2 Lloyds Rep 91), as two judges of great experience in the field.
74. Ante, fn.70.
75. [2013] EWCA Civ 184, [25].
76. At [28].
77. [2012] EWHC 2879 (Comm); [2012] 2 Lloyds Rep 660; [2013] 1 All ER (Comm) 955 (QBD: Eder J).
the terminal became unusable due to the fire, to nominate an alternative berth. They were entitled to nominate any safe berth in the port of Paranagua and the fact that the CBL
terminal was unusable did not mean that they were unable to perform their obligation to nominate any safe berth. They were not, however, entitled to invoke cl.28 because the
only sense in which loading was prevented or delayed was that it became impossible to load at the berth originally intended. Clause 28 made no mention of fires as an
excepted peril and the inoperability of the conveyor belt system appeared to have been the result of physical damage due to the fire rather than any mechanical breakdown. Any
refusal of permission by the port authority for vessels to load at the terminal were not government interferences within the meaning of cl.28, as that term related to such things
as embargoes and export bans, and not to simple administrative rescheduling of cargoes due to a fire.
On appeal, E submitted that a mechanical breakdown was still a mechanical breakdown, whatever its cause, and the conveyor belt system was inoperable and had broken
down. E moreover argued that the words mechanical breakdown were wide enough to include the destruction of a mechanism and submitted that there had been no sound basis
for the tribunals gloss on the words government interferences.
Held: (1) The tribunal had approached the safe berth issue by asking the wrong question, namely whether E had a relevant legal obligation to nominate an alternative loading
berth when the terminal became unusable. (2) There was no reason in principle nor in the wording of the charterparty which, as a matter of law, required E to nominate a berth as
a precondition to the operation of cl.28. (3) The correct question for the tribunal to answer was simply whether there had been prevention or delay in loading caused by a relevant
excepted peril. (4) As a matter of ordinary language and common sense, the destruction or partial destruction of an item was not within the scope of the term breakdown, still
less within mechanical breakdown. (5) Although the judgment in Olbena SA v Psara Maritime Inc (The Thanassis A) appeared to support Es argument that the cause of the
malfunction was to be regarded as irrelevant, the conclusion in that case turned on the particular wording of the clause under consideration, which referred to breakdown of
machinery and equipment. (6) Had the judge been considering only a clause encompassing breakdown of machinery, he would have been content to apply the colloquial
meaning to which he referred, namely some inherent defect of the machinery which resulted in the item breaking down. (7) It was only the inclusion of the words and equipment
which compelled a different and broader construction. (8) The wording mechanical breakdowns at mechanical loading plants in the present case pointed in favour of the narrower
colloquial meaning rather than the much broader construction for which E contended. (9) The inclusion of the word mechanical served to restrict the scope of the breakdown
which must be established for the purposes of the
78. Relying on Portolana Compania Naviera Ltd v Vitol SA Inc (The Afrapearl) [2004] EWCA Civ 864; [2004] 1 WLR 3111.
79. (22 March 1982) Unreported.
exception. (10) There was no finding in the award to the effect that the port authority was a government entity, or that permission to berth at the terminal was suspended by the
port authority or any other party. (11) As a matter of construction, the phrase government interferences was not intended to encompass an administrative rescheduling of
cargoes due to a fire. (12) What was required, at the least, was an act by a port authority, which was also a government entity, which amounted to the discharge of a sovereign
function and which differed from an ordinary administrative act of which any port or berth authority, state-owned and operated or otherwise, would be capable in the day-to-day
management of a berth. (13) There was no finding of any such act in the instant case.
Comment: Many charterparties, of which the Sugar Charter Party 1999 is a particularly well-known example, make provision for circumstances in which laytime will not run.
69
70
71
72 73
74
75
76
137. ED & F Man Sugar Ltd v Unicargo Transportgesellschaft mbH (The Ladytramp)
77
132
78
79
80
Exceptions clauses, such as cl.28, are not of course applicable to demurrage unless they are specifically so worded. The difficulty faced by E in this case was that an alternative
loading terminal was available. Their attempted reliance on the wording of cl.28 soon ran into difficulty as the court held that a fire, leading to the unavailability of the terminal,
was not covered by mechanical breakdowns at mechanical loading plants or government interferences.
Time charterpartybunkers on redeliveryprice actually paidSHELLTIME 4, cl.15
E chartered the Bonnie Smithwick from T on amended Shelltime 4 terms. Clause 15 provided that:
Charterers shall accept and pay for all bunkers on board at the time of delivery, and owners shall on redelivery accept and pay for all bunkers remaining on board, at the price
actually paid, on a first-in-first-out basis. Such prices are to be supported by paid invoices.
E sub-chartered the vessel for a time charter trip to C. The sub-charter provided for payment for bunkers at fixed prices on the basis IFO US$625 pmt both ends. C paid E for
bunkers on board on delivery under the sub-charter. Following completion of the voyage, C redelivered the vessel to E and E was obliged to buy back the bunkers on board at the
same stipulated prices. There remained a relatively short unexpired period under the head charterparty with T and it was agreed that, following completion of the charterparty with
C, E would relet the vessel back to T for one time-charter trip. The sub-charter back to T was on the terms of the head charter. Following that voyage, the Bonnie Smithwick was
redelivered by T to E under the sub-charter and also simultaneously by E to T under the head charter. The prices under the charterparty with C were used for the purpose of
80. See eg Compania Naviera Aeolus SA v Union of India [1964] AC 868.
81. [2012] EWHC 202 (Comm); [2012] 1 Lloyds Rep 407; [2012] 2 All ER 100 (QBD: Eder J).
82. ie IFO (High Sulphur Fuel Oil) at US$625 per metric ton on delivery and redelivery.
calculating the price of bunkers on board on delivery of the vessel by E to T under the sub-charter and on redelivery by T to E.
The issue was the price of bunkers payable by T to E on redelivery under the head charter. The arbitrators agreed with T that the words price actually paid in cl.15 of the
charterparty referred to the prices actually paid for the bunkers which had been put on board and remained on board the vessel on redelivery assessed on a first-in-first-out basis,
as supported by invoices paid by T to the bunker suppliers when the bunkers were stemmed.
On appeal, E argued that the price actually paid was the price actually paid by the party seeking payment under cl.15, namely the prices with C which E had been obliged to
pay T on redelivery under the sub-charter. T argued that the price actually paid referred to the price that it had paid to the bunker suppliers.
Held: (1) The arbitrators had specifically addressed Es argument that Ts construction of cl.15 was unworkable and concluded that, although a charterer might have difficulty in
obtaining copies of relevant invoices, it was not impossible. (2) Es submissions with regard to unworkability would be rejected as would their argument that, as a matter of
business common sense, cl.15 was intended to provide reimbursement of the party seeking payment. (3) On the contrary, it seemed most unbusinesslike that the head owner
should be taken to have agreed to pay a price for bunkers on redelivery over which he had no control and which was not necessarily related to any particular market price or price
actually paid to a bunker supplier. (4) As the arbitrators recognised, the Shelltime 4 form was not well suited to being the source document in a chain or sequence of time charters
and cl.15 was more appropriate where there was a long-term charter between two parties who could be expected to have copies of all invoices paid for bunkers supplied to the
vessel. (5) E had raised a plea in the arbitration that an estoppel by convention prevented T from arguing that price actually paid meant the price paid when the bunkers were
stemmed but failed to prove any of the relevant facts. (6) Clause 15 was badly drafted and was potentially open to more than one interpretation but the conclusion reached by the
arbitrators was correct principally because of the specific requirement in the clause for first-in-first-out assessment. (7) That wording seemed to refer to the physical acts of
stemming bunkers and consuming them and the structure of the wording seemed to link the price actually paid to that physical movement of fuel, in particular the price paid for
the fuel being taken in at any particular moment in time. (8) The answer to the question of law was therefore that in cl.15 the words price actually paid meant the price paid
when the bunkers were stemmed.
Comment: This was a case where between the date of a sub-charter for a time charter trip and redelivery the market in charterparty rates and bunker prices dropped
considerably. The difficulties in which T found itself occurred, in part, because cl.15 was designed for the simpler chartering case where there were just two parties. Nevertheless,
it was possible to construe the clause and, in particular, the wording price actually paid as the price paid when the bunkers were stemmed.
83. Ie, when the IFO was ordered and pumped on board the vessel.
Time charterpartywithdrawal of vesseldamages for detentionowners entitlement to recovery as baileesrecovery of expenses in providing a bank guaranteeSHELLTIME 3
K, the owners of a VLCC, the Kos, chartered her to P on the Shelltime 3 form. Hire under the charterparty was payable in advance and if it was not paid the owners had the right
to withdraw the vessel without prejudice to any other claim owners may otherwise have on charterers under this charter. There was, however, no anti-technicality clause in the
charterparty. Clause 13 of the charterparty provided that:
The Master (although appointed by Owners) shall be under the orders and direction of Charterers as regards employment of the vessel, agency or other arrangements. Charterers
hereby indemnify Owners against all consequences or liabilities that may arise from the Master otherwise complying with Charterers or their agents orders.
While the Kos was at Angra dos Reis (Brazil), K served notice of withdrawal of the vessel on P following non-payment of hire. P sought to persuade K to revoke the withdrawal but
K refused and P had the cargo removed from the ship.
P argued that the withdrawal was wrongful and demanded that K provide a bank guarantee for its potential damages claim before they would release the ship to K. K asserted
that the withdrawal had been lawful but agreed to provide the guarantee subject to its right to claim that the demand was unjustifiable and the right to recover the costs of
providing it.
K claimed compensation for the use or detention of the ship between notice of withdrawal and discharge of the cargo, for fuel consumed during that time and used to unload the
cargo, and for the costs of providing and maintaining the guarantee. K argued that it was entitled to compensation for use or detention of the Kos because the charterparty
provided in cl.13 an indemnity from all consequences arising from the masters compliance with Ps orders, and its claim was a consequence of Ps order to load the cargo. K also
argued that it was entitled to damages for failure to pay hire and that it was an implied term that P would forthwith discharge the cargo after notice of withdrawal and pay for use
of the ship until discharge. Finally, K argued that it was entitled to its expenses as bailee of the cargo.
84. [2012] UKSC 17; [2012] 2 AC 164; [2012] 2 WLR 976; [2012] 2 Lloyds Rep 292; [2012] 4 All ER 1; [2013] 1 All ER (Comm) 32 (UKSC: Lords Phillips, Walker, Mance,
Clarke & Sumption); noted S Baughen [2012] LMCLQ 343; Alvin W-L See & Ken TC Lee [2012] JBL 549; L Zhao (2012) 18 JIML 121; refd Dry Bulk Handy Holding Inc v Fayette
International Holdings Ltd (The Bulk Chile), ante, 136 ; Taokas Navigation SA v Komrowski Bulk Shipping KG (GmbH & Co), post, 149; rvsg [2010] EWCA Civ 772; [2010] 2
Lloyds Rep 409; [2010] 2 CLC 19; [2011] 2 All ER (Comm) 57 (Longmore & Smith LJJ & Sir Mark Waller); noted S Girvin [2011] IMCLY 117; Ken TC Lee & Alvin W-L See
[2011] LMCLQ 178; F D Rose (2011) 127 LQR 514; partly affg [2009] EWHC 1843 (Comm); [2010] 1 Lloyds Rep 87; [2010] 1 All ER (Comm) 669 (QBD: Andrew Smith J);
noted G McMeel [2010] LMCLQ 226; S Girvin [2010] IMCLY 121; folld in Metall Market OOO v Vitorio Shipping Co Ltd [2012] EWHC 844 (Comm).
85. Ie, a grace period for the charterer during which late payment, provided it is made within the number of days specified in the charterparty, will amount to a regular and
punctual payment for the purposes of the charterparty. See Girvin, Carriage of Goods by Sea, 2nd edn (Oxford University Press, 2011), [33.75].
86. Unlike Shelltime 4, cl.9(a).
87. Cf the more detailed clause in the Shelltime 4 form.
The judge at first instance rejected all of these arguments but accepted Ks argument that it was entitled to recover in respect of the guarantee as costs.
The Court of Appeal rejected Ks appeal but allowed the owners to recover the value of bunkers consumed in actually discharging the cargo. The claim under cl.13 failed because
the withdrawal of the vessel was an independent cause of the owners loss, breaking the chain of causation between the order to load the cargo and the detention of the vessel
after withdrawal. The claim for remuneration in bailment failed because the owners were doing no more than required of a gratuitous bailee. There was no element of accident,
emergency or necessity.
K appealed on the ground that it was entitled to the payments under both the indemnity clause and bailment.
80
138. Eitzen Bulk A/S v TTMI SARL (The Bonnie Smithwick)
81
82
134
83
139. ENE Kos v Petroleo Brasileiro SA (The Kos)
84
85
86
87
136
Decision: Appeal allowed in part.
Held: (1) The scope of the indemnity in cl.13 was very wide, but not unlimited and had to be read in the context of the owners obligations under the charterparty as a whole. (2)
Its purpose was to protect the owners against losses arising from risks or costs which they had not expressly or impliedly agreed to bear. (3) The clause also limited the indemnity
to losses which were caused by complying with the charterers orders and was sensitive to the legal context in which it arose. (4) The question was whether the charterers order
was an effective cause of the owners having to bear a risk or cost which he had not contractually agreed to bear. (5) In the instant case, the relevant order of P was the order to
load the cargo which was on board the vessel when it was withdrawn. (6) The loss claimed by K was the consequence of that order. (7) The need to discharge the cargo in Ks own
time arose from the combination of the cargos being loaded and the fact that the purpose for which it had been loaded had come to an end with the termination of the
charterparty. (8) This was not an ordinary incident of the chartered service and was not a risk that K assumed under the contract. (9) The detention of the Kos fell within the
indemnity and K was entitled to the market rate of hire and the value of the bunkers consumed during the 2.64 days when the vessel was detained. (10) K was also entitled to
succeed at common law as non-contractual bailee of the cargo after the withdrawal of the vessel. (11) That entitlement arose from the same circumstances which were decisive in
The Winson: the cargo was originally bailed to K under a contract which came to an end while the cargo was still in its possession. (12) As a matter of law, Ks obligation to look
after the cargo continued notwithstanding the termination of the charterparty and the only reasonable or practical option open to K was to retain the cargo until it could be
discharged. (13) Although The Winson was a claim for expenses, the same principle should be applied to a claim for remuneration where the claimant stored and handled the
goods with his own facilities. (14) (Per Lord Mance, dissenting) The appeal should be allowed under the law of bailment, but not in relation to cl.13. (15) The indemnity clause
applied to consequences or liabilities that might arise from the master complying with the charterers orders. (16) It was necessary to search for the proximate or determining
cause, but in the instant case there was no direct or unbroken causal link. (17) The loss suffered by K was not caused by compliance with Ps instructions but was caused because
the charterparty was at an end. (18) There was no justification or need to apply the express
88. China-Pacific SA v Food Corp of India (The Winson) [1982] AC 939.
89. See also Gaudet v Brown (1873) LR 5 PC 134.
charter indemnity beyond any previous decision and to do so would disregard the potential uncertainty of ever more ambitious claims.
Comment: This important decision by the Supreme Court is notable on a number of fronts. On the one hand, there are the unique facts which took the case to the highest court
and required consideration of the scope of the charterparty express indemnity in the Shelltime 3 form.
On the other hand, there is the stark disagreement between the majority, led by Lord Sumption and Lord Mance (dissenting) on the indemnity point. In reiterating the purpose
of the indemnityto protect owners against losses arising from risks or costs which they had not expressly or impliedly agreed to bear and only those losses which were caused by
compliance with the charterers ordersit was clear that the discharge of the cargo in Ks own time arose from the combination of the cargos being loaded and the fact that the
purpose for which it had been loaded had come to an end with the termination of the charterparty. The majority approach to the indemnity point, however, goes much further than
earlier cases on indemnities; and, although Lord Clarke agreed with Lord Mance that a direct causal link was required to trigger the indemnity clause, this does not seem to
be reflected in the approach taken by the majority. It is submitted that the better view is that Ks decision to withdraw led to an event which was not part of the chartered service
and should not have been covered by the indemnity. The bailment point in the case is less controversial (and Lord Mance did not dissent on this point) and, indeed, points to the
continuing vitality of bailment reasoning in shipping cases.
Voyage charterpartydischargingSTS transferBPVOY4
The Falkonera was chartered by her owners, F, to D to perform a single voyage to carry crude oil from the Yemen to 12 ports far east. The charterparty was never signed but,
as set out in the recap, was on BPVOY4 terms with certain additions and amendments. D chose to discharge at Pasir Gudang (Malaysia) by way of a ship-to-ship (STS) transfer,
in accordance with cl.8.1, which provided that:
Charterers shall have the option of transferring the whole or part of the cargo to or from any other vessel including, but not limited to, an ocean-going vessel, barge and/or
lighter All transfers of cargo to or from Transfer Vessels shall be carried out in accordance with the recommendations set out in the latest edition of the ICS/OCIMF Ship to Ship
Transfer Guide (Petroleum).
90. See Larrinaga Steamship Co Ltd v The King (The Ramon de Larrinaga) [1945] AC 246; Royal Greek Government v Minister of Transport (1949) 83 Ll L Rep 228; A/B
Helsingfors Steamship Co Ltd v Rederiaktiebolaget Rex (The White Rose) [1969] 1 WLR 1098.
91. Cf the more detailed wording in Shelltime 4, cl.13(a) (lines 225234).
92. Incidentally, also his first reported decision after taking up his seat as a Justice of the Supreme Court.
93. Including cases expressly cited, such as Royal Greek Government v Minister of Transport (The Ann Stathatos) (1949) 83 Ll L Rep 228; Triad Shipping Co v Stellar Chartering
& Brokerage Inc (The Island Archon) [1994] 2 Lloyds Rep 227.
94. [2012] UKSC 17, [75].
95. [2012] EWHC 3678 (Comm); [2013] 1 Lloyds Rep 582 (QBD: Eder J).
The charterparty also contained a specific STS lightering clause which provided that:
if charterers require a ship-to-ship transfer operation or lightening by lightering barges to be performed then all tankers and/or lightering barges to be used in the
transhipment/lightening shall be subject to prior approval of owners not to be unreasonably withheld.
D nominated two VLCCs to receive the cargo but F withheld its approval of the VLCCs for the proposed STS transfer and the Falkonera subsequently discharged into other smaller
vessels. F argued that STS transfers between VLCCs were precluded by the terms of the charter and the ICS/OCIMF Ship to Ship Transfer Guide (Petroleum), which did not contain
any references or recommendations for STS transfer between VLCCs. Moreover, F argued that it was entitled to withhold approval in light of a past difficult experience with STS
transfer between VLCCs and because the fact that the vessels were the same size created mooring difficulties.
Held: (1) The wording of cl.8 was wide enough to allow an STS transfer from Fs vessel to another VLCC. (2) Ds right to order the vessel to perform an STS transfer was entirely
separate from the obligation subsequently to perform the transfer in accordance with the ICS/OCIMF Guide. (3) The STS lightering clause overlapped with cl.8. (4) The first part
limited Ds right to nominate a vessel to perform an STS transfer by requiring Fs approval of the vessel, not to be unreasonably withheld. (5) The second part reiterated the cl.8
obligation to conduct any transfer in accordance with the Guide. (6) F was not entitled to approve or to refuse the proposed STS transfer as the right of approval was limited to a
right to review the details of the nominated vessel and to decide whether or not the vessel was suitable for STS operations. (7) The ICS/OCIMF Guide did not contain a specific
section dealing with same-size-ship transfers or transfers between VLCCs but that did not mean that such transfers were precluded nor that they could not be conducted in
accordance with recommendations in the Guide. (8) D relied on certain discussions between the parties some weeks before the charter was concluded but those discussions did
not clearly support Ds case and were in any event inadmissible in relation to the correct interpretation of the charter. (9) Although an STS transfer between two VLCCs was not a
standard operation, that did not mean that F was acting reasonably in withholding its approval of the nominated vessels. (10) The nominated vessels were not subject to any kind
of peculiarity or defect that rendered them unsuitable for STS transfers and, subject to issues of timing and proper planning, an STS transfer could have been performed with each
of the nominated vessels. (11) There was no reasonable basis for F to withhold its approval of the nominated vessels. (12) The objections raised with regard to the mooring
arrangements generally did not provide any proper or reasonable foundation for withholding approval. (13) There was sufficient time properly to plan the STS transfers and
concerns about congestion, current and pilotage could have been managed and overcome; they did not provide any reasonable basis for withholding of approval. (14) F had
unreasonably withheld its approval of the nominated vessels in breach of the charterparty.
Comment: This case raises interesting issues as to the nature and scope of the shipowners right of approval and as to the scope and effect of the current edition of the
ICS/OCIMF Ship to Ship Transfer Guide (Petroleum). The case turned on whether the consent of the owners for the STS transfer was unreasonably withheld and the court
concluded that it was.
Contracts of affreightmentbills of ladingwhether contracts of carriage or mere receipts
F and M were part of a group, O, which produced, imported and distributed food products in the Russian Federation. M sourced bananas from Ecuador and shipped them to St
Petersburg by weekly shipments on reefer vessels supplied by B, the disponent owner of a number of vessels, who also acted as manager on behalf of various shipowners. The
carrying vessels were supplied pursuant to written contracts of affreightment (COAs) based on the Gencon charterparty and incorporating the Gencon arbitration clause. The
COAs were signed by B as owner and F as charterer. After the COAs came to an end, B continued to supply weekly reefer vessels.
Bills of lading on the Congenbill 2004 form (the loadport bills) were issued to the shippers naming M as the consignee. However, after the shippers had been paid under the
88
89
90
91
92
93 94
140. Falkonera Shipping Co v Arcadia Energy Pte Ltd (The Falkonera)
95
138
96
141. Finmoon Ltd v Baltic Reefers Management Ltd
97
98
contracts of sale, those bills of lading were surrendered (marked NULL AND VOID) and new bills of lading were issued to M at the discharge port (the disport bills).
F had cargo damage claims in relation to 12 cargoes of bananas. F commenced an arbitration against B and the relevant shipowners on the basis that it was the charterer under
a COA with B, alternatively under individual charters on the terms of the COA. M commenced an arbitration against the shipowners which had issued the bills of lading, on the
basis that it was the lawful holder of them. B accepted the jurisdiction of the arbitration tribunal with regard to the vessels of which it was disponent owner but not otherwise, and
the shipowners accepted the jurisdiction of the arbitration tribunal under the charterparty arrangements but not under the bills of lading.
The arbitration tribunal found that B and F were parties to the COA which covered all the disputed shipments. However, they found that they did not have jurisdiction in respect
of the claims against the registered owners, as the loadport bills of lading were not contracts but receipts which the shippers retained until they had received payment from M. M
therefore never became the lawful holder of either the loadport or disport bills of lading.
The claimants challenged parts of the tribunals award. In particular, they challenged the arbitrators findings on the effect of the chartering arrangements, the validity of the bills
of lading, and the effect of the claimants letters purporting to commence arbitration.
Held: (1) B had concluded the COAs not as agent but as principal; and during the period of the disputed shipments there was no signed COA but a contract on the COA terms
came
96. 4th edn (2005).
97. [2012] EWHC 920 (Comm); [2012] 2 Lloyds Rep 388; [2012] 1 CLC 813 (QBD: Eder J).
98. Sometimes also known as volume contracts.
99. The arbitration point is not considered in this comment.
into existence as a result of performance by the parties. (2) The proper approach was to look at the conduct of the parties overall and on that basis there was a COA by conduct
between B and F covering the disputed voyages. (3) B contracted as principal and not as agent and the disputed voyages were performed on charterparty terms binding on B as
owner under the COA. (4) The practice adopted in the instant case involving the surrender, cancellation and reissue of bills of lading was not uncommon. (5) The fact that the
loadport bills were never intended to be negotiated but were always intended to be and were in fact surrendered and cancelled following receipt of payment for the goods did not
mean that there was no contract of carriage. (6) The loadport bills were replaced by the disport bills, which were duly issued on behalf of the owners and thereby became valid
bills binding on the owners and containing or evidencing the original contract of carriage. (7) M never became the lawful holder of the loadport bills but it did become the lawful
holder of the disport bills and therefore had transferred to and vested in it, pursuant to the Carriage of Goods by Sea Act 1992, s.2(1), all rights of suit under the contract of
carriage as if M had been a party to that contract.
Comment: This case arose out of the complex contractual arrangements for shipments of a quantity of bananas sourced from Ecuador. Although there were written COAs, based
on the Gencon charterparty and incorporating the Gencon arbitration clause, at the time of the dispute the COA was already at an end. It was therefore relatively easy for the
court to look at the contractual arrangements between the parties and determine that there was a COA by conduct. The case nevertheless underlines the importance of ensuring
that parties ensure that their contracts are in writing so as to avoid any subsequent disputes as to what terms, if any, were agreed.
Time charterpartyUS Gross Transportation Tax (USGTT)BIMCO recommended clause dealing with liabilityconstruction of clauseNYPE, cl.112
R, the owners of the Dimitris L, time chartered the vessel to a head charterer, T, who in turn sub-time chartered the vessel down a chain of sub-charterers, G, N and S. All the time
charterparties in the chain were on an amended NYPE form with materially identical terms. Clause 112 of the charterparties contained the US Tax Reform 1986 clause drafted by
BIMCO and recommended in a BIMCO circular No 9 of 6 July 1988, which provided that:
Any US gross transportation tax levied on income attributable to transportation under this Charter party which begins or ends in the United States shall be reimbursed by the
Charterers.
100. Maple Leaf Macro Volatility Master Fund v Rouvroy [2009] EWHC 257 (Comm); [2009] 1 Lloyds Rep 475.
101. Brogden v Metropolitan Railway Co (1877) 2 App Cas 666.
102. [2012] EWHC 2339 (Comm); [2012] 2 Lloyds Rep 354; [2012] 2 CLC 875; [2013] 1 All ER (Comm) 645 (QBD: Christopher Clarke J).
R paid the US Treasury a total of US$134,400 for US gross transportation tax levied as a result of the vessels calls to New Orleans, Bridge Port, and Baltimore. T reimbursed R the
sum of US$134,400 and claimed that it was entitled to be reimbursed that sum by G.
The arbitrators decided that G was bound to reimburse T. G then claimed against N and N against S. In each of these arbitrations the arbitrators decided, by a majority, that G
and N were not entitled to reimbursement of the sum that G had had to pay to T.
On appeal, the issues were: (1) the relevance of the BIMCO circular; (2) the actual incidence of the tax; (3) the meaning and effect of cl.112. In particular, it was submitted that
the BIMCO circular showed that it was understood that the tax would or could be exacted from anyone in the chain other than the final sub-charterer, who would not be a recipient
of either hire or freight, and from more than one person. In the circumstances, cl.112 was designed to enable each owner in the chain to recover any tax paid by him from his
charterer, but it did not provide for any further recovery.
Decision: Claim allowed in part.
Held: (1) The arbitrators were entitled to take the BIMCO circular into account as part of the relevant background and this was relevant, not because it was to be taken as an
accurate statement of the incidence of the tax, on which topic it might or might not be correct, but because it indicated the risk with which the clause was designed to deal. (2)
Evidence of the risk that it was designed to address was admissible and a commercial party to whom the circular was available would interpret the clause on the basis that it was
intended to meet that risk. (3) The words tax levied on income attributable to transportation under this Charter party in the sub-charters were not apt to cover tax levied on
income received under the head charter. (4) Clause 112 of the charterparties dealt with tax levied on hire due under the charterparty with the person from whom reimbursement
was claimed. (5) Furthermore, tax and reimbursement in respect of tax were different things and there was no sufficient reason to construe any tax as covering
reimbursement for tax. (6) To construe the clause to provide reimbursement of the tax to the taxpayer by the charterer from him but no further was at least as sensible as
imposing the entire burden of the tax on the ultimate charterer. (7) The decision in the T arbitration did not address the potential consequence of the interpretation that the
ultimate charterer was, or might be, responsible for all the tax levied on all those in the chain. (8) It also relied on the BIMCO circular as having the effect that the eventual liability
for the tax was transferred from the shipowner to the eventual charterers. (9) However, the BIMCO circular made clear that each charterer might, as disponent owner, be liable for
the tax and that the clause provided for each such owner to be able to recover the tax it had paid from its charterer. (10) It said nothing about liability for one or more taxes
cascading down the chain to the end charterers. (11) Accordingly, R was entitled to reimbursement from T in respect of the tax which it paid, but no one else was entitled to
reimbursement. (12) Clause 112 contained specific provision in respect of liability for the tax and it could not be recovered under other provisions of the charter.
Comment: This case concerned the recoverability of tax initially paid by the shipowners to the US Treasury and reimbursed by the sub-charter. Could this be recovered against
the other charterers in a chain of time charterparties? The court decided that the tax paid was not reimbursable down the chain. In reaching this decision, the court gave effect to
BIMCO circular No 9 of 6 July 1988, though this predated the charterparty by 20 years, and on this basis charterers could not pass on liability by using back-to-back USGTT
clauses. Even though the court was not confident spelling out how the US Treasury levied tax, it was confident as a matter of construction that there was no reason to construe
any tax in cl.112 as covering reimbursement for tax.
Voyage charterpartydemurrageadditional war risk premiumwhether owners entitled to costs of producing fresh water and consumption of bunkers during period of delay
BEEPEEVOY 3
G, disponent owners of an oil tanker, the Crudesky, voyage chartered the vessel to T on the BEEPEEVOY 3 form and loaded a cargo of crude oil at a floating terminal, Akpo FPSO
Terminal, off Port Harcourt (Nigeria). Clause 21 of the Beepeevoy 3 charterparty provided that:
Any delay(s) arising from arrest or restraint of princes shall, provided always that the cause of the delay(s) was not within the reasonable control of Charterers count as
one half laytime or, if the Vessel is on demurrage, at one half of the demurrage rate.
99
140
100
101
142. Global Maritime Investments Ltd v STX Pan Ocean Co Ltd (The Dimitris L) (No 2)
102
142
103
143. Great Elephant Corp v Trafigura Beheer BV (The Crudesky)
104
When the Crudesky was ready to load, the representative of the Nigerian Department of Petroleum Resources was not at the terminal but the terminal operator understood that
the head of operations at Port Harcourt had given verbal authorisation to commence the loading operation and so loading commenced. On 1 September 2009, the Departments
representative arrived on board and did not require the loading operation to stop. The Departments head office in Lagos issued clearance to load and transmitted it to its
representative. Later the same day, however, the clearance was revoked and, as a result, the necessary cargo documents were not completed and the Crudesky could not leave
Nigeria. On 7 September, the Department required the terminal operator to explain its apparent breach of the Procedure Guide for Terminal Operations by commencing loading
without clearance. The Minister of Petroleum Resources required the terminal operator to pay a fine of US$12 million before the Department completed the cargo documents and
the Crudesky was allowed to leave on 13 October.
G brought various claims against T, including: (1) a claim for demurrage; (2) a claim for additional war risk premium under the BP War Risk Insurance Clause; (3) a claim for
the costs incurred in producing fresh water and for bunker consumption during the
103. Available at www.bimco.org/en/Chartering/~/media/Chartering/Special_Circulars/SC1989_04_12. ashx .
104. [2012] EWHC 1745 (Comm); [2012] 2 Lloyds Rep 503; [2012] 2 CLC 505; [2013] 1 All ER (Comm) 415 (QBD: Teare J).
105. This provided that: War risk insurance additional premiums, crew war bonus and insurance and additional expenses directly incurred as a result of the vessel entering and
or transiting an excluded area shall be for charterers account .
delay, on the basis that T was in breach of an implied term of the charterparty that the charterers would not load any cargo in breach of the municipal law which was of direct
relevance to the carriage of the cargo. A further issue was whether T could pass on these liabilities to various buyers and sub-buyers under the contracts of sale relating to the
crude oil.
Held: (1) No criminal offence was committed under Nigerian law when loading commenced without clearance to load from the Nigerian Department of Petroleum Resources head
office in Lagos. (2) Though the terminal operator failed to comply with the Procedure Guide for Terminal Operations by commencing to load without clearance and in the absence of
the Departments representative, its conduct could not be described as culpable where it had sought and obtained permission from the head of operations at Port Harcourt to
commence loading. (3) The Nigerian authorities were entitled to revoke the clearance, to refuse to issue the cargo documents, and to ensure that the vessel did not leave Nigeria.
(4) However, the fine was an abuse or arbitrary exercise of power by the Minister. (5) G was entitled to demurrage from T under the terms of the charterparty for the period
when the vessel was delayed after the hoses were disconnected and the vessel was waiting cargo documentation. (6) Demurrage accrued at half-rate pursuant to cl.21, since the
delay caused by the abuse or arbitrary exercise of power by the Minister arose from arrest or restraint of princes and was not within the reasonable control of T. (7) G was
entitled to recover additional war risk premium from T for the time spent by the vessel in Nigerian waters. (8) Loading in breach of the Procedure Guide for Terminal Operations
was a breach of an implied term of the charterparty that T would not load any cargo in breach of the municipal law. (9) However, the loss or damage that G suffered in the form of
the costs of producing fresh water and consumption of bunkers following the improper actions of the Minister were caused by restraint of princes. (10) Ts liability for that loss or
damage was, for that reason, excluded by cl.46 of the charterparty.
Comment: This case raised a number of issues of interest and centred on the decision of the Nigerian Department of Petroleum Resources to revoke a clearance after loading of
cargo was already underway. The delays that this caused clearly put the vessel on demurrage and the question was whether such delays were chargeable at half the normal
demurrage rate in accordance with cl.21. That depended upon the court finding that the delays were caused by arrest or restraint of princes, which it did (for the period from 7
September), given that the Minister of Petroleum Resources had improperly demanded payment of a fine. In relation to the claims for fresh water and bunker consumption, such
costs were not encompassed within the payment of demurrage because they represented loss over and above the mere detention of the vessel. It was an implied term of the
charterparty that the charterers would not load any cargo in breach of the municipal law of direct relevance to the carriage of the cargo.
106. This issue is not considered in this digest.
107. See Bunge SA v ADM Do Brasil Ltda (The Darya Radhe) [2009] 2 Lloyds Rep 175; [2010] IMCLY 117.
Time charterpartyrepudiation by premature redeliveryowners entitlement to claim hiredamagesNYPE
S, owners of the Aquafaith, time chartered the vessel to G on an amended NYPE form for a duration of 5961 months. The charterparty included an express warranty that the
vessel will not be redelivered before the minimum period of 59 months. In admitted anticipatory breach of the charter, G purported to redeliver the vessel 94 days early. S refused
to accept redelivery and commenced arbitration, seeking a declaration that it was entitled to refuse redelivery and affirming the charterparty, holding G liable for hire for the
balance of the minimum period.
The arbitrator held that S was required to take redelivery of the vessel, trade the vessel on the spot market by way of mitigation, and claim damages in respect of its loss. S
could not refuse to accept the repudiation and affirm the continuation of the contract, relying on the principle in White & Carter (Councils) Ltd v McGregor, because, as the
innocent party, S could not complete the contract itself without the need for any action by G. He further held that S had no legitimate interest in insisting that the charterparty
remained alive.
S appealed on the question whether they were entitled to refuse to accept early redelivery of the Aquafaith or whether they were bound in law to accept early redelivery and sue
for damages.
Held: (1) In the instant case, hire was payable in advance and S could hold the ship available without any need for G to do anything in order to maintain its claim for hire. (2) In
that respect there was a material difference between a time charterparty and a demise charterparty, under which the charterer took possession of the vessel, provided the crew
and typically paid all outgoings on the vessel. (3) There was a clear error of law by the arbitrator in finding that the White & Carter principle was of no application to the time
charter. (4) The arbitrator applied the wrong test when considering whether S had a legitimate interest in maintaining the charter, as opposed to accepting the repudiatory breach,
trading on the spot market in mitigation of loss, and claiming damages for the difference. (5) The effect of the authorities was that an innocent party would have no legitimate
interest in maintaining the contract if damages were an adequate remedy and his insistence on maintaining the contract could be described as wholly unreasonable, extremely
unreasonable or, perhaps, perverse. (6) It was possible for the court to assess the inevitable outcome of applying the right test to the facts of the case, as found by the arbitrator.
(7) With 94 days left of a five-year time charter in a difficult market where a substitute time charter was impossible, and trading on the spot market very difficult, it would be
impossible to characterise Ss stance in wishing to maintain the charter and a right to hire as unreasonable, let alone beyond all reason, wholly unreasonable or perverse.
108. [2012] EWHC 1077 (Comm); [2012] 2 Lloyds Rep 61; [2012] 1 CLC 899; [2012] 2 All ER (Comm) 461 (QBD: Cooke J); noted D Winterton [2013] LMCLQ 5; J W Carter
(2012) 128 LQR 490.
109. William Robertson.
110. [1962] AC 413.
111. Distinguishing Attica Sea Carriers Corp v Ferrostaal Poseidon Bulk Reederei GmbH (The Puerto Buitrago) [1976] 1 Lloyds Rep 250.
(8) This was not an extreme or unusual case and in such circumstances the exception to the White & Carter principle could not apply. (9) The award should therefore be varied to
declare that S was entitled to refuse the purported redelivery and was entitled to hire under the charterparty and G was not entitled to insist on redelivery.
Comment: This interesting case has potentially wide ramifications. It is important in the shipping context, given the continuing problem of early redelivery, usually under long-
term time charterparties, as in this case where there were 94 days left of a five-year time charterparty in very difficult market conditions. However, the wider interest in the case is
likely to be the deliberations on the well-known House of Lords decision in White & Carter (Councils) Ltd v McGregor, where a 3:2 majority held that, where a party to a contract
repudiates the contract by announcing that it no longer intends to perform, the innocent party is entitled to reject the purported termination and insist on keeping the contract
alive. The scope of the decision has been subject to controversy because of an exception in relation to contracts that entail a degree of co-operation between the parties and
because it is generally accepted not to assist an innocent party that has no legitimate interest in electing to keep the contract alive. Many shipping lawyers (mistakenly) took the
view that the case would not apply to time charterparties, but this case authoritatively decides that no co-operation is needed from a charterer under an ordinary time charterparty
which can prevent the operation of the rule in White & Carter. It also suggests that the decision of an owner might need to be perverse before it can be said that the owner
has no legitimate interest in holding the charterer to the contract. The judgment also shows that taking what may be termed the commercial approach of insisting on continued
performance will be acceptable where the charterparty hire rate is significantly above the prevailing market rate at the time of repudiation.
Carriage of passengerswhether a rigid inflatable boat (RIB) was a ship and whether seagoingwhether claim subject to two-year limitation periodAthens Convention 1974,
105
106
107
144
144. Isabella Shipowner SA v Shagang Shipping Co Ltd (The Aquafaith)
108
109
110
111
112
145. Michael v Musgrave (Trading as Ynys Ribs) (The Sea Eagle)
113
Art.16
The claimant, R, was injured on a rigid inflatable boat (RIB), the Sea Eagle, owned by M. The Sea Eagle was used for pleasure trips around the coast of Anglesey. When R
sustained injuries after the Sea Eagle was hit by a wave, he alleged that M was negligent for failing to provide a safety briefing prior to the trip and for failing to operate the boat
safely. It was Ms case that passengers had been told not to stand up when the vessel was underway, but that R had done so and had been hit by a wave that was not part of the
general swell. M contended that the claim was outside the two-year time limit provided for by the Athens Convention 1974, Art.16. R argued that the Sea Eagle did not
qualify as a seagoing ship for the purposes of Art.1 of the Convention, so that the time bar did not apply.
112. [2012] EWHC 1077 (Comm), [44]. See eg Attica Sea Carriers Corporation v Ferrostaal Poseidon Bulk Reederei GmbH (The Puerto Buitrago) [1976] 1 Lloyds Rep 250 (CA).
113. [2011] EWHC 1438 (Admlty); [2012] 2 Lloyds Rep 37 (Jervis Kay QC).
114. Ie, the Convention Relating to the Carriage of Passengers and Their Luggage by Sea.
115. As enacted by the Merchant Shipping Act 1995, s.183, and Sched.6.
Held: (1) Under the Athens Convention, the term ship included any vessel capable of being used in navigation, whether or not it was in fact being used in navigation at the
relevant time. (2) The starting point was whether the construction of an object was capable of being a vessel which might be used in navigation. (3) The Sea Eagle was
certificated as a small commercial vessel to be used on open water, which was an indication that she was to be treated as such; but, even if that had not been the case, it was
clear that the RIB was of a design and construction that was intended to be capable of operating offshore. (4) The Sea Eagle was a permanent structure of some length with a rigid
hull, internal seats and engine, fixed steering position with navigational aids and a below-deck permanent fuel tank. (5) The manufacturers description of the roles for which the
RIB was intended certainly characterised it as a vessel to be used in navigation. (6) The Sea Eagle was therefore a ship in the sense of being a vessel capable of being used, and
actually used, in navigation. (7) The word seagoing was adjectival and was intended to describe the actual use of a vessel. (8) It was therefore intended to convey something
more than the words used in navigation and, though a ship might be a ship for the purposes of the 1995 Act, she would not be a seagoing ship unless it was her actual business
to go to sea. (9) Having regard to Merchant Shipping Notice MSN 1776 issued in March 2003, which indicated which of the coastal waters of the United Kingdom were to be
regarded as sea, it could be concluded that the trips in which the Sea Eagle were involved were sea trips. (10) It followed that the Sea Eagle was a seagoing vessel for the
purposes of the 1995 Act and the Convention, so that the claim was time barred.
Comment: The question whether a particular type of vessel qualifies for the purpose of various international maritime Conventions is one which arises surprisingly regularly.
This case confirms, for the first time, that a rigid inflatable boat (RIB) qualifies as a seagoing vessel for the purposes of Art.1 of the Athens Convention.
Time charterpartyoff-hire during a period of driftingwhether sufficient for charterers to establish net loss of time as regards service immediately required or whether necessary
to establish that time was lost to the chartered serviceNYPE 1946, cl.15
The Athena, owned by M, was chartered by them to O, who in turn sub-chartered her to T. Both charterparties were on amended NYPE 1946 terms and were, save as to rate of
hire, in all material respects identical. The off-hire clause in the charterparties was a modified version of the NYPE 1946, cl.15. So far as material it read that:
in the event of loss of time from default of master or by any other cause preventing the full working of the vessel, the payment of hire shall cease for the time thereby lost
and all
116. See Steedman v Scofield [1992] 2 Lloyds Rep 163; R v Goodwin (Mark) [2005] EWCA Crim 3184; [2006] 1 WLR 546.
117. Salt Union Ltd v Wood [1893] 1 QB 370.
118. See www.hmrc.gov.uk/mariners/msn1776.pdf .
119. See now the discussion in Simon Rainey QC, What is a ship under the 1952 Arrest Convention? [2013] LMCLQ 50.
120. [2012] EWHC 3608 (Comm); [2013] 1 Lloyds Rep 145 (QBD: Walker J).
extra expenses directly incurred including bunkers consumed during period of suspended hire shall be for Owners account .
The Athena loaded a cargo of wheat at Novorossiysk and the bills of lading showed the discharge port as Lattakia or Tartous (Syria). When the vessel arrived at Tartous, the
cargo was rejected on the ground that it was contaminated. Syrian law prohibited re-export of the cargo other than to its country of origin. On 16 January 2010, the Athena
departed Tartous, nominally for Novorossiysk. Once she had cleared Syrian waters, the owners instructed the master to proceed to international waters just outside Libya and wait
for further instructions. On 19 January the Athena stopped in international waters about 50 miles from Libya and drifted until 30 January.
T claimed its losses during the drifting period under the sub-charterparty and O, in turn, claimed for the same losses against M under the head charterparty. The arbitrators
found that the sums claimed were recoverable under cl.15 of the modified version of the NYPE 1946. They also held that all charterers needed to do in respect of a claim under the
clause was to demonstrate that there had been a default by the master, which had caused an immediate loss of time. As the master had failed to proceed directly to a different
port after refusal of the cargo, the claims under the clause succeeded regardless of whether, in the absence of drifting, the same time would have been lost for other reasons.
Both M and O submitted that the arbitrators had failed to take account of the difference between ascertaining the period of time during which the Athena was not fully
performing, and ascertaining whether any of that period constituted a net loss of time in the performance of the chartered service. They submitted that there had been no net loss
and that the arbitrators crucial proposition was incorrect.
Held: (1) Whether the arbitrators were right depended on the true meaning of cl.15 and that involved asking two questions: first, whether the clause was engaged, and second,
what were the consequences of such engagement. (2) In relation to the first question, the clause was engaged when two prerequisites were met, namely that the cause of the
problem prevented the full working of the vessel, and the cause was a prescribed cause falling within the description in cl.15. (3) The second question involved ascertaining what
the clause specified should happen if the prerequisites were met. (4) In the instant case, the focus of the clause was on the Athenas ability fully to perform the service
immediately required of her. (5) Therefore, cl.15 would not be engaged unless and until there was some service immediately required of her which, by reason of a prescribed
cause, she did not fully perform. (6) As regards the consequences of cl.15 being engaged, the modified clause in the instant case envisaged that there would be a period of
suspended hire. (7) It was agreed that cl.15 precluded the charterers from claiming as off-hire any amounts in respect of delay arising after the vessel was fully efficient for the
service immediately required under the charterparty. (8) The issue was whether time during that period had been thereby lost if charterers could show that the service
immediately required had been delayed, but could not show that there had been a net loss of time in performing the charter service overall by reason of a prescribed cause. (9) An
examination of previous
121. The underlined words show additions to the wording of the NYPE 1946 form.
authorities indicated that cl.15 in the instant case permitted charterers to deduct time for the duration of the off-hire event, but only to the extent that there was a net loss of time
to the chartered service. (10) Ms assertions were correct and the arbitrators crucial proposition was incorrect.
Comment: This charterparty off-hire case, one of three in the year under review, was concerned with the particular consequences of a modified clause of the NYPE 1946
charterparty. There were essentially two issues: (1) whether time was lost owing to a prescribed cause, in this case default of master; (2) whether there had been a net
loss of time such as to constitute a net loss of time in the performance of the chartered service. The first issue was unproblematic and was not seriously in question in this appeal.
The second issue, however, required detailed consideration of the earlier authorities. The court concluded that cl.15 permitted the charterers to deduct time for the duration of
the off-hire event, but only to the extent that there was a net loss of time to the chartered service. It was not sufficient for the charterers merely to show that, as regards the
service immediately required, there was a net loss of time.
Time charterpartyvessel hijacked by Somali pirateswhether capture/seizure of vessel had to be carried out by any authority to constitute off-hire eventNYPE 1946, cl.56
O, owners of the Captain Stefanos, chartered her on amended NYPE terms to C. The off-hire clause, cl.56, provided that:
Should the vessel put back whilst on voyage by reason of any accident or breakdown, or in the event of loss of time either in port or at sea or deviation upon the course of the
114 115
146
116
117 118
119
146. Minerva Navigation Inc v Oceana Shipping AG (The Athena)
120
121
148
122
123 124
125
126
147. Osmium Shipping Corp v Cargill International SA (The Captain Stefanos)
127
voyage caused by capture/seizure, or detention or threatened detention by any authority including arrest, the hire shall be suspended from the time of the inefficiency until the
vessel is again efficient in the same or equidistant position in Charterers option, and voyage resumed therefrom. All extra directly related expenses incurred including bunkers
consumed during period of suspended hire shall be for Owners account.
On 13 September 2008, the Captain Stefanos arrived at Richards Bay and loaded a bulk cargo of coal. She departed on 14 September, proceeding as instructed by charterers to
her destination via the Suez Canal. In order to transit the Suez Canal, the vessel had to sail
122. See The Pearl C, ante, 129 and The Captain Stefanos, post, 147.
123. See now NYPE 93, cl.17 (lines 219236).
124. [2012] EWHC 3608 (Comm), [35].
125. Western Sealanes Corp v Unimarine SA (The Pythia) [1982] 2 Lloyds Rep 160; Sig Bergesen DY & Co v Mobil Shipping and Transportation Co (The Berge Sund) [1993] 2
Lloyds Rep 453; Forestships International Ltd v Armonia Shipping & Finance Corp (The Ira) [1995] 1 Lloyds Rep 103; TS Lines Ltd v Delphis NV [2009] EWHC 933 (Comm);
[2009] 2 Lloyds Rep 54.
126. [2012] EWHC 3608 (Comm), [84].
127. [2012] EWHC 571 (Comm); [2012] 2 Lloyds Rep 46; [2012] 1 CLC 535; [2012] 2 All ER (Comm) 197 (QBD: Cooke J); noted B Soyer (2012) 18 JIML 276.
through the Indian Ocean and thus off the eastern coast of Somalia. On or about 21 September, the vessel was hijacked by pirates off the coast of Somalia and on or about 6
December released after O paid a substantial ransom to the pirates. Arbitrators were asked to determine whether the vessel was off-hire between 21 September and 6 December
while subject to the hijacking.
O argued that the words capture/seizure in cl.56 of the charterparty were qualified by the further words by any authority and that pirates did not constitute such an
authority. Moreover, O argued that the off-hire clause had to be read with the charterparty as a whole, particularly the Conwartime 2004 clause, which placed the risk of piracy on
C. The arbitrators concluded that the relevant off-hire event was the capture/seizure of the vessel and that such a seizure need not be carried out by any authority. The Captain
Stefanos was accordingly off-hire during the period of the hijacking. O appealed.
Held: (1) Where there were one or more clauses that dealt with off-hire events, they had to be looked at together and reconciled, but where the charterparty provided for off-
hire in some provisions and charterparty obligations and remedies for breach in others, the focus had inevitably to be on the off-hire clauses when determining whether an off-hire
event had occurred. (2) When regard was had to the various off-hire events set out in the clause, the use of the word or, the linkage of capture with seizure by the use of an
oblique stroke, and the positioning of the commas, the clause clearly set out that it was only detention or threatened detention that was qualified by the expression by any
authority. (3) The Conwartime 2004 clause related to the performance of the charterparty and to breach, specifically dealing with war risks and piracy in that connection, but not
to off-hire. (4) Nor could it be taken as an all-embracing allocation of risk of piracy to C so as to affect the construction of the off-hire clause. (5) The off-hire clause specifically set
out the events that were to qualify as off-hire events and that clause, in itself, was the allocation of the risk between the parties where hire was concerned.
Comment: This case was one of three involving the consequences of piracy in the year under review, although the only case that was concerned with the consequences of
seizure by pirates. A previous case, Cosco Bulk Carrier Co Ltd v Team-up Owning Co Ltd (The Saldanha), had decided that a vessel would not be off-hire pursuant to the
standard cl.15 of the NYPE form, and so it could not be argued that the Captain Stefanos was off-hire pursuant to the standard cl.15 of the NYPE form. For this reason, the point in
dispute turned on the construction of the words capture/seizure in cl.56, in the context of the clause and the charterparty as a whole. The court noted that there was no issue
between the parties that the word seizure covered any forcible possession of the vessel and was apt to include hijacking by pirates unless the words were qualified by the
further words by any authority. As the charterers had clearly brought themselves within the clause, they had discharged the onus of showing that there was an off-hire event.
128. See post, 148, 149.
129. See Lloyds List, 22 September 2008, where the seizure is reported.
130. [2011] 1 Lloyds Rep 187. See [2011] IMCLY 114.
131. [2012] EWHC 571 (Comm), [33].
Time charterpartyvessel proceeded via Cape of Good Hope because of risk of piracyliability for extra costs of proceeding via the Capemeaning of being exposed to [acts of
piracy]CONWARTIME 1993
This case arose following further submissions in the case and turned on CON-WARTIME 1993, the material clauses of which provided that:
(1) For the purpose of this Clause, the words:
(b) War Risks shall include any acts of piracy which, in the reasonable judgement of the Master and/or the Owners, may be dangerous or are likely to be or to become
dangerous to the Vessel, her cargo, crew or other persons on board the Vessel.
(2) The Vessel shall not be ordered to any place where it appears that the Vessel, her cargo, crew or other persons on board the Vessel, in the reasonable judgement of the
Master and/or the Owners, may be, or are likely to be, exposed to War Risks.
(8) If in compliance with any of the provisions of sub-clauses (2) to (7) of this Clause anything is done or not done, such shall not be deemed a deviation, but shall be considered
as due fulfilment of this Charter Party.
At the initial hearing the focus was on the words may be, or are likely to be exposed to War Risks in cl.(2). The issue now was the meaning of the phrase exposed to War
Risks in so far as it related to acts of piracy. The charterers submitted that being exposed to acts of piracy meant being exposed to the peril or danger of piracy, by which they
meant being in contact with pirates or being exposed to acts of piracy having an actual effect on the vessel, which would include an attack by pirates and also a failed attempt
to pursue and attack the vessel. The owners contended that being exposed to acts of piracy simply meant being exposed to the risk of piracy.
Held: (1) The phrase exposed to War Risks should be construed as referring to a situation which was dangerous, as this flowed naturally from the wording of the clause read
as a whole and gave effect to the parties intentions. (2) Thus, the question to be addressed by an owner or master, when ordered to go to a place, was whether there was a real
likelihood that the vessel would be exposed to acts of piracy in the sense that the place would be dangerous on account of such acts. (3) What was dangerous would depend on
the facts of the case, the degree of likelihood that a particular peril might occur, in this case acts of piracy, and the gravity or otherwise of the consequences to the vessel, cargo
and crew should that peril occur. (4) That approach was consistent with the overriding priorities set out by BIMCO in their Special Circular No 6 dated 28 July 1993. (5) The
master had to be given the tools to enable him to keep the vessel, cargo and crew out of harms way, but such tools had to be no more than were reasonably necessary to allow
the master to do his job. (6) Thus, whether or not the Gulf of Aden was dangerous to the
132. [2012] EWHC 70 (Comm); [2012] 1 Lloyds Rep 457; [2012] 1 CLC 21 (QBD: Teare J).
133. Noted [2012] IMCLY 181. See Pacific Basin IHX Ltd v Bulkhandling Handymax AS (The Triton Lark) [2011] EWHC 2862 (Comm); [2012] 1 Lloyds Rep 151; [2012] 1 CLC
1; [2012] 1 All ER (Comm) 639 (QBD: Teare J).
134. Emphasis added.
135. Available at www.bimco.org/en/Chartering/~/media/Chartering/Special_Circulars/SC1993_07_28.ashx .
vessel in question on account of acts of piracy would depend on the degree of likelihood that they would occur and on the gravity of the consequences to the vessel, cargo and
crew should they occur.
Comment: This follow-up decision arose following further submissions and focused on the alternative wording used in Conwartime 1993, namely exposed to War Risks, which
the judge interpreted as referring to a situation that was dangerous. Whether the situation was dangerous would depend on the facts of the case, the degree of likelihood that a
particular peril might occur, and the gravity or otherwise of the consequences to the vessel, cargo and crew should that peril occur.
Time charterpartyowners refusing to proceed on voyage to Mombasa because of concerns about piracywhether justifiedNYPE 93CONWARTIME 2004
128
129 130
131
150
148. Pacific Basin IHX Ltd v Bulkhandling Handymax AS (The Triton Lark)
132
133
134
135
136
149. Taokas Navigation SA v Komrowski Bulk Shipping KG (GmbH & Co) (The Paiwan Wisdom)
137
This case arose out of three different charterparties for the Paiwan Wisdom made with her owners, T, on materially identical terms. K were the intervening charterers. The
charterparties were on the NYPE 93 form, incorporating the BIMCO War Risks Clause for Time Charters 2004, CONWARTIME 2004 (cl.94). Clause 5 provided that the Vessel shall
be employed in such lawful trades between safe ports and safe places within (see Clause 50) and cl.50 (Trading limits/exclusions) provided that:
Vessel always to trade within IWL, Charterers option breach of IWL subject to Owners underwriters approval and invoice (Owners will assist to obtain the rate lower or
approximate to London scale. it is however WOG), always afloat at any time of tide, Charterers option NAABSA, always via safe port(s)/berth(s)/anchorage(s) excluding:
Abkhazia, Angola, Cambodia, C.I.S. Far Eastern ports, Eritrea, Ethiopia, Georgia but the port of Poti is allowed, Great Lakes, Haiti, Lebanon, but Iraq will be allowed as soon as
situation normalizes, Israel, Liberia, North Korea, Serbia, Somalia, Syria is allowed provided vessel is not flying Liberian flag, Yemen, Zaire, places subject to UN sanctions, areas
prohibited by vessels war risks underwriters due to war-like activities, and places which may be excluded by the authority of the vessels flag. Passing Gulf of Aden always allowed
with H&M insurance authorization.
Cuba is included in the trading of the vessel but to be redelivered to the Owners free of any USA ban.
No direct trade between Peoples Republic of China and Taiwan.
On receiving orders to proceed to Hoping (Taiwan) and there load a cargo of cement clinker for discharge in Mombasa (Kenya), T declined and referred to recent developments
in Indian Ocean in respect of piracy. T also referred to piracy getting more severe and extending further along the coast/waters of East Africa. K had to charter in a replacement
vessel to perform the voyage, costing US$815,000.
The arbitrators found that there was no suggestion that T was aware, when entering the charterparty, that the Paiwan Wisdom was likely to be employed on one or more
136. [2012] EWHC 70 (Comm), [12].
137. [2012] EWHC 1888 (Comm); [2012] 2 Lloyds Rep 416; [2013] 1 All ER (Comm) 564 (QBD: Teare J).
138. Colin Sheppard, David Martin-Clark, and Richard Siberry QC.
voyages to Kenya and that, when the charterparty was concluded, the shipping community was aware of the threat of piracy in some parts of the Indian Ocean. They therefore
held that T was not precluded from relying on the CONWARTIME 2004 clause to justify its refusal to proceed on the voyage, even though there had been no material change in the
risk of proceeding with that voyage between the date of the charterparty and the date of the order.
K appealed. For the purposes of the appeal it was assumed that Ts liberty to determine that the approach to Kenya would be dangerous on account of piracy was exercised in
good faith, and that there had been no change in the likelihood that the vessel would be exposed to acts of piracy on the approach to Kenya between the date of the charterparty
and the date of the voyage instructions about a month later.
K submitted that, on the true construction of the charterparty, there had to be a material change in the relevant war risk after the date of the charterparty before the liberty to
refuse to obey the charterers order could be exercised. Moreover, the trading limits in cl.50 expressly excluded Eritrea, Ethiopia, Somalia and expressly permitted passing Gulf of
Aden and therefore the parties, having considered the question of piracy, had given detailed thought to where the vessel might go in East Africa, and Kenya had not been
excluded.
Held: (1) Kenya was within the Paiwan Wisdoms trading limits under the charterparty but CONWARTIME 2004 provided that an owner could refuse to proceed to a place which
was dangerous on account of a war risk. (2) T had agreed to pass through the Gulf of Aden and it would be inconsistent with that express agreement to construe CONWARTIME
2004 in such a way as to permit T to refuse to pass through the Gulf of Aden. (3) The presence in the Gulf of Aden of naval forces and a convoy system explained why T agreed to
pass through the Gulf of Aden. (4) That agreement was no warrant for construing cl.50 as an agreement that the vessel could be ordered by the charterers to proceed to any port
or place on the east coast of Africa, other than the excluded countries of Eritrea, Ethiopia and Somalia, where there was a risk of piracy but no naval forces or convoy system. (5)
The charterers could direct the vessel to proceed to Mombasa but T had liberty to refuse to proceed to Mombasa if, within the meaning of CONWARTIME 2004, there was a real
likelihood of the vessels being exposed to acts of piracy. (6) CONWARTIME 2004 contained no requirement that any such likelihood should have materially increased from the date
of the charterparty. (7) The instant case was not one in which T had, by the terms of the charterparty construed in its factual context, accepted the risk of piracy in trading to
Kenya. (8) Whilst trading to Kenya was permitted, CONWARTIME 2004 enabled the owner or master to avoid danger from war risks which might be encountered en route to Kenya.
Comment: This case arose because of a refusal by owners to comply with orders to load a cargo in Taiwan bound for Kenya owing to recent developments in Indian Ocean in
respect of piracy and piracy getting more severe and extending further along the coast/ waters of East Africa. Was their refusal justifiable? The charterparty contained a safe
berth warranty and a trading exclusion clause, which permitted trading to Kenya. However, the charterparty also incorporated the 2004 CONWARTIME clause and this provided that
an owner could refuse to proceed to a place which was dangerous on account of a war risk or a real likelihood of the vessels being exposed to acts of piracy. There was
no requirement that the relevant war risk had to have escalated since the date of the charterparty.
Time charterpartywarranty that vessel would arrive at loadport with all cargo tanks suitable to load the intended cargocrack in slop tankwhether owners in breach
SHELLTIME 4
P, the owners of a products tanker, chartered her to V on amended SHELLTIME 4 terms and V, as permitted, sub-chartered the vessel to lift a cargo of gasoline in Rotterdam for
carriage to a range of ports in Mexico, the USA and the Caribbean. The vessel sailed from Boston for Falmouth to bunker on the way to Rotterdam. However, before reaching
Falmouth, oil was found on the surface of the ballast water in one of the ballast tanks and later investigations revealed that this was due to a 12mm crack in the port side slop
tank. P advised V that permanent repairs would take place at Rotterdam but these could not be effected before the end of the cancellation date under the sub-charterparty. The
sub-charterers cancelled the sub-charter before the end of the cancellation date and, three days after this, the vessel arrived in Rotterdam. V deducted US$455,432 from hire on
the basis of an alleged breach of cl.64 of the charterparty, which provided that:
Owners warrants that vessel will arrive at each load port with all cargo tanks, pumps and lines suitable to load the intended cargo as per Charterers representative and/or
independent surveyors satisfaction which always is subject to tank cleaning/squeeging Clause 102. All damages, time lost and costs incurred due to noncompliance will be for
Owners account and deducted from monthly hire.
Vs case was that P was in breach of cl.64 when it informed V that by reason of the need to carry out repairs the vessel would not meet her cancelling date under the sub-charter.
However, the arbitrators found that the clause had to be seen in a context which depended on satisfying Vs representative or surveyor as to the suitability of the cargo tanks,
pumps and lines, and tanks where the cargo was to be loaded. They found that cargo was not going to be loaded into the slop tanks so those tanks would not be inspected, and
that in that context slop tanks were not cargo tanks for the purpose of cl.64. Accordingly, P was not in breach of cl.64 and so the arbitrators awarded them US$455,432 together
with interest and costs.
On appeal by V, the issue was whether the phrase all cargo tanks in cl.64 encompassed the vessels slop tanks.
Held: (1) Whilst it was open to V to contend that the charterparty contemplated the possibility of the carriage of cargo in the slop tanks, the cargo in the instant case had not
been ordered to be loaded into slop tanks, and thus V had to argue that cargo tanks in cl.64 always included slop tanks. (2) The natural meaning of cl.64 was that it referred to
cargo tanks in contradistinction to other ships tanks. (3) Further, the findings as to context
139. Distinguishing Abu Dhabi National Tanker Co v Product Star Shipping Ltd (The Product Star) (No 2) [1993] 1 Lloyds Rep 397 (CA).
140. [2012] EWHC 1100 (Comm); [2012] 2 Lloyds Rep 527 (QBD: Hamblen J).
141. Timothy Marshall and Bruce Harris.
could not be challenged and were a further reason why the arbitrators were correct to conclude that here cl.64 only related to the cargo tanks. (4) When the vessel arrived at
Rotterdam, it was not a loading port, as the sub-charter had been cancelled three days before its arrival there and the vessels cargo tanks, pumps and lines were never inspected
by, or found not to be suitable to the satisfaction of, Vs representative or independent surveyor, as required by cl.64. (5) Therefore, there was no breach of cl.64 in any event.
Comment: This relatively straightforward case required the court to construe the words used in cl.64 of the charterparty. The court held that cargo tanks did not include slop
tanks; if the charterers wished to extend the scope of cl.64 to tanks other than cargo tanks, it would have been the easiest thing to delete the word cargo.
138
152
139
150. VTC v PVS
140
141
154
142
Time charterpartylien on all hire and sub-hire for any amounts due under time charterwhether owners entitled to lien over sums due to sub-charterers from sub-sub-charterers
NYPE, cl.18
W, owners of the bulk carrier Western Moscow, time chartered the vessel to C, the head charterer, on an amended NYPE charterparty. C sub-chartered the vessel to the second
respondent, O, which sub-chartered it to the third respondent, S. The relevant charterparty clause, cl.18, provided: That the Owners shall have a lien upon all cargoes, and all
sub-freights, hire and sub-hire for any amounts due under this Charter, including General Average contributions .
C repudiated the charterparty with W, whereupon W claimed unpaid hire, disbursements and damages. W also exercised its lien under the NYPE charterparty with C by giving
notice to O. In addition, by exercising the lien, W claimed to have acquired Os equivalent lien under the sub-charterparty and to have exercised that second lien by giving notice to
S. W thus claimed to be entitled to pursue Cs claim against O for unpaid hire and Os claim against S. W said that it had good arguable claims against O and S, as there was a real
risk of dissipation of assets, and obtained a worldwide freezing injunction against O and S without notice.
O and S argued that there was no risk of dissipation and that the court had no substantive jurisdiction against S, because the sub-sub-charterparty provided for Greek law and
arbitration rather than English, and because cl.18 in that charterparty had been changed to a clause providing for no lien. They applied to discharge the injunctions.
Decision: Claim dismissed (injunctions discharged).
Held: (1) W had good arguable claims against C for unpaid hire, disbursements and damages for wrongful repudiation of the charter. (2) Ws claim against C for the balance of
hire plainly fell within the lien clause, cl.18, in the charterparty. (3) Whether or not W had any right in the nature of an assignment of Cs claims against O or Os claims against S
was a question of law which was not subject to the good arguable case test and had to
142. [2012] EWHC 1100 (Comm), [12].
143. [2012] EWHC 1224 (Comm); [2012] 2 Lloyds Rep 163; [2012] 1 CLC 954; [2012] 2 All ER (Comm) 1140 (QBD: Christopher Clarke J).
be decided on the instant application. (4) The better view was that the lien clause created an assignment by way of charge. (5) W had done all that was required to perfect its lien
over the sub-hire payable under the sub-sub-charterparty, by giving notices of lien to O c/o S, as in The Cebu. (6) There was no need for O to give its own separate notice to S.
(7) W had a good arguable case that it became entitled to claim outstanding hire due from O to C under the sub-charterparty, which contained an English law and jurisdiction
clause. (8) W had also acquired Os claim for unpaid hire against S. (9) Where there was a chain of charters each containing lien clauses, the party at the top of the chain became
the assignee not only of the sub-hire owed to the head charterer by a sub-charterer, but also of the hire payable under the sub-sub-charter by the sub-sub-charterer. (10) The
expression all sub-hire in the lien clause indicated that it extended to all sub-hire down the line. (11) W had given notice to S and had a good arguable case that it was entitled
to claim any amount due from S under the sub-sub-charterparty. (12) W did not have a good arguable case that the sub-sub-charterparty, which provided for Greek law and
jurisdiction, was not the true charter. (13) It followed that the sub-sub-charterparty was not shown to be subject to English law and arbitration and there was, therefore, no basis
for serving S out of the jurisdiction on the footing that W had a claim against it which was subject to English law. (14) W had an arguable case that at least $62,000 was
outstanding as hire under the sub-sub-charterparty but failed to show a real risk of dissipation and so the injunctions were discharged.
Comment: This second case on the NYPE lien clause in the year under review required consideration of the amended wording all sub-freights, hire and sub-hire for any
amounts due under this Charter. Importantly, the court confirmed that the contractual lien clause created an assignment by way of charge. The court also confirmed that,
under the amended NYPE lien clause, the shipowner became the assignee not only of the sub-hire owed to the head charterer by a sub-charterer, but also of the hire payable
under the sub-sub-charter by the sub-sub-charterer.
Shipbuildingrefund guaranteedelayed delivery datewhether implied that sellers should procure an extension of the refund guarantee within a reasonable timewhether
sellers in repudiatory breachwhether buyers validly terminated contract for accepted repudiation
W were the sellers of a newbuild container vessel under a shipbuilding contract with S, the buyers. S were to pay the price in instalments and repayment of the instalments was
144. Care Shipping Corp v Latin American Shipping Corp (The Cebu) [1983] QB 1005.
145. Ibid.
146. See Dry Bulk Handy Holding Inc v Fayette International Holdings Ltd (The Bulk Chile), ante, 136.
147. The unamended NYPE 1946 clause does not refer to hire or sub-hire.
148. Cf NYPE 93, cl.23.
149. Applying Care Shipping Corp v Latin American Shipping Corp (The Cebu), supra fn.144; Welsh Irish Ferries Ltd, Re (The Ugland Trailer) [1986] Ch 471. It has previously
been suggested that the charge is not a charge at all: see Fidelis Oditah, The juridical nature of a lien on subfreights [1989] LMCLQ 191.
150. [2012] EWHC 3104 (Comm); [2013] 1 Lloyds Rep 273; [2013] 1 All ER (Comm) 1277 (QBD: Cooke J).
to be secured by a refund guarantee. The refund guarantee was provided by a Chinese bank on 7 June 2007, and provided that:
This Letter of Guarantee shall remain in force until the Vessel has been delivered to and accepted by [the buyers] or refund has been made by the Seller or ourselves (the Export
Import Bank of China) or until 30 June 2010, whichever occurs earliest, after which you are to return it to us by airmail for cancellation. In case arbitration initiated by either Seller
or Buyer before delivery of the Vessel, the validity of this guarantee shall be extended to 60 calendar days after the final arbitration award is issued.
Delivery of the vessel was delayed by agreement until October 2010. W undertook to obtain an extension to the refund guarantee but no timescale was stipulated. On 28 June, S
terminated the contract on the ground that Ws failure to obtain an extension of the guarantee was a repudiatory breach. On 29 June, the bank extended the guarantee. By that
time, arbitrators had been appointed.
The arbitrators found that it was unreasonable and uncommercial to expect S to bear the risk of losing the security of the guarantee by having to wait for an extension until
shortly before its expiry. They held that, as a matter of business necessity, a term was to be implied into the contract that the extension had to be obtained within a reasonable
time. They concluded that a reasonable time was 14 days before expiry of the initial guarantee and that W had been in breach of contract from 16 June, that breach becoming a
repudiatory breach by 23 June.
On appeal, the issues were: (1) whether W had been obliged to obtain an extension any time before the date on which the initial guarantee expired or whether it had been
correct to imply a reasonable time term; (2) if the latter, whether the implied term was an innominate term or a warranty; (3) whether the breach was a repudiatory breach.
Held: (1) Where parties imposed a unilateral obligation without specifying the time in which it was to be done, there had to be some implication regarding time. (2) There was
force in Ws argument that the natural and most obvious implication should be the one that gave it the most time, namely that an extension that merely ensured continuity when
the existing guarantee ended. (3) However, no commercial logic or business rationale had been put forward to dispute the finding that there were good commercial reasons for an
earlier date. (4) Once it was recognised that there had to be an implied term regulating the time for fulfilment of the obligation, commercial elements fell to be taken into account
as part of the test of necessity for business efficacy. (5) The arbitrators had been right to regard the instant case as a paradigm case for implication of the reasonable time test
given the need for Ss security to be protected. (6) The parties were entitled to an instrument from the bank setting out their extended rights without any further risk on their
part; certainty would have been jeopardised, and the risks increased, if the extension were not obtained in good time before expiry of the initial guarantee. (7) The arbitrators
finding that a reasonable time was 14 days was, as a finding of fact, unchallengeable. (8) The agreement to extend the guarantee within a reasonable time was an innominate
term
151. See Attorney-General of Belize v Belize Telecom Ltd [2009] UKPC 10; [2009] 1 WLR 1988; Mediterranean Salvage & Towage Ltd v Seamar Trading & Commerce Inc (The
Reborn), Noter Up, post, p.163.
152. See Covington Marine Corp v Xiamen Shipbuilding Industry Co Ltd [2005] EWHC 2912 (Comm); [2006] 1 Lloyds Rep 745.
because the existence of the guarantee was of fundamental importance to the contract and breach of the agreement to extend it went to the root of the contract. (9) The
arbitrators had been wrong to find that Ws breach was a repudiatory breach. (10) Since the guarantee would automatically have been extended if S had started arbitration
proceedings at the expiry date of the initial guarantee, it could not be said that Ws failure to extend the guarantee within a reasonable time had truly imperilled Ss security.
Comment: This case concerned a late delivery of a newbuild vessel and highlights one of the difficulties which can occur in current market conditions. In particular, it underlines
the importance of certainty when agreeing to extensions to delivery dates. In this case, difficulties were encountered precisely because of uncertainties over the refund guarantee.
151. Western Bulk Shipowning III A/S v Carbofer Maritime Trading APS (The Western Moscow)
143
144
145
146 147
148 149
152. Wuhan Ocean Economic & Technical Cooperation Co Ltd v Schiffahrts-Gesellschaft Hansa Murcia mbH & Co KG
150
156
151
152
Although the court was persuaded that, on the particular wording of the refund guarantee, commencement of arbitration would extend the refund guarantee automatically, it would
be rather risky to assume that this will always work. Buyers would be advised to clearly spell out the consequences of failing to obtain an extension.
153. Merchant Shipping (Accident Reporting and Investigation) Regulations 2012: SI 2012/1743 (in force 31 July 2012).
These Regulations replace the Merchant Shipping (Accident Reporting and Investigation) Regulations 2005, primarily to reflect the requirements of Directive 2009/18/EC of the
European Parliament and of the Council. They specify the purpose of investigations, make provision for their scope and conduct, define the accidents and incidents which may
be investigated, and set out the requirements for reporting accidents and the publication of reports and summaries. A new power is given to the Chief Inspector of Marine
Accidents to delegate the whole, or part, of a safety investigation to another EEA Member State, where it has been mutually agreed and where he deems it appropriate.
154. Merchant Shipping and Fishing Vessels (Health and Safety at Work) (Chemical Agents) (Amendment) Regulations 2012: SI 2012/1844 (in force 10 August
2012).
The Regulations complete implementation of EU Directive 2009/161/EU of 17 December 2009, which amends Directive 98/24/EC on the introduction of measures to protect
workers from risks related to exposure to chemical agents at work. They extend to the maritime sector the employers duty to reduce the risk to their employees health from
exposure to chemical agents at work. The Regulations also correct an error identified in the Merchant Shipping and Fishing Vessel (Health and Safety at Work) (Chemical Agents)
Regulations 2010, which omitted a reference to the list of exposure limits in Directive 2000/39/EC. The Regulations also insert a review clause into the Merchant Shipping and
Fishing Vessel (Health and Safety at Work) (Chemical Agents) Regulations 2010,
153. SI 2005/881.
154. [2009] OJ L131/114.
155. [2009] OJ L338/87.
156. SI 2010/330, amended by SI 2010/1110, reg.5. See [2011] IMCLY 133.
requiring the Secretary of State to review the amended Regulations at five-yearly intervals, calculated from the commencement of these Regulations, and to publish a report
containing the conclusions of that review.
155. Merchant Shipping (Carriage of Passengers by Sea) Regulations 2012: SI 2012/3152 (in force 31 December 2012; 12 January 2013).
These Regulations support the operation of Regulation (EC) 392/2009, which gives effect to the main provisions of the Athens Convention 1974, as last amended by the Protocol
of 2002 relating to the Carriage of Passengers and their Luggage by Sea 1974. The EU Regulation creates parity for the passenger shipping sector and ensures that UK citizens
have access to the same levels of compensation when travelling between two different EU Member States. The Regulations apply to the carriage of passengers by sea within the
United Kingdom on board ships of Classes A and B as defined in Directive 2009/45/EC, Art 4(1). As well as providing for compulsory insurance, the Regulations also require the
provision of information relating to passengers rights under the EU Regulation to all passengers. Regulation 4, which operates to disapply the EU Regulation from certain classes of
ships operating on domestic voyages, came into force on 31 December, while the remaining regulations, which deal with the issue of certificates and provide for the enforcement of
the EU Regulation, came into effect on 12 January 2013.
156. Merchant Shipping (Compulsory Insurance of Shipowners for Maritime Claims) Regulations 2012: SI 2012/2267 (in force 5 October 2012).
These Regulations endeavour to ensure that owners of all seagoing ships of 300 gross tonnage and above have in place third-party liability insurance to cover the vast majority of
third-party claims of the type described as subject to limitation in the Convention on Limitation of Liability for Maritime Claims 1976 (LLMC) as amended by the 1996 Protocol.
This is intended to guard against situations where a shipowner is liable for third-party claims but has insufficient funds to pay, and transpose Directive 2009/20/EC on the
insurance of shipowners for maritime claims, which entered into force across the EU on 1 January 2012. Insurance in this context means the indemnity insurance offered by P&I
Clubs or self-insurance or some other form of financial security, provided that it can be proved that such alternative financial guarantees provide adequate cover for their liabilities.
Any shipowner who wants to rely on this latter type of insurance would have to seek the prior written approval from the Secretary of State before the ship enters United Kingdom
waters.
157. Merchant Shipping (Passenger Ships on Domestic Voyages) (Amendment) Regulations 2012: SI 2012/2636 (in force 16 November 2012).
These Regulations transpose into UK law Commission Directive 2010/36/EU of 1 June 2010, amending Directive 2009/45/EC of the European Parliament and of the Council, of 6
May 2009, on safety rules and standards for passenger ships.
157. Regs 2, 4 only.
158. [2009] OJ L131/24.
159. [2009] OJ L131/128.
160. [2009] OJ L163/1, amended by Commission Directive 2010/36/EU of 1June 2010 [2010] OJ L162/1.
158. Merchant Shipping (Ship-to-Ship Transfers) (Amendment) Regulations 2012: SI 2012/742 (in force 31 March 2012).
These Regulations amend the Merchant Shipping (Ship-to-Ship Transfers) Regulations 2010, which were designed to restrict ship-to-ship transfers to harbour authority areas
within the seaward limits of the territorial sea of the United Kingdom, 12 nautical miles off the UK coast. The 2012 Regulations are designed to ensure that operators had a wider
choice of locations for operations and that small scale bunkering and lightering operations (the process of transferring cargo or fuel from a vessel to reduce its draft to allow it to
enter ports or harbours with depth restrictions) unintentionally caught by the 2010 Regulations would be unaffected. They also allow the UK to meet a small number of
international obligations relating to ship transfers laid down by the International Convention for the Prevention of Pollution from Ships (MARPOL) 1973, as modified by the Protocol
of 1978 relating to that Convention.
161. SI 2010/1228. See [2011] IMCLY 141.
162. Eg of oil and bunkers.
163. In force 1 January 2011.
LEGISLATION
153
154
155
156
158
157
158
159
160
161 162
163
ARTICLES
159. Anderson, Norman A, & de la Rue, Colin, Environmental salvagePlus a change ? (2012) 18 JIML 279.
160. Basijokas, Sarunas, Is the doctrine of deviation only a historical record today? [2012] UCL Journal of Law and Jurisprudence 114.
161. Bishop, Archie, The development of environmental salvage and review of the London Salvage Convention 1989 (2012) 37 Tulane Maritime LJ 65.
162. Cremean, Damien, Historic origins of the Admiralty Court [2012] JBL 350.
163. Lamont-Black, Simone, Claiming damages in multimodal transport: A need for harmonisation (2012) 36 Tulane Maritime LJ 707.
164. Lee Yu Heng, Darryl & Sooksripaisarnkit, P, The straight bill of lading: past, present, and future (2012) 18 JIML 39.
165. Li, Ling, Binding effect of arbitration clauses on holders of bills of lading as nonoriginal parties and a potential uniform approach through
comparative analysis (2012) 37 Tulane Maritime LJ 107.
166. Murray, Olivia, Fair treatment of seafarersinternational law and practice (2012) 18 JIML 150.
160
167. Naravane, Shantanu S, The implications of Transfield for concurrent liability in tort and contract [2012] JBL 404.
168. Staniland, Hilton, The enduring and evolving legal legacy of the Titanic: an enquiry into marine casualty investigations and self-incrimination
[2012] JBL 299.
169. Thomas, D Rhidian, Multimodalism and through transportLanguage, concepts, and categories (2012) 36 Tulane Maritime LJ 761.
AP Moller-Maersk A/S v Sonaec Villas Cen Sad Fadoul [2010] EWHC 355 (Comm); [2011] 1 Lloyds Rep 1; [2010] 2 All ER (Comm) 1159; [2012] 1 CLC 798; [2010] Bus LR D97
(QBD: Christopher Clarke J); appl Dubai Islamic Bank PJSC v PSI Energy Holding Co BSC [2011] EWHC 1019 (Comm); Finmoon v Baltic Reefers Management Ltd [2012] EWHC
920 (Comm); noted S Girvin [2012] IMCLY 171.
Bunge SA v ADM Do Brasil Ltda (The Darya Radhe) [2009] EWHC 845 (Comm); [2009] 2 Lloyds Rep 175; [2009] 1 CLC 608; [2010] 1 All ER (Comm) 784 (QBD: Tomlinson J);
noted S Girvin [2010] IMCLY 117; cons Equitas Ltd v R & Q Reinsurance Co (UK) Ltd [2009] EWHC 2787 (Comm); [2010] Lloyds Rep IR 600; [2010] 2 All ER (Comm) 855;
[2009] 2 CLC 706; Great Elephant Corp v Trafigura Beheer BV [2012] EWHC 1745 (Comm).
Cosco Bulk Carrier Co Ltd v Team-up Owning Co Ltd (The Saldanha) [2010] EWHC 1340 (Comm); [2011] 1 Lloyds Rep 187; [2010] 1 CLC 919 (QBD: Gross J); noted J Weale
[2010] LMCLQ 574; S Girvin [2011] IMCLY 114; refd Osmium Shipping Corp v Cargill International SA [2012] EWHC 571 (Comm).
Dalwood Marine Co v Nordana Line SA (The Elbrus) [2009] EWHC 3394 (Comm); [2010] 2 Lloyds Rep 315; [2010] 1 CLC 1; [2010] 2 All ER (Comm) 802 (QBD: Teare J); noted
S Girvin [2010] IMCLY 120; refd Glory Wealth Shipping Pte Ltd v Korea Line Corp (The Wren) [2011] EWHC 1819 (Comm); Progress Bulk Carriers Ltd v Tube City IMS LLC [2012]
EWHC 273 (Comm).
Dolphin Tanker SRL v Westport Petroleum Inc (The Savina Caylyn) [2010] EWHC 2617 (Comm); [2011] 1 Lloyds Rep 550; [2011] Bus LR D110 (QBD: Simon J); noted S Girvin
[2011] IMCLY 115.
Emeraldian Ltd Partnership v Wellmix Shipping Ltd (The Vine) [2010] EWHC 1411 (Comm); [2011] 1 Lloyds Rep 301; [2010] 1 CLC 993 (QBD: Teare J); noted R Gay [2011]
LMCLQ 23; S Girvin [2011] IMCLY 116; refd British Arab Commercial Bank Plc v Bank of Communications [2011] EWHC 281 (Comm); [2011] 1 Lloyds Rep 664; Great Elephant
Corp v Trafigura Beheer BV [2012] EWHC 1745 (Comm).
Glory Wealth Shipping Pte Ltd v Korea Line Corp (The Wren) [2011] EWHC 1819 (Comm); [2011] 2 Lloyds Rep 370; [2012] 1 All ER (Comm) 402 (QBD: Blair J); noted S Girvin
[2012] IMCLY 173.
Glory Wealth Shipping Pte Ltd v North China Shipping Ltd (The North Prince) [2010] EWHC 1692 (Comm); [2011] 1 Lloyds Rep Plus 19; [2010] 2 CLC 64; [2011] 1 All ER
(Comm) 641 (QBD: David Steel J); noted S Girvin [2011] IMCLY 119.
Golden Ocean Group Ltd v Salgaocar Mining Industries Pvt Ltd [2012] EWCA Civ 265; [2012] 1 WLR 3674; [2012] 1 Lloyds Rep 542; [2012] 3 All ER 842; [2012] 2 All ER
(Comm) 978; [2012] 1 CLC 497 (CA: Rix, Tomlinson LJJ & Sir Mark Waller); noted S Girvin [2012] IMCLY 174; appd Alliance Bank JSC v Aquanta Corp [2012] EWCA Civ 1588;
affg [2011] EWHC 56 (Comm); [2011] 1 WLR 2575; [2011] 2 All ER (Comm) 95; [2011] 1 CLC 125 (QBD: Christopher Clarke J); refd WS Tankship II BV v Kwangju Bank Ltd
[2011] EWHC 3103 (Comm).
Golden Strait Corp v Nippon Yusen Kubishika Kaisha [2007] UKHL 12; [2007] 2 AC 353; [2007] Bus LR 997; [2007] 2 WLR 692; [2007] 2 Lloyds Rep 164; [2007] 3 All ER 1;
[2007] 2 All ER (Comm) 97; [2007] 1 CLC 352; (HL: Lords Scott of Foscote; Brown of Eaton-under-Heywood; Carswell; Lords Bingham of Cornhill and Walker of Gesting-thorpe
dissenting); noted B Coote (2007) 123 LQR 503; Q Liu [2007] LMCLQ 273; J Morgan (2007) 66 CLJ 263; (Lord) M Mustill (2008) 124 LQR 569; C Nicoll [2008] JBL 91; S Girvin
[2008] IMCLY 97; affg [2005] EWCA Civ 1190; [2006] 1 WLR 533; [2005] 2 Lloyds Rep 747; [2005] 2 CLC 576; [2006] 1 All ER (Comm) 235 (CA: Auld and Tuckey LJJ and Lord
Mance); noted Q Liu [2006] LMCLQ 17; Sir Guenter Treitel (2007) 123 LQR 9; affg [2005] EWHC 161; [2005] 1 Lloyds Rep 443; [2005] 1 CLC 138; [2005] 1 All ER (Comm) 467
(QBD: Langley J); noted S Girvin [2006] IMCLY 145; appl Seatbooker Sales Ltd v Southend United Football Club Ltd [2008] EWHC 157 (QB); Multiplex Constructions (UK) Ltd v
Cleveland Bridge UK Ltd [2008] EWHC 2220 (TCC); Tele2 International Card Co SA v Kub 2 Technology Ltd [2009] EWCA Civ 9; Force India Formula One Team Ltd v Etihad
Airways PJSC [2009] EWHC 2768 (QB); Trademark Licensing Co Ltd v Leofelis SA [2012] EWHC 485 (Ch); Novasen SA v Alimenta SA [2013] EWHC 345 (Comm); folld Dalwood
Marine Co v Nordana Line SA [2009] EWHC 3394 (Comm); [2010] 2 Lloyds Rep 315; [2010] 1 CLC 1; [2010] 2 All ER (Comm) 802; cons Oxus Gold Plc v Templeton Insurance
Ltd [2007] EWHC 770 (Comm); Carleton (Earl of Malmesbury) v Strutt & Parker (A Partnership) [2007]
EWHC 999 (QB); DRC Distribution Ltd v Ulva Ltd [2007] EWHC 1716 (QB); P&S Amusements Ltd v Valley House Leisure Ltd [2007] EWHC 1494 (Ch); Gray v Thames Trains Ltd
[2007] EWHC 1558 (QB); Richmond Adult Community College v McDougall [2008] EWCA Civ 4; Tele2 International Card Co SA v Kub 2 Technology Ltd [2009] EWCA Civ 9;
Whitehead v Searle [2008] EWCA Civ 285; [2009] 1 WLR 549; Automotive Latch Systems Ltd v Honeywell International Inc [2008] EWHC 2171 (Comm); Maple Leaf Macro
Volatility Master Fund v Rouvroy [2009] EWHC 257 (Comm); [2009] 1 Lloyds Rep 475; [2009] 2 All ER (Comm) 287; CNH Global NV v PGN Logistics Ltd [2009] EWHC 977
(Comm); [2009] 1 CLC 807; Classic Maritime Inc v Lion Diversified Holdings bhd [2009] EWHC 1142 (Comm); [2010] 1 Lloyds Rep 59; Lilly Icos LLC v 8PM Chemists Ltd [2009]
EWHC 1905 (Ch); [2010] FSR 4; Midland Packaging Ltd v HW Accountants Ltd [2010] EWHC 1975 (QBD); Vercoe v Rutland Fund Management Ltd [2010] EWHC 424 (Ch); Zodiac
Maritime Agencies Ltd v Fortescue Metals Group Ltd (The Kildare) [2010] EWHC 903 (Comm); [2011] 2 Lloyds Rep 360; Omak Maritime Ltd v Mamola Challenger Shipping Co Ltd
[2010] EWHC 2026 (Comm); [2011] 1 Lloyds Rep 47; [2011] Bus LR 212; [2011] 2 All ER (Comm) 155; AerCap Partners 1 Ltd v Avia Asset Management AB [2010] EWHC 2431
(Comm); [2010] 2 CLC 578; Linklaters Business Services v Sir Robert McAlpine Ltd [2010] EWHC 2931 (TCC); Cassa di Risparmio della Repubblica di San Marino SpA v Barclays
Bank Ltd [2011] EWHC 484 (Comm); Anthracite Rated Investments (Jersey) Ltd v Lehman Brothers Finance SA [2011] EWHC 1822 (Ch); [2011] 2 Lloyds Rep 538; Pegasus v
Ernst & Young [2012] EWHC 738 (Ch); Deutsche Bank AG v Total Global Steel Ltd [2012] EWHC 1201 (Comm); Fox v British Airways Plc [2013] ICR 51; Federal-Mogul
170. Thomas, Sean, Transfers of documents of title under English law and the Uniform Commercial Code [2012] LMCLQ 573.
171. Todd, Paul, Ransom, piracy and time charterparties (2012) 18 JIML 193.
172. Todd, Paul. Laytime, demurrage and implied safety obligations [2012] JBL 668.
173. Weale, John, Deviation and off-hire (2012) 18 JIML 126.
174. Zhu, Ling, Ng, Adolf KY, Zhang, Ming Zhao, Some thoughts on civil liability for maritime piracy-caused oil pollution (2012) 18 JIML 306.
BOOKS
175. Basedow, Jurgen, Magnus, Ulrich, & Wolfrum, Rudiger, The Hamburg Lectures on Maritime Affairs: 2009/10 (Springer-Verlag, 2012), paperback, 62.99;
reviewed E Egede (2012) 18 JIML 399.
176. Baughen, Simon, Shipping Law, 5th edn (Routledge-Cavendish, 2012), paperback, 37.99.
177. Chircop, Aldo, Letalik, Norman, McDorman, Ted, & Rolston, Susan, The Regulation of International Shipping: International and Comparative Perspectives
Essays in Honour of Edgar Gold (Martinus Nijhoff, Leiden, 2012), hardback, 165.00.
178. Cockcroft, AN & Lameijer, JNF, A Guide to the Collision Avoidance Rules 7th edn (Butterworth-Heinemann, London, 2011), hardback, 49.99.
179. Curtis, Simon, The Law of Shipbuilding Contracts, 4th edn (Informa, London, 2012), hardback, 450.00.
180. Glass, David, Freight Forwarding and Multimodal Transport Contracts , 2nd edn (Informa, London, 2012), hardback, 340.00.
181. Goldrein, Iain, Turner, Paul, & Hannaford, Matt, Ship Sale and Purchase, 6th edn (Informa, London, 2012), hardback, 420.00.
182. Gutierrez, Norman A Martinez, Limitation of Liability in International Maritime Conventions: The Relationship Between Global Limitation Conventions and
Particular Liability Regimes (Routledge, London, 2012), paperback, 40.00; reviewed M Fitzmaurice (2012) 14 Int Community L Rev 81.
183. Huang, Yuna, Recoverability of Pure Economic Loss Arising from Ship-source Oil Pollution (Lit Verlag, 2012), paperback, 39.95.
184. Klein, Natalie, Maritime Security and the Law of the Sea (Oxford University Press, 2012), paperback, 24.99; reviewed D Guilfoyle (2012) 71 Cambridge LJ 712.
185. Lorenzon, Filippo & Coles, Richard, The Law of Yachts and Yachting (Informa, London, 2012), hardcover, 260.00.
186. Morrison, Anthony P, Places of Refuge for Ships in Distress: Problems and Methods of Resolution (Martinus Nijhoff, Leiden, 2012), hardback, 140.00.
187. Reeder, John, Brice on Maritime Law of Salvage, 5th edn (Sweet & Maxwell, London, 2012), hardback, 375.00.
188. Reynolds, Barnabas, & Tsimplis, Michael, Shipowners Limitation of Liability (Kluwer Law International, 2012), hardback, 104.00.
189. Singh, Lachmi, Law of Carriage of Goods by Sea (Bloomsbury Professional, 2012), softback, 50.00; reviewed A Basu Bal (2012) 18 JIML 403.
190. Soyer, Baris, & Tettenborn, Andrew, Pollution at Sea: Law and Liability (Informa, London, 2012), hardback, 270.00; reviewed R Force (2012) 18 JIML 321.
191. Tan, Alan Khee-Jin, Vessel-Source Marine Pollution: The Law and Politics of International Regulation (Cambridge University Press, 2012), paperback, 25.99.
NOTER UP
162
Aftermarket UK Ltd, Re [2008] EWHC 1099 (Ch); [2008] Bus LR 1443; Glory Wealth Shipping Pte Ltd v Korea Line Corp (The Wren) [2011] EWHC 1819 (Comm); [2011] 2 Lloyds
Rep 370; [2012] 1 All ER (Comm) 402; Bunge SA v Nidera BV (formerly Nidera Handelscompagnie BV) [2013] EWHC 84 (Comm).
Great Eastern Shipping Co Ltd v Far East Chartering Ltd (The Jag Ravi) [2012] EWCA Civ 180; [2012] 1 Lloyds Rep 637; [2012] 2 All ER (Comm) 707; [2012] 1 CLC 427 (CA:
Longmore, Tomlinson, Davis LJJ); noted S Girvin [2012] IMCLY 175; J R Wereley (2012) 18 JIML 338; affg [2011] EWHC 1372 (Comm); [2011] 2 Lloyds Rep 309 (QBD: HHJ
Mackie QC).
Hyundai Merchant Marine Co Ltd v Trafigura Beheer BV (The Gaz Energy) [2011] EWHC 3108 (Comm); [2012] 1 Lloyds Rep 211; [2012] 2 All ER (Comm) 209 (QBD: Flaux J);
noted S Girvin [2012] IMCLY 176.
Lansat Shipping Co Ltd v Glencore Grain BV (The Paragon) [2009] EWCA Civ 855; [2009] 2 Lloyds Rep 688; [2009] 2 CLC 465; [2010] 1 All ER (Comm) 459 (CA: Lord Clarke of
Stone-cum-Ebony, Goldring & Patten JJ); noted S Girvin [2010] IMCLY 126; affg [2009] EWHC 551 (Comm); [2009] 1 Lloyds Rep 658; [2009] 1 CLC 379; [2009] 2 All ER
(Comm) 12 (QBD: Blair J); refd Azimut-Benetti SpA v Healey [2010] EWHC 2234 (Comm); [2011] 1 Lloyds Rep 473; Wright v Deccan Chargers Sporting Ventures Ltd [2011]
EWHC 1307 (QB); Imam-Sadeque v Bluebay Asset Management (Services) Ltd [2012] EWHC 3511 (QB).
Mediterranean Salvage & Towage Ltd v Seamar Trading & Commerce Inc (The Reborn) [2009] EWCA Civ 531; [2009] 2 Lloyds Rep 639; [2009] 1 CLC 909; [2010] 1 All ER
(Comm) 1 (CA: Clarke MR, Rix & Carnwath LJJ); noted S Girvin [2010]
IMCLY 128; affg [2008] EWHC 1875 (Comm); [2008] 2 Lloyds Rep 628; [2008] 2 CLC 381; [2009] 1 All ER (Comm) 411 (QBD: Aikens J); appl Aymard v SISU Capital Ltd
[2009] EWHC 3214 (QB); F&C Alternative Investments (Holdings) Ltd v Barthelemy [2011] EWHC 1731 (Ch); folld Deutsche Bank AG v Sebastian Holdings Inc [2009] EWHC 2132
(Comm); [2009] 2 CLC 908; SNCB Holding v UBS AG [2012] EWHC 2044 (Comm); cons AET Inc Ltd v Arcadia Petroleum Ltd [2009] EWHC 2337 (Comm); [2010] 1 Lloyds Rep
591; [2009] CLC 567; [2010] 1 All ER (Comm) 23; CDV Software Entertainment AG v Gamecock Media Europe Ltd [2009] EWHC 2965 (Ch); Fortis Bank SA/NV v Indian Overseas
Bank [2010] EWHC 84 (Comm); [2010] 2 Lloyds Rep 641; [2010] Bus LR 835; [2010] 1 CLC 16; [2010] 2 All ER (Comm) 28; Rutherford v Seymour Pierce Ltd [2010] EWHC 375
(QB); Lord Mayor and Citizens of Westminster v Urban Wimax Ltd [2010] EWHC 1166 (Ch); Redmayne Bentley Stockbrokers v Isaacs [2010] EWHC 1504 (Comm); Hildron
Finance Ltd v Sunley Holdings Ltd [2010] EWHC 1681 (Ch); [2010] 3 EGLR 1; Crema v Cenkos Securities Plc [2010] EWCA Civ 1444; [2011] Bus LR 943; [2010] 2 CLC 963; West
Sussex CC v Amberley (UK) Ltd [2011] EWCA Civ 11; Fortis Bank SA/NV v Indian Overseas Bank [2011] EWCA Civ 58; [2011] 2 Lloyds Rep 33; [2011] 1 CLC 276; Looney v
Trafigura Beheer BV [2011] EWHC 125 (Ch); Cassa di Risparmio della Repubblica di San Marino SpA v Barclays Bank Ltd [2011] EWHC 484 (Comm); Standard Chartered Bank v
Ceylon Petroleum Corp [2011] EWHC 1785 (Comm); Winnetka Trading Corporation v Julius Baer International Ltd [2011] EWHC 2030 (Ch); F&C Alternative Investments
(Holdings) Ltd v Barthelemy (Costs) [2011] EWHC 2807 (Ch); [2012] Bus LR 891; Leander Construction Ltd v Mulalley & Co Ltd [2011] EWHC 3449 (TCC); Spencer v Secretary of
State for Defence [2012] EWHC 120 (Ch); Canwell Estate Co Ltd v Smith Brothers Farms Ltd [2012] EWCA 234; [2012] 1 WLR 2626; [2012] 2 All ER 1159; Procter & Gamble Co v
Svenska Cellulosa Aktiebolaget [2012] EWHC 498 (Ch); Compass Group UK and Ireland Ltd (t/a Medirest) v Mid Essex Hospital Services NHS Trust [2012] EWHC 781 (QB); Brown
v Innovator-One Plc [2012] EWHC 1321 (Comm); Fitzhugh v Fitzhugh [2012] EWCA Civ 694; MRI Trading AG v Erdenet Mining Corp LLC [2012] EWHC 1988 (Comm); [2012] 2
Lloyds Rep 465; [2013] 1 All ER (Comm) 1; Jackson v Dear [2012] EWHC 2060 (Ch); Lisnave Estaleiros Navais SA v Chemikalien Seetransport GmbH [2013] EWHC 338 (Comm);
KG Bominflot Bunkergesellschaft fr Mineralele mbH & Co KG v Petroplus Marketing AG (The Mercini Lady) [2010] EWCA Civ 1145; [2011] 1 Lloyds Rep 442; [2011] 2 All ER
(Comm); [2010] 2 CLC 637; Wuhan Ocean Economic and Technical Cooperation Co Ltd v Schiffahrts-Gesellschaft Hansa Murcia MBH & Co KG, ante, 152.
MH Progress Lines SA v Orient Shipping Rotterdam BV (The Genius Star 1) [2011] EWHC 3083 (Comm); [2012] 1 Lloyds Rep 222; [2012] 1 All ER (Comm) 1230; [2012] 1 CLC
26 (QBD: Teare J); noted S Girvin [2012] IMCLY 177.
Miom 1 Ltd v Sea Echo ENE (No 1) [2010] EWHC 3180 (Admlty) (QBD: Teare J); noted S Girvin [2012] IMCLY 178; refd Owners and/or Bareboat Charterers and/or Sub
Bareboat Charterers of the Samco Europe v Owners of the MSC Prestige [2011] EWHC 1580 (Admlty); [2011] 2 Lloyds Rep 579; [2011] 2 CLC 655.
Miom 1 Ltd v Sea Echo ENE (No 2) [2011] EWHC 2715 (Admlty); [2012] 1 Lloyds Rep 140; [2011] 2 CLC 877 (QBD: Teare J); noted S Girvin [2012] IMCLY 179.
National Shipping Co of Saudi Arabia v BP Oil Supply Co (The Abqaiq) [2011] EWCA Civ 1127; [2012] 1 Lloyds Rep 18 (CA: Ward, Tomlinson LJJ & Sir Mark
Potter); noted S Girvin [2012] IMCLY 180; rvsg [2010] EWHC 3043 (Comm) (QBD: Field J).
Omak Maritime Ltd v Mamola Challenger Shipping Co (The Mamola Challenger) [2010] EWHC 2026 (Comm); [2011] 1 Lloyds Rep 11; [2011] Bus LR 212; [2010] 2 CLC 194;
[2011] 2 All ER (Comm) 155 (QBD: Teare J); noted S Girvin [2011] IMCLY 122; A Tettenborn [2011] LMCLQ 1; D McLaughlan (2011) 127 LQR 23; appd Dhanani v Crasnianski
[2011] EWHC 926 (Comm); Shared Network Services Ltd v Nextiraone UK Ltd [2011] EWHC 3845 (Comm); Ampurius Nu Homes Holdings Ltd v Telford Homes (Creekside) Ltd
[2012] EWHC 1820 (Ch); Yam Seng Pte Ltd v International Trade Corp Ltd [2013] EWHC 111 (QB).
Pace Shipping Co Ltd v Churchgate Nigeria Ltd (The Pace) [2009] EWHC 1975 (Comm); [2010] 1 Lloyds Rep 183; [2009] CLC 446 (QBD: Teare J); noted S Girvin [2010] IMCLY
131; appl Dalwood Marine Co v Nordana Line SA [2009] EWHC 3394 (Comm); [2010] 2 Lloyds Rep 315; [2010] 1 CLC 1; [2010] 2 All ER (Comm) 802; AK Kablo Imalat San Ve
Tic AS v Intamex SA [2011] EWHC 2970 (Comm); Progress Bulk Carriers Ltd v Tube City IMS LLC [2012] EWHC 273 (Comm); [2012] 1 Lloyds Rep 501; [2012] 2 All ER (Comm)
855; [2012] 1 CLC 365.
Pacific Basin IHX Ltd v Bulkhandling Handymax AS (The Triton Lark) [2011] EWHC 2862 (Comm); [2012] 1 Lloyds Rep 151; [2012] 1 All ER (Comm) 639; [2012] 1 CLC 1 (QBD:
Teare J); noted S Girvin [2012] IMCLY 181.
Parbulk II A/S v Heritage Maritime Ltd SA (The Mahakam) [2011] EWHC 2917 (Comm); [2012] 1 Lloyds Rep 87; [2012] 2 All ER (Comm) 418 (QBD: Eder J); noted S Girvin
[2012] IMCLY 182.
Polestar Maritime Ltd v YHM Shipping Co Ltd (The Rewa) [2012] EWCA Civ 153; [2012] 1 Lloyds Rep 510; [2012] 2 All ER (Comm) 447; [2012] 1 CLC 381 (CA: Sir Anthony
May; Lloyd & Aikens LJJ); noted S Girvin [2012] IMCLY 183; refd Dalmare SpA v Union Maritime Ltd (The Union Power), ante, 134.
Samco Europe and MSC Prestige (The) [2011] EWHC 1580 (Admlty); [2011] 2 Lloyds Rep 579; [2011] 2 CLC 655 (QBD: Teare J, sitting with Captain Glass and Commodore
Squire as Nautical Assessors); noted S Girvin [2012] IMCLY 184.
Samco Europe v MSC Prestige (The) (Costs) [2011] EWHC 1656 (Admlty); [2011] 2 CLC 679 (QBD: Teare J); noted S Girvin [2012] IMCLY 185; refd MIOM 1 Ltd v Sea Echo
ENE [2011] EWHC 2715 (Admlty).
Sideridraulic Systems SPA v BBC Chartering & Logistic GmbH & Co KG (The BBC Greenland) [2011] EWHC 3106 (Comm); [2012] 1 Lloyds Rep 230 (QBD: Andrew Smith J);
noted S Girvin [2012] IMCLY 186.
Stocznia Gdynia SA v Gearbulk Holdings Ltd [2009] EWCA Civ 75; [2010] QB 27; [2009] 3 WLR 677; [2009] 1 Lloyds Rep 461; [2009] 1 CLC 134; [2009] 2 All ER (Comm)
1129 (CA: Moore-Bick, Ward, Smith LJJ); noted S Girvin [2009] IMCLY 133; E Peel (2009) 125 LQR 378; A Dudnikov (2009) 15 JIML 16; appd Cavenagh v William Evans Ltd
[2012] EWCA Civ 697; folld Shell Egypt West Manzala GMBH v Dana Gas Egypt Ltd [2010] EWHC 465 (Comm); [2011] 1 Lloyds Rep 517; [2010] 1 CLC 895; [2010] 4 All ER 847;
consd Force India Formula One Team Ltd v Etihad Airways PJSC [2009] EWHC 2768 (QBD); Force India Formula One Team Ltd v Etihad Airways PJSC [2010] EWCA Civ 1051;
Geldof Metaalconstructie NV v Simon Carves Ltd [2010] EWCA Civ 667; Ng v Ashley King (Developments) Ltd [2010] EWHC 456 (Ch); [2011]
Ch 115; [2010] 3 WLR 911; [2010] 4 All ER 914; Parbulk II A/S v Heritage Maritime Ltd SA [2011] EWHC 2917 (Comm); [2012] 1 Lloyds Rep 87; [2012] 2 All ER (Comm) 418;
Air Transworld Ltd v Bombardier Inc [2012] EWHC 243 (Comm); [2012] 1 Lloyds Rep 349; [2012] 2 All ER (Comm) 60; [2012] 1 CLC 145; [2012] Bus LR D109; Dalmare SpA v
Union Maritime Ltd (The Union Power), ante, 9; Nakanishi Marine Co Ltd v Gora Shipping Ltd [2012] EWHC 3383 (Comm); rvsng [2008] EWHC 944 (Comm); [2008] 2 Lloyds
Rep 202; [2008] 1 CLC 816 (QBD: Burton J).
Sylvia Shipping Co Ltd v Progress Bulk Carriers Ltd (The Sylvia) [2010] EWHC 542 (Comm); [2010] 2 Lloyds Rep 81; [2010] 1 CLC 470 (QBD: Hamblen J); noted S Girvin
[2011] IMCLY 128; appl Borealis AB v. Geogas Trading SA [2010] EWHC 2789 (Comm); [2011] 1 Lloyds Rep 482; Dolphin Tanker Srl v Westport Petroleum Inc [2010] EWHC
2617 (Comm); [2011] 1 Lloyds Rep 550; Pindell Ltd v AirAsia Bhd [2010] EWHC 2516 (Comm); [2011] 2 All ER (Comm) 396; Ispat Industries Ltd v Western Bulk Pte Ltd [2011]
EWHC 93 (Comm); MRI Trading AG v Erdenet Mining Corp LLC [2012] EWHC 1988 (Comm); [2012] 2 Lloyds Rep 465; [2013] 1 All ER (Comm) 1.
Transfield Shipping Inc v Mercator Shipping Inc (The Achilleas) [2008] UKHL 48; [2009] 1 AC 61; [2008] 3 WLR 345; [2008] 2 Lloyds Rep 275; [2008] Bus LR 1395; [2008] 2
CLC 1; [2008] 2 All ER (Comm) 753; [2008] 4 All ER 159 (HL: Lords Hoffmann, Hope of Craighead, Rodger of Earlsferry, Walker of Gestingthorpe & Baroness Hale of Richmond);
noted Lord Hoffmann (2010) 14 Edinburgh LR 47; J Halladay [2009] Denning LJ 173; G Gordon (2009) 13 Edin LR 125; S Girvin [2009] IMCLY 134; A Kramer (2009) 125 LQR
408; J OSullivan (2008) 68 CLJ 34; E Peel (2009) 125 LQR 6; R Gay (2008) 14 JIML 295; rvsng [2007] EWCA Civ 901; [2007] 2 Lloyds Rep 555; [2008] 1 All ER (Comm) 685;
[2007] 2 CLC 400 (CA: Ward, Tuckey, Rix, LJJ); noted J Weale [2008] LMCLQ 6; R Halson [2008] LMCLQ 119; J Sundaram [2008] Denning LJ 187; S Girvin [2008] IMCLY 112;
affg [2006] EWHC 3030; [2007] 1 Lloyds Rep 19; [2007] 1 All ER (Comm) 379; [2006] 2 CLC 1069 (QBD: Christopher Clarke J); noted S Girvin [2007] IMCLY 124; disting in
Sylvia Shipping Co Ltd v Progress Bulk Carriers Ltd [2010] EWHC 542 (Comm); [2010] 2 Lloyds Rep 8; [2010] 1 CLC 470; [2011] 1 Lloyds Rep 96; [2010] 4 All ER 1011; [2011]
1 All ER (Comm) 1; folld in How Engineering Services Ltd v Southern Insulation (Medway) Ltd [2010] EWHC 1878 (TCC); [2010] BLR 53; appd Donoghue v Greater Glasgow
164
166
Health Board [2009] CSOH 115; cons Lansat Shipping Co Ltd v Glencore Grain BV (The Paragon) [2009] EWCA Civ 855; [2009] 2 Lloyds Rep 688; [2010] 1 All ER (Comm) 459;
Durham Tees Valley Airport Ltd v bmibaby Ltd [2009] EWHC 852 (Ch); [2009] 2 Lloyds Rep 246; [2009] 2 All ER (Comm) 1083; Classic Maritime Inc v Lion Diversified Holdings
bhd [2009] EWHC 1142 (Comm); [2010] 1 Lloyds Rep 59; [2010] 1 CLC 445; Ryan v Islington LBC [2009] EWCA Civ 578; ENE 1 Kos Ltd v Petroleo Brasileiro SA Petrobras (The
Kos) [2009] EWHC 1843 (Comm); [2010] 1 Lloyds Rep 87; Oceanbulk Shipping & Trading SA v TMT Asia Ltd [2010] UKSC 44; [2010] 3 WLR 1424; [2011] BLR 1; Lansat
Shipping Co Ltd v Glencore Grain BV (The Paragon) [2009] EWCA Civ 855; [2009] 2 Lloyds Rep 688; [2010] 1 All ER (Comm) 459; [2009] 2 CLC 465; Mayhaven Healthcare Ltd v
Bothma (t/a DAB Builders) [2009] EWHC 2634 (TCC); [2010] BLR 154; GB Gas Holdings Ltd v Accenture (UK) Ltd [2009] EWHC 2734 (Comm); Strategic Property Ltd v OSe
[2009] EWHC 3512 (Ch); Safeway Stores Ltd v Twigger [2010] EWHC 11 (Comm); [2010] Bus LR 974; [2010] 2 Lloyds Rep 39; [2010] 3 All ER 577;
[2010] 2 BCLC 106; Jones v Environcom Ltd [2010] EWHC 759 (Comm); [2010] Lloyds Rep IR 676; Oceanbulk Shipping & Trading SA v TMT Asia Ltd [2010] UKSC 44; [2011] 1
AC 662; [2010] 3 WLR 1424; [2011] 1 Lloyds Rep 96; [2010] 4 All ER 1011; [2011] 1 All ER (Comm) 1; [2010] 2 CLC.686; [2011] BLR 1; Borealis AB v Geogas Trading SA
[2010] EWHC 2789 (Comm); [2011] 1 Lloyds Rep 482; Pindell Ltd v AirAsia Bhd [2010] EWHC 2516 (Comm); [2011] 2 All ER (Comm) 396; Jabir v HA Jordan & Co Ltd [2010]
EWHC 3465 (QB); Eaton Square Properties Ltd v Shaw [2011] EWHC 2115 (QB); Hi-Lite Electrical Ltd v Wolseley UK Ltd [2011] EWHC 2153 (TCC); Jones v Environcom Ltd [2011]
EWCA Civ 1152; [2012] Lloyds Rep IR 277; Paros Plc v Worldlink Group Plc [2012] EWHC 392 (Comm); Shah v HSBC Private Bank (UK) Ltd [2012] EWHC 1283 (QB); Rubenstein
v HSBC Bank Plc [2012] EWCA Civ 1184; Petrochemical Industries Co (KSC) v Dow Chemical Co [2012] EWHC 2739 (Comm); ASM Shipping Ltd of India v TTMI Ltd of England
(The Amer Energy) [2009] 1 Lloyds Rep 293; Siemens Building Technologies FE Ltd v Supershield Ltd [2010] EWCA Civ 7; [2010] 1 Lloyds Rep 349 [2010] 2 All ER (Comm)
1185; [2010] 1 CLC 241; [2010] BLR 145; Tom Hoskins Plc v EMW Law (A Firm) [2010] EWHC 479 (Ch); Pindell Ltd v AirAsia Bhd [2010] EWHC 2516 (Comm); [2011] 2 All ER
(Comm) 396; Ispat Industries Ltd v Western Bulk Pte Ltd [2011] EWHC 93 (Comm); John Grimes Partnership Ltd v Gubbins [2013] EWCA Civ 37
Transpetrol Maritime Services Ltd v SJB (Marine Energy) BV (The Rowan) [2012] EWCA Civ 198; [2012] 1 Lloyds Rep 564; [2012] 1 CLC 415 (CA: Longmore, Davis, LJJ & Sir
David Keene); noted S Girvin [2012] IMCLY 187; R Gay (2012) 18 JIML 15; rvsg [2011] EWHC 3374 (Comm); [20 11] 2 Lloyds Rep 331 (QBD: Judge Mackie QC); noted R Gay
[2011] LMCLQ 465.
TTMI SARL v Statoil ASA (The Sibohelle) [2011] EWHC 1150 (Comm); [2011] 2 Lloyds Rep 220; [2011] 2 All ER (Comm) 647 (QBD: Beatson J); noted S Girvin [2012] IMCLY
188.
Abou-Nihm, Vernica Ruiz, The Arrest of Ships in Private International Law (Oxford University Press, 2011), hardback, 95.00; reviewed P Sooksripaisarukit (2012) 18 JIML
172.
Meeson, Nigel & Kimbell, John A, Admiralty Jurisdiction and Practice 4th edn (Informa, London, 2011), hardback, 390; reviewed D R Thomas (2012) 18 JIML 402.
Rainey, Simon, The Law of Tug and Tow and Offshore Contracts, 3rd edn (Informa, London, 2011), hardback, 395; reviewed N Gaskell (2012) 18 JIML 322.
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