Vol. 23, No. 2. Maritime Digest of Arbitration Awards and Court Rulings

Interoceanic Corporation v Helm Dungemittel GMBH and Helm Fertilizer Corp. – SMA 4305, March 3, 2017

FOB SALE - VESSEL ARRIVING LATE - SECOND VESSEL NOMINATED - CONTRACT AMENDED FOR NEW LAYCAN - PRODUCER’S MARKETER CLAIMED DAMAGES FOR ALLEGED EFFORTS TO AVOID PLANT SHUTDOWN - BUYER CLAIMED FOR DEMURRAGE AND DAMAGES DUE TO MISSED OPPORTUNITY A contract was fixed for the sale of ammonium sulfate to be loaded in Pasadena, Texas. After the originally nominated vessel was to miss the laycan, a replacement vessel was nominated. The contract was then re-negotiated with a new window and cargo quantity. Later, the producer’s marketer claimed for damages incurred when several barges were loaded to avoid a plant shutdown. The buyer claimed for demurrage and damages due to a missed opportunity.
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Seatrade Group N.V. v Isabella Shipping Company Limited (The “Santa Catharina”) – SMA 4303, 21 February 2017

TIME CHARTER – VESSEL CRANE FAILURE – UNABLE TO USE 1 HOLD ON THE SHIP – CHARTERER WITHHELD A PROPORTIONATE SHARE OF HIRE – OWNER BELIEVED HIRE DUE IN FULL – CHARTERER GOING OUT OF BUSINESS – PARTIAL AWARD FOR SECURITY Although continuing to trade, due to a crane breakdown onboard a time chartered vessel cargo capacity was reduced for a month and a half for which the charterer withheld a pro rata share of hire. The owner countered that as no time was lost, hire is due in full. After the owner was informed that the charterer was going...
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Ellin E.N.E c/o Nereus Shipping v Castleton Commodities Shipping Co. Pte. Ltd. and Phillips 66 Company (The M/V “Romantic”) – SMA 4299, 11 Jan 2017

BPVOY4 - "ALL INCLUSIVE" FREIGHT COVERING ALL COSTS OF VOYAGE - RIVER BERTH REQUIRING STANDBY TUGS Afforded a range of ports within the fixture recap, Charterer directed the Vessel to a river berth wherein due to high current, standby tugs were required. Owner claimed the cost of the standby tugs from Charterer. Charterer pointed to freight being “ALL INCLUSIVE” and thus covering all costs of the voyage inclusive of standby tugs.
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Navalmar UK Ltd v Kale Maden Hammaddeler Sanayi ve Ticaret AS (The “Arundel Castle”) – QBD (Comm Ct) (Knowles J) [2017] EWHC 116 (Comm) – 31 January 2017

VESSEL ORDERED TO ANCHOR OUTSIDE “PORT LIMITS” BY PORT AUTHORITY - DEFINITION OF “PORT LIMITS” - WHETHER VESSEL CONSIDERED GEOGRAPHICALLY READY TO TENDER NOR WITHIN THE CONTEXT OF C/P - DEMURRAGE A vessel arrived off of the load port and was instructed by the port authority to anchor outside the port limits to await berth availability. The Court was tasked at determining whether the vessel was geographically ready for the purposes of tendering notice of readiness. The Court also looked at the definition of “port limits”.
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London Arbitration 1/17

DEMURRAGE - DETENTION - WHETHER VESSEL IN BREACH OF PUMP WARRANTY - WHETHER OWNER SHOULD BEAR EXTRA SHIFTING EXPENSES INCURRED WHEN THE VESSEL WAS ORDERED OFF THE DOCK DUE TO SLOW DISCHARGE - DELAY AWAITING DOCUMENTS AT DISPORT Due to a slow discharge rate, the vessel was forced off her berth by port authorities. And after hoses disconnected at the disport, the vessel was delayed in departing for over 4 hours whilst awaiting documents onboard. Charterer denied Owner’s subsequent claims for demurrage, additional shifting expenses, and detention leading to this arbitration.
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London Arbitration 7/17

INTERIM PORT CALL FOR CUSTOMS REQUIREMENT BEFORE AND AFTER DISCHARGE - DEVIATION - BUNKER COSTS - DEMURRAGE When the vessel was required to attend a port prior to and after the disport for customs reasons, owner charged the transit times from and to the interim port, the time in the interim port, and extra bunkers consumed. The charterer rejected owner’s claim under the auspices that the interim port calls were “beyond charterer’s control”.
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London Arbitration 3/17

CHARTER PARTY - SPECIFIC DISCHARGE PORT PROVISIONS - DEMURRAGE COP - DISPUTE OVER “ALWAYS ACCESSIBLE” PROVISION - DEMURRAGE AND DETENTION IN QUESTION After the vessel arrived at the disport, a port strike coupled with low berthing priority status caused extensive delays. The owners argued that charterers had not met their responsibility of providing a berth that was “always accessible” and sought to claim reimbursement for this delay as detention, or alternatively, demurrage.
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Star Tankers, Inc. v. Chevron Marine Ltd. (The “SN Federica”) – SMA No. 4289, 23 Sep 2016

ASBATANKVOY - DEMURRAGE - NOR VALIDITY - EXPEDITE INSPECTION - SUBSTANTIAL READINESS – “ROOT CAUSE” PRINCIPLE Nearly 38 days after the tender of NOR, charterer inspected and subsequently directed the vessel to repair its anchor chain prior to berthing. The repair took 3 days. Charterer subsequently claimed that as the vessel was not ready the NOR was invalid with the 38 days for Owner’s account.
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London Arbitration: 27/16, 28/16, & 29/16

DISPONENT OWNER TERMINATING TIME CHARTER FOR CHARTERER’S FAILURE TO PAY HIRE - WITHOUT PREJUDICE PRIVILEGE - WHETHER PARTIES IN DISPUTE - WHETHER OWNER WAIVED CHARTERER’S BREACH - IMPOSSIBILITY OF PERFORMANCE DEFENSE - MEASURE OF DAMAGES With the subject vessel out on time charter disponent owner was not receiving hire from charterer. As funds were not passed from disponent owner to head owner, head owner terminated the head charter and disponent owner in turn cancelled the charter with charterer. The panel was tasked at determining whether prior settlement discussions between the parties should be admissible or protected by privilege. Further, the panel would need to determine whether owner had waived charterer’s breaches and then whether or not to award damages.
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Castleton Commodities Shipping Co. Pte. v Vulica Shipping Ltd. – SMA 4287, 16 Sep 2016

BIMCO OREVOY VOYAGE CHARTER - VESSEL UNABLE TO LIFT MINIMUM QUANTITY - OWNER CLAIMS FORCE MAJEURE - CHARTERER REPUDIATES CHARTER AND CHARTERS SUBSTITUTE VESSEL A vessel arrived at the load port with a portion of her previous cargo frozen to the inside of her hold. After owner failed to secure a substitute vessel charterer terminated the charter and fixed its own sub. Charterer’s claim for damages was denied by owner who presented a counterclaim basis what owner believed to be charterer’s wrongful repudiation of the charter party.
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