Author: Haugen Consulting

Zurich American Insurance Co. and Vinmar International Ltd., Inc. v. Team Tankers AS and Eitzen Chemical (The “Siteam Explorer”) – SMA No. 4216, 26 Aug 2013

ASBATANKVOY -- CARGO CONTAMINATION -- CARRIAGE OF GOODS BY SEA ACT (COGSA) -- Owner Award Charterer alleged that their cargo of Acrylonitrile (ACN) was allegedly contaminated onboard the Vessel resulting in a yellowing to a color rating of APHA 13 (exceeding the maximum resale spec of APHA 10).
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Atlas Shipping AS v. Olendorff GmbH & Co. KG (The “Fomalhaut”) – SMA No. 4211, 8 Jul 2013

NYPE -- CHAIN OF TIME CHARTERS -- CONTAMINATED BUNKERS -- WHETHER CHARTERER PREJUDICED BY FAILURE TO PARTICIPATE IN EARLIER CONSOLIDATED DISPUTE -- Owner Award After bunkering, the Vessel sailed to the next port prior to receiving the bunker test results showing that the bunkers were off-spec (after the bunkers were already partially consumed). At the consolidated proceedings, the Owner was deemed liable for the resultant machinery damage but was awarded costs for debunkering, tank cleaning, rebunkering, and associated costs. At issue in this dispute is whether the last Charterer in the chain, who freely chose not to participate in the consolidated proceedings, is liable to indemnify the Time Chartered Owner.
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London Arbitration 12/13

TIME CHARTER -- REPUDIATION OF CONTRACT BY CHARTERER -- MEASURE OF DAMAGES WHEN NO SIMILAR MARKET EXISTS -- Owner Award After non-payment of hire for 10 consecutive months, Owner withdrew the Vessel and sought restitution from the Guarantor of Charterer’s liabilities for the unpaid hire up to the point the time charter contract was deemed repudiated, damages for the unexpired period remaining, and restitution for bunker costs.
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Kingsway Shipping Co. Ltd. v. STX Gulf Shipping DMCCO – QBD (Comm. Ct.), 28 May 2013

TIME CHARTER -- GROUNDING DUE EXCESS DRAFT RESULTING FROM SUB-CHARTERER’S LOAD INSTRUCTIONS -- Charterer Award Under a chain of time charters, the Vessel grounded and damaged her hull as a result of following the sub-Charterer’s load instructions to a draft of 13.3m. The Head Owner’s claim for indemnity failed because the sub-Charterer’s indemnity guarantee was given to the Master as the representative of the intermediate Charterer (not as a representative of the Head Owner) and the indemnity was not provided on a back-to-back basis throughout the chain.
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Great Elephant Corp. v. Trafigura Beheer BV (The “Crudesky”) – English Court of Appeal, 25 Jul 2013

BPVOY 3 -- VESSEL DETAINED -- RESTRAINT OF PRINCES -- DEMURRAGE LIABILITY -- FORCE MAJEURE -- FOB Buyer Award In overturning the lower Court ruling, the Court of Appeal held that parties may not be able to rely on Force Majeure clauses where the event is within their reasonable control or that of the parties whom they had delegated their responsibilities.
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Beijing Jianlong Heavy Industry Group v. Golden Ocean Group Ltd. and Others – QBD (Comm. Ct.), 1 May 2013

TIME CHARTER -- ENFORCEABILITY OF ENGLISH ARBITRATION IN CONTRACT CONTAINING AN ILLEGAL GUARANTEE -- NON-COMPLIANCE WITH CHINESE "SAFE" (STATE ADMINISTRATION FOR FOREIGN EXCHANGE) REGISTRATION -- Owner Award The background to this case involved five claims pursued by various ship owners against Beijing Jianlong Heavy Industry Group (hereinafter "Charterer") against the Charterer’s guarantor to resolve essentially the same issue i.e. Charterer’s repudiation of its obligations under several time charter contracts. Due to the similarities, the dispute was consolidated at London arbitration.
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Frescati Shipping Co., Ltd. v. Citgo Asphalt Refining Co. (The “Athos I”) – US Court of Appeal (Third Circuit), 16 May 2013

ASBATANKVOY -- SAFE PORT WARRANTY -- "APPROACH" DEFINED -- Owner Award Owner appealed the U.S. District Court ruling for exoneration from or limitation of liability resulting from the Vessel striking a partially submerged anchor in its approach to the Charterer’s discharge terminal. Per Owner, Charterer breached the safe berth warranty. Per Charterer, the incident occurred outside its area of control and the Owner is responsible for port draft restrictions by virtue of the port being named in the charter party.
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