Seacape Shipping and Trading, LLC v Metalex 2000 S.A. (The “MV Livadi”) – SMA 4390, 15 Jul 2020


The M/V LIVADI was the subject of this arbitration after Seacape Shipping and Trading (hereinafter “Seacape” or “Claimant”) filed an $850K claim as disponent owner covering amongst other things, freight, and demurrage when Metalex 2000 (hereinafter “Metalex” or “Respondent” or “Charterer”) failed to deliver a cargo of 28,000 metric tons of direct reduced iron briquettes, 10 percent at the owner’s option, which was scheduled to load in August 2018 at one safe berth Palua, Venezuela, and discharge at one safe berth Oran, Algeria. Metalex contended that government interference was to blame, and only demurrage was owed.

On July 31, 2018, Seacape chartered the MV LIVADI for a one-time trip from Palua Port to the Mediterranean Continent with a bulk cargo of DRI/HBI. On the same day, the vessel was assigned to charterer Metalex for a single journey.

The ship arrived at the Orinoco River around 0100 hours on August 12, 2018 and tendered NOR. The pilot joined the vessel at 1204 hours and proceeded to steer it upriver to mile 68, where it anchored at 0001 hours on August 13 with NOR being re-tendered without prejudice. 

… Orinoco Iron had undergone a management transition, resulting in a modification to the cargo price.

The Master told Seacape… the loaded cargo would be unloaded.

After anchoring for 3.5 hours, the vessel journeyed upriver to the loading berth in Palua.  The re-tendered NOR was accepted at 0000 hours on August 14, 2018, and cargo loading operations began. Cargo operations ended at 1400 a.m., with 8,470 metric tons loaded on board. Seacape claimed that on August 15, 2018, they were informed by Mr. Enio Ortiz, of Metalex, that Orinoco Iron had undergone a management transition, resulting in a modification to the cargo price. The Master told Seacape on the 16th the loaded cargo would be unloaded. On the 18th, at 1600 hours, discharge and cleaning operations commenced, with all cargo released by 1400 hours on the 21st. Cleaning was carried out until the 24th. Metalex had not paid the proforma disbursement account (PDA), according to the agent, Semanaca, who reported it to Seacape on August 22nd. Metalex paid $ 57,500.35 of the PDA after communicating with Mid-Ship, leaving Seacape to pay the remaining $ 74,660.74.  Seacape subsequently claimed for all damages stemming from the non-loading of the cargo.

After carefully evaluating the evidence and submissions before it, the Panel concluded that Seacape’s submissions established a strong case that Metalex had a contractual obligation to deliver the agreed-upon cargo to the MV LIVADI, which they failed to do. Metalex’s brief response (Metalex barely participated in the arbitration) offered little in the way of a defense for Metalex’s lack of performance under the charter party’s requirements, the occurrence of a force majeure, or a counter to Seacape’s claims.

Based on the information presented, the Panel concluded the Respondent failed to fulfill its contractual obligation to load the vessel and was liable for the Claimant’s damages. The Panel considered the Claimant’s submissions to calculate the damages and determined Seacape was entitled to the expected voyage’s profits.  

Metalex was directed to pay Seacape $ 798,60.27 in damages, plus interest, attorney fees/ expenses, and all of the arbitrator fees, for a total of $ 952,508.35.  The damages were calculated basis the freight income less the broker’s commission, plus demurrage and agency expenses (paid by Seacape yet the responsibility of Metalex), less the savings realized when the voyage was not performed.