Spring Marine DMCC v General Oil Co., Inc. (The M/T “MAMBO”) – SMA No. 4511 – 8 September 2025
Spring Marine DMCC (“Spring Marine”) brought arbitration against General Oil Co., Inc. (“General Oil”) under a voyage charter party dated August 12, 2024, for the vessel M/T MAMBO. The charter provided for the carriage of diesel fuel from Beaumont, Texas to Haiti. On August 18, 2024, the MAMBO twice tendered its Notice of Readiness at Beaumont anchorage. On August 20, 2024, however, General Oil abruptly cancelled the charter via email to its broker, citing its Haitian counterpart’s failure to provide expected funding. Spring Marine immediately repositioned the vessel to Corpus Christi and secured substitute employment, but claimed damages for 4.5 days of waiting time and bunkers consumed during the deviation, which it invoiced to General Oil. No payment was made.
Spring Marine demanded arbitration in September 2024. General Oil was included in all panel correspondence but refused to participate, raising belated objections to jurisdiction and contract formation. Judge Schofield of the Southern District of New York had already found that General Oil was properly served, subject to personal jurisdiction, and bound to arbitrate, and the panel followed that ruling.
Spring Marine’s claim was supported by the charter recap, Notices of Readiness, correspondence, demurrage rate terms, and evidence of bunkers consumed. General Oil’s limited submission contested jurisdiction, contract validity, and argued that Haitian counterparties’ failure to perform excused its cancellation. It also raised force majeure and impossibility, though the charter contained no such clause. The panel rejected these defenses, noting that American law recognizes an owner’s right to recover damages when a charterer fails to provide cargo. In particular, the panel cited Voyage Charters, which states: “When a charterer fails to supply a cargo, the owner will be entitled to recover any accrued demurrage or, alternatively, detention as well as consequential damages and/or such damages as may be allowed an owner when the charterer fails to perform,” and further, “under American law, the owner may consider the charter terminated if the charterer demonstrates by its statements or conduct that it will not or cannot perform.”
The panel found that Spring Marine satisfied all elements of a breach of contract claim: the existence of a valid charter, the owner’s proper performance, a clear breach by General Oil, and damages flowing directly from that breach. Moreover, Spring Marine acted prudently in mitigating its losses by promptly fixing substitute employment for the MAMBO. The tribunal awarded damages for four and a half lost days at the agreed demurrage rate of $38,000 per day, totaling $170,778, plus reimbursement of $29,085.63 in bunker costs incurred at the anchorage. Together with accrued interest, attorney’s fees, and arbitrators’ expenses, the final award came to $251,077.84.