COMETALS PRO FORMA CP -- SAFE BERTH WARRANTY -- VESSEL SUITABILITY -- BERTH RESTRICTIONS – IMPROPER CANCELLATION -- Owner Award At issue is whether the Charterer improperly canceled the charter party. The fixture stipulated the discharge as "one safe berth" and when the Receiver at the intended berth rejected the Vessel as being unsuitable (taking into consideration the size of the terminal’s grabs relative to the size of the Vessel’s hatch openings), the Charterer canceled the fixture claiming that the Owner failed in providing a suitable vessel thereby frustrating the commercial purpose of the charter.
GENCON -- WHARFAGE AND WATCHMEN FEES FOR EXTENDED DISCHARGE TIME -- DEMURRAGE AS JUST COMPENSATION -- DELAYS BEYOND CHARTERER’S CONTROL -- Partial Charterer, Partial Owner Award This award follows up an earlier decision under London Arbitration 23/07 for the same voyage, and addresses two new points: 1) who is responsible for dues paid by Owner resulting from the delayed discharge; and, 2) whether time is interrupted for discharging delays that are beyond Charterer’s control e.g. awaiting shoreside equipment and personnel.
CONTRACT OF SALE -- IMPLIED TERM REGARDING QUALITY AFTER DELIVERY -- CONDITION OF CARGO -- Buyer Award This ruling hinged on whether there is an implied term warranting condition of cargo after delivery; and, if so, whether the Seller was relieved of such obligation under an express exclusion clause (which, in this instance, did not reference "conditions") or, alternatively a certificate final clause (which, in this instance, did not exclude implied terms).
NYPE -- LATE REDELIVERY -- ILLEGITIMATE LAST VOYAGE -- MEASURE OF DAMAGES -- PENALTY CLAUSE -- Charterer Award In an appeal over the late redelivery of a time-chartered vessel, the Court was called on to determine if a clause stipulating that in the event of late redelivery the daily hire rate for the 30 days prior to the commencement of the overrun period is to be calculated at the higher prevailing market rate, is a penalty clause and unenforceable in English law.
SHELLTIME 3 -- TIME CHARTER -- UNPAID HIRE -- WITHDRAWAL OF VESSEL FOR UNPAID HIRE -- DETENTION OF VESSEL -- CONSUMPTION OF BUNKERS -- SECURITY -- Partial Owner Award The Court was called to determine if, following the Charterer's failure to pay hire, Owner's withdrawal of the Vessel during load operations was legal. If so, was the Owner entitled to damages or solely compensation for expenses (bunkers and time consumed discharging the cargo) incurred fulfilling their duties as bailee, plus the cost of securing the bank guarantee as required by the Charterer.
The maxim “once on demurrage, always on demurrage”, although seemingly an innocent phrase, is not a fairy tale and is in fact, serious business. In order to understand this maxim one must first clearly define demurrage. In a strict sense, demurrage represents liquidated damages for delays associated with loading and discharging beyond the laytime contractually allowed. Applicable case law, both as court cases and in arbitration, holds that demurrage is extended freight and that the risk of circumstances which prevent the loading or discharge of cargo within the stipulated laytime lies unconditionally with the charterers. As explained in M/T “Raphael”, SMA No. 3739 (6/10/02), “this rule of ‘absolute liability’ for payment of demurrage is subject to three exceptions: