Arbitration- Tug expenses at Mississippi River

One of the disputes in this arbitration arose from a charter under a Vegoilvoy Form for a voyage from the Mississippi River to Yugoslavia.

Tug expenses at the loading berth

At the loading berth, two tugs were ordered to hold the vessel in berth against the high water and the prevailing current at the time. Owners submitted that, because the terminal required such tug assistance whenever the water was over 12 feet at the Carrollton gage —which, in fact, it was —Charterers were liable for such expenses because they had failed to provide a safe berth at which the vessel could load.

Owners incurred tug expenses of $10,325.00.

Contract Clause C provides: “Loading Port. One (1) safe port/one (1) safe berth - Mississippi River.”

Contract special provision H-1 provides: “Charterers have the option of loading Two (2) safe ports, One (1) or Two (2) safe berths each port ….”

Charterers asserted that such tug expenses were for Owners' account since they were incurred not because of the character of the berth itself, but because of the conditions existing in the Mississippi River at the time of the loading, which were normal and to be expected and were or should have been known to Owners at the time of entering

into the Contract.

The Panel believed that the tug assistance was essential to the safety of the berth for this vessel during her period of loading. While it was true that both parties were bound to know of certain conditions existing in the river at that time nevertheless, both Clause C and Special Provision H-1 placed upon Charterers the burden of selecting

a safe berth at which the vessel can safely load.

Absent the tug assistance, the panel did not believe the Charterers fulfilled their warranty.

Owners were entitled to this tug expense, together with appropriate interest thereon.

Editor’s comment: While this is a past award, similar cases have been addressed in both SMA and LMAA arbitrations, addressing expenses for tug assistance under voyage and time charter terms. The allocation of costs for tug assistance has also been discussed in English High Court cases, which led to the development of specific clauses found in modern voyage charterparties.