Arbitration- Vessel off hire due to poor condition of cranes

Summary prepared by Prokopios Krikris, FCIArb, Arbitrator

The disputes which were the subject of this arbitration arose under a NYPE Form of Charter Party.

The discharge was to be carried out by the Vessel's own gear into barges while the Vessel waited in the stream for berth availability. The Port of Kandla had a procedure whereby vessels were allotted a discharging berth, which they can occupy for only seventy-two hours. If the Vessel did not complete discharge within that time, it must vacate the berth at the end of the third day.

Charterers alleged that the vessel performed poorly her discharge operations because the Vessel's cranes and gear were in a state of disrepair.

It was Charterers' position that Owners were in breach of Clause 15, Clause 22 and Clause 32 which entitled them to place the Vessel off-hire for a period of ten (10) days corresponding to a claim of $90,000.

Charterers endeavoured to demonstrate to the Panel the poor state of the vessel's cargo gear and the deleterious effect of the gear upon the duration of the discharge of the Vessel. It was Charterers' position, that, not only were the vessel's cranes deficient and in a state of disrepair, but in addition the validity of the Cargo Gear Certificates expired during vessel's discharging operations, which constituted a breach of Clause 32, which required the Vessel to be at all times in possession of valid and up-to-date certificates.

It was undisputed that the Charterers and their Stevedores, despite their belated criticism about the poor condition of the Vessel's cranes, continued to work both the cranes and the winches of the Vessel, did not interrupt discharge, did not report the alleged deficiencies to the authorities, did not conduct an independent survey, neither invited Owners to a joint survey to assess the cause, nature and extent of the malfunctions or crane breakdowns.

Owners denied the Charterers' allegations noting that; (a) the Notice of Readiness at the port of discharge was accepted without notation or exception, (b) vessel had previously loaded the instant cargo of pig iron in Brazil without incident, (c) anyhow, according to Clause 8, Charterers were duty bound to load, stow, time, tally and discharge the cargo at their expense, (d) ship's Crane No. 2 became inoperable due to the negligent operation of Charterers' Stevedores. It was the Owners' position that the Master, contemporaneously with the crane stoppages, placed Charterers and the Stevedores on notice about the crane breakdowns, which he attributed to the Stevedores' negligence, inexperience and to the fact that they were lifting weights in excess of the capacity of the cranes.

Finally, Owners argued that Charterers never employed more than two (2) of the vessel's three (3) available cranes while discharging in the stream. In fact, fifty-seven (57) of the shifts in the stream worked only one (1) crane and only four (4) shifts worked two (2) cranes. Upon berthing, Vessel discharged the balance of the cargo within the allotted seventy-two (72) hours without the assistance of shore equipment.

Owners never engaged an independent surveyor to; (a) certify the true condition of vessel's cargo gear, (b) determine the cause of the breakdowns, and; (c) substantiate Owners' allegations that the negligent rough handling and inexperience of Charterers' Stevedores was the proximate cause of the gear breakdown.

Decision

The Panel upon weighing all of the evidence rules, that given the occurrence of an event, such as a crane breakdown, it was incumbent upon the party who prima facie was charged with the care and proper working condition of said equipment, to explain in a credible fashion, why same became inoperable and thus shift the blame to whomever was responsible for the damage. Such evidence has to be unimpeachable, and obtained contemporaneously by way of a joint survey or, at the minimum, by an independent surveyor.

Charterers' reference to the expiration of the validity of the Cargo Gear Certificate, although of major concern, did not, in and by itself, trigger the operation of the off-hire clause, unless one can show the causative effect of said expiration to the loss of time occurred thereby. This was not done. Given the nature and the duration of the alleged delays and/or crane breakdowns, the Panel was surprised that neither Owners or Charterers attempted to preserve their own evidence by unbiased, unimpeachable, and certainly available to both of them, means.

The testimony and evidence received by both parties fall short in meeting the standards mentioned above. Owners' reference to the fact that the Vessel had loaded cargo uneventfully in Brazil and/or that the Notice of Readiness was accepted without protest or reservation and/or that Clause 8 shifted the duty to discharge the cargo onto the Charterers, are all issues totally unrelated to the issue of the performance of the cranes while the Vessel was in Kandla.

The Panel, after careful consideration and deliberation, concluded that Charterers' off-hire claim of $90,000 was inflated; however, the condition of the cranes did in fact delay discharge of the cargo and therefore awarded Charterers the sum of $38,250.00.

SMA 3004

Editor’s note: The Owners failed to establish that the crane breakdowns were caused by stevedore negligence, and evidence showed the cranes were in poor condition. Accordingly, the Charterers were held entitled to off-hire. Previous awards illustrate that stevedore damage claims failed for want of proof (arbitrators fall back on the burden of proof), though in some cases tribunals have made affirmative findings on the evidence.