Double dipping in time loss calculations

Summary prepared by Prokopios Krikris, FCIArb, Arbitrator

There are many examples of this in practice, showing that quantifying loss can be as challenging as establishing liability. In The Divinegate [2022] EWHC 2095, at paragraphs 120–122, the Court accepted that damages should not allow recovery twice for the same loss—referred to by counsel as “double dipping”.

In this arbitration( well before the Divinegate), there were numerous issues that were not addressed in detail here, but one had to do with the effect of “double dipping” on loss quantification.

Two disputed periods of time loss overlapped.

Dispute 1: the Charterers made a claim for time loss while the Vessel was adrift or proceeded at a reduced speed and deducted close to 17 hours, which occurred within a two-day period failling within the period of sailing from port A to port B.

Dispute 2: During the transit (which included the two-day period above), the Charterers also raised a claim for the Vessel’s underperformance and claimed time loss. The Charterers succeeded in part of their claim, since the Vessel underperformed only on two days, which appear to be the same days as those referred to above that the Vessel stayed adrift ( possible for maintenance or engine related issues), and the claim was restricted to that period only as in the other steaming days the Vessel performed.

It was recognised that recovery under both heads of claim would amount to double recovery, or “double dipping”, for the same loss, contrary to the compensatory principle. As the tribunal had already awarded damages for the two days of underperformance, no additional damages or off hire (due to staying adrift or slow steaming) could be awarded for the same loss.

Note: This is for information purposes only.