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Case citation: Imperial Marine Company v Pasquale della Gatta; Imperial Marine Company v Filippo Lembo (638/10) [2011] ZASCA 131 (15 September 2011)- Supreme Court of South Africa Deviation- off-spec bunkers- engine damage- expert evidence- performance claims- prima facie case This brief post does not aim to address the various claims advanced in detail but focuses exclusively on the performance claims and the observations made in relation to expert evidence (which can be helpful). Nevertheless, the other claims remain of general interest and warrant consideration by readers. The issues related to the arrest of two vessels as security for claims pending arbitration in London, following disputes under a long-term time charter party on NYPE form. A dispute arose in 2005 when the vessel suffered damage to its main engine and underwent repairs at Pylos, Greece.  For the first two years under charter, there appear to have been no significant problems. The present disputes originate with the provision by Charterers of a bunker stem at Yeo Su, Korea on 4 March. The vessel then sailed for Dampier in Australia and started burning these bunkers. Whilst the vessel was en route to Port Hedland the chief engineer received a report that the bunkers delivered in the first bunker stem at Yeo Su were not in accordance with specification. This is accepted as correct, at least insofar as the Kineamatic viscosity of the bunkers is concerned. The engineer’s response was to stop burning those bunkers and to switch to others. The unwillingness to use the initial Yeo Su bunker stem meant that when the vessel left Port Hedland it had insufficient bunkers to reach its destination at Redcar in the United Kingdom and it accordingly diverted to Colombo in Sri Lanka to take on additional bunkers. Its onward route was via Suez where there was a brief stoppage because of engine problems. Shortly thereafter it became apparent that the main engine had suffered major damage and required repairs. The evidence showed that the vessel continued to operate under the charterparty after the repairs had been undertaken at Pylos. No complaint was made of any malfunctioning of the engine or under-performance arising from its operating with repaired cylinder blocks. Charterer claims that the reason for the breakdown in the main engine was a failure on the part of Owners to fulfil its obligations to provide a vessel with its machinery and equipment in a thoroughly efficient state and its further obligation to maintain it in such state. It accordingly contends that the detour to Colombo was an improper diversion and that the vessel was off-hire during that period as well as the periods of the breakdown at Suez and repairs at Pylos. Owners disputed these claims. It laid the blame for the damage to the main engine on the first Yeo Su bunker stem, which led to the vessel burning bunkers with excessive viscosity. It accordingly counterclaimed for the unpaid hire and the cost of the repairs to the main engine at Pylos. Over and above this it claimed an unspecified amount for the diminution in the value of the vessel arising from the manner in which the repairs to the engine’s cylinder blocks were undertaken. Observations on expert opinion ( see Paras 24-26) Where the applicant asks the court to draw factual inferences from the evidence they must be inferences that can reasonably be drawn from it, even if they need not be the only possible inferences from that evidence. If they are tenuous or far-fetched the onus is not discharged. Second the drawing of inferences from the facts must be based on proven facts and not matters of speculation. As Lord Wright said in his speech in Caswell v Powell Duffryn Associated Collieries Ltd: ‘Inference must be carefully distinguished from conjecture or speculation. There can be no inference unless there are objective facts from which to infer the other facts which it is sought to establish … But if there are no positive proved facts from which the inference can be made, the method of inference fails and what is left is mere speculation or conjecture.’7 (citation [1939] 3 All ER 722 (HL) at 733E-F, cited in Motor Vehicle Assurance Fund v Dubuzane 1984 (1) SA 700 (A) at 706B-D. See also Great River Shipping Inc v Sunnyface Marine Limited 1994 (1) SA 65 (C) at 75I-76C and particularly the statement that ‘evidence does not include contention, submission or conjecture.’) In a trial action, it is fundamental that the opinion of an expert must be based on facts that are established by the evidence, and the court assesses the opinions of experts on the basis of ‘whether and to what extent their views are founded on logical reasoning’.8 ( citation- Michael & another v Linksfield Park Clinic (Pty) Limited & another 2001 (3) SA 1188 (SCA) para 36 and generally paras 34 – 40) If not then the expert’s opinion is worthless because it is purely hypothetical, based on facts that cannot be demonstrated even on a prima facie basis. It can be disregarded. If the relevant facts are established on a prima facie basis then the court must consider whether the expert’s view is one that can reasonably be held on the basis of those facts. In other words, it examines the reasoning of the expert and determines whether it is logical in the light of those facts and any others that are undisputed or cannot be disputed. If it concludes that the opinion is one that can reasonably be held on the basis of the facts and the chain of reasoning of the expert the threshold will be satisfied. This is so even though that is not the only opinion that can reasonably be expressed on the basis of those facts. However, if the opinion is far-fetched and based on unproven hypotheses then the onus is not discharged. Performance claims (see para 77)- without guarantee- “standard system”? There were a number of performance claims based on allegations that the vessel was at various times and on various voyages not able to steam in accordance with the speed and consumption figures given in clause 62 of the charterparty. The first problem with these claims is that these figures were given subject to certain weather and sea conditions and without guarantee. They are advanced in the draft amended points of claim on the basis of an allegation that ‘the vessel failed to achieve the performance warranted under clause 62 of the charterparty’. However there was no guarantee. Most of the claims were not included in the charterer’s provisional final hire statement. They were based on what was said to be a standard system of measurement of the performance of vessels but no basis was laid for its application to this charterparty and these voyages. In addition the vessel appears to have been under sub-charter during the voyages in question and there is no evidence that the sub-charterers advanced such claims, nor any response to the statement by Imperial Marine’s attorney that the sub-charters contained the same performance figures on a back to back basis. In my view no prima facie case was established in respect of these claims and counter-security should not have been ordered in respect of them. Editors’ comment: regarding the reference to a “standard system of measurement of the performance of vessels,” it remains unclear which system the charterers relied upon, as no supporting evidence was submitted. The featured picture is indicative and unrelated to the ship in the case #underperformance #bunkers #experts #enginedamage #offspecbunkers

The dispute arose under an ASBATANKVOY charter party, wherein the Charterers alleged that the Owners had engaged in the conversion of cargo, specifically by utilising a portion of it as bunkers. This necessitated a detailed analysis of the vessel's fuel consumption during the voyage, as well as an evaluation of the energy efficiency of the engine(s). The engine logs were thoroughly examined, as is customary in cases involving the analysis of bunker consumption. As found, given the inaccuracies contained in the logs, which open all log entries to considerable doubt, the ship's cargo figures were unreliable and that the shore figures must control. It became clear at an early point in the arbitration that the logs were inaccurate and that crude oil had entered the engine space and bunker tanks, Owner did not present anyone from the vessel to offer any explanation. In these circumstances, the inaccuracies in the logs could not be overemphasised. As the court said in The Silver Palm, 94 F.2d 754 (9th Cir. 1938) at p. 762: “Once you find there has been tampering with a log, as I have had occasion to say before in other cases, the court at once looks with suspicion at the whole matter.” Fuel consumption The analysis of the fuel consumption on the voyage was the point under discussion here. That was relevant since considering the bunker consumption at sea with the bunker reserves could identify if the cargo was converted to bunkers. The engine consumption, distance of the voyage, and RPM were considered on each voyage, so the average consumption per day was calculated. Both parties relied on expert evidence to calculate the vessel’s energy requirements. The primary issue was the total amount of IFO the vessel actually consumed during the voyage. It seemed clear that at approximately 87 or 88 rpm, it required about 7 metric tons per day for auxiliary equipment. The owner took the position that an additional 42 tons would be required to run the main engine at that rpm. The charterer contended that the consumption of the main engine had to be much higher. In both voyages, independent bunker surveys were used to calculate actual consumption. According to the Owners’ expert, his calculation was based on the vessel's performance curves published by the engine manufacturer. Based on that, the power developed at 85 RPM was 12800 BHP and specific consumption 154 G/BHP/HR, giving 47.308 MT/ DAY but an allowance must be made for heavy oil use and normal fouling. A reasonable estimate would be 2.5 + 2.5 percent giving an expected consumption of about 49.0 long tons/ day (Forty-nine long tons was equal to about 50 metric tons). The panel found the above as the most persuasive evidence. Based on this analysis, it dealt only with the main engine and did not encompass any additional fuel required for the auxiliary machinery. It was also clear that this estimate of main engine consumption was very conservative and was based on 85 rpm which was slightly less than the actual rpm of the vessel during the voyage. It only gave a 2 1/2% allowance for the use of heavy fuel. The performance curves were developed using a fuel with calorific value of 10.25 Kcal/kg which was higher than that of the fuel actually consumed during the voyage. Owner's and Charterer's experts used a calorific value of 9.6 or 9.8 Kcal/kg. It was clear, therefore, that the 2 1/2% allowance would not cover the difference in fuels. Moreover, a 2 1/2% allowance for a normal fouling must be considered conservative. Most importantly, no allowance was made in the calculation for the vessel's age. The vessel was almost 10 years old and a 10% increase in fuel consumption based on age alone, could be considered reasonable. The panel considered the Owners’ evidence and found that the main engine had to consume at least 50 metric tons per day. Another 7 metric tons would be required for the auxiliary machinery. When this total consumption of 57 tons per day (well over 60 tons if an allowance was made for age) was compared with the average consumption of 44 listed in the logs, or even the 47 tons per day based on inventory, it was clear that a large discrepancy existed. Over a voyage of 25 days the discrepancy between the average daily consumption listed in the logs and what the vessel must have consumed was well over 300 tons. Given this discrepancy there can be no doubt that the vessel must have burned cargo to supplement its bunker consumption. SMA, published in 1986 (M/T TRISUN) Editor’s Comment:  there appears to be no published London Arbitration awards dealing with performance curves. Therefore, seeing how other arbitrators approached this matter in different jurisdictions was interesting. In practice, the points raised in challenging performance curves were largely consistent, with the exception of considerations related to calorific value ( this point was not raised), but even if, it requires expert evidence( a similar observation that can be found on the publications article " vague terms remain in speed and consumption clauses" ( f199d9_34c597db0f884a1d925467ec69312357.pdf ) The foregoing highlights several challenges inherent in analyses based on past records or sea trials. Even by applying the cubic law, using the reported bunkers/ speed on each voyage on a diagram, it could be easily observable that there was something wrong with the masters' reported bunkers. Discrepancies and inaccuracies in the engine logs have raised concerns about their reliability, thereby casting doubt on the validity of the entire dataset. Notably,  The Silver Palm  has been cited in other SMA awards. Similar cases also demonstrate that engine logs may, in certain instances, be deemed unreliable (this will be discussed in another post). When available and subject to no dispute, official bunker surveys remain the primary reference point for determining actual consumption ( a usual clause stating the results will be "binding" cannot be ignored; it would also cause double dipping by amending the redelivery bunkers for hire purposes and not the arrival bunkers for performance analysis). On another note, deductive reasoning is frequently employed to establish the accuracy of these surveys, particularly in cases of discrepancies between ships and surveyors' figures. This often involves working backwards to assess daily consumption as a means of validating the survey results ( this was also applied in two unreported arbitrations). A similar approach was adopted here, having the consumption at sea as a common ground based on the surveys, working on whether the vessel’s reported “daily” consumption was in line with the engines’ specifications. It was not. Thus the vessel consumed a portion of the cargo for bunker purposes. #enginelogs #underperformance

This dispute originated under a Time Charter Party based on the NYPE form and was brought before a Panel that rendered its decision in 2010. Notably, similar disputes have been presented before London arbitration tribunals and the High Court in England concerning deviations and delays in transiting the Gulf of Aden (GOA) due to piracy-related incidents. Such incidents remain a subject of significant debate, as the prevailing conditions in the Red Sea and GOA continue to be volatile. Charterers fixed the Vessel for a voyage from Dumai to Dublin. Thereafter, the Owners advised the Charterers by email that in view of "lots of piracy incidents" off Somalia and in the Gulf of Aden, in order to protect the Vessel, her crew and Charterers' cargo, it would be prudent to route the Vessel via the Cape of Good Hope and not via the Suez Canal. The Owners advised further that if the Charterers ordered the Vessel via Suez, the Owners would engage a security service to place three unarmed security experts on board the Vessel at Salalah (Mina Rasut), Oman and disembark these experts at Djibouti, and that as a result of complying with Charterers' orders to proceed via the Gulf of Aden, the resultant risks, additional costs and time lost "would rest with Charterers only." The Charterers asserted that the deviation was unwarranted and, consequently, deducted the sum of $ 25,346.58 in respect of the time lost and additional bunkers consumed, as well as refused to pay the cost of the security experts. Owners argued that the sole purpose of the deviation was to take on security guards to protect life (i.e., the crew) and property (i.e., the vessel and her cargo) and that the cost of the security experts flowed directly from Owners' compliance with Charterers' voyage orders. Charterers have argued that Clause 74 of the Charter Party describes "the type of deviation agreed to between the parties with respect to the Somali pirate problem." The Panel found that - given the circumstances prevailing in the Gulf of Aden at that time- the Owners' decision to deviate to embark those security experts was not unwarranted and was, in fact, quite reasonable. In that regard, reasonable deviation was provided for by Section 4(4) of the Carriage of Goods by Sea Act of the United States as well as by similar sections of the Hague Rules and the Hague-Visby Rules, which were all incorporated into the Charter Party under Clause 31(a), the Clause Paramount. Indeed, the many advisories issued by governmental and other international maritime agencies recommend the engagement of security personnel as an element among the counter-measures to be taken by vessels to deter attack by pirates. Moreover, even Charterers acknowledged that "we do not fault the Owner for taking further precautions, beyond the Charter Party precautions, if it felt those precautions were suddenly warranted. Nevertheless, the Charterer cannot unilaterally be expected to bear the costs of the Owner's further precautions." Therefore, the deviation and the employment of the security team must be seen to have been reasonable exercises of due diligence and good seamanship in order to protect the Vessel, its crew and its cargo under the circumstances existing in the Gulf of Aden at that time, and which continue today. The Panel opined that the Charterers should not unilaterally bear the entirety of the costs associated with this claim, as the deviation served the interests of both parties. Regarding the deduction of hire, the Panel awarded the Owners the full amount deducted, along with interest. SMA, 2010   Editors’ comment: The Gulf of Aden has long been classified as a "High-Risk Area" by the marine insurance industry due to its persistent history of piracy, including hijackings and ransom demands. Following a series of attacks by Houthi forces during November and December 2023, the region's security concerns have further disrupted commercial shipping operations, affecting the rights and obligations of parties under various contractual frameworks. Disputes arising from transits through the Gulf of Aden have frequently required adjudication by English courts and arbitration tribunals, addressing pivotal issues such as: (1) Costs under the BIMCO Piracy Clause, (2) Allocation and determination of additional expenses incurred during high-risk transits, (3) Evaluations of shipmasters' decisions to deviate from charterers' instructions, particularly avoiding the Suez Canal due to piracy-related threats, (4) Off-Hire Claims: Disputes arising from vessel seizures by Somali pirates, specifically regarding hire payment obligations and (5) Interpretation of Key Clauses: Legal scrutiny of the BIMCO Piracy Clause and CONWARTIME Clause. In some disputes, the reasonableness of a master’s decision was a central consideration. Such decisions must balance the duty to safeguard the vessel, its crew, and its cargo against the specific risks presented by the prevailing conditions. Reasonableness is inherently a question of fact, evaluated in light of the circumstances at the time of the decision. Nonetheless, the assessment of risk often diverges between stakeholders ashore and the crew on board, who confront the realities of the situation directly. Picture: powered by Netpas #Deviation #Piracy #Master

The disputes originated under an ExxonMobil VOY2005 Charter Party for a single voyage. The vessel arrived at the designated loading port and remained at anchorage for approximately 18 days due to port congestion. The primary issue in this dispute centered on whether the full demurrage rate or only half the rate should apply during the weather-related delays in berthing the vessel. The vessel arrived at the port on December 19 and berthed in early January. ·         From December 23- December 25, this was deducted in full ·         From December 25- December 26, this was deducted in full ·        From December 27- December 31, it was a period 6 days, 18 hours and 25 minutes that was deducted by 50%. Owners sought recovery of the rest 50%, i.e. 3.384 days demurrage. The Owners contended that the conditions constituted merely "poor weather," which did not meet the threshold for the application of the "half-rate" demurrage standard. The Owners placed minimal emphasis on the terminal's decision to suspend berthing operations due to weather in accordance with its local regulations and instead relied primarily on their own evidence. The Owners submitted various pieces of evidence, including the Master's statement, the vessel's deck logs, the vessel's weather fact sheets, the Master's protests, and photographs taken from the vessel's bridge while it was awaiting berth. The Owners also argued that there were movements by other vessels and ongoing cargo operations during the disputed periods. Charterer contended that the legal authorities relied on by Owner were clearly distinguishable since they interpreted the weather-related half demurrage clauses in the Exxonvoy '69 (Clause 8) and Asbatankvoy (Clause 8). By contrast, Clause 14(b) of the ExxonMobil Voy2005 was similar to the Conoco Weather Clause that provided, in effect, that any weather-related delay in berthing a vessel entitles a charterer to the half-rate. "Severe weather" or "storm" was clearly not the exclusive trigger for the half-rate to apply. The Panel unanimously concluded that Charterer was entitled to half-rate demurrage for the following reasons. Clause 14(b) of the ExxonMobil Voy2005 neither requires that severe weather must be experienced nor that "any weather" is sufficient to trigger the half-rate. Clause 14(b) provides: Weather and/or sea conditions shall include, but not be limited to lightning, restricted visibility (the term "restricted visibility" shall mean any condition in which visibility is restricted by fog, mist, falling snow, ice, heavy rainstorms, sandstorms any other similar causes), storm, wind, waves and/or swells." The Panel interpreted the language of Clause 14(b) to require that the weather must rise to a level that is sufficiently significant to interfere with, impede, disrupt, delay and/or otherwise prevent vessel operations at the specific port, terminal or facility involved. In applying this standard to this specific case, the Panel carefully considered and weighed the actual weather conditions encountered during the times in dispute, the physical characteristics of the terminal and the vessel, and the terminal local rules that clearly alerted arriving vessels to the weather-related restrictions in effect at that time. Furthermore, there was also a dispute over a delay after completion of loading as two tugs were unavailable to unberth the vessel due to tug breakdowns and weather-related reasons. The Panel found that the unavailability of unberthing tugs created a de facto port closure due to "weather and/or sea conditions" and "a breakdown of machinery or equipment in or about the facilities of Charterer, Supplier, Shipper *** of the cargo" as contemplated in Clause 14(b), and awarded Owner half-rate demurrage. Moreover, there was a dispute over when time ends with cargo documents on board or when the documents are signed. Charterer required the cargo documents, particularly the bills of lading, to be reviewed by the Master and signed. Charterer ended its calculation at the point in time when unsigned cargo documents were brought on board but Owners counted time on demurrage up to signing of cargo documents was completed on board. The language of Clause 11 of the Asbatankvoy and Clause 13(c) of the Exxonmobil Voy form charters was strikingly similar and with similar effect. Notwithstanding that loading was completed and the loading arms disconnected, the disputed time used for signing cargo documents, was "solely for Charterer's purpose" and the Panel unanimously awarded Owner its claim. SMA, issued in 2010   Editor's comment: In the event that the dispute concerned the application of the CWC, the evidence provided by the terminal would likely meet the requirement to establish that adverse weather prevailed during the period of delay. The resolution of such cases remains highly fact-sensitive. #laytime #tankers

Summary The dispute arose under a tanker charter party on an amended ASBATANKVOY form, over demurrage charges amounting to $331,567.70 due to excess laytime at four different ports. The Owner initiated arbitration proceedings after the Charterer failed to respond to payment requests. The Panel unanimously found in favor of the Owner based on evidence provided, including statements of facts and notices of readiness showing compliance with charter party requirements. In addition to the demurrage claim, interest from February 6th 2023 until March 4th 2024 amounting to $29,661.69 was awarded along with attorney’s fees and costs totaling $9,163. The total sum ordered for payment by Respondent was $385,262.39 which includes Demurrage ($331,567.70), Interest ($29,661.69), Attorney’s Fees ($9,163), Sub-Total Amount ($370,392.39) and Arbitrators’ Fees as per Appendix B"($14,870). The Voyage The voyage involved loading a full cargo of CBFS, or 67,856.142 MT. Part of the cargo, or 12,678.588 MT, was loaded from the Centre Point Terminal in Port Allen, with the balance cargo of 55,177.554 MT loaded from the IMTT Terminal at St. Rose. The discharge was accomplished by first lightering a total of 12,678.588 MT into two 'Daughter vessels’ (hereafter "transshipment vessels") via STS operations at Dharma, with the balance cargo of 55,177.554 MT discharging at the HDC Terminal in Haldia. The charter party allowed for a total of 192 hours for laytime, with a demurrage rate of $50,000 per day/pro-rata. The charter party expressly provided that the Vessel comply with multiple, specific vessel operational and port restrictive requirements, including tank presentation, maximum draft and clearance restrictions, and extensive requirements on the STS operation. The Panel noted no protests issued by the Charterer or delays specific to the Owner’s failure to comply as contracted. The Vessel waited 5 days to berth at Port Allen and encountered no delays in berthing at St. Rose. As earlier mentioned, the discharge was accomplished by first lightering a total of 12,678.588 MT into two transshipment vessels at Dharma. The first transshipment vessel was available shortly after the M/T Cabo Fuji arrived. However, the M/T Cabo Fuji waited for 3.4 days for the second transshipment vessel to arrive. Although the charter party called for one STS operation, the Panel noted no protest from the Owner for the Vessel performing two STS operations. The remaining 55,177.554 MT of cargo was discharged at Haldia, where the Vessel encountered a minor berthing delay. Decision The Panel found that Owner properly applied the appropriate laytime exceptions and correctly calculated the demurrage as required by the governing charter party. Demurrage was incurred on this voyage primarily due to time lost while the Vessel was waiting to load at Port Allen; and time lost waiting for the second lightering vessel for the STS operation at Dharma. The charter party allowed laytime of 192 hours for loading and discharging, but the Vessel waited slightly over 120 hours [5 days] to berth at Port Allan and about 97 hours [about 4 days] for the second transshipment daughter vessel to arrive at Dharma. The Panel unanimously finds that Owner is due net demurrage of $331,567.70, as set forth in Appendix "A", which is made an integral part of this Award.   The award was published in March 2024 and can be found on Jus Mundi | AI-Powered Search for International Law & Arbitration #tankers #laytime

Disputes emerged under an amended NYPE form charterparty, involving the vessel's voyage from China to Luanda carrying various cargoes. While at Luanda, the vessel suffered stevedore damage and was subjected to heavy swell, leading to repeated allisions with the berth. These incidents caused significant damage, necessitating repairs before the vessel could resume trading. Stevedore damage to hold no 2 and to the Pilot Ladder The undisputed evidence, supported by numerous photographs and expert-witness reports, clearly established that the berth at Luanda was anything but a safe berth for the vessel. The face of the berth consisted of bare rock and large concrete blocks, lacking any kind of fendering systems, with mooring bits missing and/or insufficiently spaced, and exposed to swell, causing the vessel alongside to range and heave, thus subjecting it to frequent contact with the berth. The vessel's classification society determined in its Preliminary Report that some of the damages affecting seaworthiness must be carried out prior to departure. It later decided that the damage to the frames in hold No. 2 and the pilot ladder, needed to be repaired before it would allow the vessel to load any further cargo. Other damage could be repaired at the next drydock. Charterers argued that the repairs were not urgent and could have been done in Luanda or by the ship's crew for a minimal fee. The vessel did proceed to Santos where the repairs were satisfactorily completed. The repair invoices are well supported and unchallenged, as are the various surveyors' charges both at Luanda and Santos as well as the port[1]charges for the vessel's stay at Santos. The Charterers’ main point was that Owners failed to mitigate its damages by diverting the vessel to Santos. Charterers relied on an expert report arguing that the repairs could have been substantially cheaper and more efficiently done in Argentina, to which the vessel, in any case, originally had been intended to proceed next and where indeed, she did load her next cargo. The Panel found the Owners’ decision to repair the vessel at Santos a prudent and reasonable attempt to mitigate its damages. It held that where an innocent party was left to mitigate damages, "The injured claimant need not prove that its mitigation was the best and most effective, only that it was reasonable. At that point, the burden shifts to the defendant to prove that the effort to mitigate was palpably unreasonable."( SMA, 3935 followed) Claim for unsafe berth The written and photographic evidence submitted in this arbitration, including the concessions on cross-examination by Charterers’ expert witness that the bollards were improper and insufficient and fenderings were inadequate and unsafe, make it abundantly clear that the berth to which the vessel was assigned, was unsafe for this vessel under the prevailing circumstances. In its subsequent arguments, some three years later in connection with this arbitration, Charterers suggested that the vessel had an insufficient number of lines available and/or that the available lines were worn and/or in unsatisfactory condition. After carefully evaluating the evidence submitted and the arguments made by the parties, the Panel found that the weather and berth conditions, as contemporaneously stated by the Master, very persuasively speak to the events at Luanda at the time of the vessel's stay there and that indeed the vessel and her crew exerted every effort to keep the vessel safe. There was nothing in the record to suggest that the mooring lines used were either insufficient or of unqualified quality or condition. Eleven new mooring lines were eventually purchased and delivered to the vessel. In the Panel’s opinion, Owner was entitled to reimbursement for the broken lines and with taking into account an allowance of "new for old," it allowed the cost of the replacement lines and the expenses of putting them on board. SMA, issued in 2013 Editor’s comment:  Additionally, there were other matters in this arbitration concerning the vessel's performance and the charter duration on a "Without Guarantee" (WOG) basis, which have not been included in the discussion above. The Panel denied the Owners’ claim for excess voyage time for breach of the “ABT 60-70 DWOG” as there was no willful misrepresentation or deliberate deceit and, therefore, no action of bad faith. The Owners also brought a claim for underperformance that arose on the subsequent voyage, as a result of the previous prolonged stay at Luanda. The Panel denied the claim as the Owners should have either arranged for a bottom cleaning or should have prudently taken this situation into consideration when it described the vessel's speed and consumption in its agreement with the next charterers. Interestingly, the circumstances bore a strong resemblance to a dispute involving the Nouakchott port, which was ultimately settled during arbitration under the LMAA Terms. Regrettably, this case did not progress to the stage of an award. The featured picture is unrelated to this arbitration. #unsafeport #swell #underperformance #stevedores

The vessel arrived at Manzanillo on 1 October, and the charter was terminated on 5 November. Subsequently, the Owners arranged another voyage in mitigation of losses. Disputes arose following the termination of the charterparty, with the Owners bringing multiple claims against the Charterers. These claims included detention, freight differential (arising from mitigation), bottom cleaning costs, and compensation for lost time and over-consumption of fuel during the next voyage. The Charterers, however, denied liability for these claims. This post particularly concerns two issues: the costs associated with bottom fouling and the performance-related dispute. Bottom Cleaning As a result of the prolonged stay at Manzanillo, Owners contend that the vessel's bottom became fouled with marine growth which not only adversely affected her speed and fuel consumption, but would require the bottom to be cleaned at some future date. Rather than paid invoices, Owners merely presented an unsupported estimate of $ 15,000 for such cleaning. The panel held that absent persuasive evidence that Owners were required and did pay to have the ship's bottom cleaned and that such cleaning was made necessary by the vessel's prolonged stay in Manzanillo, the panel was obliged to deny this claim. Time Loss and Over-Consumption   Owners claimed for time lost and over-consumption because of the bottom fouling. Here again, Owners had not presented persuasive evidence to support their time lost and excess consumption calculations. Both calculations were merely predicated on a comparison of the ship's actual performance against the speed and consumption warranties contained in the head time charter party.  The panel had seen no evidence of the ship's performance prior to arriving Manzanillo nor what wind and sea conditions were experienced during the mitigation voyage. Absent such proof, the Owners' calculations did not rise to the level of proof required to justify an award. More importantly, if Owners thought the bottom had become fouled, the proper remedy was to have the ship cleaned prior to departing Manzanillo on the mitigation voyage. That did not take place and the panel, therefore, required to also deny this claim. SMA, issued in 2009 Editor's Comment: This scenario commonly arises in practice. A ship departs, and a potential performance claim arises concerning the subsequent voyage. The question arises whether the Owners should clean the ship before departure to mitigate potential losses. Additionally, in situations where the Owners raise a claim for prospective bottom cleaning costs, can they withhold amounts (e.g., set off from overpaid hire) or claim sums that have not yet been expended for cleaning the vessel? The resulting loss must be specifically particularised, and the costs must also be reasonable. Furthermore, some contracts stipulate "hull cleaning" at the Charterers' cost without explicitly referencing "time" or "time, risk, and expense" (see The  Globe Danae  – "always at Charterers' time and expense"). In such instances, the dispute often revolves around whether only the cost of cleaning should be claimed, excluding any associated time. In some arbitration cases, both under time and voyage charter parties and under different contexts, the tribunals treated "cost" as distinct from "time." The featured picture is indicative and not related to the above case. #fouling, #underperformance

Glad to share that my recent article was published in Maritime Risk International and can be found as well in i-law. This article briefly discusses the terms even keel, deep water, calorific fuel value, and the seawater temperature found in vessel’s performance warranties. These terms started life in shipbuilding contracts and complicate the process of establishing breach and loss under a time charter party. Finally, for clarity, the article provides observations from some of the disputes that I handled for Owners, Charterers or weather routing companies (Claims Consultant). However, not all issues are addressed in this short article. In a few published and unpublished awards, the tribunals considered and decided issues related to these terms. Also, in practice, much of the parties’ discussion centered on the burden of proof (including proof of causation-competing causes), presumptions-rebuttal by hard evidence, and implication-given the bare wording. My previous guidebook, ‘Speed and Consumption Claims: A practical perspective and statistics'(see here: https://www.charterpartydisputes.com/post/speed-and-consumption-claims-a-practical-perspective-and-statistics-prokopios-krikris ) made a brief reference to such terms and their frequent usage in charter parties’ performance clauses (see Part III – statistics) that result in disputes. The original post can be found here: Vague terms remain in speed and consumption clauses – Maritime Risk International (maritime-risk-intl.com) .

The Charterers claimed the Vessel underperformed and withheld US$ 95,294.66 from hire based on an analysis and calculations performed by [x] WRC. The dispute was referred to arbitration under the LMAA Terms 2012. A sole arbitrator awarded and directed the charterers to pay the full amount together with interest and costs of this first final Award. Clause 78- Weather routing clause. “…..IN CASE OF CALCULATED UNDERPERFORMANCE OF THE VESSEL AND OWNERS CONTEST SUCH CALCULATIONS, OWNERS ARE TO PROVIDE THEIR REASONS FOR NOT ACCEPTING WRC REPORTAND COPIES OF LOG BOOKS AS EVIDENCE FOR A REVISED PERFORMANCE ANALYSIS BY AN INDEPENDENT WRC which is mutually agreed and cost to be shared 50/50. SUCH REVISED VOYAGE ANALYSIS BY THE INDEPENDANT WRC TO BE FINAL AND BINDING FOR BOTH PARTIES..” Clause 97- Vessel’s description “Speed/cons: abt 14 knots ballast /abt 13.5 knots laden on 36mt IFO (380 cst) at sea for main engineand auxiliaries. No MDO at sea ..Above speed/consumption basis no swell and no adverse current and good weather which is only up to Beaufort scale 4…” The issues In this reference the central issues to be considered were: (i) the meaning and effect of the performance warranty and whether or not the Charterers applied the warranty as it was intended, and (ii) whether the Vessel in fact underperformed or was the performance of the Vessel affected by the weather and sea conditions encountered during each of the voyages. The Owners case The owners disputed the charterers’ calculations and deductions from hire and proposed an independent WRC based on clause 78. Then, the parties could not agree upon an independent WRC, and the owners submitted that since this dispute resolution procedure failed, the matter was to be determined by the arbitration agreement. Owners defended the claim on these grounds: charterers have failed to bring themselves within clause 15 and establish loss due to a defect or breakdown; thus, the claim fails at the outset. Even if charterers bring themselves within clause 15, they cannot show loss of time or bunkers overconsumed when the voyage data are analysed as per the English law principles. Regarding the performance methodology, owners asserted that a day with an adverse current could not qualify as a good weather day to assess the vessel’s performance. Likewise, swell data were missing from the report as compared to the forecasts and any day during which there is swell also cannot qualify as a good weather day. Further, the WRC has not considered the “about” when calculating MDO consumption, and “about” means 5% per London Arbitration 1/07. Therefore, the charterers’ deduction was unlawful. The Charterers case Ballast voyage On 123 hours of good weather, the WRC calculated an average good weather speed of 12.60 knots under a favourable current of 0.20 knots. Thus, the good weather speed was only 12.40 knots. As a result, the vessel lost 64.50 hours and consumed an extra 54.62 mt IFO but saved 3.53 MDO. Laden Voyage The WRC relied on 371.50 hours of good weather and calculated the vessel’s average good weather speed was 12.30 knots, while a favourable current of 0.20 knots assisted her. Thus, the good weather speed was only 12.10 knots. As a result, the vessel lost 64.50 hours and consumed extra 47.92 mt IFO but saved 5.752 MDO. In their submissions, charterers argued that the X report is binding upon all parties. They disputed the owners’ understanding of the off-hire clause 15 and submitted that they were deprived of the full use of the vessel and were entitled to put her off–hire. Alternatively, they were entitled to set off against hire a claim for damages due to owners’ breach of the charter party and relied on The Nanfri [1978] 2 Lloyd’s Rep 132; The Chrysovalandou Dyo [1981] 1 Lloyd’s Rep 159 and to The Kostas Melas [1981] 1 Lloyd’s Rep 18. The charterers submitted that the WRC applied a compliant methodology with the charter party terms and English law. The WRC’s method was to assess good weather on a six-hourly analysis, and a “day” is the period between consecutive daily noon positions. Subject to the direction and number of time zones through which a vessel passes, the weather and seas are assessed every six hours and categorised as either “Good” or “Bad” and, if more than half of the day is classified as “Good”, the whole day is considered to be a fair-weather day. The charterers further submitted that the Masters’ noon report did not reflect the weather for the entire day with the same accuracy and detail as the WRC did. Owners’ reply The owners asserted that the charterers’ reliance on the Nanfri was misplaced. The proper way was to read the authorities in conjunction with the test applied in the Kostas Melas, which requires that the right of set-off be measured against the test of good faith. The charterers could only make such deductions in good faith and the reasonable belief that there had been a breach of the Charterparty on the part of the Owners. However, the charterers failed to make any positive case to bring themselves within the off-hire clause 15 or prove an independent breach and were not entitled to claim set-off. Another issue concerned the charterers’ denial of any discrepancies between the weather data in the vessel’s logs and the data calculated by the WRC in their voyage audit reports. The discussion The owners are familiar with the vessel’s performance when giving the warranty and act in good faith. It should be viewed with skepticism if a third-party attempts to reinterpret such a warranty. However, equally, a vessel’s failure to perform should be examined and determined if such failure results from: (i) misrepresentation on the part of the Owners; and/or (ii) a defect in or breakdown of any part of her hull, machinery or equipment as is contemplated by clause 15 of the Charterparty in this reference, and/or (iii) an intentional slowing of the main engine, for whatever reason, and/or (iv) the effect of wind and/or currents and/or waves and/or swell. Off hire Held, that it is well known that if a charterer wishes to make deductions from hire on the basis of the off-hire clause, he must show that the loss of time was a consequence of a defect or breakdown.Charterers did not identify any breakdown or defect which caused any evidenced loss of time or consumption of extra fuel and failed to substantiate an entitlement to claim set-off pursuant to clause 15. Reduce speed – passing strait The owners referred to the remarks included in the Log Abstracts and in the master’s reports to WRC concerning speed reductions and changes in her course to alleviate the effects of heavy weather. The WRC made no allowance in their analysis on the ballast voyage but excluded 6th September from their laden voyage assessment since the master reported he had reduced speed due to poor visibility and heavy coastal vessel traffic. There were times when the Vessel’s speed was intentionally reduced for heavy weather and whilst in congested waters. The performance warranty The performance warranty is clear in its wording and meaning. The Owners intended that the performance warranty be applied, providing the Vessel encountered no swell, no adverse current, and good weather, which is only up to Beaufort Scale 4. The Charterers did not dispute it. Applying these criteria, the owners submitted that the vessel saved time and bunkers. No adverse currents The owners submitted that when the charter party states “no adverse currents”, the charterers could not claim a benefit for favourable currents (London Arbitration 15/07). Held, that as the warranty excludes adverse currents and makes no mention of favourable currents, no account can be taken of favourable currents. As for the “about” allowance, the purpose of the about is to protect the owners if the fuel consumption is slightly above that expected and not penalise the charterers if the Vessel consumes less than expected. No swell Owners highlighted that the WRC has not taken into account the qualifying criterion of “no swell” and referred to the website of the WRC that mentioned “…for days to be selected as “good weather days”, they must meet all parameters defined in the charter party …..” The WRC has applied Significant Wave Height as “the de-factor standard” of the profession and includes swell. Held, that the WRC took no account of the good weather criterion of clause 97 in respect of swell. By their own admission, the Significant Wave Height multiplies the Average Wave Height by a factor of 1.6 and is equivalent to Douglas Sea Scale 3, which includes a Swell Code. Thus, the charterers have not substantiated their claim that the Vessel did not comply with performance warranty during the ballast voyage. Moreover, the Log Abstracts evidence that the Vessel could perform at “about 14 knots” in ballast condition as recorded between 9th and 12th July, and at other times during the voyage. Logs or weather reports The owners submitted that the conditions reported contemporaneously by the Master were, by and large, in accordance with the WRC’ forecast that the Vessel would encounter. The charterers asserted that even if the master’s reports were by and large in accordance with the WRC forecasts it did not mean that the Master had accurately reported the weather encountered. Weather forecasting continues to improve with technology and is more often accurate than it is inaccurate. By and large, modern weather forecasting assisted by the latest technology is reliable across the large and predictable expanses of the world’s oceans. Held, that as the master’s reports are, by and large, in accordance with the forecasts, it is not reasonable to simply dismiss the master’s reports as inaccurate or false. In addition, there is no presumption in the charterparty in favour of the weather data produced by WRC over the evidence of the Master as is contained in his reports and in the Log Abstracts. Significantly, the forecasts predicted the swell would be encountered and WRC took no account of it in the performance assessment. Accordingly, charterers’ claim failed. Comment For the readers’ reference, this award was issued in 2013. Notably, this is another published award that the tribunal departed from London Arbitration 4/12 and followed the London arbitration 15/07, which was heavily argued that applied the correct approach on the issue of positive currents for many years. Now, the Divinegate judicially settles this issue ( https://www.charterpartydisputes.com/the-divinegate-2022-performance-claims ). However, there are still different views on the meaning and application of the words “no swell” in the performance warranty. Based on more recent published awards (and one unpublished), the trend is to avoid a restrictive application in exchange for interpreting this wording with business efficacy in mind. Therefore, London tribunals will likely take a pragmatic view and consider these words to mean “no adverse swell” to make the contract work. In practice, weather routing companies and experts (technical offices) adopt different methodologies, sometimes incorporating a significant wave height of 1.25 meters or 2.0 meters when the charter states, “no adverse swell”; again, this method is not entirely free of criticism since the report’s methodology did not separate wind and sea waves, thus providing a confusing representation of the sea state in the reports ( See also London Arbitration 23/21 & 29/22 ). Further, the parties also attempt to distinguish “no adverse swell” from “no negative influence of swell” or treat these words as a surplusage or give a different meaning, saying the words are ambiguous, i.e., it is susceptible to more than one meaning and reasonably intelligent persons would differ as to which meaning is the proper one. Therefore, the words “no swell” do not offer a complete defense to the owners (as felt when drafting the clause). Based on experience, charterers have points to argue in order to settle. Note: This website removes the names of the parties involved in this or other awards. The reader can find more details on Jus Mundi https://jusmundi.com/en/conflict-checker . These awards mostly come into the public domain through enforcement under the NYC 1958 .

Disputes arose under an amended NYPE 1993 form and came before two LMAA arbitrators for determination. The Owners claimed a balance of US$238,077.18 due to them, and the Charterers claimed a balance in Charterers’ favor of US$245.99. In their Defence submissions, the Charterers attached a hire invoice for US$39,008.29 due to Owners and paid that amount. This decision supports some of the observations made in another post here: Speed & Consumption- in good faith- deductions from hire Deductions The Charterers’ deductions from hire related to alleged underperformance and overconsumption of bunkers together with an alleged stevedore overtime claim in the sum of US$34,852.83. Underperformance claim The Charterers’ hire statement served with their Defence Submissions included deductions from hire as a result of alleged underperformance evidenced by a [X] Performance Report Damietta to Becancour for a period of 6.06208333 days (6.0621 days). The IFO overconsumption figure for Damietta to Escoumains was 25.52mt, and the MGO consumption figure for the same period was 0.77mt. The Owners’ RFI served on 16 September 2021 asked, inter alia, for the Charterers to state precisely the basis on which the Charterers assessed the loss of 6.0620833 days, whether any account had been taken of agreed off-hire or deliberate slow steaming in determining periods of “ good weather ” as defined in the Charterparty and whether it was the Charterers’ case that AIS alone was capable of assessing and quantifying the alleged underperformance of the vessel. In particular, the Owners asked whether four specific periods of time between 9 and 28 October had been assessed as “ good weather “. The Owners also asked whether any deduction in relation to the calculation of 6.0620833 days differed from the same amount included in “ Off-hire ” in the Charterers’ hire statements and/or the “ Off-hire Schedule AIS ” and, if so, to explain in what respect and on what basis such sums for hire for 6.0620833 days remained separately deductible or for the Owners’ account. The Owners requested similar clarification in relation to the calculation of consumption of IFO and MGO and whether account had been taken of any agreed off-hire or deliberate slow steaming in determining the periods of “good weather”. Despite an extension of time for the Charterers to respond, followed by the tribunal’s order for a response failing which a final and peremptory order would follow, the Charterers did not reply. The Disponent Owners sent the following message to the Owners, Charterers and the Tribunal: “Dear Sirs The purpose of the RFIs was to require Charterers (and Sub-Charterers by service down the chain) to properly evidence and quantify the indemnity claim (and defence of sub-charterers) that Vessel underperformed and overconsumed during the period of the sub-charterparty. The RFIs also required proof of loss of the stevedore overtime expenses claimed at Becancour. Alleged Underperformance/overconsumption The Sub-Charterers relied upon weather routing reports prepared by [X], but as Owners pointed out in their submissions, the reports used periods when the Vessel was off-hire to count as “good weather”. As these cannot be used as evidence to support any contention that the Vessel underperformed or overconsumed, the Charterers and Sub-Charterers were requested to provide further information on the basis of which they were entitled to claim the damages sought. Any claim for damages must relate to the warranted capabilities of the Vessel and so can only be assessed according to the contractual yardstick agreed by the parties. If the Sub-Charterers are not prepared to, or cannot, provide proper evidence of any loss suffered as a result of any alleged underperformance or overconsumption then the appropriate sanction is that the defence of Sub-Charterers in relation to underperformance/overconsumption (and by extension the indemnity claim against Owners by Charterers) must be struck out. Stevedore Overtime Expenses Sub-Charterers were requested to provide information regarding timings of the Vessel at Becancour in relation to other vessels and discharge at Becancour in order to evidence the losses allegedly sustained. They were also requested to provide further information on the alleged breach by Charterers/Owners that would entitle to claim any damages at all. If Sub-Charterers (and by extension Charterers) are unable to provide information to support or evidence any alleged loss, then again the appropriate sanction would be that that part of the defence by Sub-Charterers (and by extension the indemnity claim against Owners by Charterers) be struck out. …….. Kind regards “ Held, Liability In the absence of any response from the Charterers and in their breach of the tribunal’s final and peremptory order resulting in the striking out of those parts of the Charterers’ claims identified in the Disponent Owners’ email, the Owners’ claim for unpaid hire in the sum of US$150,354.23 succeeds in full. Costs Since the Owners have succeeded with the most part of the claim, the tribunal found no reason to depart from the normal rule that costs should follow the event. The hourly rates ranging from £185 to £285 were reasonable and lower than those charged by many solicitors’ firms in the maritime field. Award accordingly. Issued 4th of May 2022. Note: This website removes the names of the parties involved in this or other awards. The reader can find more details on Jus Mundi https://jusmundi.com/en/ . These awards mostly come into the public domain through enforcement under the NYC 1958 .

The below analysis is based on the published London Maritime Arbitration awards cited in the guidebook: Prokopios Krikris, A Snapshot Guide to Laytime & Demurrage,2021. Part A: BULK CARRIERS Figure 1: The BIMCO GENCON form leads Figure 2: Sophisticated bargains causing concern Figure 3: Owners’ fault as a usual defence to demurrage claim. Figure 4: The key issues relating to NOR. Part B: TANKERS PartB: TANKER Figure 5: The ASBATANKVOY form leads. Figure 6: Issues of interpretation and when time starts are leading. Part C: COMPARISON BETWEEN BULKERS AND TANKERS Figure 7: The awards and issues involved per category – bulkers lead. Part D: BRIEF REMARKS The sample used is not large. However, from personal experience, the results appear to be realistic. Disputes related to: draft survey, shifting time, excluded periods when the CP is silent on this, excluded periods from laytime or time on demurrage when the CP refers to ‘Owners’ cost or time’, rejection of holds (always invalidates the NOR?), legal readiness (formalities), weather delays and when laytime (or demurrage) ends are usually found in practice. It should be no surprise that there are so many published summaries of awards on these issues. In some cases, inconsistent or vague terms were at the heart of the problem. So, precise drafting (both text and context) will assist the parties in reducing disputes. The published summaries on sale contracts are limited in number. Some published summaries do not mention the charter form. That will have an impact on the results shown in figure1. Most of the summaries contain the authorities, including the previous awards; the tribunal was referred to, e.g. case law and excerpts from leading law textboo ks. Case law and prior awards have been considered in some cases, and either distinguished on the facts or followed. The wording of the clause was open to question: terms agreed upon either during the formation of the contract or after the contract was made, e.g. special agreements, addendum, etc. The disputes usually fall under these categories: charter party, when time starts, and when time ends. The principles of contractual interpretation & construction were applied: ejusdem generis, contra proferentem, specific terms to prevail over general terms, reading the contract as a whole, and whether to imply terms or duties- implied terms rejected when served as to re-write the contract for the parties. Extrinsic evidence to qualify the terms of the contract has usually been denied. The above raise issues of interpretation or construction, several which are complex and costly to resolve. However, the disputes related to SOF usually create low-value claims, especially if the weather delays happened during the excepted periods. The majority of ‘SOF cases’ concerning weather delays. In most cases, the tribunal decided the issue in favour of the Owners. But it depends on the facts of each case, with cases falling on either side of the line. Some cases were decided based on where the burden of proof lies (distinguishing between exception and interruption) and whether the burden was properly discharged. As found, the parties submitted conflicting evidence: logs, weather reports, SOF from various parties, etc. The threat of weather or anticipation of bad weather is not itself bad weather (case law considered). Some extreme weather events were considered: typhoons, hurricane, tropical storm warnings, floods etc., as a weather exceptions or interruption. Holiday: the parties submitted conflicting (or lacked) evidence to prove their case. In some cases, the tribunal found favor of the Owners on the evidence provided and the time counted. This also happened with delays due to strikes or declared force majeure events. Periods of “holiday, strike, and Force majeure” were not permanently excluded from laytime. Some issues raised mixed points of fact and law. The Charterers’ usual defence to the Owners’ demurrage (or detention) claim was that the delay was caused due to the Owners’ or the vessels’ fault. In some cases, the concurrent events that contributed to the delay were considered, including the consequential delays. In many cases, the tribunal decided in favour of the Owners on the evidence and the facts presented. Whether Owners are entitled to a detention claim for delays before loading, after loading, before, or after discharging were considered in a number of cases under different factual matrix. The exercise of a lien for unpaid freight was commonly discussed. Also, who is liable for any delay in signing the cargo documents upon the completion of loading because the parties disagreed on whether the master is allowed to put some remarks in the BL, e.g. damaged or contaminated cargo, etc. The tribunal considered the contractual scheme and the reasonableness of the parties conduct, and decided either in favour of the Owners or the Charterers. The commencement of laytime (NOR validity) is a frequent dispute between the parties. The allegations of waiver and estoppel were most frequently raised and considered in several cases. Depending on the facts of the case and whether the relevant ingredients of waiver or estoppel were established, the tribunal decided either in favour of the Owners or the Charterers. Whether ‘free pratique’ is a mere formality or a precondition to tender the NOR was considered many times. In some cases, it was found not to be a mere formality, e.g. in times of SARS and flu epidemics; thus being a precondition to tender the NOR. In some other cases, the time taken to inspect by the authorities was considered in deciding the matter. Slow pumping claims are decided on the factual matrix of each case. Expert opinion is adduced in some cases. The holds rejection does not always invalidate the NOR (physical readiness). This is another point that causes debate between Owners and Charterers regularly. One of the parties in the string of contracts might say that the declaration of the vessel’s readiness was not given in ‘good faith’ given the poor condition of the holds. In some cases, the tribunal considered the usual practice to re-tender NOR ‘without prejudice to the previous NOR’ during various stages before commencing operation. For bulkers, the published summaries of awards are almost double in number compared to tankers. Also, the issues included in the reference  are about four times more than that of the tankers. This means that, on average, one point decided in one award for tankers and four issues determined in one award for bulkers. This could have potentially rendered onerous the parties’ submissions in the reference in the case of bulkers. As a side note, I should emphasize that the published summaries of the recent awards are more detailed than those of the previous years. The editors of the LMLN are endeavoring to provide the relevant facts needed to understand the issues of law involved and to discern the tribunal’s reasoning. Indeed, this is very useful. #Mustread

The owners’ justified decisions for safety reasons would not amount to ‘fault’ for time to be suspended for demurrage purposes. “Free pratique” requirements will be examined before invalidating a notice of readiness (NOR) . The issues The MT Stena Primorsk was chartered under an amended Shellvoy 6 for a single voyage. The owners claimed demurrage for USD 143,153.64, and the charterers defended the claim on these grounds: (1) the NOR was invalid because the free pratique had not been granted, (2) two incidents allegedly suspended time; the owners’ decision to leave the terminal on 31 March and owners’ refusal to return to berth on 1 April upon the charterers’ request. For these, owners contended that it was due to safety reasons, i.e., to avoid a breach of the vessel’s UKC policy, causing safety concerns, (3) charterers counterclaimed lightering costs and (4) the applicable demurrage rate; full rate or half rate to apply. Both parties relied on expert evidence. The decision In giving judgment for the claimant and dismissing the counterclaim, his honour concluded that: (1) Charterer needs to establish some “fault” on the part of the owner or those the owner is responsible for time to be suspended for demurrage purposes ( The Fontevivo [1975] 1 Lloyd’s Rep. 339 ). Where an owner acts in a way authorised by the charter, it can be no fault. The masters’ decision to leave the berth was an appropriate one which did not put the owner in breach of the charter [67]. The owner was entitled to reject the charterers’ request to re-berth on 1 April since the UKC policy was a clear and important term of the charter [68]. There was no fault on the part of the owners, the Master or NMM [70]. However, a capricious refusal might amount to “fault” as to prevent time running for demurrage purposes. Although he made no finding on this, the charterer would almost certainly have been in breach of clause 4 on 1 April if it had ordered the vessel to berth [71]. Based on the data available, the masters’ decision was justified [79]. (2) There are 2 ways to analyse the issue of free pratique: first, there is the formal question of whether it was customary to grant free pratique and second, there is the question of the mechanism of grant. On the evidence, the port authorities acted as if free pratique was granted [73]. There was no issue with the relevant notice of readiness [74]. (3) According to the relevant clause 25, the charterers would meet the costs of lightering. Clause 7 was general and had no application here [77]. (4) The half rate applies in certain limited circumstances, and these do not apply here [78]. ======================= More than 30 LMAA published awards related to “fault” were briefly stated in the pages 34-36 of this free guidebook: https://www.charterpartydisputes.com/a-snapshot-guide-to-laytime-demurrage-a-tribute-to-maritime-arbitrators-prokopios-krikris Source: https://www.bailii.org/