A WRC argued that the tribunal departed from established precedent, concerning the definition of “day” and the interpretation of no adverse currents. Due to multiple errors in the performance report and the application of “and/ or” (a point made by the Charterers in their submissions) in the application of the benchmark conditions, the WRC asserts that these affected seriously the tribunal’s decision deviating from precedent and found against the Charterers.
The inclusion of “and/or” (as interpreting the warranted benchmark conditions) addressed a distinct issue from the interpretation of the term “good weather day.” It did not serve as the sole rationale for the arbitrator’s departure from precedent and the ruling against charterers.
Another WRC expressed the view that LA 32/22 was wrongly decided and the wording “24 hours consecutive good weather” was missing from the performance warranty. In essence, WRC, or rather their external legal advisers, argued: “Why not say it?” i.e. 24 hours of consecutive good weather if that was the intention of the parties.
Legal practitioners and P&I Clubs have also raised the below challenging points:
The award summary "held" section does not explicitly confirm that it accepted the Owners' argument regarding the requirement for 24 consecutive hours of good weather.
Industry Practice dictates the inclusion of precise language, such as "24 consecutive hours of good weather between noon-to-noon positions," to reflect the Owners' intended position. Since this interpretation functions as a limitation or exclusion clause, it requires unequivocal and unambiguous wording. It is well known that other contracts in the market include this wording. This is part of the background knowledge available to the parties or part of the factual matrix (ICS [1998] 1 W.L.R 896)
In the Ocean Virgo, Teare J did not address the interpretation of the term "good weather days" but rather the implication argument (Interpretation and implication are two logically distinct exercises with separate rules- Marks and Spencer per Lord Neuberger at [26], [29], Trump International v Scottish Ministers [ 2016] 1 WLR 85 per Lord Hodge at [35] ). A literal interpretation of the word "day" could result in different durations (e.g., 23, 24, or 25 hours) due to the ship's passage through time zones, potentially leading to an illogical or absurd result. Even if this is considered as a ship's day, it is not 24 hours. The deck logs contain entries for the vessel's sea passage in periods of less than 24 hours ( departure- noon, and noon- arrival position). It is the sea passage that is relevant for the ship's performance evaluation.
The tribunal's examination of the sub-section pertaining to adverse currents is notably cursory, rendering its reasoning difficult to discern. Even in judicial proceedings involving concise arbitral awards, it has been observed that "it is difficult to discern their full import given the brief reports available" (The Globe Danae [2023] EWHC 1683 (Comm) and "The report of the case is extremely brief and it is not possible to discern what arguments were presented or whether there were any other provisions of the charter, or features of the factual matrix, that supported the conclusion reached" ( The "Archimidis" [2007] EWHC 1182 (Comm) and
This decision was rendered by a sole arbitrator, based on limited evidence under the Small Claims Procedure (SCP)). It has not been subsequently followed in other cases, further diminishing its precedential value.
Note: These are brief observations gleaned from handling performance claims, not indicative of the author’s perspective on whether the decision was correct or whether the word “day” means, in this context, 24 hours.
It is common for Owners to include precise wording if they intend periods of 24 consecutive hours of good weather to apply. This growing practice started after The Ocean Virgo case. The need for clear drafting has been highlighted several times even by P&I Club claims handlers and lawyers. So, why not clearly say it and avoid disputes?