Category: Featured

TIME CHARTER – DEATH OF MASTER – COVID-19 – QUARANTINE REQUIREMENTS – PANAMA CANAL – OFF-HIRE – CANAL TRANSIT AUTHORITIES – DELAY DUE TO COVID TESTING – HEALTH AUTHORITY HOLD – DETENTION – AMENDED NYPE FORM

Shortly before its arrival at the Panama Canal in May 2021, complications arose on a time charter due to the unfortunate death of the vessel’s master. The vessel was placed on hold until PCR test results were available, delaying transit through the Panama Canal and prompting claims by Charterers of off-hire and detention.

DEMURRAGE – ENGINE BREAKDOWN – SIX MONTH DELAY – CHANGES TO PORT REGULATIONS – CHANGE TO DISCHARGING PORT – DELAY TO DISCHARGE – SEAWORTHINESS OF VESSEL – ENGINE REPAIRS DELAYED DUE TO COVID-19 PANDEMIC CONDITIONS

A vessel was chartered to carry part cargo of steel pipes from Turkey to Futuna Island in the French Pacific Ocean Islands. An engine breakdown off Mauritius required lengthy repairs and was complicated by shortages due to the COVID-19 pandemic. Nearly a year later, the vessel arrived at the intended discharge port but was turned away due to new port entry requirements. The vessel was quickly rerouted to Fiji and incurred demurrage of US$37,317.71 while awaiting discharging operations to begin. Charterers refused to pay, claiming the delay was the owners’ fault, and arbitration proceedings commenced.

SHIPPER AS CHARTERER – CARGO DISCHARGE WITHOUT BILL OF LADING – NOVATION OF CHARTERPARTY – CAUSATION – CARRIAGE OF GOODS BY SEA ACT OF 1992 – BILL OF LADING AS CONTRACT OF CARRIAGE – MISDELIVERY – BANK AS CLAIMANT
The case was brought to the Court of Appeal to review a lower court’s decision on whether a bill of lading formed a contract of carriage after a novation of charterparty. BP chartered the vessel SIENNA from Euronav to transport low-sulphur fuel oil for sale to Gulf. UniCredit Bank AG provided financing to Gulf, secured by a bill of lading, and a novation was completed shifting the charterers from BP to Gulf. Euronav delivered the cargo without requiring the bill of lading and the Bank brought a claim against Euronav for breach of contract. The Court of Appeal reviewed whether the bill of lading constituted a contract and examined the impact of the Carriage of Goods by Sea Act 1992.

UNSAFE PORT – MOROCCO – UNPREDICTABLE WEATHER CONDITIONS -GROUNDING OF VESSEL – ALLEGED NEGLIGENCE OF MASTER
Editor’s Note: This 1958 case set the industry standard for determining a safe berth and is referenced in two new recaps: London Arbitration 2/23 and SMA No. 4457 “PRESINGE.”
Leeds Shipping and Societe Francaise were parties to a voyage charterparty with the vessel discharging in “…One or two safe ports in Morocco…” This appeal challenged a previous decision in favor of Leeds Shipping, which claimed Charterers ordered the vessel to an unsafe port, Mogador, where she ran aground and sustained damage. Societe Francaise denied that Mogador was an unsafe port and asserted by accepting the voyage, Owners had consented to the vessel going to Mogador. Charterers also claimed the negligence of· the Master caused the vessel’s grounding.

JURISDICTION of ARBITRATION – SECTION 67 OF ARBITRATION ACT 1996 – LIFTING of SUBJECTS – FIXTURE – ARBITRATION AGREEMENT – ARBITRATION CLAUSE – FORMATION OF CONTRACT – APPEAL

DHL Project & Chartering and Gemini Ocean Shipping negotiated a proposed voyage charter for the carriage of 130,000 metric tons of coal from Newcastle, Australia, to Zhoushan, China. When the vessel, the NEWCASTLE EXPRESS, did not obtain RightShip approval, DHL informed Gemini that they were releasing the vessel. DHL did not confirm to Gemini that either the shipper or receiver had approved the vessel. Owners asserted that the charterparty had been concluded, and thus the arbitration clause was binding. Furthermore, by releasing the vessel this way, the Charterer was in breach of the charterparty. The arbitration was in favor of the Owners and later overturned in court. Charterers appealed, and the claim was then heard by the Court of Appeals.