2024 Maritime Digest of Arbitration Awards and Court Rulings

English Maritime Cases

London Arbitration 11/23

TIME CHARTER – LATE REDELIVERY – IMO 2020 FUEL REGULATIONS – LIABILITY FOR DE-BUNKERING OF HSFO – DETERMINING VALUE OF HSFO – DISTRESSED SALE OF HSFO – HULL CLEANING – APPORTIONMENT OF COSTS – NYPE
A dispute arose between disponent owners and charterers over a charterparty formed in May 2019. The charterparty was written based on the impending IMO 2020 fuel regulations. The vessel’s redelivery was delayed due to cargo payment issues, causing it to have excess HSFO onboard after the regulation’s deadline. Owners claimed losses, including voyage expenses, de-bunkering costs, HSFO value, cleaning expenses, port charges, and an outstanding hire balance. Charterers contested responsibility for late redelivery, arguing the contract did not explicitly cover HSFO-related issues and implying the owners were aware of the risks.

English Maritime Cases

London Arbitration 10/23

DAMAGES FOR REPUDIATORY BREACH – FIXING A SUBSTITUTE VESSEL BEFORE THE SUBJECT CHARTER– DETERMINING MARKET RATES FOR LOSSES – LOSSES RELATED TO STORAGE CHARGES AND PENALTIES DUE TO SWITCHING VESSELS
A vessel was chartered for the transport of bulk wheat from a Black Sea port to a Turkish port under an amended SYNACOMEX 2000 form. A disagreement arose due to the charterers’ failure to fulfill the contractual voyage, leading the charterers to claim US$90,829.99 in damages for a repudiatory breach.

English Maritime Cases

London Arbitration 9/23

TIME CHARTER – BALANCE ON FINAL HIRE ACCOUNTS – SPEED AND CONSUMPTION COUNTERCLAIM– CONDITIONS TO TIME-BAR COUNTERCLAIM – JURISDICTION OF ARBITRATOR OVER COUNTERCLAIM – REFERRAL OF COUNTERCLAIM TO WEATHER ROUTING COMPANY
After a vessel completed a voyage under a time-charter, disputes arose regarding the final hire accounts. The arbitration was referred to a sole arbitrator under the LMAA Small Claims Procedure 2017 (SCP). The owners claimed a balance of hire totaling US$49,423.30. The charterers maintained that they were owed damages of US$62,876.66 due to a speed and consumption issue and counterclaimed for the difference of US$16,170.82.

English Maritime Cases

London Arbitration 7/23

TIME CHARTER – DAMAGE TO VESSEL DURING DISCHARGE – REPAIRS REQUIRED AFTER DISCHARGE – CHANGE OF REDELIVERY – REIMBURSEMENT OF WAR-RISK BONUS TO CREW – DAMAGES FOR LOSS OF FOLLOW-ON FIXTURE
A vessel was chartered on the NYPE form with amendments for a time charter to transport bulk coal from Richards Bay in South Africa to one safe port, India or Pakistan, as per the charterers’ choice. The arbitration centered on the charterers’ failure to redeliver the vessel at the agreed location. Claims related to crew war-risk bonuses, lost earnings from a follow-on fixture, and waiting time were also put forward.

English Maritime Cases / Featured

London Arbitration 6/23

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.

English Maritime Cases

London Arbitration 4/23

TIME CHARTER – BIMCO – ADDENDUM VALIDITY – BALANCE OF HIRE – CARGO CLAIMS – COUNTER-
SECURITY
A vessel was chartered for a time charter trip from India to Cotonou and Tema. The cargo was bagged
rice, and the charter included the BIMCO Standard Dispute Resolution Clause. A sole arbitrator presided
over the arbitration, which addressed the validity of an addendum agreement after the arbitration
proceedings had started, balance of hire, and counter-security for cargo claims.

English Maritime Cases / Featured

UniCredit Bank AG v Euronav NV – Court of Appeal, 4 May 2023

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.

English Maritime Cases

London Arbitration 3/23

NYPE 1946 FORM – EXCESS BUNKERS ON REDELIVERY – CLAIM MASTER OVERESTIMATED BUNKER QUANTITIES – BREACH OF CHARTERPARTY – DAMAGES – PRICE FOR CALCULATING EXCESS BUNKERS – BUNKER SAFETY MARGIN
A vessel was chartered to travel from Thailand to the Nacala-Cape Town range using the NYPE 1946 form. A disagreement arose between Charterers and Owners regarding the final hire statement. Charterers claimed that the master had overestimated the bunker requirements, while Owners contended that the Charterers’ breach had caused the excess bunkers on redelivery and counterclaimed for damages.

English Maritime Cases / Featured

DHL Project & Chartering Ltd v. Gemini Ocean Shipping Co Ltd (The “Newcastle Express”) – Court of Appeal – (Males, Birss and Snowden LJJ) [2022] EWCA Civ 1555 – 24 November 2022

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.

Featured / U.S. Maritime Cases

Seastar Maritime Ltd. v. AUM Scrap and Metal Waste Trading LLC. (MT “AMIAS”) – SMA No. 4455, 12 December 2022

DEMURRAGE – CHARTERPARTY BREACH – DEVIATION – LOSS MITIGATION
The MT AMIAS was chartered by AUM from Seastar using the Asbatankvoy form with rider clauses to carry Methanol in bulk from Venezuela to 1-2 Safe Port/ 1 Safe Berth (Kandla to Chennai Range). The Vessel finished loading in Venezuela and submitted its invoice for 70% freight for payment within 10 days, per the charterparty. AUM did not pay, and the Vessel stayed in port until May 11. Seastar was forced to seek alternate employment to mitigate losses, which required calling another port. Both parties agreed upon an earlier settlement, but AUM did not pay it either.