2024 Maritime Digest of Arbitration Awards and Court Rulings

SwissMarine Pte Asia v. Mosaic Fertilizer (MN “PRESINGE”) – SMA No. 4457, 10 March 2023

BREACH OF COA – FAILURE TO PROVIDE SAFE BERTH – FAILURE TO NOMINATE SAFE VESSEL – DEMURRAGE – FORCE MAJEURE – WEATHER – HURRICANE – LOST TIME

SwissMarine and Mosaic Fertilizer had a COA for the carriage of phosphate rock from Peru to the US Gulf for discharge at either New Orleans Triport and/or Tampa – Port Manatee. On the way to discharge at Tampa, concerns were raised by the Port that the Vessel could not safely berth, so the vessel was diverted to New Orleans. Shortly after arrival at anchorage on the Mississippi River, the US Coast Guard limited marine traffic due to the impending arrival of Hurricane Ida. Mosaic declared force majeure, and the PRESINGE did not complete cargo operations until 38 days later. Owners alleged demurrage was due and that Charterers were in breach of COA for failing to provide a safe berth. Charterers countered that no demurrage was due because of the force majeure event, and Owners were in breach of COA for failing to nominate a safe vessel.

Phillips 66 Company v. Yamuna Spirit, LLC, Teekay Chartering and Teekay Marine (The “YAMUNA SPIRIT”) – SMA No. 4454, 12 January 2023

OIL SHEEN – OIL LEAK – OIL SPILL – MARINE TERMINAL LEAK – VESSEL LEAK

On September 19, 2016, the YAMUNA SPIRIT began discharging her Arabian Extra Light crude cargo at the Phillips 66 Marine Terminal, Rodeo Refinery, California. Shortly after operations commenced, a series of odors and oil sheens were observed nearby in San Pablo Bay, San Francisco. The parties, in cooperation with the USCG and state agencies, conducted extensive investigations and testing to determine whether the source of the leak was the Terminal or Vessel. Both parties contended that the other was the source of the oil. Arbitration was sought to establish responsibility for the leak and recover the expenses associated with the oil spill responses, investigations, and legal fees.

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.

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.

XCoal Energy v. Classic Maritime – SMA No. 4450, 16 August 2022

DAMAGES – COVID-19 – COA BREACH – BURDEN OF PROOF
A December 2, 2019 contract of affreightment between XCoal Energy and Classic Maritime stated XCoal was to provide cargos for 6 – 7 vessels during the year 2020. Due to the Covid-19 pandemic, XCoal was only able to provide cargo for two vessels. Classic believed they should have been awarded damages of over US$ 4.4 million for the breach, however, XCoal asserted they owed far less, claiming Classic did not meet the burden of proof to warrant this higher claim.

Team Tankers Deep Sea v. Tauber Petrochemical (MT “TEAM TOCCATA”) – SMA No. 4441, 18 March 2022

DEMURRAGE – COVID-19 – FORCE MAJEURE – DUE DILIGENCE – PANDEMIC
On March 25, 2020, the Gujarat Maritime Board issued a declaration of a Force Majeure Event at Dighi Port where Team Toccata was due to berth after its discharge was completed at Kandla on April 19, 2020. Team Tankers Deep Sea claimed that the charterer, Tauber Petrochemical, owed demurrage for the entire 118.5 hours Team Toccata waited at Dighi before proceeding to the berth regardless of the force majeure event.

London Arbitration 32/22 

AMENDED NYPE – TIME CHARTER – DEDUCTIONS FROM HIRE- SPEED AND CONSUMPTION- GOOD WEATHER AND SMOOTH SEA- WEATHER CONDITIONS – WEATHER ROUTING COMPANY REPORT
The subject vessel was chartered on an amended NYPE to transport steel from Brazil to Baltimore. After the voyage, the owners claimed a balance of hire which the charterers subsequently denied. Under dispute were speed and consumption, vessel weather reporting, and the weather routing company report.

London Arbitration 21/19

DEMURRAGE – TROPICAL STORM- FORCE MAJEURE – DUE DILIGENCE – BAD WEATHER CLAUSE – TERMINAL CLOSING – PORT CLOSING – HURRICANE
A vessel chartered under a contract of affreightment was scheduled to load 60,000 mt of coal from a terminal on the Mississippi when the terminal ordered her to vacate the berth due to an impending hurricane. The owner claimed demurrage of US$330,495 for the time spent awaiting the vessel’s return to the berth, however, the charterer denied any liability for the demurrage incurred claiming bad weather, events outside of their control, and force majeure.

London Arbitration 31/32

DEMURRAGE – DETENTION – GENCON 94 – AWAITING ORDERS
The subject vessel was chartered to carry wheat from the Russian Federation to Turkey. The owners claimed damages for detention at the discharge port, calculated at the demurrage rate. However, the charterer denied the provisions of the charterparty entitled the owner to these damages, and asserted the owner was only entitled to demurrage.

Astir Holdings, Inc. v. Xcoal Energy & Resources (The “Lacon”) – SMA No.4438, 25 February 2022

AMERICANIZED WELSH COAL CHARTER – DEMURRAGE – SECOND DISCHARGE BERTH – QUARANTINE INSPECTION – REPOSITIONING CREDIT
Xcoal Energy & Resources chartered Astir Holdings Inc. for carriage of coal from Mobile to one safe berth at Jingtang. En route, Xcoal changed its discharging port from Jingtang to Lanshan, and claimed a repositioning credit since Lanshan was closer to the vessel’s next port. Astir approved the request to unload at two discharging berths instead of the one that was contractually agreed upon, however exceptions to laytime and demurrage at the second berth were not discussed at the time. Arbitration was sought to determine if the charterer’s exceptions to time counting as demurrage should apply for the second discharging berth.