2024 Maritime Digest of Arbitration Awards and Court Rulings

Weather Delays at an FPSO – Does Time Count?

As with most laytime and demurrage issues, charter party terms and conditions spell out when time starts and stops– but what happens when a Vessel loads at an FPSO (Floating Production, Storage and Offloading vessel)? Although no charter party boilerplate specifically mentions the FPSO operation, this is not an issue because it is generally incorporated by a catch-all phrase like, “…or any other loading or discharging point whatsoever to which Charterers are entitled to order the vessel hereunder” and thus all the laytime and demurrage provisions would apply. Problems can arise, however, when clauses are modified during the fixture negotiation process. In particular, since shipowners oftentimes modify the Conoco Weather Clause1 by stipulating that weather delays count in full at transshipment areas, lighterage, and for STS operations, the question arises whether this implicitly applies to FPSO operations too. Although Owners’ intention is to mitigate adverse weather delays (including wind and swells) that ships are frequently subjected to in these areas of operation at sea, said amendment may not necessarily include delays at an FPSO.
To access this content, you must either Log In or Subscribe.

London Arbitration 21/07

ASBATANKVOY -- BILL OF LADING -- NOR TENDERED OUTSIDE PORT LIMITS -- "QUICK DEPARTURE" PROCEDURE -- PIRACY -- Owner Award Charterers presented two complaints against the Owner in this arbitration. The first was regarding a "quick departure procedure" in which a verbal agreement was made between Charterer's and Owner's agents, for the Vessel to sail the loadport without a copy of the bill of lading onboard. The second was regarding the Vessel's location when she tendered NOR at the Nigerian discharge port. The award details why the Panel rejected any agreements made by agents, and how the threat of piracy off the shore of Nigeria affected the Panel's ruling on what constituted a valid NOR.
To access this content, you must either Log In or Subscribe.

London Arbitration 20/07

NYPE -- TIME-CHARTER -- SPEED WARRANTY -- BUNKER CONSUMPTION -- CHARTERPARTY LANGUAGE -- APPLICATION OF MARGIN FOR "ABOUT" -- EXERCISE OF LIEN OVER CARGO (OFF HIRE) -- Partial Owner, Partial Charterer Award The Panel in this dispute was called on to determine the amount recoverable by Charterers under a time charter for the Vessel's underperformance in the warranted speed and for the over-consumption of bunkers. The award details how the Panel calculated the damages.
To access this content, you must either Log In or Subscribe.

London Arbitration 19/07

GENCON -- NOR VALIDITY -- TENDERED PRIOR TO LEGALLY BEING ABLE TO ENTER THE PORT -- LOCAL AUTHORITIES -- DEMURRAGE -- Charterer Award The Vessel arrived and tendered NOR at the Libyan discharge port despite not having received permission to discharge from the Libyan Port Authority. Four days after arrival, permission was granted. The Vessel had missed her turn at berth, and the port had closed for a period due to inclement weather. The Charterer rejected both the NOR and the subsequent demurrage claim. The award explains the consequences for the Owner for failing to re-tender NOR after receiving permission to discharge.
To access this content, you must either Log In or Subscribe.

Progress Bulk Carriers Ltd. v. Sunbulk Shipping NV (The “C. Duke”) – SMA No. 3990, 31 Dec 07

GENCON -- VESSEL ARRESTED WHILE AWAITING BERTH -- FORCE MAJEURE -- HURRICANE -- STORM -- WEATHER -- GROUNDING -- DEMURRAGE -- Owner Award Although the loading operations were uneventful, the discharge on the Mississippi River was delayed due to a recent hurricane (Katrina) as well as the threat of another hurricane (Rita). Charterers declared force majeure, and, in the event that the Panel did not agree, also argued that the demurrage claim should be reduced during an eight day period that the Vessel was under arrest. The award explains why the Panel upheld the Owners claim in full, despite the arrest and a grounding incident.
To access this content, you must either Log In or Subscribe.

Maribus Shipping Co. Ltd. v. Bottiglieri Di Navigazione SpA (The “Lacerta”) – SMA No. 3983, 12 Oct 2007

TIME CHARTER -- LATE REDELIVERY -- REQUEST FOR CONSOLIDATION -- COMMON QUESTION OF LAW -- Partial Charterer Award While under a time charter, the Vessel was sub-chartered for a single voyage. During the single voyage, the time charter expired and the Vessel was delivered late. Owners attempted to consolidate their arbitration claim for damages against both the time charterer and the sub-charterer, citing SMA rules which allow for same when the dispute against all parties involves the same common question of law. The ruling explains why the Panel rejected Owners request for consolidation.
To access this content, you must either Log In or Subscribe.

Apex Bulk Carriers, LLC v. DS Norden AS (The “Denise”) – SMA No. 3976, 6 Sep 2007

NYPE -- SUBCHARTER -- SUBPOENAS -- REQUEST FOR DOCUMENTS -- CONSOLIDATION OF DISPUTES -- Partial Owner Award The Vessel suffered severe damage allegedly caused by stevedore negligence, and Owners commenced arbitration to recover damages. Charterers contended that they had no first-hand knowledge of the incident, as the Vessel was under sub-charter at the time. Charterers subsequently requested arbitration against their sub-charterer and requested that the Panel consolidate all parties into one proceeding.
To access this content, you must either Log In or Subscribe.

Waterfront Shipping Co. Ltd. v. Trafigura AG (The “Sabrewing”) – QBD (Comm. Ct.), 31 Oct 07

BPVOY3 -- DEMURRAGE -- TIME-BAR -- REQUIRED DOCUMENTS -- PUMP LOG NOT PROVIDED BY OWNER -- Charterer Award The Owner filed a claim for demurrage before the 90-day time-bar, however they did not supply the supporting pump log before the time-bar date. The Owners argue that they only needed to provide the necessary documents supporting their claimed amount and that their claim was not dependent upon the pump logs. Furthermore, they have evidence that the Charterer had received the pump logs from an alternative source before the time-bar.
To access this content, you must either Log In or Subscribe.

Transfield Shipping Inc of Panama v. Mercator Shipping Inc of Monrovia (The “Achilleas”) – Court of Appeal, 6 Sep 07

TIME CHARTER -- LATE REDELIVERY -- LOST PROFITS UNDER SUBSEQUENT FIXTURE -- LIABILITY -- Owner Award This arbitration appeal deals with the damages that a time-charterer is liable to pay to a shipowner for any late redelivery of the chartered Vessel.
To access this content, you must either Log In or Subscribe.

Ocean Pride Maritime Ltd. Partnership v. Quingdao Ocean Shipping Co. (The “Northgate”) – QBD (Comm. Ct.), 27 Nov 07

NOR -- TENDERED FROM OUTER ANCHORAGE -- NOR ACCEPTED UNCONDITIONALLY BY THIRD PARTY TERMINAL -- DEMURRAGE -- Owner Award The Vessel tendered her NOR to the Charterer’s agents and the Terminal from the outer anchorage within the given laycan. However, a congested berth forced her to wait at the outer anchorage for ten days, which was subsequently claimed as demurrage by the Owners. The Charterer rejected this demurrage claim and stated that because the Vessel was at the outer anchorage upon tender, the NOR was invalid. Conversely, the Owner pointed out that the Terminal unconditionally accepted their NOR.
To access this content, you must either Log In or Subscribe.