The question of whether demurrage liquidates all or just some of the damages arising from a charterer’s breach in failing to complete cargo operations within the laytime has divided practitioners and academics for decades and, more recently, the English Court in K Line Pte Ltd v. Priminds Shipping (HK) Co Ltd  EWCA Civ 1712 (The Eternal Bliss). Now, in granting permission to appeal to the shipowners, it is a question which the Supreme Court has said it will answer.
Public today: an important judgment handed down by the English High Court this morning has re-opened the door to recovering damages in addition to demurrage for losses caused by exceeding laytime in cargo operations.
In today’s 43 page judgment in K Line Pte Ltd vs Priminds Shipping (HK) Co Ltd (The Eternal Bliss)  EWHC 2373 (Comm), Mr Justice Andrew Baker thoroughly surveys almost 100 years of law and commentary on a question that has never been properly resolved and which has divided the opinion of academics and practitioners alike.
In reaching the “firm and clear view” that The Bonde (1990), thought by some to have settled the issue 30 years ago, was wrongly decided the Court found that, quite apart from demurrage, damages can be also recovered for other losses caused by a failure to load or discharge within the allowable laytime. No separate breach of charter is required.
Continue Reading Damages in addition to demurrage – long standing debate settled in owners’ favour
Mitigation and the assessment of damages on early redelivery – “The New Flamenco”
Assessing the level of damages recoverable following the early redelivery of a vessel under a time charter can be a complex area of law to navigate, especially when there is no available market at the date of the termination of the charter. This Blog looks at the impact on owners and charterers of the decision in The New Flamenco.
On 13 February 2004, The New Flamenco was time chartered by the Claimant Owners to the Defendant Charterers. In August 2005, the charterparty was extended to 28 October 2007 by mutual agreement. On 8 June 2007, the parties reached an oral agreement to extend the charter for another two years, to 2 November 2009.
The Charterers alleged that no such extension had been agreed and indicated an intention to redeliver the vessel at the end of October 2007, refusing to sign an addendum documenting the further extension. The Owners declared the Charterers to be in anticipatory repudiatory breach and accepted this breach as terminating the charterparty on 17 August 2007.
The vessel was redelivered by the Charterers on 28 October 2007. The Owners, having been unable to find an alternative employment for the vessel from October 2007, entered into a Memorandum of Agreement for the sale of the vessel for the sum of US$23,765,000 shortly before redelivery.…