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The COVID pandemic has impacted nearly every aspect of global commerce, and the shipping industry is no exception having experienced severe disruption in many different ways.

Over the past two years, most maritime lawyers will have received multiple enquiries in relation to delays caused to vessels by COVID, where there is a dispute as to whether owners or charterers are liable under the terms of the charterparty.

Against this background, two London arbitration awards have recently been published which shed some light on how Tribunals are grappling with these issues.
Continue Reading COVID related off-hire decisions from the LMAA

At a glance: the words “CLEAN ON BOARD” and “SHIPPED in apparent good order and condition” in a draft bill of lading presented to the Master for signature, were merely an invitation by the shippers to the Master to make those representations in accordance with his own assessment.

Our previous briefing on this case can be found here.
Continue Reading The “Tai Prize” [2021] EWCA Civ 87: An invitation to the Master?

At a glance: In a recent judgment, the Commercial Court highlighted the difficulties that can arise of out of LoU wording in terms of arbitration agreements and extensions of time.

Background

The M/V Majesty was carrying 25,000 mt of rice under a voyage charterparty on an amended Synacomex 90 form. Five Bs/L were issued. The charterparty contained (a) a BIMCO arbitration clause; and (b) a bespoke arbitration clause (“CP Arbitration Clause”), although it was common ground between the parties that the Bs/L incorporated the bespoke CP Arbitration Clause rather than the BIMCO clause.
Continue Reading The “Majesty”: Cargo claims, LoUs, and the importance of clear cross-referencing

Summary

The “Atlantic Tonjer” [2019] EWHC 1213 (Comm) is thought to be the first reported judgment on SupplyTime 2017. The decision clarifies the meaning of clause 12(e) of the standard form, which requires Charterers to notify Owners by no later than the due date of an invoice, if they reasonably believe that the invoice is incorrect. The Court construed clause 12(e) in its commercial setting, highlighting the equal bargaining power of the parties and the importance of cash flow to Owners as key features. It found that, on its proper construction, clause 12(e) means that Charterers cannot later raise a defence to payment of an invoice of which Charterers have failed to notify Owners by way of a valid notice prior to its due date. Whilst this does not impact on Charterers’ right under 12(g) or their right to raise a counterclaim, it serves as a reminder that courts have little sympathy for commercial parties that have misunderstood the letter of their bargain. It provides a valuable insight into the judicial approach to SupplyTime 2017 and standard form charterparties negotiated between commercial parties generally. Parties are advised to negotiate standard form charterparties cautiously and know exactly what their contracts say.

The “Atlantic Tonjer” – the first glimpse of the judicial approach to interpreting SupplyTime 2017

On 14 May 2019, the High Court handed down its judgment in Boskalis Offshore Marine Contracting BV v Atlantic Marine and Aviation LLP (the “Atlantic Tonjer”) [2019] EWHC 1213 (Comm). This is thought to be the first reported judgment on the BIMCO SupplyTime 2017 standard form.

“SupplyTime” was first published in 1975 and, now in its third revision, is one of BIMCO’s most widely used forms.  It is considered to be the industry standard form for the chartering of offshore vessels. The 2017 revision included amendments to the payments provision at clause 12(e), and this dispute gave the Court (Sir Ross Cranston sitting as Deputy Judge) the opportunity to clarify the effect of the revised clause 12(e), as well as to consider SupplyTime2017 generally.

Background…
Continue Reading The “Atlantic Tonjer” – the first glimpse of the judicial approach to interpreting SupplyTime 2017

Summary

The Court of Appeal’s decision in Ark Shipping Co LLC v. Silverburn Shipping (IOM) Ltd, “ARCTIC”  [2019] EWCA Civ 1161, provides a clear statement of the principles of construction, and how they are applied in ascertaining whether a term is a condition or an innominate term.

This decision provides guidance on the proper interpretation of parties’ continuing obligations during the life of a bareboat charterparty in relation to matters such as classification status, and the consequences if a charterer fails to fulfil such obligations. It also demonstrates the Court’s reluctance to classify contractual terms as conditions, where the risk of disproportionate consequences outweighs the advantages of commercial certainty.

While this case is particularly relevant to bareboat charterers, it is also anticipated to have implications for the interpretation of similar obligations in a time charter context.

Ark Shipping Company LLC v. Silverburn Shipping (IoM) Ltd [2019] EWCA Civ 1161

In a judgment of 10 July 2019, the Court of Appeal heard an appeal of a High Court decision dated 22 February 2019, where an appeal from an LMAA arbitration award was brought pursuant to s. 69 of the Arbitration Act 1996.

Facts…

Continue Reading MV “ARCTIC” – Obligation to “keep vessel in class” is an innominate term

Transgrain Shipping (Singapore) Pte Ltd V Yangtze Navigation (Hong Kong) Co Ltd [2017] EWCA Civ 2107

This was a further appeal, to the Court of Appeal, from an LMAA arbitration award, considering the true construction of the sweep-up provision at sub-clause 8(d) of the Inter-Club Agreement 1996 (“ICA ‘96”); specifically, whether the meaning…

In a recent decision, the Paris Court of Appeal refused to enforce an LMAA arbitral award on the basis that the underlying contract was affected by illegality on account of corruption.

Introduction

Pursuant to article V of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, a national authority may …

TRANSGRAIN SHIPPING (SINGAPORE) PTE LTD v YANGTZE NAVIGATION (HONG KONG) CO LTD [2016] EWHC 3132

This was an appeal from an LMAA arbitration award, considering the true construction of clause 8(d) of the Inter-Club Agreement 1996 (“ICA”); specifically, whether the meaning of the term “act” in the phrase “act or neglect” should be restricted to a culpable act.

The dispute concerned a trip time charter where the charterers (also the shippers) had, for their own purposes, ordered the ship to wait off the discharge port for over four months before discharging the cargo. During this time part of the cargo was damaged due to overheating, which was found by the Tribunal to have been caused by a combination of the prolonged delay at the discharge port and the inherent nature of the cargo.…

Continue Reading Culpability and Clause 8(d) of the Inter-Club Agreement – The Yangtze Xing Hua

Viscous Global Investment Ltd v Palladium Navigation Corp [2014] EWHC 2654 (Comm)

The Claimants had claims for cargo damage against the vessel Owners arising under four bills of lading. The vessel was the subject of a chain of three charterparties. The head and sub-charter provided for London Arbitration (two arbitrators unless a sole could be…