WHAT IS NEW IN NEW YORK?
ATHENS, GREECE
APRIL 14, 2005
William J. Honan
Holland & Knight LLP
1. A few years ago, there were
hardly any time charters being done.
Rates were low and owners were
disinclined to offer vessels for long
terms at those low rates.
2. The forms haven't changed very
much.
For example, ASBATANKVOY
dates back to 1977 and its predecessor
Essovoy dates back to 1969. At some
point, disputed issues have to diminish.
3. Traders and other charterers
have adopted special provisions which
have been refined to reduce the risk of
exposure and dispute.
The Panel, in its award, shall
grant any remedy or relief which it
deems just and equitable. . . .
. . . under New York law, arbitrators
are not constrained by the strict rules
of the courts and may grant relief that
a court would not, or could not, grant.
Because "contracts often lack explicit
provisions for specific kinds of remedies,
it falls to the arbitrator to devise one."
The parties' agreement did not restrict
the arbitrators to remedies available to a
court of law.
1. Arbitrators, in many ways,
have more power than courts of law.
2. Arbitrators have the power to
fashion innovative remedies to resolve
complex problems.
It is not the role of the courts to
undermine the comprehensive grant of
authority to arbitrators by prohibiting
an arbitral security award that ensures
a meaningful award.
• I am not going to perform.
• I shall not perform when it is my time
to do so.
• I may not perform when it is my time
to do so.
Repair Protocol and Schedule
1.
Within 10 days from the date hereof, Owner will furnish the preliminary drydock and
repair specification for submission to qualified repair yards located within US East Coast,
Gulf of Mexico or Caribbean, not East of Trinidad.
2.
Within 30 days from the date hereof, Owner will furnish the name and location of the
drydock and repair yard designated to carry out all repairs and the date those repairs are
expected to begin. The repairs are to be carried out as expeditiously as practicable.
3.
All repairs shall be subject to inspection and certification by the appropriate Classification
and regulatory authorities.
4.
Owner shall furnish weekly progress reports together with the shipyard's projected
completion date.
5.
Charterer shall have the privilege of appointing a surveyor to monitor all repairs.
6.
Should Owner fail to comply with the provisions hereof, Charterer will be free to renew its
application for the panel to terminate the charter party.
§6 OF COGSA,
46 U.S.C. §1303
In any event the carrier and the ship
shall be discharged from all liability in
respect of loss or damage unless suit is
brought within one year after delivery of
the goods or the date when the goods
should have been delivered . . . .
SCANPORTS 1990
20. Demurrage Claims. Charterer shall be
discharged and released from all liability in respect of
any claim for demurrage owner may have under this
charter party unless a written invoice for the claimed
demurrage and copies of ETA notices sent in
compliance with voyage orders, notices of readiness
at each port, pumping logs, and port logs/statements
of fact for each port as well as all other supporting
documents have been received by charterer within
ninety (90) days after completion of discharge of the
cargo covered buy this charter party or after other
termination of the voyage, whichever first occurs. . . .
KOCH SHIPPING INC.
20.2. Owner to present to Charterer, in
writing, any claim for demurrage within 58
days of completion of discharge together
with the following signed documents,
otherwise Owner waives any such claim. In
the event suppliers/receivers signatures are
not obtainable, Owner must provide a
signed notice of protest noting same. . . .
BPVOY 4
20.2 Any other claim against charterers for
any and all other amounts which are alleged to be
for charterers' account under this charter shall be
extinguished, and charterers shall be discharged
from all liability whatsoever in respect thereof,
unless such claim is presented to charterers,
together with full supporting documentation
substantiating each and every constituent part of
the claim, within one hundred and eighty (180)
days of the completion of discharge of the cargo
carried hereunder.
WESTPORT PETROLEUM INC
21. DEMURRAGE/EXPENSE CLAIMS CLAUSE:
In order to be honored, any demurrage claim must be received in
writing with full supporting documents including but not limited to
Notice of Readiness, authorized statements of facts signed by Master,
Suppliers/Receivers/Agents, letters of protest, crude oil washing
statement and vessel's pumping log, within 90 days of completion of
discharge failing which the claim shall be deemed to be waived and
absolutely barred. Master is to issue Letter of Protest should
documents or signatures not be available. All other claims (but not
including freight, dead freight) shall be deemed waived, extinguished
and absolutely barred if such claim is not received, in writing with
supporting documentation, within 180 days from completion of
discharge.
CHEMBULK NEW YORK
S.M.A. 3868 (2004)
VOYAGE CHARTER
Demurrage which charterer does not contest except for Owner's
non-compliance with Rider Clause 6.
DEMURRAGE TIME BAR CLAUSE
Charterers shall not be obliged to pay any claim for demurrage,
unless the claim, along with supporting documents (including, but
not limited to vessel time sheets signed by ship's agent and terminal
time log) is received by Charterers within ninety (90) days from date
of completion of discharge of cargo.
CASCO LMLN 622
(March 20, 2005)
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Time Charter (Shelltime 4)
60 to 90 days
Charterer subcharters vessel
Vessel fails Subcharterer's inspection
Subcharterer rejects the vessel
Charterer claims against the Owner
Cargo would have been delivered in early May 2003
Charterer commences arbitration against Owner in July 2004
Owner claims contractual time bar
Owner relies on the incorporation of the Hague Visby Rules
Article III rule 6 of the Hague Visby Rules:
"Subject to paragraph 6 bis the carrier and the ship shall in any event be
discharged from all liability whatsoever in respect of the goods unless suit is brought
within one year of their delivery or of the date when they should have been
delivered."
SUN ADMIRAL
S.M.A. 3831 (2004)
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Voyage Charter
NOLA/Vera Cruz
rice cargo
vessel failed charterer's inspector's survey
vessel rejected on July 11, 2001
Owner demands arbitration on February 26, 2003
Charterer claims time bar based on Rider Clause 44
Rider Clause 44:
. . . any claims under this contract must be notified in writing to the
other party and claimants' arbitrator appointed within twelve (12)
months of final discharge of the cargo and where this provision is
not complied with, the claim shall be waived and absolutely barred.
BOW CEDAR
[2005] 1 Ll. L. Rep. 275
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Voyage Charter Party (BPVOY 4)
Bahrain to Benin
jet fuel, gas oil, gasoline
charterer had difficulty arranging for the purchase of the cargoes
charterer cancels charter party on August 27, 2002
Club, on behalf of Owner, submits claim documents on
July 15, 2003
charterer claims contractual time bar based on Clause 20.2 of BPVOY 4:
20.2 Any other claim against charterers for any and all other amounts which are
alleged to be for charterers' account under this charter shall be extinguished, and
charterers shall be discharged from all liability whatsoever in respect thereof, unless
such claim is presented to charterers, together with full supporting documentation
substantiating each and every constituent part of the claim, within one hundred and
eighty (180) days of the completion of discharge of the cargo carried hereunder.
GENERAL RULES
1.
Contractual time bars are enforced.
2.
Arbitrators require strict compliance (substantial compliance
probably insufficient) to satisfy contractual time bars.
3.
Contractual time bars are probably enforced even if there is
no dispute concerning the claim in question.
4.
Contractual time bars are construed strictly against the drafter.
PRACTICE TIPS
1.
If the Owner:
a)
b)
c)
d)
2.
seek to eliminate altogether
make the clauses mutually applicable
provide as long a period as possible
provide training to the persons handling claims
If the Charter:
a)
b)
include all claims not just demurrage and detention
draft the clause so as to avoid obvious loopholes
EXXON MOBILVOY 2000
19.
BACK LOADING. Charterer shall have
the option of loading Vessel with a part cargo at
any discharging port or place to which Vessel may
have been ordered,. . . . Owner shall discharge
such part cargo at any other discharging port(s)
or place(s) previously nominated, provided such
port(s) or place(s) lie within the rotation of the
discharging ports or places previously nominated.
If this option is exercised, additional time
consumed awaiting berth and/or cargo and/or
tank preparation and/or loading and discharging
such part cargo shall count as laytime or, if Vessel
is on demurrage, as time on demurrage. . . .
SHELLVOY 5
Back Loading
38.
Charterers may order the vessel to load a part cargo at
any nominated discharging port, and to discharge such part cargo at
a port(s) to be nominated by Charterers within the range specified
in Part I(E) and within the rotation of the discharging ports
previously nominated, provided that such part cargo is of the
description specified in Part I(F) and that the master in his absolute
discretion determines that this cargo can be loaded, segregated and
discharged without risk of contamination by, or of, any other cargo
remaining on board.
Charterers shall pay a lump sum freight in respect of such part
cargo calculated at the demurrage rate specified in Part I(J) on any
additional time used by the vessel as a result of loading, carrying or
discharging such part cargo.
ASBA II
22. Charterer shall have the option of
reloading the Vessel with a part cargo as
described in Part I(E) at any port of discharge
nominated by the Charterer within the
discharge options contained in Part I(D) and
Owner agrees to discharge such reloaded
cargo at any other discharge port or ports,
previously nominated provided such port or
ports, lie within the rotation of discharge ports
previously nominated.
27. KOCH DISCHARGE/RELOAD
27.1 Charterer has the option to discharge
all or part cargo at one safe port or lighterage
location and reload same or different cargo in
same or different port or place for final
discharge on the same voyage within agreed
ranges as specified in Part I of this Charter
Party.
27.2 Provided the charter freight under
the terms of this Charter Party are based
on Worldscale, the port of
discharge/reload to be considered as an
additional Loadport for freight calculation
purposes . . . .
6. DISCHARGE/RELOADING CLAUSE:
Charterer's shall have the option to
discharge and reload all or part cargo at any
port within the trading range. If exercised, any
additional costs in connection with the reload to
be for Charterer's account and additional time
consumed to count as used laytime.
For
Worldscale purposes, said discharge/reload port
to count as a load port under Worldscale.
PRACTICE TIPS
• If Owner
– Exclude if possible
– Make sure the new discharge port is in the same
rotation
– Make sure WS is the applicable freight
• If Charterer
– Include if possible
– Draft as widely as possible (see Koch clause)
– Use demurrage rate as the measure of compensation
MARTHA A,
S.M.A. 3861 (2004)
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Voyage Charter (ASBATANKVOY)
Mineral oil parcels
Antwerp – Tampa - Houston
Vessel delayed en route due to bad weather
Arrival at Tampa, temporary closure of berth due
to scheduled maintenance by the port authority
Temporary closure prevented previous vessel
from completing cargo operations
Martha A was delayed
• Clause 6 (last sentence)
However, where delay is caused to vessel getting
into berth after giving notice of readiness for any
reason over which Charterer has no control, such
delay shall not count as used laytime.
• Owner said Clause 6 does not apply because the berth
closure was not due to unforeseen circumstances such
as casualty, emergency repairs, bad weather or other
force majeure events.
ENERGY RANGER,
S.M.A. 3817 (2003)
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Time Charter (NYPE)
Concentrates
Punta Patache, Chile to Montreal
Berthed commenced loading on Jan. 29, 2002
Loading commenced and continued until 0750 on Jan. 31
Served with Order of Detention at request of USDEA
Accused of having large quantity of drugs in no. 3 ballast tanks (2
m/ts cocaine)
No. 3 hold 15,700 m/ts cargo
Rather than discharge; cut an access hole in the ship’s side
No drugs, hole patched, loading completed
Delay of 6.75 days
• Who is responsible?
• Off-hire clause: Clause 15
That is the event of a loss of time from deficiency and/or
default of men including strike, stoppages of Master,
Officers and crew or deficiency of stores, fire, breakdown
or damages to hull, machinery or equipment . . . Or any
other cause or restriction preventing the full working of
the vessel, the payment of hire shall cease for the time
thereby lost.
WHAT IS NEW IN NEW YORK?
ATHENS, GREECE
APRIL 14, 2005
William J. Honan
Holland & Knight LLP