Issue 1


Despite the 1995 English High Court judgement in the case of O.K. Petroleum v. Vitol S.A., there are still some companies who believe that the time bar contained in a charter party is automatically incorporated into a CIF or FOB contract and can be used to avoid paying a late-presented demurrage claim. If you are not aware of this case and need a copy of the 20 page judgment, please give us a call. The situation in U.S. law is sadly not so clear cut. We have taken advice from New York lawyers who expect the position to be similar to English law. They advise that the New York courts tend to take a very narrow view of "exculpatory" clauses, i.e. those clauses which attempt to avoid otherwise legitimate liabilities. Nevertheless there are several U.S. companies who will refuse to pay "late" claims and quote "industry practice" as their excuse. Our only suggestion is to make sure, if your contract does not specify English law, that you protect your position either by clarifying any time bar when the contract is agreed or by doing everything to reserve your position before the expiry of the charter party time limit.


As the name suggests, Mobil have released a new charter party effective from March 1996. It requires very careful analysis since it introduces a few concepts not seen in previous charter parties. Here are two examples: (i) The pumping clause now refers to an average of 100 psi, rather than a minimum. (ii) The bad weather provisions state that "weather and or sea conditions (and/or any effects thereof)" will count as half rate demurrage.


The weather clause in Mobilvoy96 leads on to a question that has been raised several times recently. Can the Conoco weather clause or the weather clauses in any of the charter parties be used to reduce or avoid consequential demurrage? That is to say, where the bad weather has caused subsequent delay, e.g. by creating berth congestion. Before the appearance of Mobilvoy96 we would have said that in every case only the time lost directly as a result of bad weather, and only while such weather conditions prevailed, would be treated as half rate demurrage. Finally, we recently encountered a charter under Asbatankvoy to which neither the Conoco weather clause nor any alternative had been added. The charterer was aggrieved to learn that "storm" has been interpreted by the English courts in only the narrowest sense to mean winds of force 10 on the Beaufort Scale.


We have encountered a new excuse for rejecting a claim. The charter party stated that any demurrage claim should be supported by a statement of facts. The claimant had only provided a document headed "Time Sheet". Although this had been signed by all the interested parties and also provided all the necessary information, it was initially rejected because it wasn't entitled "Statement of Facts". We canvassed the views of various oil and trading companies to check we were not missing something. The conclusive response was that the words "Statement of Facts" are a general description of a document which details all the relevant times and events covering the loading or discharge of a tanker. So long as this document provides all this information and is signed by the ship's master and the shore's representative it is accepted regardless of the title at the top of the sheet. The title often depends on the geographical location. In North West Europe about 90% of these reports are headed "Statement of Facts". In the Far East the majority are titled "Tanker Time Sheet". They are sometimes called "Port Log", "Tanker Port Performance Record", or "Time Report". The precise wording of the document's title should be irrelevant.



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