Issue 16


The Working Group on the Fair Interpretation of Pumping Clauses has drafted a set of pumping clauses that should go a long way towards removing the subjective approach and the contentious nature of many claims for excess pumping. We hope that these terms will prove equally acceptable to owners and charterers. Mark Aspinall of Shaw & Croft will present the Working Group's proposals at the International Conference on Tanker Demurrage on 22/23 May.


We wrote in the last newsletter about the apparent uncertainty under English law over the validity of a Notice of Readiness tendered under Asbatankvoy before the vessel had reached the customary anchorage, e.g. one tendered at the pilot station. In an effort to clarify the position we have commissioned Yvonne Baatz to present a paper on this and related issues at the Demurrage Conference. Yvonne, originally a practising maritime lawyer, is now a highly respected lecturer at The Institute of Maritime Law, Southampton University.

As an example of the rigid interpretation that the English courts put on the effects of invalid NOR's, we now have the High Court judgement in the, somewhat inappropriately named, case of The Happy Day [2000]. The vessel was carrying a cargo of grain under a berth charter which stated that a valid NOR could only be tendered when the vessel was allfast at the berth. The "Happy Day" tendered NOR while awaiting the tide to berth. There was no berth congestion. No further NOR was tendered. The vessel took nearly three months to discharge and the owners claimed demurrage. However, the charterers contended that as no valid NOR had ever been tendered, laytime could not have commenced. The arbitrators agreed with the charterers. On appeal, the High Court judge, Mr. Justice Langley, confirmed the arbitrators' decision. Following the principles laid down in The Mexico I [1990], an invalid NOR would not become valid at a later date unless the parties agreed that it would. The judge held that the NOR not only advised the charterers that the ship was ready, it also triggered the commencement of time under the charter party and the specific provisions for when that time was exceeded (i.e. laytime and demurrage). The judge held that in the absence of a valid NOR the parties would have to have conducted themselves in such a way that it was clear that they had agreed that laytime would commence when discharge began. Even though discharge began despite the invalid notice which was never rejected, the judge considered that there was insufficient evidence to indicate any agreement between the parties. Furthermore, there had been no waiver by the charterer of his right to receive a valid NOR. The owners were unable to recover demurrage for two and a half months' delay, and even had to pay despatch to the charterers. The owners could have avoided this result by ensuring that the Master retendered NOR on berthing. As the Judge observed in The Timna [1970] "It is a good working rule …to give notice of readiness and to go on giving such notices in order that, when later the lawyers are brought in, no one shall be able to say: 'If only the master had given notice of readiness, laytime would have begun and the owners would now be able to claim demurrage'."


In the recent Central London County Court case, The Minerva [2001], the charter party stated that the demurrage claim with supporting documents should be presented within 90 days otherwise it would be time-barred. It also said "Demurrage invoice if any, shall be supported with documents duly signed with the authorised signatures including, but not limited to, Notice of Readiness, Time Sheets signed by the Master/terminal/agent, Letters of Protest…"

The judge held that as the owners had provided a time sheet for the first discharge port signed only by the Master, this was a breach of the clause sufficient to permit charterers to time-bar the owner's claim relating to the demurrage incurred at that particular port. This was the case even though the time sheet was on the Terminal's headed paper and there were no other time sheets signed by the terminal or the agents.


Another small point was also decided in The Minerva case. The ship had been chartered on Shellvoy5. Clause 13(1)(a) says "A loading or discharge berth shall be deemed inaccessible only for so long as the vessel is or would be prevented from proceeding to it by bad weather, tidal conditions, ice, awaiting daylight pilot or tugs, or port traffic control requirements…". The judge rejected the owner's claim that there was such a person as a "daylight pilot".

He was content to treat the clause as if there was a comma between "daylight" and "pilot".


We have seen a few cases recently where charterers have issued voyage orders that have tried to alter previously agreed charter party terms, particularly those relating to laytime and demurrage. In one Asdem arbitration, the conclusion was that charterers can order the vessel not to tender NOR to the loading terminal before 00.00 on the first day of laydays. They can even order the vessel not to tender NOR until they tell it to. However, the ship is still entitled to tender NOR directly to the charterers on arrival, provided the charter party does not specifically preclude this. Laytime will run in accordance with the charter party terms, which under Asbatankvoy means from 6 hours after the NOR is tendered or from 00.00 on the first day of laydays, whichever is later.


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