We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Tuesday, 13 January 15
MORE PITFALLS FOR OWNERS LOOKING TO TERMINATE FOR UNPAID HIRE - INCE & CO
 KNOWLEDGE TO ELEVATE
It is a debatable point whether or not the obligation to pay hire under a time charter is a condition of the contract or not, notwithstanding the obiter comments of Mr Justice Flaux in the Astra [2013] EWHC 865 (see the Shipping E-Brief July 2013). Making payment under a commercial contract is said to be “not of the essence of the contract” and therefore not a condition. The significance is that a breach of condition allows the innocent party to terminate the contract in addition to claiming damages. Otherwise, he may be limited to his damages claim but unable to terminate the contract unless the failure to make payment, or indeed making repeated late payment under an instalment contract, amounts to a repudiatory breach of the contract.
The traditional view is that, in order to terminate a time charter and claim damages for losses suffered following a failure to pay hire, the charterer’s conduct must be shown to be
(i) repudiatory in the sense that the breach deprives the owner of substantially the whole benefit of the charter; and/or
(ii) renunciatory in the sense that it evinces an intention on the charterer’s part no longer to perform the charter at all or to perform the charter in a manner substantially inconsistent with his contractual obligations.
It will very much depend on the facts and circumstances in any given case whether the non-payment or late payment of hire instalments under a time charter amounts to a repudiatory breach. This often requires the owner to make a difficult decision as to whether the charterer’s failure to pay a number of hire instalments, or paying them late, entitles him, the owner, to terminate the charter. If the owner “calls it wrong”, he can find himself in repudiatory breach for wrongful termination and facing a claim for damages from the charterer.
Januzaj v. Valilas is not a shipping case but deals with general principles concerning the law on repudiation. It arguably introduces a further potential pitfall for owners seeking to rely on multiple failures to pay hire, or repeated late payments of hire, in order to demonstrate repudiatory conduct on the part of a charterer.
The background facts
The Claimant was a dentist operating his practice from the Defendant’s premises. The Claimant had agreed to pay the Defendant half his earnings from his practice in return for use of the premises. The Claimant’s earnings came from the UK’s National Health Service (the “NHS”) under an arrangement whereby the Claimant was paid in advance in equal monthly instalments for his work. If, at the end of the year, the Claimant had not done sufficient work, then any over-payment of his advance earnings had to be refunded to the NHS.
A dispute arose between the Claimant and Defendant, as a result of which the Claimant stopped any further payments to the Defendant. The Claimant was particularly concerned that the Defendant would not return his half of any advance payments if a refund became due to the NHS. The Claimant failed to make three monthly payments to the Defendant between August and October. In November, the Defendant terminated the agreement on the basis of the Claimant’s repudiatory breach of contract.
The Court decisions
At first instance, the Court found that the agreement had been terminated wrongfully and awarded the Claimant damages. The majority of the Court of Appeal upheld this decision on the basis that, on the facts, the Defendant should have been aware that the Claimant was only intending to pay late as opposed to evincing an intention not to pay at all. By contrast, the dissenting judgment concluded that the failure to make three payments in a row was a repudiatory breach.
In the context of time charter hire disputes
The onus will be on an owner to demonstrate that he has been deprived of substantially the whole benefit of his time charter and/or that the charterer does not intend to make any further hire payments in the future. Furthermore, The Brimnes [1972] 2 Lloyd’s Rep. 465 made it clear that even persistent late payment of hire instalments will not necessarily amount to a repudiation of the charter.
One of the majority appeal judges in Januzaj v. Valilas suggested that, in determining whether the number of missed or late payments was repudiatory, regard had to be given to the length of the contract as a whole. There is, however, previous case law to the effect that, in deciding whether repeated late payments are repudiatory, it will not simply be a question of looking at the number of payment instalments required over the whole of the contractual period and comparing that number with the number of occasions on which payment has not been made or has been made late. It is also necessary to look at the type of contract in question.
Januzaj v. Valilas was very much decided on its own facts. In that case, the dentist who missed three monthly payments had, in previous years, always managed to complete the requisite amount of work he had to perform for the NHS over the course of the year and so no refund to the NHS had ever been necessary. The majority of the Court of Appeal concluded that the Defendant should, therefore, have known that the Claimant would complete all his NHS work in the relevant year also, so that no refund would have been required and the Claimant would eventually have paid the Defendant all that was owing to him, albeit somewhat late. That was not sufficient to amount to repudiatory conduct.
In a time charter context, however, and in a challenging economic climate, it will often not be at all clear to an owner that he will eventually get his money, albeit late. Charterers may be on the brink of insolvency and may be looking to negotiate a reduced hire rate rather than comply with their original contractual obligations. There may also be a history of repeated defaults on the part of the charterer that can render his behaviour repudiatory as a whole. Nonetheless, Januzaj v. Valilas gives an owner faced with a defaulting charterer some cause for concern that he will be jumping the gun if he chooses to terminate where a charterer has missed a few hire payments. Is it relevant to consider the length of the charter when deciding whether several unpaid instalments is repudiatory? Are those payments just late or is the charterer not going to pay at all?
Comment
Given the Court of Appeal decision in Januzaj v. Valilas, an owner will need to be cautious about terminating for late payments of hire and there remains uncertainty over exactly how many non-payments will be sufficient to justify a decision by the owner to terminate the charter. Defaulting charterers often suggest to owners that they intend to pay outstanding hire in the future. Such a defaulting charterer, faced with an owner who chooses to terminate the charter as a result, may now argue that the outstanding payments were merely late or that only a few non-payments of hire in the context of a long-term charter is not repudiatory.
Source: INCE&Co | Hellenic Shipping News
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Wednesday, 07 January 15
2015 IS RIDDLED WITH CHALLENGES FOR THE SHIPPING SECTOR, MOST NOTABLY THE DRY BULK MARKET - HELLENIC SHIPPING NEWS
As the new year has now set foot for real, many are still looking to detect what’s in store for the various shipping markets, with the first ...
Tuesday, 06 January 15
SHIPPING MUST ADOPT CAN-DO ATTITUDE IN 2015 - MOORE STEPHENS
Shipping needs to adopt a can-do attitude in order to successfully meet the challenges which are likely to come its way in 2015.
Shipping part ...
Tuesday, 06 January 15
Q4' 15 FOB INDONESIA COAL SWAP CLOSED 1.81% HIGHER COMPARED TO Q1' 15 CLOSING
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 lost month on month and week over week.
The Q1 swap has lost US$ 0.74 (-1.51%) m ...
Tuesday, 06 January 15
FOB RICHARDS BAY COAL SWAPS LOST W-O-W AND M-O-M, SGX DATA SHOWS
COALspot.com: API 4 FOB Richards Bay Coal for delivery Q1' 2015 lost month on month and week over week.
The Q1 swap has lost US$ 3.52 (-5. ...
Monday, 05 January 15
CFR SOUTH CHINA COAL SWAPS GAINED WEEK OVER WEEK, SGX DATA SHOWS
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery has decreased by US$ 2.50 (-4.02%) month over month and gained US$ 0.20 ( ...
|
|
|
Showing 3271 to 3275 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Coastal Gujarat Power Limited - India
- Videocon Industries ltd - India
- Kalimantan Lumbung Energi - Indonesia
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Alfred C Toepfer International GmbH - Germany
- Malabar Cements Ltd - India
- Oldendorff Carriers - Singapore
- Heidelberg Cement - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Interocean Group of Companies - India
- Pipit Mutiara Jaya. PT, Indonesia
- Star Paper Mills Limited - India
- Price Waterhouse Coopers - Russia
- Kohat Cement Company Ltd. - Pakistan
- Grasim Industreis Ltd - India
- Dalmia Cement Bharat India
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- Bangladesh Power Developement Board
- Directorate General of MIneral and Coal - Indonesia
- Mjunction Services Limited - India
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Energy Development Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thiess Contractors Indonesia
- Sindya Power Generating Company Private Ltd
- Sarangani Energy Corporation, Philippines
- Vedanta Resources Plc - India
- Gujarat Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Marubeni Corporation - India
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Global Business Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement PLC, Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Rashtriya Ispat Nigam Limited - India
- Anglo American - United Kingdom
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
- Kobexindo Tractors - Indoneisa
- Directorate Of Revenue Intelligence - India
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- PNOC Exploration Corporation - Philippines
- Thai Mozambique Logistica
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- Economic Council, Georgia
- Jindal Steel & Power Ltd - India
- Commonwealth Bank - Australia
- AsiaOL BioFuels Corp., Philippines
- International Coal Ventures Pvt Ltd - India
- Deloitte Consulting - India
- Trasteel International SA, Italy
- The State Trading Corporation of India Ltd
- IEA Clean Coal Centre - UK
- Sakthi Sugars Limited - India
- ASAPP Information Group - India
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Ind-Barath Power Infra Limited - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Mercuria Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- Sojitz Corporation - Japan
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- Coalindo Energy - Indonesia
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Kepco SPC Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Planning Commission, India
- Miang Besar Coal Terminal - Indonesia
- Xindia Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Karbindo Abesyapradhi - Indoneisa
- Posco Energy - South Korea
- Bhoruka Overseas - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Chettinad Cement Corporation Ltd - India
- Intertek Mineral Services - Indonesia
- Uttam Galva Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- Bharathi Cement Corporation - India
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- New Zealand Coal & Carbon
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- GVK Power & Infra Limited - India
- Antam Resourcindo - Indonesia
- The Treasury - Australian Government
- Bhatia International Limited - India
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- Rio Tinto Coal - Australia
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Mercator Lines Limited - India
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Cigading International Bulk Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Barasentosa Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- LBH Netherlands Bv - Netherlands
- Cement Manufacturers Association - India
- Australian Coal Association
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Wood Mackenzie - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- South Luzon Thermal Energy Corporation
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- PTC India Limited - India
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Goldman Sachs - Singapore
- Aditya Birla Group - India
- Indika Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Gujarat Sidhee Cement - India
- Metalloyd Limited - United Kingdom
- Sree Jayajothi Cements Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- GMR Energy Limited - India
- The University of Queensland
- European Bulk Services B.V. - Netherlands
- Indian Oil Corporation Limited
- White Energy Company Limited
- Electricity Authority, New Zealand
- India Bulls Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CIMB Investment Bank - Malaysia
- Tamil Nadu electricity Board
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- Merrill Lynch Commodities Europe
- Bukit Baiduri Energy - Indonesia
- Coal and Oil Company - UAE
- Globalindo Alam Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
|
| |
| |
|
