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Tuesday, 17 February 15
WHO PAYS THE SUEZ CANAL FEES? - INCE & CO
 KNOWLEDGE TO ELEVATE
This was an appeal from an arbitration award on a point of construction in relation to the wording of an addendum to a charterparty.
The Commercial Court held that the costs of transiting the Suez Canal arising as a result of amended voyage orders were for the Charterers’ account, even though the Disponent Owners would have had to incur them anyway in order to redeliver the vessel.
The background facts
The Claimant Disponent Owners (“Owners”), chartered the vessel to the Respondents for a voyage from Constanza to Djibouti. The vessel arrived at Djibouti but was unable to discharge because there were no receivers for the cargo. After the vessel had spent three months off Djibouti, the Owners and the Charterers agreed an addendum (“addendum no. 1″) to the charterparty whereby the discharge port was changed to Ain Sukhna, Egypt, a port to the south of the Suez Canal.
Addendum no. 1 provided:
“Owners and Headowners to be held harmless and indemnified against all losses, expenses, damages, risk whatsoever and howsoever arising including but not limited to those which may arise from any 3rd party including but not limited to Egyptian authority’s rejection refusal or inability to accept delivery of the cargo or from charterer’s failure to discharge cargo.”
Later, by a further addendum (“addendum no. 2″), the discharge port was changed again from Ain Sukhna to Damietta, an Egyptian port on the Mediterranean coast, meaning that the vessel would have to transit the Suez Canal northbound in order to arrive at the discharge port. Materially, addendum no. 2 provided:
“…the cargo is to be discharged at the port of Damietta (Egypt) instead of Ain Sukhna (Egypt) and all other terms, conditions, clauses and paragraphs as per Charter Party dated 23 October 2009 and addendum no. 1 and reservations of rights to remain in force.”
Under the head charterparty, a time trip charter, the Owners had to re-deliver the vessel at Port Said after completion of the voyage. She would, therefore, have had to transit the Suez Canal irrespective of the change of discharge port under addendum no. 2. The head charterparty provided that the Owners (as charterers under that charter) were responsible for all canal tolls and, therefore, as between them and the registered Owners, would have to bear the costs of transiting the Suez Canal.
In the arbitration, the Tribunal held that the costs of transiting the Suez Canal were not an expense that the Charterers had agreed to bear in the addenda on the basis that the Owners would have had to transit the Suez Canal anyway and:
“in the context, “losses” or “expenses” [in addendum no. 1, as cited above] must be construed as limited to additional losses and expenses which would not have been incurred in any event.”
It was this finding that was the subject of the Owners’ appeal.
The Commercial Court decision
The Court found that the commercial aim of the addenda had been to allow the Charterers to bring the voyage (and therefore their liability to pay demurrage) to an end and to allow the Owners to discharge the cargo and redeliver the vessel. The Court considered both the commercial objectives of the parties and their background knowledge when they agreed the addenda. The Court noted that the Owners’ liability under the head charterparty to bear the costs of transiting the Suez Canal was not within the knowledge of the Charterers and should not therefore be taken into account when assessing the scope of the Charterers’ indemnity.
Given the Court’s finding on the facts, the question which it had to answer was simply whether the expense of transiting the Suez Canal arose from the Charterers’ failure to discharge the cargo at Djibouti. The Court found that the Suez Canal transit would not have been required in order to perform the original voyage to Djibouti but was required to perform the amended voyage to Damietta and, as such, the costs of the transit were ones that the Charterers had agreed to bear. The appeal was therefore allowed.
Comment
This judgment shows the Court applying the clear wording used by the parties, since the expense arose from the Charterers’ failure to discharge the cargo at Djibouti, and that is what was expressly covered by the indemnity. The decision also emphasises that the background knowledge against which contracts will be interpreted is limited to that knowledge available to both parties.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
Source: Ince & Co | Hellenic Shipping News
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Friday, 20 February 15
U.S. PRODUCED AROUND 19.2 MILLION SHORT TONS OF COAL WEEK ON WEEK
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.2 million short tons (mmst) of coal ...
Thursday, 19 February 15
PANAMAX: NOPAC AND AUSSIE ROUNDS ARE DONE IN LOW/MID $ 4000; TRIPS VIA INDONESIA TO INDIA CLOSER TO THE $5000 MARK - FEARNLEYS
Handy
The handy and supra market has not seen any firming rates in front of the Chinese New Year and still suffering on low activity in both hemi ...
Wednesday, 18 February 15
DRY BULK SHIPPING TO RECOVER IN LATE 2015 - DREWRY MARITIME RESEARCH
Strong trade growth, moderating fleet development and deployment of new fuel efficient vessels are expected to lead to a recovery in dry bulk shipp ...
Tuesday, 17 February 15
BUOYANT WAVES IN RECENT YEARS: GLOBAL SHIP INVESTMENT SINCE THE CRASH - HELLENIC SHIPPING NEWS
Anxiety about fleet expansion is a recurring feature of world shipping markets. Within the global maritime community, worries about the vast amount ...
Tuesday, 17 February 15
FOB SUB-BIT INDONESIA COAL SWAP UP 8% MONTH OVER MONTH
COALspot.com: Indonesian coal swaps for delivery Q2' 2015 rose week over week and month on month.
The Q2 swap up US$ 3.58 (+8.00%) month o ...
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- Karaikal Port Pvt Ltd - India
- Commonwealth Bank - Australia
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- European Bulk Services B.V. - Netherlands
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- Tamil Nadu electricity Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Grasim Industreis Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Sojitz Corporation - Japan
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Jindal Steel & Power Ltd - India
- PTC India Limited - India
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- Mercator Lines Limited - India
- International Coal Ventures Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- Billiton Holdings Pty Ltd - Australia
- SN Aboitiz Power Inc, Philippines
- Chamber of Mines of South Africa
- PNOC Exploration Corporation - Philippines
- Parliament of New Zealand
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Salva Resources Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Energy Link Ltd, New Zealand
- Kepco SPC Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- Orica Mining Services - Indonesia
- Indian Oil Corporation Limited
- Semirara Mining Corp, Philippines
- Mercuria Energy - Indonesia
- Samtan Co., Ltd - South Korea
- McConnell Dowell - Australia
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- India Bulls Power Limited - India
- The Treasury - Australian Government
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- ASAPP Information Group - India
- Tata Chemicals Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coal and Oil Company - UAE
- Thiess Contractors Indonesia
- Independent Power Producers Association of India
- Riau Bara Harum - Indonesia
- Interocean Group of Companies - India
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Power Finance Corporation Ltd., India
- PetroVietnam Power Coal Import and Supply Company
- Xindia Steels Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- Gujarat Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Mintek Dendrill Indonesia
- Economic Council, Georgia
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Indo Tambangraya Megah - Indonesia
- Eastern Energy - Thailand
- OPG Power Generation Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Electricity Generating Authority of Thailand
- Kaltim Prima Coal - Indonesia
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Cement Manufacturers Association - India
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- Uttam Galva Steels Limited - India
- VISA Power Limited - India
- Central Java Power - Indonesia
- SMC Global Power, Philippines
- Price Waterhouse Coopers - Russia
- Bharathi Cement Corporation - India
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Orica Australia Pty. Ltd.
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Meralco Power Generation, Philippines
- Thai Mozambique Logistica
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Kartika Selabumi Mining - Indonesia
- Bulk Trading Sa - Switzerland
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Trasteel International SA, Italy
- Australian Commodity Traders Exchange
- Chettinad Cement Corporation Ltd - India
- Agrawal Coal Company - India
- Bhatia International Limited - India
- Antam Resourcindo - Indonesia
- Marubeni Corporation - India
- Siam City Cement PLC, Thailand
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Indonesian Coal Mining Association
- Karbindo Abesyapradhi - Indoneisa
- Vizag Seaport Private Limited - India
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Maheswari Brothers Coal Limited - India
- Borneo Indobara - Indonesia
- Wilmar Investment Holdings
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- Intertek Mineral Services - Indonesia
- Therma Luzon, Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Kalimantan Lumbung Energi - Indonesia
- Bhoruka Overseas - Indonesia
- Baramulti Group, Indonesia
- Deloitte Consulting - India
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Central Electricity Authority - India
- Manunggal Multi Energi - Indonesia
- Mjunction Services Limited - India
- New Zealand Coal & Carbon
- Georgia Ports Authority, United States
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- Australian Coal Association
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kideco Jaya Agung - Indonesia
- Ind-Barath Power Infra Limited - India
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Star Paper Mills Limited - India
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- Sakthi Sugars Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Meenaskhi Energy Private Limited - India
- Simpson Spence & Young - Indonesia
- Ministry of Finance - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Timah Investasi Mineral - Indoneisa
- Bhushan Steel Limited - India
- Rio Tinto Coal - Australia
- Formosa Plastics Group - Taiwan
- ICICI Bank Limited - India
- Kobexindo Tractors - Indoneisa
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- Videocon Industries ltd - India
- Altura Mining Limited, Indonesia
- Anglo American - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- White Energy Company Limited
- Global Green Power PLC Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Lanco Infratech Ltd - India
- San Jose City I Power Corp, Philippines
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