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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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- Mercuria Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- Indonesian Coal Mining Association
- Agrawal Coal Company - India
- Economic Council, Georgia
- Mercator Lines Limited - India
- Ind-Barath Power Infra Limited - India
- Mintek Dendrill Indonesia
- Energy Development Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- PTC India Limited - India
- Bhushan Steel Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Jindal Steel & Power Ltd - India
- Medco Energi Mining Internasional
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- Vizag Seaport Private Limited - India
- Interocean Group of Companies - India
- European Bulk Services B.V. - Netherlands
- Kaltim Prima Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- San Jose City I Power Corp, Philippines
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- New Zealand Coal & Carbon
- Bukit Asam (Persero) Tbk - Indonesia
- Madhucon Powers Ltd - India
- Wood Mackenzie - Singapore
- Ministry of Finance - Indonesia
- Renaissance Capital - South Africa
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- CNBM International Corporation - China
- Xindia Steels Limited - India
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Leighton Contractors Pty Ltd - Australia
- SMC Global Power, Philippines
- Coalindo Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Videocon Industries ltd - India
- Therma Luzon, Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Petron Corporation, Philippines
- Africa Commodities Group - South Africa
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Australian Commodity Traders Exchange
- McConnell Dowell - Australia
- Chettinad Cement Corporation Ltd - India
- SMG Consultants - Indonesia
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Pendopo Energi Batubara - Indonesia
- Meralco Power Generation, Philippines
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- SN Aboitiz Power Inc, Philippines
- Sojitz Corporation - Japan
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- Planning Commission, India
- Siam City Cement PLC, Thailand
- Heidelberg Cement - Germany
- Samtan Co., Ltd - South Korea
- Holcim Trading Pte Ltd - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Lanco Infratech Ltd - India
- Sindya Power Generating Company Private Ltd
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Kumho Petrochemical, South Korea
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- GMR Energy Limited - India
- MS Steel International - UAE
- Parry Sugars Refinery, India
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Mines - Canada
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Singapore Mercantile Exchange
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Kartika Selabumi Mining - Indonesia
- Orica Mining Services - Indonesia
- Makarim & Taira - Indonesia
- Global Business Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Carbofer General Trading SA - India
- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Coal and Oil Company - UAE
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Commonwealth Bank - Australia
- Savvy Resources Ltd - HongKong
- Tata Chemicals Ltd - India
- ICICI Bank Limited - India
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Binh Thuan Hamico - Vietnam
- Barasentosa Lestari - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Mineral Development Corp Ltd - India
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- IHS Mccloskey Coal Group - USA
- Miang Besar Coal Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- Ambuja Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Tamil Nadu electricity Board
- Australian Coal Association
- Bukit Makmur.PT - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- Globalindo Alam Lestari - Indonesia
- Bhatia International Limited - India
- Power Finance Corporation Ltd., India
- GVK Power & Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- ASAPP Information Group - India
- Chamber of Mines of South Africa
- Asmin Koalindo Tuhup - Indonesia
- India Bulls Power Limited - India
- Thai Mozambique Logistica
- Aditya Birla Group - India
- Posco Energy - South Korea
- Edison Trading Spa - Italy
- Standard Chartered Bank - UAE
- Borneo Indobara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Energy Exchange, India
- Electricity Authority, New Zealand
- Deloitte Consulting - India
- Banpu Public Company Limited - Thailand
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- Indian Oil Corporation Limited
- White Energy Company Limited
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- The University of Queensland
- Wilmar Investment Holdings
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Trasteel International SA, Italy
- Malabar Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- LBH Netherlands Bv - Netherlands
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Toyota Tsusho Corporation, Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Independent Power Producers Association of India
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Mjunction Services Limited - India
- Romanian Commodities Exchange
- Siam City Cement - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coastal Gujarat Power Limited - India
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Krishnapatnam Port Company Ltd. - India
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Antam Resourcindo - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sree Jayajothi Cements Limited - India
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- The Treasury - Australian Government
- TeaM Sual Corporation - Philippines
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
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