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Sunday, 12 July 15
SHIPYARD NOT LIABLE FOR ENGINE ROOM FIRE CAUSED BY OIL LEAKAGE - BIRCH WINDAHL
 KNOWLEDGE TO ELEVATE
A Danish vessel owner requested a Danish shipyard to undertake repairs and maintenance works on its vessel. An agreement between the two parties stipulated that the shipyard would be liable for damages caused to the vessel resulting from negligence on the part of the shipyard, its employees or subcontractors. On February 17 2011 at 11:40am – in connection with repair works in the engine room of the vessel – damage was caused to an oil pipe due to an error which resulted in the leakage of 200 litres of oil into the engine room. After the leakage, all hot work in the vessel was suspended. The repair work resumed at 6:45pm. However, it was not clear whether the hot work was also resumed at that time. At 6:16pm a boiler which was used to heat the accommodation on the vessel was switched on by the owner’s crew.
The clean-up of the oil spillage had not been finished at that point. The exhaust smoke from the boiler was 290 degrees Celsius. The self-ignition temperature of the leaked oil was 350 degrees Celsius, whereas its flashpoint temperature was 250 degrees Celsius. It was disputed in the proceedings whether the shipyard had confirmed that the boiler could be switched on. At 8:00pm smoke was detected in the casing and a fire was also detected. The owner and the shipyard agreed that the fire had been caused by the fact that the leaked oil had been ignited. However, it was uncertain how this had happened. After the damage caused by the fire was repaired, the vessel left the shipyard on February 20 2011. On the night of February 20 2011 another fire broke out on the vessel close to its main engine. The owner brought proceedings against the shipyard and submitted a claim for compensation for the damage caused due to the fire. The shipyard denied liability and submitted that it had not been proven that the fires were caused by the shipyard due to errors or omissions on its part.
Decision
The Maritime and Commercial Court stated that the presence of oil in the engine room was “a necessary prerequisite but not a sufficient condition for the fire to occur”. The court found that it was not proven that the shipyard, due to errors or omissions, had caused the oil to ignite. The court stated as follows:
“The court finds that the Owner has not proved that the ignition of the oil, approximately eight hours after the leakage, stems from an error or omission on the part of the Yard or any for which it is responsible. The reason for the ignition has not been clarified, the court, however, finds that the ignition as mentioned required an external source of heat and that the fire, on the basis of the available facts… must be considered to have occurred in time close to the start-up of the boiler which was the responsibility of the owner and it cannot be considered proven that the yard had approved that the boiler could be started.”(1)
The shipyard was thus found free of liability.
Comment
It followed from the contract terms pertaining to the repair work that the shipyard could be held liable only subject to proof of negligence on its part. If the aforementioned contract terms had not been agreed, the shipyard could possibly have been held liable under Danish law, unless it could establish that it had not caused the damage due to negligence. The fact that there were several possible causes of the fire and that the shipyard was not liable if the oil had been ignited by sparks from the boiler – which had been switched on by the owner’s crew – meant that the shipyard was not liable. The failure to determine the source of the fire – regardless of the fact that it would undoubtedly not have occurred on February 17 2011 if the shipyard had not caused the oil leak – was insufficient to impose liability on the shipyard. With respect to the subsequent fire, it was also not established by the owner that it had been the result of negligence on the part of the shipyard.
Source: Birch Windahl
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Monday, 13 July 15
THE DRY BULK MARKET CLOSED ON A POSITIVE TONE THIS PAST WEEK
COALspot.com: Despite Greece crisis and turmoil in the stock market across the world , the freight market overall was firm and up in all segments t ...
Saturday, 11 July 15
MAJOR IRANIAN GAS EXPORTS WILL TAKE AT LEAST FIVE YEARS - FITCH
Iran has the long-term potential to become one of the world's top gas producers, thanks to its 34 trillion cubic meters (tcm) of natural gas re ...
Friday, 10 July 15
DRY BULK MARKET KEEPS POSITIVE MOMENTUM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its positive momentum over the course of the past few days, thanks to Panamax gains. During yesterday’s session ...
Friday, 10 July 15
U.S PRODUCED APPROXIMATELY TOTALED AN ESTIMATED 14.1 MMST WEEK OVER WEEK - EIA
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 14.1 million short ...
Thursday, 09 July 15
CPP MARKET : POSITIVE IN THE SHORT TERM - GEORGE VASTARDIS
Despite the traditionally quieter summer period, the clean tanker market has so far experienced healthy activity especially East of Suez. Increased ...
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- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Independent Power Producers Association of India
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- Price Waterhouse Coopers - Russia
- Aditya Birla Group - India
- Neyveli Lignite Corporation Ltd, - India
- The University of Queensland
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- Mercuria Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Central Electricity Authority - India
- Central Java Power - Indonesia
- Renaissance Capital - South Africa
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- Simpson Spence & Young - Indonesia
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- Petrochimia International Co. Ltd.- Taiwan
- Leighton Contractors Pty Ltd - Australia
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- TNB Fuel Sdn Bhd - Malaysia
- Global Coal Blending Company Limited - Australia
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
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- Directorate Of Revenue Intelligence - India
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- Australian Coal Association
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- Baramulti Group, Indonesia
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- Sinarmas Energy and Mining - Indonesia
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- Economic Council, Georgia
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- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Bukit Baiduri Energy - Indonesia
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Rio Tinto Coal - Australia
- Sree Jayajothi Cements Limited - India
- Anglo American - United Kingdom
- Sojitz Corporation - Japan
- Therma Luzon, Inc, Philippines
- Posco Energy - South Korea
- GAC Shipping (India) Pvt Ltd
- Indika Energy - Indonesia
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Bhoruka Overseas - Indonesia
- Metalloyd Limited - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Marubeni Corporation - India
- London Commodity Brokers - England
- ASAPP Information Group - India
- SMG Consultants - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- Straits Asia Resources Limited - Singapore
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Singapore Mercantile Exchange
- Bangladesh Power Developement Board
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Binh Thuan Hamico - Vietnam
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- Globalindo Alam Lestari - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
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- Coal and Oil Company - UAE
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Agrawal Coal Company - India
- International Coal Ventures Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Xindia Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Port Waratah Coal Services - Australia
- Ceylon Electricity Board - Sri Lanka
- Billiton Holdings Pty Ltd - Australia
- Thai Mozambique Logistica
- Jaiprakash Power Ventures ltd
- Tata Chemicals Ltd - India
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- Chamber of Mines of South Africa
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Sidhee Cement - India
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- Formosa Plastics Group - Taiwan
- Sakthi Sugars Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Petron Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Planning Commission, India
- Bhushan Steel Limited - India
- Ind-Barath Power Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Kaltim Prima Coal - Indonesia
- Commonwealth Bank - Australia
- Deloitte Consulting - India
- Indonesian Coal Mining Association
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- European Bulk Services B.V. - Netherlands
- Kumho Petrochemical, South Korea
- Rashtriya Ispat Nigam Limited - India
- Bhatia International Limited - India
- McConnell Dowell - Australia
- Energy Development Corp, Philippines
- Salva Resources Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Kobexindo Tractors - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- White Energy Company Limited
- Essar Steel Hazira Ltd - India
- Indian Energy Exchange, India
- Georgia Ports Authority, United States
- New Zealand Coal & Carbon
- The Treasury - Australian Government
- Grasim Industreis Ltd - India
- Indogreen Group - Indonesia
- Sical Logistics Limited - India
- Samtan Co., Ltd - South Korea
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Holcim Trading Pte Ltd - Singapore
- Iligan Light & Power Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- Minerals Council of Australia
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- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- Interocean Group of Companies - India
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