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Monday, 04 April 16
THE LOADING, AND SUBSEQUENT DISCHARGE, OF UNSAFE NICKEL ORE - ALL TIME TO 'COUNT' - THE STANDARD CLUB
 KNOWLEDGE TO ELEVATE
In a recent, published, London arbitration award the English tribunal has held that all time lost as a result of loading, and then discharging, a confiscated (unsafe) cargo will be for the charterer’s account.
Background facts
Under a contract of affreightment (CoA), the owner was required to carry eight shipments of nickel ore. The ship promptly arrived at the nominated load, with loading commencing the very next day. Loading stopped two weeks later, however, and the local navy issued a confiscation order, resulting in the ship being compounded in a nearby naval base. The confiscation order was issued due to the cargo being mined outside the parameters of the locally granted permits. Only three months later was the ship released to discharge the cargo already on board the ship, which took two more months to complete.
When the ship was released the charterer emailed the owner requiring it to organise the remaining discharge operation. In addition, the charterer advised that it would not provide any cargo for the next shipment. In response, the owner advised the charterer that it had wrongfully repudiated the CoA and claimed, through London arbitration, demurrage for the entire duration of delay.
The Tribunal’s decision
The arbitration tribunal would only consider the claim for demurrage, not the claim for possible wrongful termination.
The charterer’s primary defense to the demurrage claim was based upon the following CoA clause (our emphasis):
‘In case any acts of God, riots, civil commotions, fire or any other causes comprehend in the Force Majeure terms which may delay or prevent to provide the cargo at the port of loading and load/discharge of the cargo, such time lost is not to count as laytime as neither Charterers nor Shipper nor Suppliers nor Receivers shall be liable for any loss of demurrage, unless vessel already on demurrage. Once on demurrage always on demurrage.’
The tribunal found that the above clause did not aid the charterer in its defence. It was held that the confiscation of the ship by the local navy did not fall within the boundaries of ‘any acts of God, riots, civil commotions, fire or any other causes comprehend in force majeure terms’.
Also, the tribunal found that because the subject cargo had been illegally mined, the charterer had failed to meet its primary contractual obligation under the CoA to provide a safe cargo, which could not be ‘excused’ by other contractual defences.
Finally, as the intervention by the navy was after the ship fell on demurrage, it was found that as per the above wording, ‘once on demurrage always on demurrage’, the charterer remained liable for the entire period of detention and delay.
On the other hand, the tribunal refused to accept that the charterer should not be allowed load time. This was on the basis that cargo had been partially loaded. The charterer was therefore allowed laytime, on a pro rata basis, irrespective of it being considered an unsafe cargo.
Concluding remarks
Following the above decision, members acting in a charterer’s capacity should take all precautions to ensure that the cargo to be loaded on board a ship is safe, legal and that all applicable documentation is in order to best prevent similar situations from arising in the future. It should also be noted that if the subject charter includes the phrase ‘once on demurrage, always on demurrage’ the charterer will remain liable for all time used until the load or discharge operation is completed. Charterer members should, therefore, be proactive and continue to use their best efforts to minimize any time lost.
This article intends to provide general guidance on the issues arising as a matter of English law. It is not intended to provide legal advice in relation to any specific query. Members requiring further information on this topic should direct their enquiries to either their usual contact at the club, or to the authors of this article.
Defence cover is, by its very nature, discretionary in that the club must be satisfied as to the merits and quantum of the claim in question and the likelihood of achieving a successful outcome, if it is to lend support.
Source: The Standard Club
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Monday, 16 May 16
THE FREIGHT MARKET WAS WEAK AND ALL SEGMENTS EXCEPT PANAMAX WERE DOWN
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities decline this week.
The freight market was weak and a ...
Friday, 13 May 16
COAL CARGOES - SOME RECENT DEVELOPMENTS: SWEDISH CLUB
KNOWLEDGE TO ELEVATE
Indonesia continues to be amongst the world’s major exporters of coal, some 426Mt being traded in 2013 mostly to In ...
Friday, 13 May 16
US WEEKLY COAL PRODUCTION IS RUNNING 33% BELOW THE SAME PERIOD IN 2015 - EIA
COALspot.com – U.S the world’s second largest coal producer has produced approximately totaled an estimated 10.9 million short tons (mm ...
Friday, 13 May 16
DRY BULK SHIPPING MARKET RECOVERY WILL BE A LONG, HARD-FOUGHT BATTLE - HELLENIC SHIPPING NEWS
Anyone who expects a strong rally in dry bulk market rates to end the industry’s downturn will be bitterly disappointed. By contrast – ...
Wednesday, 11 May 16
U.S. FORECAST COAL PRODUCTION IS EXPECTED TO DECLINED BY 150 MMST IN 2016; THE LARGEST DECLINE SINCE 1949 - EIA
COALspot.com: EIA estimates that U.S. coal production in April was 46 million short tons (MMst), a 6 MMst (12%) decrease from the previous month an ...
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Showing 2436 to 2440 news of total 6871 |
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- Petrochimia International Co. Ltd.- Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- GMR Energy Limited - India
- Sindya Power Generating Company Private Ltd
- Mjunction Services Limited - India
- Jaiprakash Power Ventures ltd
- Neyveli Lignite Corporation Ltd, - India
- Semirara Mining Corp, Philippines
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Eastern Energy - Thailand
- Billiton Holdings Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- Agrawal Coal Company - India
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Samtan Co., Ltd - South Korea
- Timah Investasi Mineral - Indoneisa
- Energy Link Ltd, New Zealand
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- MS Steel International - UAE
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- Indo Tambangraya Megah - Indonesia
- Coalindo Energy - Indonesia
- Sojitz Corporation - Japan
- ASAPP Information Group - India
- TNB Fuel Sdn Bhd - Malaysia
- IHS Mccloskey Coal Group - USA
- Africa Commodities Group - South Africa
- The State Trading Corporation of India Ltd
- Planning Commission, India
- Central Java Power - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kapuas Tunggal Persada - Indonesia
- Aboitiz Power Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Interocean Group of Companies - India
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Coastal Gujarat Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Jindal Steel & Power Ltd - India
- Karaikal Port Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- LBH Netherlands Bv - Netherlands
- Gujarat Mineral Development Corp Ltd - India
- Antam Resourcindo - Indonesia
- Bukit Baiduri Energy - Indonesia
- Marubeni Corporation - India
- Ministry of Mines - Canada
- Siam City Cement PLC, Thailand
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- PNOC Exploration Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indian Energy Exchange, India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
- Simpson Spence & Young - Indonesia
- Altura Mining Limited, Indonesia
- Sree Jayajothi Cements Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indika Energy - Indonesia
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- Bulk Trading Sa - Switzerland
- The University of Queensland
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Intertek Mineral Services - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Petron Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Metalloyd Limited - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- White Energy Company Limited
- Cement Manufacturers Association - India
- Parliament of New Zealand
- Coal and Oil Company - UAE
- Anglo American - United Kingdom
- Goldman Sachs - Singapore
- SMC Global Power, Philippines
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- GVK Power & Infra Limited - India
- Power Finance Corporation Ltd., India
- India Bulls Power Limited - India
- Bangladesh Power Developement Board
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- Grasim Industreis Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chettinad Cement Corporation Ltd - India
- Banpu Public Company Limited - Thailand
- London Commodity Brokers - England
- McConnell Dowell - Australia
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Vijayanagar Sugar Pvt Ltd - India
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- Bharathi Cement Corporation - India
- Kideco Jaya Agung - Indonesia
- Global Business Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- Mercuria Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- ICICI Bank Limited - India
- Rio Tinto Coal - Australia
- Mintek Dendrill Indonesia
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- San Jose City I Power Corp, Philippines
- Merrill Lynch Commodities Europe
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- PowerSource Philippines DevCo
- Tata Chemicals Ltd - India
- Bhoruka Overseas - Indonesia
- Sarangani Energy Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Tamil Nadu electricity Board
- PTC India Limited - India
- Rashtriya Ispat Nigam Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Authority, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Barasentosa Lestari - Indonesia
- Energy Development Corp, Philippines
- IEA Clean Coal Centre - UK
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- South Luzon Thermal Energy Corporation
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- Star Paper Mills Limited - India
- Orica Australia Pty. Ltd.
- Ind-Barath Power Infra Limited - India
- Riau Bara Harum - Indonesia
- Dalmia Cement Bharat India
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- Vizag Seaport Private Limited - India
- Maheswari Brothers Coal Limited - India
- Lanco Infratech Ltd - India
- Bhushan Steel Limited - India
- Ministry of Finance - Indonesia
- Standard Chartered Bank - UAE
- Global Green Power PLC Corporation, Philippines
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Parry Sugars Refinery, India
- Ambuja Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Electricity Regulatory Commission - India
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- TeaM Sual Corporation - Philippines
- Videocon Industries ltd - India
- Port Waratah Coal Services - Australia
- Minerals Council of Australia
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Xindia Steels Limited - India
- Medco Energi Mining Internasional
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Sakthi Sugars Limited - India
- Alfred C Toepfer International GmbH - Germany
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Binh Thuan Hamico - Vietnam
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
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