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Sunday, 07 April 19
SHIP PASSAGE PLANS - NO ROOM FOR ERROR! - WATSON FARLEY & WILLIAMS
 KNOWLEDGE TO ELEVATE
The English High Court’s judgment in Alize 1954 v Allianz Elementar Versicherungs AG (The CMA CGM Libra) is an important decision involving the application of longstanding principles as to a shipowner’s liability for actionable fault following a casualty. In finding that a defective passage plan rendered a vessel unseaworthy, the English High Court has demonstrated how traditional tests will be applied to update the law into the modern day world.
Prior to this decision, there had been no case whereby a defective passage plan rendered a vessel unseaworthy. However, it is now clear that just as the standard of seaworthiness must rise with improved knowledge of shipbuilding, so must the standard of seaworthiness rise with improved knowledge of the documents required to be prepared to ensure safe navigation. Following the IMO’s recognition in 1999 of the need for passage planning to be adopted by “all ships engaged on international voyages”, The CMA CGM Libra shows that by 2011 the English courts expected an adequate passage plan to have been prepared. If it was defective, the consequences could be severe.
The Case
The case concerned a laden container vessel which grounded by virtue of the master negligently navigating outside of the buoyed fairway when leaving the port of Xiamen in China. The owner had known this to be a difficult port to navigate, especially as various Notices to Mariners had been issued advising that areas existed in the Xiamen Gang (though not in the fairway) that had depths less than those charted.
Cargo interests refused to pay the owner their proportion of the total claim in general average and denied liability under Article III r.1 of the Hague Rules on the basis that the casualty was caused by the owner’s actionable fault. In particular, they alleged that the vessel was unseaworthy because she had an inadequate passage plan, that inadequacy was a cause of the casualty and due diligence was not exercised by the owner to make the vessel seaworthy.
The Decision
Before considering the substantive matters of unseaworthiness, causation and due diligence, Mr Justice Teare addressed the issue of which party bears the burden of proof in relation to Article III r.1. He affirmed the conventional view that the burden lies on the cargo interests to establish that the vessel was unseaworthy and such unseaworthiness caused the grounding. If those matters are established, the burden then lies on the owners to prove that due diligence was exercised to make the vessel seaworthy.
Unseaworthiness
Mr Justice Teare held that neither the formal passage plan, nor the working chart, contained the necessary warning of the potential danger arising outside the buoyed fairway from the existence of areas with lower depths than charted. The necessary warning should have been such that, when the navigator was faced with a decision whether to remain in the buoyed fairway or to navigate outside, he had in mind the warning that charted depths outside the buoyed fairway may be unreliable.
The judge affirmed that the long-established and authoritative test of unseaworthiness is whether a prudent owner would have required the relevant defect, had he known of it, to be made good before sending his ship to sea. He found it inconceivable that a prudent owner would allow the vessel to depart from Xiamen with a passage plan that lacked the necessary warning, especially given that IMO Resolution of 1999 states that a “well planned voyage” is of “essential importance for safety of life at sea, safety of navigation and protection of the marine environment”.
The owner argued that passage planning is simply the preparation for safe navigation and is not itself an aspect of seaworthiness. In making these arguments, the owner sought to benefit from the negligent navigation exception under Article IV r.2(a) of the Hague Rules, which provides that (assuming there is no failure by the owners to make the vessel seaworthy) a shipowner will not be responsible for loss caused by neglect in the “navigation or in the management of the ship”.
However, Mr Justice Teare rejected this, stating that seaworthiness extends to having the appropriate documentation on board, including the appropriate charts. Firstly, he noted that Article III r.1 places a seaworthiness obligation upon the shipowner “before and at the beginning of the voyage” and that passage planning before the beginning of the voyage is necessary for safe navigation during voyage. Secondly, he pointed out that it is well recognised that if a vessel’s charts are not up to date that is an “attribute” of the vessel which can render her unseaworthy – and that a proper passage plan is now like an up to date and properly corrected chart.
Mr Justice Teare also suggested that a “one-off” failure to correct a chart in a material manner before the beginning of the voyage is capable of rendering a vessel unseaworthy, even if the shipowner has put in place proper systems to ensure that the prerequisite materials were on board to prepare an adequate chart. He explained that concentrating upon the shipowner’s own actions to the exclusion of those of his servants or agents, confuses the issue of seaworthiness with the issue of due diligence, which in any event is a non-delegable duty.
Finally, Mr Justice Teare observed that the negligent navigation exception applied only to Article III r.2 and not Article III r.1. Therefore, a shipowner will not be protected from liability for failing to exercise due diligence to make the vessel seaworthy by the fact that a cause of the casualty was negligent navigation.
Conclusion
In conclusion, this case found that an appropriate passage plan is a matter of seaworthiness under Article III r.1 of the Hague Rules. This is not the type of chart that might traditionally have been expected to affect the seaworthiness of a vessel, especially as a passage plan relates principally to navigation of the ship. Nevertheless, following this judgment, shipowners will have to ensure that, through its agents and servants, due diligence is exercised to produce a non-defective passage plan that clearly contains the necessary warnings. Failure to do so, if causative of a casualty, will not be saved by the negligent navigation exception under Article IV r 2(a) of the Hague Rules, which cannot be applied where a shipowner has failed to exercise due diligence to make the vessel seaworthy.
Source: Watson Farley & Williams
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Saturday, 06 April 19
SUPRAMAX: IT WAS A POOR WEEK OVERALL FOR THE BALTIC SUPRAMAX INDEX, WHICH LOST GROUND - BALTIC BRIEFING
Capesize
The Capesize market over the past week looked to have found a floor on Tuesday with the BCI 5TC at $3460 before firming into the rest ...
Thursday, 04 April 19
OVERSUPPLY STILL MAJOR CHALLENGE WARNS ICS
Speaking in Istanbul, Simon Bennett, Deputy Secretary General of the International Chamber of Shipping (ICS) warned that avoiding overcapacity and ...
Thursday, 04 April 19
GLENCORE, TOHOKU ELECTRIC SET COAL CONTRACT PRICE AT $94.75/T - SOURCE, REUTERS REPORTED
Global miner Glencore and Japan’s Tohoku Electric Power agreed on a price of $94.75 per tonne for supplies of thermal coal from Australia for ...
Monday, 01 April 19
FORCE MAJEURE SUCCESS NOT A SEA CHANGE - BALTIC EXCHANGE
KNOWLEDGE TO ELEVATE
It is difficult to successfully argue that contractual performance has been prevented or delayed by force majeure. This i ...
Monday, 01 April 19
AUSTRALIAN COAL AT RISK FROM CHINA MOVE, WARNS GOVERNMENT REPORT - SYDNEY MORNING HERALD
A new government report warns China’s restrictions on coal imports is the number one risk for Australian coal this year and could lead to a s ...
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Showing 1436 to 1440 news of total 6871 |
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- Intertek Mineral Services - Indonesia
- TeaM Sual Corporation - Philippines
- PTC India Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Merrill Lynch Commodities Europe
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Mercator Lines Limited - India
- Uttam Galva Steels Limited - India
- Leighton Contractors Pty Ltd - Australia
- Standard Chartered Bank - UAE
- Indogreen Group - Indonesia
- SMG Consultants - Indonesia
- Manunggal Multi Energi - Indonesia
- Oldendorff Carriers - Singapore
- Ministry of Finance - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Globalindo Alam Lestari - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ambuja Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Bharathi Cement Corporation - India
- Ministry of Mines - Canada
- Kartika Selabumi Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Essar Steel Hazira Ltd - India
- Vizag Seaport Private Limited - India
- Agrawal Coal Company - India
- Bulk Trading Sa - Switzerland
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Larsen & Toubro Limited - India
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Java Power - Indonesia
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Meenaskhi Energy Private Limited - India
- Savvy Resources Ltd - HongKong
- SN Aboitiz Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Medco Energi Mining Internasional
- Global Business Power Corporation, Philippines
- Africa Commodities Group - South Africa
- New Zealand Coal & Carbon
- Directorate Of Revenue Intelligence - India
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- Chettinad Cement Corporation Ltd - India
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Riau Bara Harum - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- Georgia Ports Authority, United States
- Global Coal Blending Company Limited - Australia
- White Energy Company Limited
- Banpu Public Company Limited - Thailand
- Toyota Tsusho Corporation, Japan
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Miang Besar Coal Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- Borneo Indobara - Indonesia
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Karbindo Abesyapradhi - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- European Bulk Services B.V. - Netherlands
- Star Paper Mills Limited - India
- Wilmar Investment Holdings
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Latin American Coal - Colombia
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- IEA Clean Coal Centre - UK
- Parliament of New Zealand
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- The Treasury - Australian Government
- Petrochimia International Co. Ltd.- Taiwan
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Petron Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Coalindo Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Romanian Commodities Exchange
- CNBM International Corporation - China
- Antam Resourcindo - Indonesia
- Singapore Mercantile Exchange
- Deloitte Consulting - India
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Sakthi Sugars Limited - India
- London Commodity Brokers - England
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Anglo American - United Kingdom
- Thai Mozambique Logistica
- OPG Power Generation Pvt Ltd - India
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Posco Energy - South Korea
- Sojitz Corporation - Japan
- Dalmia Cement Bharat India
- Sree Jayajothi Cements Limited - India
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- Kaltim Prima Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Siam City Cement - Thailand
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Neyveli Lignite Corporation Ltd, - India
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Bhushan Steel Limited - India
- Videocon Industries ltd - India
- Sinarmas Energy and Mining - Indonesia
- Electricity Generating Authority of Thailand
- Sindya Power Generating Company Private Ltd
- Australian Coal Association
- Siam City Cement PLC, Thailand
- Salva Resources Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- The University of Queensland
- Pipit Mutiara Jaya. PT, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Straits Asia Resources Limited - Singapore
- Indika Energy - Indonesia
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Tata Chemicals Ltd - India
- India Bulls Power Limited - India
- Coal and Oil Company - UAE
- VISA Power Limited - India
- GMR Energy Limited - India
- Electricity Authority, New Zealand
- Energy Development Corp, Philippines
- Parry Sugars Refinery, India
- Bhoruka Overseas - Indonesia
- Karaikal Port Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Rio Tinto Coal - Australia
- LBH Netherlands Bv - Netherlands
- Trasteel International SA, Italy
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- Power Finance Corporation Ltd., India
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Marubeni Corporation - India
- Port Waratah Coal Services - Australia
- Price Waterhouse Coopers - Russia
- Edison Trading Spa - Italy
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