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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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Tuesday, 19 February 19
FAST DEPLETING COAL RESERVES COULD PUSH UP ENERGY PRICES, CAUTIONS EXPERT - THE HINDU BUSINESS LINE
The fast depletion of coal, a strategic resource and India’s fuel of choice currently, has huge implications for energy costs, according to K ...
Monday, 18 February 19
INDIA'S COAL IMPORT FALLS TO 17.25 MT IN JANUARY - PTI
Coal imports saw a decline in January FY 2019 to 17.25 MT from 19.59 MT in the same month of the previous fiscal, according to a report by mjunctio ...
Monday, 18 February 19
THE ROLE OF COAL IN INDIA'S ENERGY AMBITIONS - WCA
India is the world’s second most populous country and figures among the world’s most rapidly growing economies.
The Sout ...
Saturday, 16 February 19
COALTRANS CHINA 2019, CHINA'S LARGEST COAL INDUSTRY GATHERING
Press Release: Coaltrans China 2019 | With the import ban likely to be lifted, it’s time for you to meet your potentia ...
Wednesday, 13 February 19
MALAYSIA WAS THE REGION'S LARGEST COAL IMPORTER WITH 34 MT IN 2018, UP 25% Y-O-Y
Although coal market in 2018 started with strong prices, starting in the beginning of the second half of 2018, the international spot prices for co ...
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- Iligan Light & Power Inc, Philippines
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Trasteel International SA, Italy
- Marubeni Corporation - India
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Manunggal Multi Energi - Indonesia
- Planning Commission, India
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- TeaM Sual Corporation - Philippines
- India Bulls Power Limited - India
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Indika Energy - Indonesia
- Lanco Infratech Ltd - India
- Leighton Contractors Pty Ltd - Australia
- White Energy Company Limited
- Medco Energi Mining Internasional
- Petron Corporation, Philippines
- Global Business Power Corporation, Philippines
- Wilmar Investment Holdings
- Parry Sugars Refinery, India
- Interocean Group of Companies - India
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Edison Trading Spa - Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Tata Chemicals Ltd - India
- Siam City Cement - Thailand
- MS Steel International - UAE
- Aboitiz Power Corporation - Philippines
- San Jose City I Power Corp, Philippines
- IEA Clean Coal Centre - UK
- Oldendorff Carriers - Singapore
- Pendopo Energi Batubara - Indonesia
- Kumho Petrochemical, South Korea
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Sindya Power Generating Company Private Ltd
- Tamil Nadu electricity Board
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Semirara Mining and Power Corporation, Philippines
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Deloitte Consulting - India
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Goldman Sachs - Singapore
- GVK Power & Infra Limited - India
- Chamber of Mines of South Africa
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
- Central Java Power - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Altura Mining Limited, Indonesia
- PowerSource Philippines DevCo
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Makarim & Taira - Indonesia
- Indonesian Coal Mining Association
- South Luzon Thermal Energy Corporation
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- Krishnapatnam Port Company Ltd. - India
- Riau Bara Harum - Indonesia
- Minerals Council of Australia
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- IHS Mccloskey Coal Group - USA
- Alfred C Toepfer International GmbH - Germany
- GN Power Mariveles Coal Plant, Philippines
- Malabar Cements Ltd - India
- Barasentosa Lestari - Indonesia
- Ministry of Transport, Egypt
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Rio Tinto Coal - Australia
- Gujarat Mineral Development Corp Ltd - India
- Global Green Power PLC Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- SMC Global Power, Philippines
- Bukit Baiduri Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Central Electricity Authority - India
- Ceylon Electricity Board - Sri Lanka
- Jindal Steel & Power Ltd - India
- VISA Power Limited - India
- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- Bharathi Cement Corporation - India
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Asmin Koalindo Tuhup - Indonesia
- Sarangani Energy Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- Thai Mozambique Logistica
- Port Waratah Coal Services - Australia
- Vedanta Resources Plc - India
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Africa Commodities Group - South Africa
- Ambuja Cements Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Merrill Lynch Commodities Europe
- Wood Mackenzie - Singapore
- The State Trading Corporation of India Ltd
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- LBH Netherlands Bv - Netherlands
- Ministry of Mines - Canada
- Savvy Resources Ltd - HongKong
- Orica Australia Pty. Ltd.
- Billiton Holdings Pty Ltd - Australia
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- European Bulk Services B.V. - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- Indo Tambangraya Megah - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Sakthi Sugars Limited - India
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Borneo Indobara - Indonesia
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- Standard Chartered Bank - UAE
- Jorong Barutama Greston.PT - Indonesia
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- Energy Development Corp, Philippines
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- Vizag Seaport Private Limited - India
- Gujarat Sidhee Cement - India
- Electricity Generating Authority of Thailand
- Neyveli Lignite Corporation Ltd, - India
- Star Paper Mills Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- ICICI Bank Limited - India
- Semirara Mining Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- ASAPP Information Group - India
- Kepco SPC Power Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Heidelberg Cement - Germany
- Ind-Barath Power Infra Limited - India
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Metalloyd Limited - United Kingdom
- Agrawal Coal Company - India
- Antam Resourcindo - Indonesia
- Coastal Gujarat Power Limited - India
- Sree Jayajothi Cements Limited - India
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
- Eastern Energy - Thailand
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Meralco Power Generation, Philippines
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- Indogreen Group - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- Carbofer General Trading SA - India
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Meenaskhi Energy Private Limited - India
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
- Larsen & Toubro Limited - India
- Romanian Commodities Exchange
- Attock Cement Pakistan Limited
- Gujarat Electricity Regulatory Commission - India
- Sical Logistics Limited - India
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
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