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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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Sunday, 18 November 18
COAL STOCKS IN A THIRD OF NTPC PLANTS CLOSE TO NIL - FINANCIAL EXPRESS
Coal supply shortage continues to haunt NTPC, the country’s largest power generator, with latest government data showing 31% of the company&r ...
Thursday, 15 November 18
OIL MARKET REPORT: HEEDING THE WARNINGS - IEA
In last month’s Report, we noted that since the middle of the year oil supply had increased sharply, with gains in the Middle East, Russia an ...
Wednesday, 14 November 18
BIMCO ADOPTS 2020 BUNKER CLAUSES
BIMCO has developed two 2020 bunker clauses that deal with general compliance and the transitional period for an early December release.
...
Wednesday, 14 November 18
SHIPPING MARKET INSIGHT - KONSTANTINOS KONTOMICHIS
The shipping industry is going through an interesting period across all markets. Since the end of last year, the Dry Baltic Index has been showing ...
Tuesday, 13 November 18
INDIA: POWER DEMAND UP; COAL STOCKS AT MINES AT A 5-YEAR LOW - FINANCIAL EXPRESS
Stocks at Coal India mines plunged to a five-year low of 21 million tonne (mt) in October, as a sudden surge in demand for the fuel from the power ...
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Showing 1561 to 1565 news of total 6871 |
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- Iligan Light & Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Videocon Industries ltd - India
- Aditya Birla Group - India
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Sakthi Sugars Limited - India
- ICICI Bank Limited - India
- White Energy Company Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Indian Oil Corporation Limited
- OPG Power Generation Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Independent Power Producers Association of India
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Jindal Steel & Power Ltd - India
- The University of Queensland
- Straits Asia Resources Limited - Singapore
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- Global Coal Blending Company Limited - Australia
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Goldman Sachs - Singapore
- Wood Mackenzie - Singapore
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Parry Sugars Refinery, India
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- GMR Energy Limited - India
- Vizag Seaport Private Limited - India
- Manunggal Multi Energi - Indonesia
- The State Trading Corporation of India Ltd
- Maheswari Brothers Coal Limited - India
- Medco Energi Mining Internasional
- The Treasury - Australian Government
- Orica Mining Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Australian Coal Association
- Minerals Council of Australia
- Siam City Cement - Thailand
- Price Waterhouse Coopers - Russia
- Mintek Dendrill Indonesia
- Georgia Ports Authority, United States
- Indo Tambangraya Megah - Indonesia
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Thiess Contractors Indonesia
- Economic Council, Georgia
- Wilmar Investment Holdings
- Bhushan Steel Limited - India
- Indian Energy Exchange, India
- Parliament of New Zealand
- Anglo American - United Kingdom
- SN Aboitiz Power Inc, Philippines
- Marubeni Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Energy Development Corp, Philippines
- Madhucon Powers Ltd - India
- Merrill Lynch Commodities Europe
- CIMB Investment Bank - Malaysia
- Bharathi Cement Corporation - India
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Mercator Lines Limited - India
- Ambuja Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- London Commodity Brokers - England
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Cement Manufacturers Association - India
- Kalimantan Lumbung Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Interocean Group of Companies - India
- GN Power Mariveles Coal Plant, Philippines
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Central Java Power - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sindya Power Generating Company Private Ltd
- Indonesian Coal Mining Association
- IHS Mccloskey Coal Group - USA
- Coastal Gujarat Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Lanco Infratech Ltd - India
- Electricity Authority, New Zealand
- GAC Shipping (India) Pvt Ltd
- Banpu Public Company Limited - Thailand
- Sinarmas Energy and Mining - Indonesia
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Carbofer General Trading SA - India
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Eastern Coal Council - USA
- Ministry of Transport, Egypt
- Pendopo Energi Batubara - Indonesia
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMG Consultants - Indonesia
- South Luzon Thermal Energy Corporation
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- VISA Power Limited - India
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- CNBM International Corporation - China
- Petrochimia International Co. Ltd.- Taiwan
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Planning Commission, India
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Baramulti Group, Indonesia
- Bukit Baiduri Energy - Indonesia
- Makarim & Taira - Indonesia
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- Singapore Mercantile Exchange
- Holcim Trading Pte Ltd - Singapore
- Thai Mozambique Logistica
- Globalindo Alam Lestari - Indonesia
- MS Steel International - UAE
- Kumho Petrochemical, South Korea
- PetroVietnam Power Coal Import and Supply Company
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- Kartika Selabumi Mining - Indonesia
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- Global Business Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- New Zealand Coal & Carbon
- Chamber of Mines of South Africa
- Dalmia Cement Bharat India
- SMC Global Power, Philippines
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- Commonwealth Bank - Australia
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Renaissance Capital - South Africa
- Central Electricity Authority - India
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- PowerSource Philippines DevCo
- Jaiprakash Power Ventures ltd
- PNOC Exploration Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Savvy Resources Ltd - HongKong
- Borneo Indobara - Indonesia
- Antam Resourcindo - Indonesia
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Posco Energy - South Korea
- Gujarat Mineral Development Corp Ltd - India
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