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Tuesday, 03 March 20
IMPORTANCE OF MASTER'S CARGO CHECKS - BALTIC EXCHANGE
 KNOWLEDGE TO ELEVATE
Adecision in recent High Court case has made it clear that there is no implied indemnity from a charterer to their counterpart owners if cargo shippers present bills of lading that record the cargo as being loaded clean on board, even if the shippers could have ascertained that the cargo was in fact damaged at the time of loading.
Ince partner Jamila Khan and managing associate Natalie Nielsen lay out the facts of the case. Noble Chartering Inc (the disponent owner) timechartered a vessel from the head owner and then sub-voyage chartered the vessel to Priminds Shipping (HK) Co Ltd (the voyage charterer). Under the voyage charterparty, the vessel loaded a cargo of soya beans in bulk at Santos, Argentina, for discharge at Guangzhou, China. The cargo was loaded by the cargo shipper from a silo via mechanical hoppers.
At the discharge port, the cargo receiver discovered that portions of the cargo had suffered heat and mould damage. In order to prevent the arrest of the vessel, the shipowner secured the receiver’s cargo claim and agreed that it would be subject to Chinese law and the jurisdiction of the Chinese courts. The receiver’s cargo claim was litigated in the Chinese courts, who found the shipowner liable to the receiver for $1,086,564.70.
The shipowner in turn brought a claim against the disponent owner under the terms of the time charterparty, seeking a contribution of 50% of the sum paid to the receiver. This claim was settled by the disponent owner paying $500,000 to the shipowner.
The disponent owner then commenced London arbitration against the voyage charterer under the voyage charterparty, seeking to recover the $500,000 paid to the shipowner and the costs of defending that claim. The disponent owner claimed that they were owed an indemnity for these costs, although there was no express provision in the voyage charterparty providing for such an indemnity.
Arbitration findings
Following arbitration, the Tribunal’s Award highlighted the facts that the cargo had been damaged by heating caking and by mould; that both types of damage were pre-existing at the time of loading but were not reasonably visible to the Master during loading, so the Master could not have verified the condition of the cargo; and the damage would have been reasonably visible to the shipper at the time of loading.
The disponent owner argued that the words “Clean on Board” and “SHIPPED at the Port of Loading in apparent good order and condition” in the draft bill of lading that the shipper provided to the Master for his signature amounted to a representation or warranty by the shipper as to the apparent condition of the cargo at the time of loading. The disponent owners pointed out that the shipper was acting as the voyage charterer’s agent in loading the cargo and said that, by presenting the draft bill of lading in those terms, it had represented that the cargo was in good order when it was loaded – although it was not – and so the voyage charterer owed them an indemnity for the losses caused by the cargo damage.
The Court rejected this argument, stating that although the Hague Rules provide an indemnity in respect of information provided by the charterer which is included in the bills of lading (for example, the marks on bales of cargo or the cargo weights), this indemnity did not extend to statements concerning the apparent order and condition of the cargo. The wording relating to the condition of the cargo in the draft bill of lading was not a representation or a warranty by the shipper or voyage charterer, but was instead an invitation to the Master to make a representation of fact about the state of the cargo, in accordance with his own assessment of the cargo’s apparent condition. Accordingly, the Court held that the voyage charterer did not owe an implied indemnity to the disponent owner in relation to the cargo claim.
Viewpoint
Commented Ms Khan and Ms Nielsen: “Industry observers are unlikely to be surprised by the Court’s ruling in this case, as it has long been understood that it is incumbent on a master to perform his own assessment of the apparent state of the cargo during loading and, if necessary, to clause the bill of lading (despite any “clean” wording in the draft provided by the shippers).
“In practice, a master is often not in a position to make an accurate assessment of the condition of the cargo while it is being loaded. Under English law this gives the shipowners a defence under the Hague/Hague-Visby Rules against a claim brought by the cargo receivers. However, due to the global nature of shipping, a shipowner could face a situation where they are obliged to accept the jurisdiction of a local court that does not apply these defences in the same way. In such circumstances, the shipowner will only be able to pass this claim down to their charterers if the charterparty terms permit it, for example by incorporating the terms of the Inter-Club Agreement.
“This decision makes it clear that there is no implied indemnity from a charterer to their counterpart owners if their agents (the cargo shippers) present bills of lading that record the cargo as being loaded clean on board, even if the shippers could have ascertained that the cargo was in fact damaged at the time of loading.”
Source: The Baltic Exchange
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Friday, 06 March 20
COLOMBIAN COAL OUTPUT FELL 2% IN 2019 - REUTERS
Coal production in Colombia, the fifth-largest coal exporter in the world, fell 2% to 82.2 million tonnes in 2019 after output at one of the princi ...
Friday, 06 March 20
SOLID BACKING FOR LNG AS A MARINE FUEL - BALTIC EXCHANGE
When it comes to choosing the best fuel on the near horizon to help the international shipping industry shrink its carbon intensity by 2050, DNV GL ...
Friday, 06 March 20
INDONESIA COAL PRICE REFERENCE UP AGAIN THIS MONTH
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised up the benchmark price of Indonesian thermal co ...
Thursday, 05 March 20
PANAMAX: SHIP-OWNERS HAVE MOSTLY BEEN GETTING HIGHER RATES THAN THE LAST DONE - FEARNLEYS
Cape
There is still limited amount of positive news around, with the effects of Corona virus hurting world economy. However, overall average in ...
Thursday, 05 March 20
COAL IMPORTS DOWN IN MAJOR ASIAN MARKETS, AND CORONAVIRUS NOT THE DRIVING FORCE - CLYDE RUSSELL
Asia’s seaborne coal markets stumbled in February and it appears the coronavirus outbreak in China may dodge most of the blame, with the weak ...
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- MS Steel International - UAE
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- Renaissance Capital - South Africa
- Sarangani Energy Corporation, Philippines
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Ministry of Finance - Indonesia
- Bangladesh Power Developement Board
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- PetroVietnam Power Coal Import and Supply Company
- Economic Council, Georgia
- India Bulls Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- Central Java Power - Indonesia
- The University of Queensland
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- Siam City Cement - Thailand
- Alfred C Toepfer International GmbH - Germany
- Indogreen Group - Indonesia
- Uttam Galva Steels Limited - India
- Independent Power Producers Association of India
- Siam City Cement PLC, Thailand
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- Orica Australia Pty. Ltd.
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Heidelberg Cement - Germany
- Ambuja Cements Ltd - India
- Star Paper Mills Limited - India
- Manunggal Multi Energi - Indonesia
- Xindia Steels Limited - India
- Jaiprakash Power Ventures ltd
- Kideco Jaya Agung - Indonesia
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Marubeni Corporation - India
- Power Finance Corporation Ltd., India
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- McConnell Dowell - Australia
- ICICI Bank Limited - India
- The Treasury - Australian Government
- Maheswari Brothers Coal Limited - India
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- South Luzon Thermal Energy Corporation
- Semirara Mining Corp, Philippines
- PTC India Limited - India
- Wilmar Investment Holdings
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Romanian Commodities Exchange
- International Coal Ventures Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- Jindal Steel & Power Ltd - India
- Bhatia International Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- Sical Logistics Limited - India
- Sakthi Sugars Limited - India
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Planning Commission, India
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Pendopo Energi Batubara - Indonesia
- IHS Mccloskey Coal Group - USA
- Sindya Power Generating Company Private Ltd
- SN Aboitiz Power Inc, Philippines
- Electricity Authority, New Zealand
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- London Commodity Brokers - England
- Ind-Barath Power Infra Limited - India
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Posco Energy - South Korea
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Eastern Energy - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Savvy Resources Ltd - HongKong
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Oldendorff Carriers - Singapore
- Interocean Group of Companies - India
- Timah Investasi Mineral - Indoneisa
- Madhucon Powers Ltd - India
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Commonwealth Bank - Australia
- Altura Mining Limited, Indonesia
- VISA Power Limited - India
- Tata Chemicals Ltd - India
- The State Trading Corporation of India Ltd
- Mercuria Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- Neyveli Lignite Corporation Ltd, - India
- Africa Commodities Group - South Africa
- Petron Corporation, Philippines
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Vedanta Resources Plc - India
- GMR Energy Limited - India
- Indian Energy Exchange, India
- Sree Jayajothi Cements Limited - India
- PNOC Exploration Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Bayan Resources Tbk. - Indonesia
- Salva Resources Pvt Ltd - India
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Trasteel International SA, Italy
- Baramulti Group, Indonesia
- Attock Cement Pakistan Limited
- Thai Mozambique Logistica
- SMC Global Power, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Coastal Gujarat Power Limited - India
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Kumho Petrochemical, South Korea
- Edison Trading Spa - Italy
- Leighton Contractors Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Minerals Council of Australia
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- Formosa Plastics Group - Taiwan
- Agrawal Coal Company - India
- Kohat Cement Company Ltd. - Pakistan
- Price Waterhouse Coopers - Russia
- San Jose City I Power Corp, Philippines
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Coal and Oil Company - UAE
- Aditya Birla Group - India
- Iligan Light & Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Thiess Contractors Indonesia
- Billiton Holdings Pty Ltd - Australia
- Australian Coal Association
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Sojitz Corporation - Japan
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- Mintek Dendrill Indonesia
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