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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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- SN Aboitiz Power Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Minerals Council of Australia
- Orica Mining Services - Indonesia
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Interocean Group of Companies - India
- Eastern Energy - Thailand
- Manunggal Multi Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- South Luzon Thermal Energy Corporation
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kohat Cement Company Ltd. - Pakistan
- Leighton Contractors Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- Bayan Resources Tbk. - Indonesia
- Straits Asia Resources Limited - Singapore
- Billiton Holdings Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Power Finance Corporation Ltd., India
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- The Treasury - Australian Government
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Sakthi Sugars Limited - India
- Global Green Power PLC Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Meenaskhi Energy Private Limited - India
- Kepco SPC Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
- Georgia Ports Authority, United States
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Videocon Industries ltd - India
- Salva Resources Pvt Ltd - India
- Baramulti Group, Indonesia
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- Eastern Coal Council - USA
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- Siam City Cement - Thailand
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- Bharathi Cement Corporation - India
- Lanco Infratech Ltd - India
- Edison Trading Spa - Italy
- Australian Coal Association
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- The State Trading Corporation of India Ltd
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- Dalmia Cement Bharat India
- Indonesian Coal Mining Association
- Ceylon Electricity Board - Sri Lanka
- Planning Commission, India
- Karbindo Abesyapradhi - Indoneisa
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Mintek Dendrill Indonesia
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Coalindo Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- Chettinad Cement Corporation Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Metalloyd Limited - United Kingdom
- Africa Commodities Group - South Africa
- Miang Besar Coal Terminal - Indonesia
- SMG Consultants - Indonesia
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Tata Chemicals Ltd - India
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- Petron Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Energy Link Ltd, New Zealand
- Semirara Mining Corp, Philippines
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Therma Luzon, Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- CNBM International Corporation - China
- Thiess Contractors Indonesia
- Madhucon Powers Ltd - India
- Wood Mackenzie - Singapore
- Meralco Power Generation, Philippines
- PNOC Exploration Corporation - Philippines
- Ambuja Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Xindia Steels Limited - India
- Intertek Mineral Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Sojitz Corporation - Japan
- Sindya Power Generating Company Private Ltd
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Deloitte Consulting - India
- Karaikal Port Pvt Ltd - India
- Carbofer General Trading SA - India
- Gujarat Sidhee Cement - India
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- MS Steel International - UAE
- Ministry of Mines - Canada
- ASAPP Information Group - India
- Orica Australia Pty. Ltd.
- Bhatia International Limited - India
- Ministry of Transport, Egypt
- Holcim Trading Pte Ltd - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bangladesh Power Developement Board
- Bulk Trading Sa - Switzerland
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Gujarat Electricity Regulatory Commission - India
- Directorate Of Revenue Intelligence - India
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Bukit Makmur.PT - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Bhoruka Overseas - Indonesia
- PowerSource Philippines DevCo
- Standard Chartered Bank - UAE
- Agrawal Coal Company - India
- GAC Shipping (India) Pvt Ltd
- Economic Council, Georgia
- Globalindo Alam Lestari - Indonesia
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- PTC India Limited - India
- Central Electricity Authority - India
- Borneo Indobara - Indonesia
- Kaltim Prima Coal - Indonesia
- Mercuria Energy - Indonesia
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- The University of Queensland
- Indogreen Group - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Ministry of Finance - Indonesia
- Kumho Petrochemical, South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- Renaissance Capital - South Africa
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