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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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Thursday, 05 March 20
SEABORNE COAL'S STRUGGLES IN ASIA ARE MORE THAN JUST CHINA CORONAVIRUS - REUTERS
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 ...
Thursday, 05 March 20
INDONESIA'S BUKIT ASAM 2019 OUTPUT RISES 10.2% Y/Y - REUTERS
PT Bukit Asam, Indonesia’s state-owned coal miner, said on Wednesday its output in 2019 rose 10.2% to 29.1 million tonnes.
Coa ...
Thursday, 05 March 20
SEEING REMOTELY - IN SAFETY: BUREAU VERITAS PERFORMS FIRST SURVEY BY DRONE - BUREAU VERITAS
Bureau Veritas Marine & Offshore (BV), a world leader in testing, inspection and certification (TIC) services has completed its first survey by ...
Wednesday, 04 March 20
AN EPIDEMIC OF UNCERTAINTY - THE CORONAVIRUS AND FORCE MAJEURE - WFW
KNOWLEDGE TO ELEVATE
Do the effects of the coronavirus give rise to legitimate force majeure claims in connection with shipbuilding contracts ...
Wednesday, 04 March 20
CHINA IMPORTED 76.8 MLN TONNES OF CRUDE OIL FOR JANUARY & FEBRUARY 2020; UP 3.4% YOY - REFINITIV | BC
The COVID-19 crisis has been gripping China already for almost two months now. It’s having a huge negative impact on the economy, and this is ...
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- Alfred C Toepfer International GmbH - Germany
- Interocean Group of Companies - India
- Bulk Trading Sa - Switzerland
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- Meenaskhi Energy Private Limited - India
- Parry Sugars Refinery, India
- Indogreen Group - Indonesia
- Banpu Public Company Limited - Thailand
- Siam City Cement - Thailand
- TeaM Sual Corporation - Philippines
- IEA Clean Coal Centre - UK
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Thai Mozambique Logistica
- Savvy Resources Ltd - HongKong
- ASAPP Information Group - India
- Indo Tambangraya Megah - Indonesia
- Merrill Lynch Commodities Europe
- Siam City Cement PLC, Thailand
- Jorong Barutama Greston.PT - Indonesia
- Sojitz Corporation - Japan
- Coal and Oil Company - UAE
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- Indika Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bhoruka Overseas - Indonesia
- Global Coal Blending Company Limited - Australia
- Australian Coal Association
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Simpson Spence & Young - Indonesia
- Energy Link Ltd, New Zealand
- The State Trading Corporation of India Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- New Zealand Coal & Carbon
- Chamber of Mines of South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- Grasim Industreis Ltd - India
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- The University of Queensland
- GVK Power & Infra Limited - India
- Coalindo Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Riau Bara Harum - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Antam Resourcindo - Indonesia
- Latin American Coal - Colombia
- Central Electricity Authority - India
- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- Ambuja Cements Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Xindia Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- Ministry of Finance - Indonesia
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Leighton Contractors Pty Ltd - Australia
- Bangladesh Power Developement Board
- Economic Council, Georgia
- Neyveli Lignite Corporation Ltd, - India
- OPG Power Generation Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- Planning Commission, India
- Cigading International Bulk Terminal - Indonesia
- Romanian Commodities Exchange
- Wilmar Investment Holdings
- Meralco Power Generation, Philippines
- Formosa Plastics Group - Taiwan
- Lanco Infratech Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Kohat Cement Company Ltd. - Pakistan
- Eastern Energy - Thailand
- Larsen & Toubro Limited - India
- Borneo Indobara - Indonesia
- Indian Energy Exchange, India
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- Intertek Mineral Services - Indonesia
- White Energy Company Limited
- Kaltim Prima Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Orica Mining Services - Indonesia
- Orica Australia Pty. Ltd.
- CIMB Investment Bank - Malaysia
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Independent Power Producers Association of India
- Tata Chemicals Ltd - India
- Iligan Light & Power Inc, Philippines
- Ministry of Transport, Egypt
- Bukit Baiduri Energy - Indonesia
- Thiess Contractors Indonesia
- MS Steel International - UAE
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Marubeni Corporation - India
- Heidelberg Cement - Germany
- Kobexindo Tractors - Indoneisa
- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
- Aboitiz Power Corporation - Philippines
- Madhucon Powers Ltd - India
- GMR Energy Limited - India
- Bukit Makmur.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Sarangani Energy Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Toyota Tsusho Corporation, Japan
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- Power Finance Corporation Ltd., India
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Renaissance Capital - South Africa
- Binh Thuan Hamico - Vietnam
- Samtan Co., Ltd - South Korea
- Bhushan Steel Limited - India
- Electricity Generating Authority of Thailand
- Malabar Cements Ltd - India
- ICICI Bank Limited - India
- Anglo American - United Kingdom
- Mintek Dendrill Indonesia
- PNOC Exploration Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cement Manufacturers Association - India
- Jaiprakash Power Ventures ltd
- Miang Besar Coal Terminal - Indonesia
- Manunggal Multi Energi - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Vedanta Resources Plc - India
- Aditya Birla Group - India
- Oldendorff Carriers - Singapore
- Minerals Council of Australia
- PowerSource Philippines DevCo
- PTC India Limited - India
- Attock Cement Pakistan Limited
- Global Business Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Singapore Mercantile Exchange
- Kalimantan Lumbung Energi - Indonesia
- Electricity Authority, New Zealand
- The Treasury - Australian Government
- Medco Energi Mining Internasional
- PetroVietnam Power Coal Import and Supply Company
- Sical Logistics Limited - India
- SMC Global Power, Philippines
- Bayan Resources Tbk. - Indonesia
- Sakthi Sugars Limited - India
- Tamil Nadu electricity Board
- Port Waratah Coal Services - Australia
- Agrawal Coal Company - India
- VISA Power Limited - India
- Australian Commodity Traders Exchange
- Energy Development Corp, Philippines
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- Directorate General of MIneral and Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Straits Asia Resources Limited - Singapore
- Bharathi Cement Corporation - India
- Kepco SPC Power Corporation, Philippines
- Ministry of Mines - Canada
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- Bhatia International Limited - India
- Indian Oil Corporation Limited
- Indonesian Coal Mining Association
- Maheswari Brothers Coal Limited - India
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