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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, 20 February 20
CHINA RESUMES OVER 70 PCT COAL PRODUCTION CAPACITY AMID EPIDEMIC - XINHUA
China has resumed 70.2 percent of its coal production capacity with output recovering steadily amid the fight against the novel coronavirus epidemi ...
Thursday, 20 February 20
CHINA THERMAL COAL MARKET FACES 2-3 MONTH CORONAVIRUS SHORT SQUEEZE: NOBLE - REUTERS
China’s domestic thermal coal market faces a 2-3 month short squeeze as a rapidly spreading coronavirus outbreak curtails production more tha ...
Wednesday, 19 February 20
KOREA MIDLAND POWER INVITED BIDS FOR 1 MILLION TONS OF HCV AND LCV COAL FOR Q2- Q4 LOADING
COALspot.com: Korea Midland Power Co. Ltd, (KOMIPO). has issued an international tender for total 1 million MT of coal for April to December 2020 l ...
Wednesday, 19 February 20
GLENCORE WRITES OFF ALMOST $1 BILLION AT COLOMBIAN COAL MINES DUE TO FALLING EUROPEAN IMPORTS: BLOOMBERG
The economic case against European coal is proving too much for even Glencore Plc.
The world’s biggest coal shipper cut the va ...
Wednesday, 19 February 20
MINERS WELCOME INDONESIA'S NEW JOBS BILL THAT COULD SPUR COAL GROWTH - REUTERS
Miners have welcomed proposed changes to Indonesian mining rules under a new law aimed at boosting investment, though critics are concerned that th ...
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- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Deloitte Consulting - India
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Indonesian Coal Mining Association
- Aditya Birla Group - India
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Ambuja Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Electricity Authority, New Zealand
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Planning Commission, India
- Global Business Power Corporation, Philippines
- Anglo American - United Kingdom
- Ind-Barath Power Infra Limited - India
- Tamil Nadu electricity Board
- GVK Power & Infra Limited - India
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- PTC India Limited - India
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- Iligan Light & Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Coal and Oil Company - UAE
- Ministry of Mines - Canada
- Minerals Council of Australia
- Banpu Public Company Limited - Thailand
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- TeaM Sual Corporation - Philippines
- PowerSource Philippines DevCo
- Power Finance Corporation Ltd., India
- Bukit Baiduri Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Heidelberg Cement - Germany
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Karaikal Port Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Eastern Energy - Thailand
- Baramulti Group, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Xindia Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Agrawal Coal Company - India
- IHS Mccloskey Coal Group - USA
- Cigading International Bulk Terminal - Indonesia
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- Lanco Infratech Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Merrill Lynch Commodities Europe
- Attock Cement Pakistan Limited
- Videocon Industries ltd - India
- Larsen & Toubro Limited - India
- Formosa Plastics Group - Taiwan
- Maheswari Brothers Coal Limited - India
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- Price Waterhouse Coopers - Russia
- Siam City Cement - Thailand
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- Cement Manufacturers Association - India
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- Wilmar Investment Holdings
- TNB Fuel Sdn Bhd - Malaysia
- Vizag Seaport Private Limited - India
- ICICI Bank Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Medco Energi Mining Internasional
- Kobexindo Tractors - Indoneisa
- Sojitz Corporation - Japan
- Africa Commodities Group - South Africa
- Simpson Spence & Young - Indonesia
- Metalloyd Limited - United Kingdom
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- Romanian Commodities Exchange
- Leighton Contractors Pty Ltd - Australia
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- White Energy Company Limited
- Maharashtra Electricity Regulatory Commission - India
- Sakthi Sugars Limited - India
- Australian Coal Association
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- India Bulls Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Chamber of Mines of South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Sidhee Cement - India
- Indian Oil Corporation Limited
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Coastal Gujarat Power Limited - India
- Bharathi Cement Corporation - India
- Economic Council, Georgia
- Pendopo Energi Batubara - Indonesia
- GMR Energy Limited - India
- GAC Shipping (India) Pvt Ltd
- Singapore Mercantile Exchange
- Vedanta Resources Plc - India
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- Parliament of New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kumho Petrochemical, South Korea
- Sical Logistics Limited - India
- Central Java Power - Indonesia
- Timah Investasi Mineral - Indoneisa
- Independent Power Producers Association of India
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Gujarat Mineral Development Corp Ltd - India
- Eastern Coal Council - USA
- Bangladesh Power Developement Board
- Sree Jayajothi Cements Limited - India
- The State Trading Corporation of India Ltd
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- Chettinad Cement Corporation Ltd - India
- European Bulk Services B.V. - Netherlands
- Sarangani Energy Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Makarim & Taira - Indonesia
- New Zealand Coal & Carbon
- Alfred C Toepfer International GmbH - Germany
- ASAPP Information Group - India
- The Treasury - Australian Government
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Dalmia Cement Bharat India
- Madhucon Powers Ltd - India
- Tata Chemicals Ltd - India
- Kaltim Prima Coal - Indonesia
- Australian Commodity Traders Exchange
- SMC Global Power, Philippines
- Latin American Coal - Colombia
- Coalindo Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Thai Mozambique Logistica
- Oldendorff Carriers - Singapore
- Edison Trading Spa - Italy
- Port Waratah Coal Services - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- MS Steel International - UAE
- Petron Corporation, Philippines
- Borneo Indobara - Indonesia
- Energy Link Ltd, New Zealand
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