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