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Tuesday, 17 February 15
WHO PAYS THE SUEZ CANAL FEES? - INCE & CO
 KNOWLEDGE TO ELEVATE
This was an appeal from an arbitration award on a point of construction in relation to the wording of an addendum to a charterparty.
The Commercial Court held that the costs of transiting the Suez Canal arising as a result of amended voyage orders were for the Charterers’ account, even though the Disponent Owners would have had to incur them anyway in order to redeliver the vessel.
The background facts
The Claimant Disponent Owners (“Owners”), chartered the vessel to the Respondents for a voyage from Constanza to Djibouti. The vessel arrived at Djibouti but was unable to discharge because there were no receivers for the cargo. After the vessel had spent three months off Djibouti, the Owners and the Charterers agreed an addendum (“addendum no. 1″) to the charterparty whereby the discharge port was changed to Ain Sukhna, Egypt, a port to the south of the Suez Canal.
Addendum no. 1 provided:
“Owners and Headowners to be held harmless and indemnified against all losses, expenses, damages, risk whatsoever and howsoever arising including but not limited to those which may arise from any 3rd party including but not limited to Egyptian authority’s rejection refusal or inability to accept delivery of the cargo or from charterer’s failure to discharge cargo.”
Later, by a further addendum (“addendum no. 2″), the discharge port was changed again from Ain Sukhna to Damietta, an Egyptian port on the Mediterranean coast, meaning that the vessel would have to transit the Suez Canal northbound in order to arrive at the discharge port. Materially, addendum no. 2 provided:
“…the cargo is to be discharged at the port of Damietta (Egypt) instead of Ain Sukhna (Egypt) and all other terms, conditions, clauses and paragraphs as per Charter Party dated 23 October 2009 and addendum no. 1 and reservations of rights to remain in force.”
Under the head charterparty, a time trip charter, the Owners had to re-deliver the vessel at Port Said after completion of the voyage. She would, therefore, have had to transit the Suez Canal irrespective of the change of discharge port under addendum no. 2. The head charterparty provided that the Owners (as charterers under that charter) were responsible for all canal tolls and, therefore, as between them and the registered Owners, would have to bear the costs of transiting the Suez Canal.
In the arbitration, the Tribunal held that the costs of transiting the Suez Canal were not an expense that the Charterers had agreed to bear in the addenda on the basis that the Owners would have had to transit the Suez Canal anyway and:
“in the context, “losses” or “expenses” [in addendum no. 1, as cited above] must be construed as limited to additional losses and expenses which would not have been incurred in any event.”
It was this finding that was the subject of the Owners’ appeal.
The Commercial Court decision
The Court found that the commercial aim of the addenda had been to allow the Charterers to bring the voyage (and therefore their liability to pay demurrage) to an end and to allow the Owners to discharge the cargo and redeliver the vessel. The Court considered both the commercial objectives of the parties and their background knowledge when they agreed the addenda. The Court noted that the Owners’ liability under the head charterparty to bear the costs of transiting the Suez Canal was not within the knowledge of the Charterers and should not therefore be taken into account when assessing the scope of the Charterers’ indemnity.
Given the Court’s finding on the facts, the question which it had to answer was simply whether the expense of transiting the Suez Canal arose from the Charterers’ failure to discharge the cargo at Djibouti. The Court found that the Suez Canal transit would not have been required in order to perform the original voyage to Djibouti but was required to perform the amended voyage to Damietta and, as such, the costs of the transit were ones that the Charterers had agreed to bear. The appeal was therefore allowed.
Comment
This judgment shows the Court applying the clear wording used by the parties, since the expense arose from the Charterers’ failure to discharge the cargo at Djibouti, and that is what was expressly covered by the indemnity. The decision also emphasises that the background knowledge against which contracts will be interpreted is limited to that knowledge available to both parties.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
Source: Ince & Co | Hellenic Shipping News
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Tuesday, 10 February 15
SUB-BIT FOB INDONESIA COAL SWAP ADVANCES 3.79% WEEK ON WEEK
COALspot.com: Indonesian coal swaps for delivery Q2' 2015 rose week over week and month on month.
The Q2 swap up US$ 0.85 (+1.81%) month o ...
Tuesday, 10 February 15
FOB NEWCASTLE COAL SWAPS SURGE WEEK OVER WEEK, RAISING HOPES?
COALspot.com: API 5 FOB Newcastle Coal swap for Q2’ 2015 delivery rose US$ 0.95 per MT (+1.91%) week over week and declined US$ 0.06 (-0.12%) ...
Monday, 09 February 15
AUSTRALIAN COAL PRODUCERS BEST POSITIONED IN OVERSUPPLIED MARKET; US MINES MOST AT RISK - WOOD MACKENZIE
In a 2015 global coal outlook report, Wood Mackenzie says that Australia and Indonesian coal suppliers will see some upside in the difficult months ...
Monday, 09 February 15
FOB RICHARDS BAY COAL SWAP GAINS 3.65% TO ONE-MONTH HIGH
COALspot.com: API 4 FOB Richards Bay Coal swap for delivery Q2' 2015 surge month over month and day on day.
The Q2 swap has soared US$ 2.1 ...
Monday, 09 February 15
Q2' CFR SOUTH CHINA COAL SWAP DECLINED 3.28% TO $ 56.92 W-O-W
COALspot.com: API 8 CFR South China Coal swap for Q2’ 2015 delivery declined US$ 1.93 (-3.28%) per MT month over month and US$ 0.10 (-0 ...
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- Sakthi Sugars Limited - India
- Timah Investasi Mineral - Indoneisa
- Indian Oil Corporation Limited
- SN Aboitiz Power Inc, Philippines
- Indian Energy Exchange, India
- Bayan Resources Tbk. - Indonesia
- Merrill Lynch Commodities Europe
- Sarangani Energy Corporation, Philippines
- Bhatia International Limited - India
- Essar Steel Hazira Ltd - India
- Borneo Indobara - Indonesia
- Barasentosa Lestari - Indonesia
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kaltim Prima Coal - Indonesia
- Romanian Commodities Exchange
- South Luzon Thermal Energy Corporation
- Interocean Group of Companies - India
- Ministry of Transport, Egypt
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Petron Corporation, Philippines
- VISA Power Limited - India
- Parry Sugars Refinery, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GAC Shipping (India) Pvt Ltd
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- Vedanta Resources Plc - India
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- Directorate Of Revenue Intelligence - India
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- Sindya Power Generating Company Private Ltd
- International Coal Ventures Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- London Commodity Brokers - England
- Thai Mozambique Logistica
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- CIMB Investment Bank - Malaysia
- SMC Global Power, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement - Thailand
- ASAPP Information Group - India
- TNB Fuel Sdn Bhd - Malaysia
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement PLC, Thailand
- GMR Energy Limited - India
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- Rio Tinto Coal - Australia
- Bhushan Steel Limited - India
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- LBH Netherlands Bv - Netherlands
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- India Bulls Power Limited - India
- Lanco Infratech Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Parliament of New Zealand
- IHS Mccloskey Coal Group - USA
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- The Treasury - Australian Government
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Aditya Birla Group - India
- IEA Clean Coal Centre - UK
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Electricity Generating Authority of Thailand
- Trasteel International SA, Italy
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Dalmia Cement Bharat India
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Makarim & Taira - Indonesia
- Indika Energy - Indonesia
- Power Finance Corporation Ltd., India
- Bangladesh Power Developement Board
- Ambuja Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Bhoruka Overseas - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Star Paper Mills Limited - India
- Indo Tambangraya Megah - Indonesia
- Iligan Light & Power Inc, Philippines
- Edison Trading Spa - Italy
- Semirara Mining Corp, Philippines
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Coastal Gujarat Power Limited - India
- San Jose City I Power Corp, Philippines
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- PTC India Limited - India
- Bulk Trading Sa - Switzerland
- Bharathi Cement Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Thiess Contractors Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Commonwealth Bank - Australia
- Mercator Lines Limited - India
- Kapuas Tunggal Persada - Indonesia
- Cement Manufacturers Association - India
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Riau Bara Harum - Indonesia
- Formosa Plastics Group - Taiwan
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Straits Asia Resources Limited - Singapore
- CNBM International Corporation - China
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asmin Koalindo Tuhup - Indonesia
- Indonesian Coal Mining Association
- Attock Cement Pakistan Limited
- Global Coal Blending Company Limited - Australia
- Posco Energy - South Korea
- Leighton Contractors Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Sree Jayajothi Cements Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Indogreen Group - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Larsen & Toubro Limited - India
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- Wilmar Investment Holdings
- Independent Power Producers Association of India
- Vizag Seaport Private Limited - India
- Medco Energi Mining Internasional
- Goldman Sachs - Singapore
- Sinarmas Energy and Mining - Indonesia
- Central Electricity Authority - India
- MS Steel International - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- Meralco Power Generation, Philippines
- Samtan Co., Ltd - South Korea
- Chamber of Mines of South Africa
- Ministry of Finance - Indonesia
- Mercuria Energy - Indonesia
- Marubeni Corporation - India
- The University of Queensland
- AsiaOL BioFuels Corp., Philippines
- Intertek Mineral Services - Indonesia
- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Jaiprakash Power Ventures ltd
- Miang Besar Coal Terminal - Indonesia
- Uttam Galva Steels Limited - India
- Africa Commodities Group - South Africa
- Anglo American - United Kingdom
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Baramulti Group, Indonesia
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- Maheswari Brothers Coal Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- Energy Link Ltd, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Deloitte Consulting - India
- GVK Power & Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- Oldendorff Carriers - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Bukit Baiduri Energy - Indonesia
- The State Trading Corporation of India Ltd
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- Orica Mining Services - Indonesia
- Sojitz Corporation - Japan
- White Energy Company Limited
- Tata Chemicals Ltd - India
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
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