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Friday, 17 July 15
DO CANCELLATION RIGHTS UNDER VOYAGE CHARTERPARTY SURVIVE RE-NOMINATION OF LOAD PORT? - INCE&CO
 KNOWLEDGE TO ELEVATE
Do cancellation rights under voyage charterparty survive re-nomination of load port?
St Shipping & Transport Inc v. Kriti Filoxenia Shipping Co SA [2015] EWHC 997 (Comm) (MT Kriti Filoxenia)
The Commercial Court has considered whether cancellation provisions in the BEEPEEVOY3 charterparty form were applicable in the event of re-nomination of a load port by charterers under the charter. In this case, the Charterers re-nominated the load port which the Owners were not able to reach by the cancellation date. The Charterers cancelled the charterparty. In arbitration proceedings, the Tribunal found that the cancellation provisions were not applicable where the Charterers had exercised the contractual option to re-nominate a load port. The Charterers appealed the decision to the Commercial Court, which upheld the findings of the Tribunal and dismissed the appeal.
The background facts
This case concerned a voyage charterparty under the BEEPEEVOY 3 standard form. The key clauses in the charterparty provided as follows:
“17.… If it appears to Charterers that the Vessel will be delayed beyond the Cancelling Date Charterers may require Owners to notify Charterers of the date on which they expect the Vessel to be ready to load whereupon Charterers shall have the option to cancel this Charter…
24.… If after any loading or discharge port or place has been nominated Charterers desire to vary such port or place, Owners shall issue such revised instructions as are necessary at any time to give effect to Charterers’ revised orders and any period by which the steaming time taken to reach the alternative port or place exceeds the time which should have been taken had the Vessel proceeded thither directly shall count as laytime or, if the Vessel is on demurrage, as demurrage.”
The vessel proceeded to a nominated load port within the range provided for under the charterparty. The Charterers then nominated an alternative load port under clause 24. The Owners could not reach that load port by the cancellation date and the Charterers cancelled the charterparty in reliance upon clause 17. The Owners denied that the Charterers had a right to cancel and accepted the cancellation as a repudiation of the charterparty. The dispute went to arbitration.
The arbitration award
The Tribunal found in favour of the Owners and held that the cancellation provisions in clause 17 did not apply where the Charterers exercised the liberty given under clause 24 to re-nominate the load port. The Tribunal further held that, even if the cancellation provisions did apply, the Charterers may not cancel where the re-nomination was made at a time when the estimated time of arrival for the re-nominated port was after the cancellation date under the charterparty. The Charterers appealed to the Commercial Court.
The Commercial Court decision
When it came to construing the words in clauses 17 and 24 of the charterparty, the Court took as its starting point the ordinary and natural meaning of the words used in those clauses as they would be understood by reasonable charterers and owners in the context in which the agreement was made. The Court highlighted the importance of the fact that the parties to a charterparty were involved in a venture which required a degree of co-operation in order to work successfully. Regarding clause 17, the cancellation clause, the Charterers’ ability to cancel necessarily entailed that the Charterers would do what is necessary on their part to enable the vessel to achieve that cancellation date and not impair the
Owners’ ability to comply with that date
The Court also looked at the reasons why it is in the interests of both sides to agree a cancellation date. At common law, subject to the express terms of a charterparty, both parties are bound by the contract until the delay is such that it frustrates the commercial purpose of the venture. Agreeing a cancellation date provides certainty to both parties in that it avoids disputes as to when that delay has frustrated a contract, which is a matter of fact in each case.
The Court referred to the “broad commercial interpretation” it has previously taken in the construction of these types of clauses, in order to achieve the parties’ commercial objectives. In this regard, the Court examined the commercial considerations which underlie the re-nomination clause. For the Charterers, the main advantage of this clause is to have greater flexibility to revise their orders so as to tailor their shipping arrangements according to their cargo arrangements. On the other hand, absence of the load port re-nomination provision would be advantageous to the Owners since it would give them the certainty of an irrevocable nomination. The Court also noted the commercial value of the cancellation clause from the Charterers’ perspective. On balance, the Court placed more importance on the Owners’ concerns of losing the certainty of an irrevocable nomination, whilst at the same time remaining exposed to the Charterers’ right to cancel.
The Court also noted that clause 24 made no express reference to the cancellation rights under clause 17. The Court recognised that the BEEPEEVOY 3 charterparty, being a standard form, is a document drafted with considerable care. Had the draftsmen of this form intended for the clause 17 cancellation rights to apply to a re-nomination of the load port under clause 24, express words would have been used to that effect and would have provided for how such rights would apply and in what circumstances. No such words were present in this case.
The appeal was therefore dismissed.
Comment
This case serves as a useful reminder of the English Court’s approach to the interpretation of charterparty provisions and, in particular, to consideration of the interplay between a cancellation clause and a load port re-nomination provision under a voyage charterparty. This decision also highlights the Court’s commercial approach to such issues, in particular its reference to the Charterers’ duty to co-operate with the Owners and to do what is necessary to enable the vessel to achieve the cancellation date if they wish to be able to rely upon the cancellation clause.
Source: INCE&Co
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Thursday, 10 August 17
ANOTHER ACTIVE WEEK FOR THE PANAMAXES WITH INCREASING RATES IN BOTH HEMISPHERES - FEARNLEYS
Supramax
Both basins have remained fairly flat, could say slightly to the negative. A quiet start of the week in the Pacific with holidays in Sin ...
Wednesday, 09 August 17
THE KEY IMPORTERS OF U.S. COAL FOR THE FIRST FIVE MONTHS OF 2017 ARE THE NETHERLANDS, INDIA AND JAPAN - PETER SAND, BIMCO
US seaborne coal exports have turned years of negative growth around and seem to be climbing for a third quarter in a row. The increase in total vo ...
Wednesday, 09 August 17
INDONESIAN COAL PRICE REFERENCE INCREASE COULD CONTINUE IN THE COMING MONTHS
COALspot.com: Indonesian coal benchmark price rose 6.36% in August, government data showed.
The benchmark price of Indonesian thermal ...
Wednesday, 09 August 17
COAL HAS GAINED AROUND 40% OVER THE PAST TWELVE MONTHS; IRON ORE HAS MOVED FROM AROUND $50/T IN AUGUST 2016 TO OVER $70/T TODAY - INTERMODAL
During the summer’s peak, and with the markets remaining relatively quiet, we can argue that most markets have built solid foundations to enj ...
Tuesday, 08 August 17
THE BULLISH RIDE CONTINUES ON FOR THE IRON ORE MARKET - GEORGE LAZARIDIS
The bullish ride continues on for the iron ore market, with most in the market now eyeing the possibility for further gains to be had as Chine ...
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Showing 1976 to 1980 news of total 6871 |
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- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- Indo Tambangraya Megah - Indonesia
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- White Energy Company Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Baramulti Group, Indonesia
- Goldman Sachs - Singapore
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- Heidelberg Cement - Germany
- Makarim & Taira - Indonesia
- Independent Power Producers Association of India
- Energy Development Corp, Philippines
- Star Paper Mills Limited - India
- Tamil Nadu electricity Board
- Indian Oil Corporation Limited
- Formosa Plastics Group - Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- SMG Consultants - Indonesia
- Pendopo Energi Batubara - Indonesia
- Marubeni Corporation - India
- Jaiprakash Power Ventures ltd
- Australian Commodity Traders Exchange
- Antam Resourcindo - Indonesia
- Parliament of New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Semirara Mining and Power Corporation, Philippines
- SMC Global Power, Philippines
- Banpu Public Company Limited - Thailand
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Thai Mozambique Logistica
- Madhucon Powers Ltd - India
- Ministry of Finance - Indonesia
- Central Electricity Authority - India
- European Bulk Services B.V. - Netherlands
- IEA Clean Coal Centre - UK
- Global Business Power Corporation, Philippines
- Thiess Contractors Indonesia
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- GVK Power & Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Mines - Canada
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Therma Luzon, Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- Wilmar Investment Holdings
- Oldendorff Carriers - Singapore
- Singapore Mercantile Exchange
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Sojitz Corporation - Japan
- Coal and Oil Company - UAE
- Salva Resources Pvt Ltd - India
- Riau Bara Harum - Indonesia
- LBH Netherlands Bv - Netherlands
- IHS Mccloskey Coal Group - USA
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Power Finance Corporation Ltd., India
- Larsen & Toubro Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Latin American Coal - Colombia
- Chamber of Mines of South Africa
- Romanian Commodities Exchange
- Parry Sugars Refinery, India
- Sarangani Energy Corporation, Philippines
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Posco Energy - South Korea
- Coastal Gujarat Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Ambuja Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Maheswari Brothers Coal Limited - India
- Dalmia Cement Bharat India
- Kumho Petrochemical, South Korea
- Global Green Power PLC Corporation, Philippines
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Merrill Lynch Commodities Europe
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- Meenaskhi Energy Private Limited - India
- Coalindo Energy - Indonesia
- Economic Council, Georgia
- Medco Energi Mining Internasional
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Price Waterhouse Coopers - Russia
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Sakthi Sugars Limited - India
- Miang Besar Coal Terminal - Indonesia
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Malabar Cements Ltd - India
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Directorate Of Revenue Intelligence - India
- Deloitte Consulting - India
- Directorate General of MIneral and Coal - Indonesia
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- New Zealand Coal & Carbon
- PTC India Limited - India
- GMR Energy Limited - India
- Karbindo Abesyapradhi - Indoneisa
- McConnell Dowell - Australia
- Ministry of Transport, Egypt
- Mercator Lines Limited - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Krishnapatnam Port Company Ltd. - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Grasim Industreis Ltd - India
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Tata Chemicals Ltd - India
- ICICI Bank Limited - India
- Wood Mackenzie - Singapore
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Kideco Jaya Agung - Indonesia
- Vedanta Resources Plc - India
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Sree Jayajothi Cements Limited - India
- South Luzon Thermal Energy Corporation
- Bhoruka Overseas - Indonesia
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Kartika Selabumi Mining - Indonesia
- Indika Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Energy Link Ltd, New Zealand
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Renaissance Capital - South Africa
- Central Java Power - Indonesia
- Eastern Coal Council - USA
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- Interocean Group of Companies - India
- Sinarmas Energy and Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- Vizag Seaport Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Eastern Energy - Thailand
- Kepco SPC Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- Global Coal Blending Company Limited - Australia
- Lanco Infratech Ltd - India
- Carbofer General Trading SA - India
- Bukit Makmur.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- London Commodity Brokers - England
- Pipit Mutiara Jaya. PT, Indonesia
- The State Trading Corporation of India Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Aboitiz Power Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Indonesian Coal Mining Association
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- CIMB Investment Bank - Malaysia
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