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Sunday, 07 April 19
SHIP PASSAGE PLANS - NO ROOM FOR ERROR! - WATSON FARLEY & WILLIAMS
 KNOWLEDGE TO ELEVATE
The English High Court’s judgment in Alize 1954 v Allianz Elementar Versicherungs AG (The CMA CGM Libra) is an important decision involving the application of longstanding principles as to a shipowner’s liability for actionable fault following a casualty. In finding that a defective passage plan rendered a vessel unseaworthy, the English High Court has demonstrated how traditional tests will be applied to update the law into the modern day world.
Prior to this decision, there had been no case whereby a defective passage plan rendered a vessel unseaworthy. However, it is now clear that just as the standard of seaworthiness must rise with improved knowledge of shipbuilding, so must the standard of seaworthiness rise with improved knowledge of the documents required to be prepared to ensure safe navigation. Following the IMO’s recognition in 1999 of the need for passage planning to be adopted by “all ships engaged on international voyages”, The CMA CGM Libra shows that by 2011 the English courts expected an adequate passage plan to have been prepared. If it was defective, the consequences could be severe.
The Case
The case concerned a laden container vessel which grounded by virtue of the master negligently navigating outside of the buoyed fairway when leaving the port of Xiamen in China. The owner had known this to be a difficult port to navigate, especially as various Notices to Mariners had been issued advising that areas existed in the Xiamen Gang (though not in the fairway) that had depths less than those charted.
Cargo interests refused to pay the owner their proportion of the total claim in general average and denied liability under Article III r.1 of the Hague Rules on the basis that the casualty was caused by the owner’s actionable fault. In particular, they alleged that the vessel was unseaworthy because she had an inadequate passage plan, that inadequacy was a cause of the casualty and due diligence was not exercised by the owner to make the vessel seaworthy.
The Decision
Before considering the substantive matters of unseaworthiness, causation and due diligence, Mr Justice Teare addressed the issue of which party bears the burden of proof in relation to Article III r.1. He affirmed the conventional view that the burden lies on the cargo interests to establish that the vessel was unseaworthy and such unseaworthiness caused the grounding. If those matters are established, the burden then lies on the owners to prove that due diligence was exercised to make the vessel seaworthy.
Unseaworthiness
Mr Justice Teare held that neither the formal passage plan, nor the working chart, contained the necessary warning of the potential danger arising outside the buoyed fairway from the existence of areas with lower depths than charted. The necessary warning should have been such that, when the navigator was faced with a decision whether to remain in the buoyed fairway or to navigate outside, he had in mind the warning that charted depths outside the buoyed fairway may be unreliable.
The judge affirmed that the long-established and authoritative test of unseaworthiness is whether a prudent owner would have required the relevant defect, had he known of it, to be made good before sending his ship to sea. He found it inconceivable that a prudent owner would allow the vessel to depart from Xiamen with a passage plan that lacked the necessary warning, especially given that IMO Resolution of 1999 states that a “well planned voyage” is of “essential importance for safety of life at sea, safety of navigation and protection of the marine environment”.
The owner argued that passage planning is simply the preparation for safe navigation and is not itself an aspect of seaworthiness. In making these arguments, the owner sought to benefit from the negligent navigation exception under Article IV r.2(a) of the Hague Rules, which provides that (assuming there is no failure by the owners to make the vessel seaworthy) a shipowner will not be responsible for loss caused by neglect in the “navigation or in the management of the ship”.
However, Mr Justice Teare rejected this, stating that seaworthiness extends to having the appropriate documentation on board, including the appropriate charts. Firstly, he noted that Article III r.1 places a seaworthiness obligation upon the shipowner “before and at the beginning of the voyage” and that passage planning before the beginning of the voyage is necessary for safe navigation during voyage. Secondly, he pointed out that it is well recognised that if a vessel’s charts are not up to date that is an “attribute” of the vessel which can render her unseaworthy – and that a proper passage plan is now like an up to date and properly corrected chart.
Mr Justice Teare also suggested that a “one-off” failure to correct a chart in a material manner before the beginning of the voyage is capable of rendering a vessel unseaworthy, even if the shipowner has put in place proper systems to ensure that the prerequisite materials were on board to prepare an adequate chart. He explained that concentrating upon the shipowner’s own actions to the exclusion of those of his servants or agents, confuses the issue of seaworthiness with the issue of due diligence, which in any event is a non-delegable duty.
Finally, Mr Justice Teare observed that the negligent navigation exception applied only to Article III r.2 and not Article III r.1. Therefore, a shipowner will not be protected from liability for failing to exercise due diligence to make the vessel seaworthy by the fact that a cause of the casualty was negligent navigation.
Conclusion
In conclusion, this case found that an appropriate passage plan is a matter of seaworthiness under Article III r.1 of the Hague Rules. This is not the type of chart that might traditionally have been expected to affect the seaworthiness of a vessel, especially as a passage plan relates principally to navigation of the ship. Nevertheless, following this judgment, shipowners will have to ensure that, through its agents and servants, due diligence is exercised to produce a non-defective passage plan that clearly contains the necessary warnings. Failure to do so, if causative of a casualty, will not be saved by the negligent navigation exception under Article IV r 2(a) of the Hague Rules, which cannot be applied where a shipowner has failed to exercise due diligence to make the vessel seaworthy.
Source: Watson Farley & Williams
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Sunday, 28 April 19
SUPRAMAX: A 54,000DWT VESSEL OPEN GRESIK FIXED VIA AUSTRALIA, REDELIVERY CHINA, IN THE MID $12,000S - BALTIC BRIEFING
Capesize
Following the holidays, activity increased in both the Pacific and Atlantic Basins. The 5TC average rallied, closing at $8,596, up $1, ...
Wednesday, 24 April 19
PANAMAX: IN THE EAST, THE MARKET MOVED SIDE-WAYS, WITH FEWER COAL CARGOES FROM INDONESIA PUTTING PRESSURE ON RATES - INTERMODAL
Sentiment in the Dry Bulk market slowly but steadily kept improving last week as Capesize rates remained in recovery mode and Panamax earnings also ...
Wednesday, 24 April 19
SHIPPING MARKET INSIGHT - IS THIS A BANKERS' MARKET? - INTERMODAL
Over the last 10 years, many of the traditional and top lending banks have made the decision to either downsize their portfolios or even exit shipp ...
Monday, 22 April 19
COAL INDIA TO ASK POWER PLANTS TO CUT COAL IMPORTS - DNA
Co to encourage import substitution with domestic supplies at power plants
Surge in coal imports has now forced Coal India Ltd (CIL) ...
Thursday, 18 April 19
BIMCO SEES HARD TIMES AHEAD FOR CAPESIZES
China’s increased use of scrap metal for its production of crude steel is fundamentally critical to the dry bulk shipping industry. Mostly Ca ...
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Showing 1411 to 1415 news of total 6871 |
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- Lanco Infratech Ltd - India
- Directorate Of Revenue Intelligence - India
- Petron Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Savvy Resources Ltd - HongKong
- Medco Energi Mining Internasional
- Thai Mozambique Logistica
- Planning Commission, India
- Indonesian Coal Mining Association
- Tata Chemicals Ltd - India
- Coalindo Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- SN Aboitiz Power Inc, Philippines
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Globalindo Alam Lestari - Indonesia
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Agrawal Coal Company - India
- Essar Steel Hazira Ltd - India
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Antam Resourcindo - Indonesia
- SMG Consultants - Indonesia
- CNBM International Corporation - China
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Java Power - Indonesia
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- Ambuja Cements Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Electricity Generating Authority of Thailand
- Bhushan Steel Limited - India
- PNOC Exploration Corporation - Philippines
- Vedanta Resources Plc - India
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Mercator Lines Limited - India
- Ministry of Transport, Egypt
- Kepco SPC Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- Bharathi Cement Corporation - India
- European Bulk Services B.V. - Netherlands
- Indian Energy Exchange, India
- Madhucon Powers Ltd - India
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- Sical Logistics Limited - India
- Independent Power Producers Association of India
- Bangladesh Power Developement Board
- Miang Besar Coal Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Oldendorff Carriers - Singapore
- Altura Mining Limited, Indonesia
- Sojitz Corporation - Japan
- GAC Shipping (India) Pvt Ltd
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Latin American Coal - Colombia
- Simpson Spence & Young - Indonesia
- Parry Sugars Refinery, India
- Siam City Cement - Thailand
- Minerals Council of Australia
- Australian Coal Association
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- International Coal Ventures Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Australian Commodity Traders Exchange
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Dalmia Cement Bharat India
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Electricity Authority, New Zealand
- Ministry of Finance - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- ICICI Bank Limited - India
- IHS Mccloskey Coal Group - USA
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Baramulti Group, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Riau Bara Harum - Indonesia
- Star Paper Mills Limited - India
- MS Steel International - UAE
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Jorong Barutama Greston.PT - Indonesia
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Commonwealth Bank - Australia
- Kapuas Tunggal Persada - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Holcim Trading Pte Ltd - Singapore
- Tamil Nadu electricity Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- Romanian Commodities Exchange
- IEA Clean Coal Centre - UK
- The State Trading Corporation of India Ltd
- Coastal Gujarat Power Limited - India
- White Energy Company Limited
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- Edison Trading Spa - Italy
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Xindia Steels Limited - India
- Wilmar Investment Holdings
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Merrill Lynch Commodities Europe
- Bukit Asam (Persero) Tbk - Indonesia
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Makarim & Taira - Indonesia
- Borneo Indobara - Indonesia
- Coal and Oil Company - UAE
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Africa Commodities Group - South Africa
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Sree Jayajothi Cements Limited - India
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Carbofer General Trading SA - India
- Timah Investasi Mineral - Indoneisa
- Kumho Petrochemical, South Korea
- Sinarmas Energy and Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Sakthi Sugars Limited - India
- Grasim Industreis Ltd - India
- Marubeni Corporation - India
- Kaltim Prima Coal - Indonesia
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Gujarat Sidhee Cement - India
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Central Electricity Authority - India
- Karbindo Abesyapradhi - Indoneisa
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- McConnell Dowell - Australia
- LBH Netherlands Bv - Netherlands
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Interocean Group of Companies - India
- Thiess Contractors Indonesia
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Goldman Sachs - Singapore
- Singapore Mercantile Exchange
- San Jose City I Power Corp, Philippines
- Port Waratah Coal Services - Australia
- Anglo American - United Kingdom
- SMC Global Power, Philippines
- Bulk Trading Sa - Switzerland
- Eastern Energy - Thailand
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