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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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Saturday, 06 April 19
SUPRAMAX: IT WAS A POOR WEEK OVERALL FOR THE BALTIC SUPRAMAX INDEX, WHICH LOST GROUND - BALTIC BRIEFING
Capesize
The Capesize market over the past week looked to have found a floor on Tuesday with the BCI 5TC at $3460 before firming into the rest ...
Thursday, 04 April 19
OVERSUPPLY STILL MAJOR CHALLENGE WARNS ICS
Speaking in Istanbul, Simon Bennett, Deputy Secretary General of the International Chamber of Shipping (ICS) warned that avoiding overcapacity and ...
Thursday, 04 April 19
GLENCORE, TOHOKU ELECTRIC SET COAL CONTRACT PRICE AT $94.75/T - SOURCE, REUTERS REPORTED
Global miner Glencore and Japan’s Tohoku Electric Power agreed on a price of $94.75 per tonne for supplies of thermal coal from Australia for ...
Monday, 01 April 19
FORCE MAJEURE SUCCESS NOT A SEA CHANGE - BALTIC EXCHANGE
KNOWLEDGE TO ELEVATE
It is difficult to successfully argue that contractual performance has been prevented or delayed by force majeure. This i ...
Monday, 01 April 19
AUSTRALIAN COAL AT RISK FROM CHINA MOVE, WARNS GOVERNMENT REPORT - SYDNEY MORNING HERALD
A new government report warns China’s restrictions on coal imports is the number one risk for Australian coal this year and could lead to a s ...
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Showing 1436 to 1440 news of total 6871 |
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- Larsen & Toubro Limited - India
- GAC Shipping (India) Pvt Ltd
- Meralco Power Generation, Philippines
- Vedanta Resources Plc - India
- Renaissance Capital - South Africa
- MS Steel International - UAE
- Coalindo Energy - Indonesia
- Minerals Council of Australia
- Alfred C Toepfer International GmbH - Germany
- Electricity Generating Authority of Thailand
- Thai Mozambique Logistica
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- Gujarat Sidhee Cement - India
- Economic Council, Georgia
- Mercuria Energy - Indonesia
- Star Paper Mills Limited - India
- Singapore Mercantile Exchange
- Kohat Cement Company Ltd. - Pakistan
- Straits Asia Resources Limited - Singapore
- Standard Chartered Bank - UAE
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kumho Petrochemical, South Korea
- Energy Link Ltd, New Zealand
- Bulk Trading Sa - Switzerland
- Iligan Light & Power Inc, Philippines
- Bhoruka Overseas - Indonesia
- Bukit Makmur.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Georgia Ports Authority, United States
- Therma Luzon, Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Krishnapatnam Port Company Ltd. - India
- New Zealand Coal & Carbon
- Bukit Asam (Persero) Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- Borneo Indobara - Indonesia
- Price Waterhouse Coopers - Russia
- Central Electricity Authority - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- India Bulls Power Limited - India
- Eastern Coal Council - USA
- Wilmar Investment Holdings
- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- VISA Power Limited - India
- Planning Commission, India
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Sindya Power Generating Company Private Ltd
- Parliament of New Zealand
- Sinarmas Energy and Mining - Indonesia
- ICICI Bank Limited - India
- IEA Clean Coal Centre - UK
- PTC India Limited - India
- Siam City Cement - Thailand
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- Thiess Contractors Indonesia
- Xindia Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Heidelberg Cement - Germany
- Semirara Mining Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Essar Steel Hazira Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Bharathi Cement Corporation - India
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- McConnell Dowell - Australia
- CNBM International Corporation - China
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Vizag Seaport Private Limited - India
- Orica Australia Pty. Ltd.
- Australian Commodity Traders Exchange
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- PNOC Exploration Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Intertek Mineral Services - Indonesia
- Sojitz Corporation - Japan
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Romanian Commodities Exchange
- Wood Mackenzie - Singapore
- Tamil Nadu electricity Board
- Sakthi Sugars Limited - India
- PowerSource Philippines DevCo
- Karaikal Port Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Maheswari Brothers Coal Limited - India
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Rio Tinto Coal - Australia
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Bukit Baiduri Energy - Indonesia
- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Metalloyd Limited - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Indian Oil Corporation Limited
- European Bulk Services B.V. - Netherlands
- Deloitte Consulting - India
- Central Java Power - Indonesia
- The University of Queensland
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- Makarim & Taira - Indonesia
- Indika Energy - Indonesia
- Videocon Industries ltd - India
- Aditya Birla Group - India
- TNB Fuel Sdn Bhd - Malaysia
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- Australian Coal Association
- Indo Tambangraya Megah - Indonesia
- Siam City Cement PLC, Thailand
- Ministry of Finance - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Power Finance Corporation Ltd., India
- Electricity Authority, New Zealand
- Eastern Energy - Thailand
- Merrill Lynch Commodities Europe
- South Luzon Thermal Energy Corporation
- Cigading International Bulk Terminal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Kaltim Prima Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Indogreen Group - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Commonwealth Bank - Australia
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Anglo American - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Tata Chemicals Ltd - India
- Globalindo Alam Lestari - Indonesia
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- Savvy Resources Ltd - HongKong
- OPG Power Generation Pvt Ltd - India
- Agrawal Coal Company - India
- Interocean Group of Companies - India
- Bhushan Steel Limited - India
- GN Power Mariveles Coal Plant, Philippines
- The State Trading Corporation of India Ltd
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Toyota Tsusho Corporation, Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Port Waratah Coal Services - Australia
- GMR Energy Limited - India
- Latin American Coal - Colombia
- Petron Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Samtan Co., Ltd - South Korea
- Indian Energy Exchange, India
- Trasteel International SA, Italy
- Attock Cement Pakistan Limited
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