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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, 30 March 19
KOEN INVITES BIDS FOR 450,000 TONS OF (SUB) BITUMINOUS COAL FOR H1 AND JUNE 2019
South Korea state-owned utility KOREA SOUTH-EAST POWER CO., LTD. (KOEN) issued a tender for total 450,000 MT of min. 4300, 3500 and 5600 NCV ...
Wednesday, 27 March 19
SHIPPING MARKET INSIGHT - INTERMODAL
Contrary to the December 2018 forecasts but in line with the expectations of the dry bulk market, the first quarter of the year closed negatively. ...
Saturday, 23 March 19
IT WAS A POSITIVE WEEK FOR THE HANDY SIZE MARKET - BALTIC BRIEFING
Capesize
The big ships endured heavy losses last week extinguishing any hopes from the recent minor rally. Negative sentiment gained pace throu ...
Friday, 22 March 19
CHINA MARKET: COAL OUT IN THE COLD - BUSINESS RECORDER
Though China maintains there is no ban, China-bound Australian coal shipments are looking for a new home. For the past few months, coal cargoes are ...
Thursday, 21 March 19
PRICE PLUNGE AS CHINESE LEAVE THERMAL COAL OUT IN THE COLD - AUSTRALIAN FINANCIAL REVIEW
Thermal coal exporter New Hope Corporation says China’s shipment squeeze on Australia is putting downward pressure on prices in all markets i ...
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Showing 1441 to 1445 news of total 6871 |
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- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sakthi Sugars Limited - India
- Madhucon Powers Ltd - India
- San Jose City I Power Corp, Philippines
- Energy Development Corp, Philippines
- Price Waterhouse Coopers - Russia
- Gujarat Mineral Development Corp Ltd - India
- Indo Tambangraya Megah - Indonesia
- Electricity Generating Authority of Thailand
- Samtan Co., Ltd - South Korea
- The Treasury - Australian Government
- Siam City Cement - Thailand
- Asmin Koalindo Tuhup - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- The University of Queensland
- Commonwealth Bank - Australia
- Bulk Trading Sa - Switzerland
- Rio Tinto Coal - Australia
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- Bukit Baiduri Energy - Indonesia
- MS Steel International - UAE
- Bukit Makmur.PT - Indonesia
- Economic Council, Georgia
- The State Trading Corporation of India Ltd
- South Luzon Thermal Energy Corporation
- LBH Netherlands Bv - Netherlands
- Kobexindo Tractors - Indoneisa
- Romanian Commodities Exchange
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- Planning Commission, India
- Interocean Group of Companies - India
- Eastern Energy - Thailand
- Global Coal Blending Company Limited - Australia
- Orica Australia Pty. Ltd.
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Central Java Power - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Posco Energy - South Korea
- Central Electricity Authority - India
- ICICI Bank Limited - India
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Cement Manufacturers Association - India
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Singapore Mercantile Exchange
- Ministry of Mines - Canada
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petron Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Semirara Mining Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Wood Mackenzie - Singapore
- Agrawal Coal Company - India
- Ind-Barath Power Infra Limited - India
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Larsen & Toubro Limited - India
- Oldendorff Carriers - Singapore
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Edison Trading Spa - Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- Neyveli Lignite Corporation Ltd, - India
- Karaikal Port Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- Ceylon Electricity Board - Sri Lanka
- Mintek Dendrill Indonesia
- Attock Cement Pakistan Limited
- Chettinad Cement Corporation Ltd - India
- Gujarat Sidhee Cement - India
- Straits Asia Resources Limited - Singapore
- Aboitiz Power Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Australian Coal Association
- GN Power Mariveles Coal Plant, Philippines
- Billiton Holdings Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Coalindo Energy - Indonesia
- IEA Clean Coal Centre - UK
- Georgia Ports Authority, United States
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- Heidelberg Cement - Germany
- Kaltim Prima Coal - Indonesia
- Therma Luzon, Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Iligan Light & Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Parry Sugars Refinery, India
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Uttam Galva Steels Limited - India
- Ministry of Finance - Indonesia
- Kartika Selabumi Mining - Indonesia
- Eastern Coal Council - USA
- SN Aboitiz Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Star Paper Mills Limited - India
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Savvy Resources Ltd - HongKong
- Mjunction Services Limited - India
- ASAPP Information Group - India
- Sojitz Corporation - Japan
- Wilmar Investment Holdings
- Salva Resources Pvt Ltd - India
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bharathi Cement Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Bhoruka Overseas - Indonesia
- Indika Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Merrill Lynch Commodities Europe
- Holcim Trading Pte Ltd - Singapore
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Indian Energy Exchange, India
- Globalindo Alam Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Australian Commodity Traders Exchange
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Trasteel International SA, Italy
- Antam Resourcindo - Indonesia
- Thai Mozambique Logistica
- Kapuas Tunggal Persada - Indonesia
- Bangladesh Power Developement Board
- International Coal Ventures Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- VISA Power Limited - India
- Mercator Lines Limited - India
- Rashtriya Ispat Nigam Limited - India
- McConnell Dowell - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- New Zealand Coal & Carbon
- Sindya Power Generating Company Private Ltd
- Cigading International Bulk Terminal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Indogreen Group - Indonesia
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- SMC Global Power, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Toyota Tsusho Corporation, Japan
- Indian Oil Corporation Limited
- India Bulls Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Videocon Industries ltd - India
- Sical Logistics Limited - India
- Vedanta Resources Plc - India
- CIMB Investment Bank - Malaysia
- PowerSource Philippines DevCo
- Kalimantan Lumbung Energi - Indonesia
- SMG Consultants - Indonesia
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- Riau Bara Harum - Indonesia
- Bhatia International Limited - India
- Coastal Gujarat Power Limited - India
- GVK Power & Infra Limited - India
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
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