Gard Shipping AS v Clearlake Shipping PTE Ltd, Court of Appeal - Commercial Court, May 12, 2017, [2017] EWHC 1091 (Comm)

Issuing Organization:Commercial Court
Actores:Gard Shipping AS v Clearlake Shipping PTE Ltd
Resolution Date:May 12, 2017
 
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Case No: CL-2016-000338

Neutral Citation Number: [2017] EWHC 1091 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 12th May 2017

Before:

Sir Jeremy Cooke

sitting as a Judge of the High Court

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Between:

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Alexander Wright (instructed by Thomas Cooper LLP) for the Claimant

Fionn Pilbrow (instructed by Reynolds Porter Chamberlain) for the Defendant

Hearing dates: May 10th 2017

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JudgmentSir Jeremy Cooke:

Introduction

  1. By a voyage charterparty dated 9 December 2015 (``the Charterparty''), Owners agreed to let and Charterers agreed to hire MT ``ZALIV BAIKAL'' (``the Vessel''), a 104,532 SDWT crude oil tanker, for one voyage from one safe port Ust-Luga (with further options as to a second and third load port) to one or two safe port(s) ``UK CONT NORTH SPAIN - HAMBURG RANGE'', (with certain exceptions) with optional discharges at up to four interim ports. The Charterparty was varied by an Addendum dated 22 December 2015, which provided for a second voyage in direct continuation from the first, with the loadport specified as one safe port Ust-Luga or St Petersburg and the discharge range as before.

  2. The dispute arises out of the second voyage and the issue is whether or not Owners are entitled to claim demurrage at an escalated rate, and the value of the bunkers consumed, over a period of 64.7083 days, during which the Vessel was waiting to discharge cargo at Rotterdam between 26 January 2016 and 31 March 2016. Charterers accept that they gave no discharge instructions during this period, and that the Vessel's delay in berthing and discharging her cargo was caused by them ``for their own commercial purposes''.

  3. There are no material disputed questions of fact between the parties and the issue between them turns on the construction of the terms of the Charter or alternatively the existence of an implied term. Whilst Owners claim the sum of $976,731.79 on the basis of their construction of the Charter or the term which they submit is to be implied into it, Charterers contend that, even if Owners are correct on either point, they cannot recover the full sum claimed.

    The Charterparty

  4. No formal charterparty document was ever drawn up but it is common ground that the Charterparty consisted, so far as material, of the fixture recap, dated 9 December 2015 (``the Recap'') which provided for a number of amendments to the terms of a previous fixture between Owners and Charterers for the Vessel dated 12 November 2015 (``the Gard/Clearlake Terms'') and otherwise incorporated the printed BPVOY4 form, with amendments. The key clauses upon which argument turned were Additional Clause 11 (AC 11) of the Gard/Clearlake terms and Clause 22 of the BPVOY4 form, as amended.

  5. The Recap contained the following material express terms:

    ``DEM : USD 32,500 PDPR

    LAYTIME : 72 HRS SHINC

    ...

    COMMISSIONS

    2.50 PCT TO CHARTERERS ON FREIGHT/DEADFREIGHT/DEM...''

  6. Part 2 of the BPVOY4 form, as amended (with amendments to the printed form underlined or struck through for ease of reference), contained the following material express terms:

    (a) Clause 6.1: ``Upon arrival of the vessel at each loading or discharge port, the Master or Agents shall tender NOR to Charterers or to their order when the vessel is in all respects ready to carry out Charterers' orders in accordance with the provisions of this Charter ...''

    (b) Clause 7.1: ``Charterers shall be allowed the number of hours stated...together with any period of additional laytime arising under Clause 7.3.1, as laytime for loading and discharging and for any other purposes of Charterers in accordance with the provisions of this Charter.''

    (c) Clause 7.3.2: ``Laytime or, if the Vessel is on demurrage, demurrage shall commence at each loading and each discharge port, upon the expiry of six (6) hours after a valid NOR has become effective...''.

    (d) Clause 7.3.3: ``Laytime or, if the Vessel is on demurrage, demurrage shall run until the cargo hoses have been finally disconnected upon completion of loading or discharging...provided always that if the Vessel is detained solely for the purposes of awaiting cargo documents (INCLUDING CUSTOMS DOCUMENTS) at loadport for more than three (3) hours beyond the final disconnection of cargo hoses, laytime or if the Vessel is on demurrage, demurrage shall recommence after such period of three (3) and terminate upon the completion of cargo documentation once cargo documents are delivered on board BUT MAX 3 HRS FOR OWNER'S ACCOUNT''.

    (e) Clause 7.4: ``Charterers shall pay demurrage at the rate stated...per running day, and pro rata for part of a running day...''.

    (f) Clause 22.1: ``if at any time after the date of this Charter, Charterers, notwithstanding that they may have nominated a loading or discharge port, wish to issue revised Charterers Voyage Orders and instruct Owners to stop and/or divert the Vessel to an alternative port within any Ranges stated in Section E or F of PART I or cause her to await orders at one or more locations, for max 3 days at dem rate plus bunkers consumed paid together with freight, Owners shall issue such revised instructions to the Master as are necessary to give effect to such revised Charterers Voyage Orders and the Master shall comply with such revised instructions as soon as the Vessel is free of any previous charter commitments''.

    (g) Clause 22.3: ``Any additional period by which the steaming time taken to reach the alternative port exceeds the time that should have been taken had the Vessel proceeded to such port directly shall count at laytime or, if the Vessel is on demurrage, as demurrage. Such additional period shall be the time required for the Vessel to steam the additional distance at the average speed actually achieved by the Vessel during the voyage or the Charter Speed as stated in Section B.25 of Part I, whichever is the higher. Charterers shall pay Owners for additional bunkers consumed for steaming the additional distance at the price paid by Owners, net of all discounts or rebates, for the last bunkers lifted be payable as per interim port cls,

    After first 5 days waiting for orders/disch instructions at sea, Vessel to be considered as being used for storage, and, unless otherwise agreed, following increase of demurrage rate to apply:

    Days 6 - 15 Demm rate plus $5,000

    Days 16 - 25 Demm rate plus $10,000

    Days 26 - 35 Demm rate plus $15,000

    Prior to expiration of 35 days period Charterers to inform Owners if they require more time to use Vessel as storage, and new rates to be mutually agreed latest on 35th day of such a waiting.

    Such waiting time to be compensated at rates agreed above and payable together with freight against Owners separate invoice.

    Charterers option to order the ship to wait at an offshore position provided they give final destination and expected cargo delivery window, in which case the above increase in rates not to apply. In case when final destination a/o cargo delivery window changes, then increase of rates to apply as per this Clause''.

    (h) Clause 31.4: ``Freight shall be payable immediately after completion of discharge...''. By the Gard/Clearlake Terms, this provision was to ``REMAIN AS PRINTED''.

  7. AC 11 has passages in different typescripts, as set out below, and although not set out in three distinct paragraphs, can be broken down thus:

    [Sub-paragraph (1)]

    ``Notwithstanding any term of this charter to the contrary, Charterers shall have the liberty, at any stage of the voyage, of instructing the vessel to stop and wait for orders FOR MAX 3 DAYS at a safe place WITHIN THE RANGES AGREED. In particular and without prejudice to the generality of the foregoing, Charterers shall be entitled to instruct the vessel not to tender NOR on arrival at or off any port or place or to delay arriving at any port of place until Charterers give the order to do so. Time to count as used laytime or time on demurrage, if vessel is on demurrage. AND ALL THE BUNKERS CONSUMED TO BE FOR CHRTS ACCOUNT

    [Sub-paragraph (2)]

    ``AFTER FIRST 5 DAYS WAITING FOR ORDERS/DISCH INSTRUCTIONS AT SEA VESSEL TO BE CONSIDERED AS BEING USED FOR STORAGE, AND, UNLESS OTHEREWISE AGREED, FOLLOWING INCREASE OF DEMMURAGE RATE TO APPLY

    DAYS 6 - 15 DEMM RATE PLUS $5,000

    DAYS 16 - 25 DEMM RATE PLUS $10,000

    DAYS 26 - 35 DEMM RATE PLUS $15,000

    PRIOR TO EXPIRATION OF 35 DAYS PERIOD CHRTS TO INFORM OWNERS IF THEY REQUIRE MORE TIME TO USE VSL AS A STORAGE, AND NEW RATES TO BE MUTUALLY AGREED LATEST ON 35TH DAY OF SUCH A WAITING.

    SUCH A WAITING TIME TO BE COMPENSATED AT RATES AGREED ABOVE AND PAYABLE TOGETHER WITH FREIGHT AGAINST OWNERS SEPARATE INVOICE.''

    [Sub-paragraph (3)]

    Chrs option to order the ship to wait at an offshore position provided they give final destination and expected cargo delivery window, In WHICH case the above increase in rates not to apply''

    in case when final destination a/or cargo delivery window changes, then increase Of rates to apply as per this clause.''

  8. There was additionally a bespoke Interim Ports Clause which provided for the Charterers to pay for additional interim loading or discharging ports within the agreed ranges, by paying for actual additional time spent in steaming to and from such additional ports, for all time spent from the moment of arrival at such ports until the point of departure at the demurrage rate and for all bunkers consumed in those periods.

    The agreed facts

  9. It was accepted that Notice of Readiness at the load port, Ust-Luga, was effectively served at 2300 on 30 December 2015 and laytime accordingly commenced at 0500 on 31 December 2015. The Vessel used 0.8125 days laytime at the load port.

  10. Between Ust-Luga and the Vessel's final discharge port, Rotterdam, her itinerary was as follows:

    i) From Ust-Luga she was ordered to proceed to Sillamae to load a further parcel of cargo, where she was between 0400 on 2 January 2016...

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