pi_circular Operational riskInsurance & claims Skuld
Charterer Members will no doubt be aware of the risk of significant unsafe Port claims being levied against them, with one of the largest to date involving the MV Ocean Victory casualty at Kashima, Japan in 2006. It is important to be aware of the legal obligations a Charterer may take on when warranting in the Charterparty that the vessel will be trading between safe Ports, Berths and anchorages. Equally important is to know the extent and limit of these obligations and what defences a Charterer may arise when confronted with such a Claim. In this bulletin, we will be providing an overview of the key points Charterers need to keep in mind. 1. The risk There is often a risk that a vessel is damaged when entering, remaining and leaving a port. The loss may consist of hull repair costs, but also delay and loss of time in addition to liabilities for third party property damage. Owners will try to recover these losses from charterers, on the basis of an alleged failure by the charterer to order the vessel to a safe port, berth or anchorage (depending on Charterparty terms). 2. Safety warranty: express or implied When Charterers consider their liability under the charter party for such an incident, they should keep in mind that they have probably given an express warranty for the safety of the port or berth. For instance, NYPE 93, clause 5. reads that the vessel shall be employed between “safe ports and safe places”. If this is not expressly mentioned, courts will in most cases not imply such a warranty [1]. However, if the contract provides for a geographical range of unnamed ports, the matter is different and a warranty may be implied [2] . 3. When does the obligation arise? After charterers have established that there is a safety warranty (express or implied), the second decisive point is when this obligation arises. The answer is that the port or the berth must be in compliance with the warranty at the time when charterers give the order to proceed to a port o
Unsafe ports and berths: Charterers´ defences
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