CESSER CLAUSE

Cesser Clause
Normally a charterer who transfers his space to a shipper is only too anxious to
drop out of the transaction provided his profit is assured. This means that he is
content to leave the work of carrying to the ship-owner, and the bill of lading will
accordingly be issued on the latter's behalf and will constitute the contract of
carriage except in so far as it may expressly incorporate the terms of the
charter-party. This result is usually brought about by inserting what is called a
'cesser clause' in the charter-party.
It is provided by such a clause that the ship-owner shall have a lien on the cargo
for freight, dead freight and demurrage, and that the charterer's obligation to
pay freight is accordingly to cease as soon as a full cargo is shipped. At that
moment, of course, the right of lien will come into existence. A cesser clause
takes, as a rule, some such form as:
This charter being entered into on behalf of others, all liability of the parties
signing to cease after shipment of cargo, in consideration of which it is agreed
that for the payment of all freight, dead freight, and demurrage, the said owner
shall have an absolute lien and charge on the said cargo.