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Asbatankvoy Clauses 6 7 8 AND 9 Published:23 February 2006 14:56 Updated: 03 November 2009 12:58
It is our experience that problems of interpretation frequently arise in relation to Clauses 6-9 of the Asbatankvoy charter. These interrelated clauses, which, just to mention a few issues, govern Notice of Readiness, Laytime and Demurrage as well as the important Reachable on Arrival warranty, direct the allocation of substantial dollar amounts between owners and charterers. Mr. E.C. Coulson, F.I.C.S., in his book ³A Guide For Tanker Brokers´ explains the working of these clauses, which even today, six years after the 2nd edition was published, provides an excellent guide practitioners may use when working with the Asbatankvoy charter form. INTERTANKO has with the kind permission of Clarkson Research Studies, London, been allowed to print a synopsis of Mr. E.C. Coulson¶s excellent analysis of the Asbatankvoy charter form. Clarkson Reaseach Studies is the research subsidiary of H. Clarkson Shipbrokers, which amongst its activites include oil, chemical and gas tanker brokerage. H. Clarkson is an associate member of INTERTANKO. We hope you make good use of this guidance and look forward to comments and questions you may have. Clause 6 - Notice of Readiness. The six hour notice period is often likely to be a kind of ³free laytime´ to which the charterer is always entitled. This is not the case. It is time permitted to the charterer to make the necessary arrangements and is allowable under certain conditions. As the Clause specifies, if the vessel should berth and/or commences loading and/or discharge before the six hours has elapsed, then laytime commences from the time of berthing and/or commencement of load and discharge. If all the laytime is used at the loading port and, on arrival at discharge port, the vessel is therefore on demurrage, the charterer would not then be entitled to a six hour notice period as the principle once on demurrage, would apply. The six hours are for commencement of laytime at load and discharge port(s). If there is no laytime left, the charterer cannot have six hours notice of something the charterer no longer has. As will be seen later, it is common today to add a clause stating that the charterer is entitled to six hours¶ notice whether the vessel is on demurrage or not. Another common error is to assume that the vessel cannot tender notice of readiness prior to the commencement of the laydays, which, if correct, would mean the charterer could always rely
shall not count as laytime. unless the charterer could or wished to commence loading earlier. Therefore. always on demurrage´ . owner accepts..comes into play. This Clause states that laytime shall run continuously unless interrupted for the reasons set out in the Clause. but that vessel arrives at the customary anchorage on 12th October. of course. The same situation should exist when the vessel is on demurrage.´.e.³Once on demurrage. if the vessel is on demurrage. the Clause makes no reference as to the date of notice of readiness can be tendered. the charterer exceeding the laytime allowed..´ and it means what it says. the reasoning being that if the charterer had not been in breach by exceeding the laytime at previous load and/or discharge port. such delay shall not count as used laytime´. Let it be assumed that vessel is fixed for laydays commencing 15th October. not to demurrage. under Clause 6. quite the opposite. at first sight.upon the six hours¶ allowance (unless. This is not correct. An argument often put forward by charterers and. where delay is caused to vessel getting into berth after giving notice of readiness for any reason over which charterer has no control.. namely that it is a fact that a vessel has to move from an anchorage to a berth and is something the owner has to face under any circumstances. The reason it counts as demurrage has been explained. Demurrage is damages for a technical breach of the charter. why should it count as demurrage time. and the charterer cannot be relieved from liability for agreed damages because of some fortuitous situation which exists 2 . As in Clause 6 it refers only to laytime. However. Clause 7 . that the time is borne by the owner. it clearly states that ³upon arrival at customary anchorage . Laytime cannot commence until 15th October. the vessel may have arrived earlier and thus avoided the delay which occurred. but the owner would be perfectly entitled to tender notice of readiness on the 12th October and the six hours¶ notice period will commence accordingly and. it is obvious that the six hours notice period would expire before the laytime commenced. Again the argument mentioned with reference to Clause 6 can be advanced perhaps with even more logic. but laytime would start counting at 00:01 hours 15th October and not at 06:00 hours 15th October. the charterer must add an express clause that states the vessel cannot tender until the first of the laydays. i. a seemingly logical one. It is important to note it refers to laytime and not to demurrage.. This line has given rise to many disputes and legal rulings which will be touched upon later. The Clause states that time ³moving from loading or discharge port anchorage to her loading or discharging berth . If an owner accepts such shifting time when laytime exists. The last line of Clause 6: ³However. vessel berths before the expire of the six hours).Hours for loading and discharging. Again the adage . if a charterer wishes to be protected in this respect. is that if an outside delay arises beyond charterers¶ control.
if they arise. It is not the purpose here to go into such minutiae. often referred to as ³half breakdown´. however. B. For example. i. Clause 8 states that the agreed amount of demurrage is payable for each hour by which the allowed laytime is exceeded and pro rata for part of an hour. There is a great deal of misunderstanding about the effect of the second sentence or so called ³half breakdown´. it needs to be emphasised again that Clauses 6 and 7 are concerned with laytime and not demurrage and that Clause 8 is concerned with demurrage. The last part of the Clause can also often be misread as the charterer not being liable for 3 . always on demurrage´. Disputes arise about the definition of the words used.´ and therefore would not qualify. namely: A.g. demurrage runs continuously unless there are express agreements to the contrary. not laytime.e. the delay being caused by ³storm´. or may have to leave the berth because of weather conditions.or arises outside charterer or owner¶s control. certain criteria have to exist. The second sentence sets out certain circumstances which. it has not been unusual for an owner to accept this argument or. for example. The conditions set out in this part of the Clause must apply to the installation itself.Demurrage Before embarking on an explanation of Clause 8 and its effect. is unable to get to the berth. its equipment. The events mentioned in the ³half breakdown´ must arise after the ship has arrived and cannot be relied upon if they arose before the vessel arrived at the port in question. mean the argument is valid. The fact an owner may so accept the argument does not. because all the laytime has been used at her previous port(s). For the ³half breakdown´ to come into force.. but argue the conditions did not come within the legal definition of ³storm´. do not come within ³in or about the plant of the charterer. due to bad weather. unless the relief is expressly agreed elsewhere in the charter. supplier. The vessel. personnel and immediate environs. Recently. Clause 8 . shipper or consignee . always on demurrage´. This should be self-evident but there is frequent confusion about this when attempting to interpret these Clauses. The charterer then argues that delay getting to the berth or caused by having to leave the berth comes within the provisions of the ³half breakdown´ part of Clause 8. a storm must damage the installation and/or its equipment. e. The final part of the Clause sets out situations where the charterer shall not be liable for demurrage. in principle accept it. even though the laytime may have been exceeded. Again ³once on demurrage. Remember the last line of Clause 6 (that delays beyond charterer¶s control not to count as laytime) does not apply here because the vessel is on demurrage. is on demurrage on arrival.. ³storm´ and ³lockout´ etc. the installation may be flooded or the storage tanks damaged. ³Once on demurrage. entitle the charterer to pay only half the agreed demurrage rate. important though it may be. The most common misinterpretation arises where a vessel arrives at the port and. High winds pressing the vessel onto the berth and damaging it or rough water in the approaches to the berth.
The kernel of the decision was that in present times. benefits and penalties of one Clause may be dependent on the proper compliance with other clauses contained elsewhere in the charter. ³Safe´ has been dealt with earlier. This decision was directly opposed to the interpretation accepted by the industry for a number of years and caused consternation amongst those involved in tanker chartering. Clause 9 . in particular. No apology is made to repeating that all clauses. and it is these stated reasons which have given rise to certain implications concerning the last line of Clause 6. important though it is. The Clause.´. lockout or restraint of labour. They further stated that ³designated and procured by the charterer" placed upon 4 . 7. safe berth shifting. tugboats or pilots. is self-explanatory.. was a ³reason over which charterers has no control´.. The charterer must procure and designate the berth. crew. 8 and 9. are interconnected in that the obligations.demurrage caused by any strike. The arbitration decision was contested through the Courts. C. the words ³.. etc. where delay is caused to vessel getting into berth after giving notice of readiness for any reason over which charterer has no control such delay shall not count as used laytime´ and might give an impression that a charterer is given a wide protection. finally reaching the House of Lords... and thus the charterer had no say in berthing priorities or arrangements which are solely in the hands of the berth operator. The Clause gives the charterer the right to load and/or discharge alongside other vessels or lighters. their Lordships referred to the provisions of Clause 9. bearing in mind the definition and responsibilities concerning ³safe´. who reinstated the previously held view that berth occupancy is within the control of the charterer. Three points must be borne in mind: A. whereas in the past vessels usually loaded and discharged at berths controlled by the charterer or its subsidiaries. The main concern here is not so much the final decision. and in particular Clauses 6. that this provision protected charterers in that another vessel occupying the berth where the ³Laura Prima´ was to berth. An umpire held in an arbitration concerning a vessel called the ³Laura prima´. charterers frequently used berths which were controlled or owned by outside parties who had no association or direct link with the charterer. When giving their reasons. As said before. The judgements given in the various Courts are well worth study by any interested student. but the reasons given by Law Lords for their decision. The load and discharge place must be ³reachable on her arrival´. the last line of Clause 6 reads: ³However. They stated the words ³reachable on her arrival´ meant precisely what they said.Safe berth shifting. a phrase of considerable significance. B. reachable on her arrival which shall be designated and procured by the charterer . but careful reading will make it clear that this exclusion from liability for demurrage applies only where these events are directly attributable to the master.
then the precise interpretation of ³reachable on arrival´ should be modified. or outside factors delay a vessel and traditionally such factors were accepted by shipowners. in essence. there is nothing a charterer can do about this and the industry would accept that these are the kind of risks owners experience and bear as part of a marine venture. is academic. perhaps. or in the past considered both a charterer¶s risk. as always. as a general guide the following might assist in a better understanding of this important phrase: 5 . and laytime counts. This explanation relating to ³reachable on arrival´ and the consequences of the legal rulings were made in the first edition of this book not too long a time after the rulings were made. albeit reluctantly. the interpretation as made by the House of Lords has been rigidly upheld and in the process elaborated upon what does or does not constitute ³reachable on arrival´. unless there is some contributory cause by the vessel or its owners. from the point of view of fairness at least. then. but a summary of the attitudes which have been tested would. indeed. The warning contained in the preface of this book that things change. and were nothing to do with the charterer. in the context of other clauses which may be added. be that where operational difficulties. accept that if the berth is not procured and designated by the charterer and/or is occupied by another vessel then it is not ³reachable on arrival´. In addition. These views. However. it is not reachable on arrival and charterer is not protected by the last line of Asbatankvoy Part II. for example. where such delays existed or arose. If the circumstances arose before the vessels arrived and/or the berth was unavailable. it was not ³reachable on her arrival´ and the charterer had failed to carry out the obligations under Clause 9 and could not seek to avoid the consequences of this failure by pleading the last line of Clause 6. of course. Clause 6. bad weather. or pilots. would seem persuasive and. in the main. Despite this it seems that many in the industry still do not understand the preciseness which the phrase carries. All the various arbitration and legal decisions cannot be gone into here.the charterer the duty to secure a suitable and available berth for the vessel and could not seek to delegate that duty to a third party or plead no responsibility because the berth was controlled by some outside agency over whom the charterer had no authority. All. as the vessel could not get to the berth anyway. However. the question of whether the berth is free or occupied. An attempt to codify circumstances which do or not constitute ³reachable on arrival´ is fraught with danger. Since that time there have been several arbitrations and court cases where parties have sought in special circumstances to mitigate or avoid the consequences of not being able to comply with ³reachable on arrival´ but. arbitration and court decisions get reversed or amended. more from regarding certain circumstances from the point of view of what an affected party sees as unfair rather than accepting the concept as seen by the law. but where the vessel could not get to the berth anyway due to. these decisions have been overruled by the courts who have reiterated that ³reachable on arrival´ has a precise meaning and that where the vessel cannot get to the berth when she arrives. Thus the charterer could only obtain the protection of the last line of Clause 6 if charterer procured an available berth which the vessel could reach on arrival and if after the vessel arrived a circumstance arose beyond the charterer¶s control which delayed the vessel. must be kept very much in mind and the particular circumstances of each situation carefully considered. strike of tugboats. This difficulty in understanding springs. have been supported by decisions in arbitration.
the berth is nominated and is unoccupied and there is nothing preventing the vessel proceeding to the berth . the berth was available on arrival and there was no impediment to vessel on arrival but afterwards a condition has arisen beyond charterer¶s control and thus charterer has the protection of the last line of Clause 6. i. 7. and 6 . notice of readiness must be tendered. It should make particular reference to the printed charter party clause it seeks to amend. somewhat involved and it may be useful to recapitulate some of the points made and add some general observations: A. arises. therefore it is not ³reachable on her arrival´. The six hours¶ notice may not be allowed the charterer if: i) the vessel is permitted to tender notice before the commencement of the agreed layday. C. The foregoing with regard to Clauses 6.1. of necessity. 4. it says nothing about demurrage.the berth is reachable on arrival.. thus delays would not count as laytime. The berth is not ³reachable on arrival´ whether or not the berth is free. Vessel is ordered to a port. Vessel arrives at the port. 8 and 9 come into effect. Charterer has not designated a berth and/or the berth is occupied. In this situation. A charter will almost certainly have special clauses added which expressly change or qualify the printed clauses. 7. It must be remembered Clause 6 excepts laytime. or a tug strike commences or there is a strike of pilots which prevents the vessel proceeding to the berth. 8 and 9. exist but after vessel¶s arrival. delayed getting to the berth for reasons beyond charterer¶s control. bad weather preventing the vessel moving to the berth occurs. In this situation the berth is not ³reachable on arrival´ because it was occupied and the fact the vessel could not get to it anyway does not relieve the charterer. 2. it should state if the exceptions are to apply even if at the time they exist the berth is occupied and finally. so that even if the berth was free the vessel could not have proceeded to it and the reasons why she cannot proceed arose after she arrived. which seeks to protect the charterer or to equitably share the delay between owner and charterer must be very carefully worded. charterer has complied with the provisions of Clause 9. B. it should specify the conditions which are to be excepted. Vessel arrives at the anchorage. then it should clearly say so. 3. 5. is.e. It follows that any clause added to the charter. if it is intended to apply to demurrage as well as laytime. The circumstances described in 1. above. At the time the vessel is so ordered there are bad weather delays or a tugboat strike at the port and these circumstances still exist when the vessel arrives at the port. Before Clause 6. ii) the vessel berths before the six hours has expired. the berth is occupied but just after the vessel¶s arrival bad weather etc.
generally. unless expressly agreed otherwise. vessel will be on demurrage on arrival and any delay and/or time getting to the berth will count as time on demurrage. but if laytime has expired and the vessel is on demurrage. installation etc. time proceeding from the anchorage to the berth will not count as used laytime. for bunkers consumed whilst the vessel is detained. but the situations described must arise after the vessel has arrived and must affect cargo handling in the port. there being a specific agreement to reduce demurrage. the consequences of missing a convoy (e.iii) the vessel is already on demurrage on arrival. such delay will not count as used laytime provided that the berth was free and available on the vessel¶s arrival and the reasons preventing her proceeding to the berth arose after the vessel arrived. If the laytime has not expired. not count as used laytime or as time on demurrage. a charterer is not entitled to require the vessel.g. to wait outside the loading port for discharge orders. A delay of this nature would constitute ³detention´ for which the owner would be entitled to damages. For example. If laytime has expired prior to the vessel¶s arrival then.g. G. Half demurrage is payable by the charterer when the situations specified in Clause 8 arise. Suez Canal transit). the time proceeding to the berth would count as time on demurrage. Laytime and demurrage provisions do not apply after loading and discharge have been completed and they do not permit the charterer against paying demurrage to detain the vessel after the completion of cargo handling operations. Although for convenience the ³time´ damages may be based on the demurrage rate. its crew or the other causes set out in the last line of Clause 8 will. the owner would be entitled to claim under other heads e. possibly the loss of income due to a following charter being cancelled because the vessel missed the cancelling date for her next voyage due to detention. E. having loaded cargo. Delays directly attributable to the vessel. port facilities. F. If laytime has not expired and the vessel is prevented from proceeding to the berth for a reason outside the charterer¶s control. 7 . D.
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