Cosmar Shipping v. SLS Trading
Peter J. Gutowski, of attorneys Freehill Hogan and Mahar LLP, for the Claimant Owner
Owen F. Duffy, of attorneys Fowler, Rodriguez and Chalos, for the Respondent Charterer
GENCON CHARTERPARTY: CARGO OF SCRAP: DEMURRAGE: DISCHARGING LAYTIME EXPRESSED IN TERMS OF "WEATHER WORKING DAYS OF 24 CONSECUTIVE HOURS": MEANING OF "WEATHER WORKING DAY": WHETHER DISCHARGE IN FACT PREVENTED BY RAIN: DEMAND FOR SECURITY: CONSIDERATIONS FOR THE TRIBUNAL TO APPLY
In this reference, the Panel of the Society of Maritime Arbitrators of New York declined (by majority) to order the Charterer to provide security in advance for Owner’s demurrage claim. The Panel then concluded, unanimously, that the discharge of the cargo of scrap would not have been affected by rain and that the Owner’s claim for demurrage was accordingly well-founded.
DMC Rating Category: Confirmed
This case note has been contributed by Patrick V. Martin, a retired New York attorney and active arbitrator, who specializes in charterparty and commodity disputes
The panel also had to consider the Owner’s application for pre-award security in the amount of US$125,000 from the Charterer, to cover the demurrage claim. In other words, rather than applying to the appropriate court for an order to seize the Charterer’s property, the Owner simply made an application to the panel.
Dealing with the latter issue first, the Owner argued that the Charterer was basically a start-up company without substantial assets and that without security there would be no money at the end of the day to pay the anticipated award.
The ruling on pre-award security
The Demurrage claim
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