Safmarine v. Atlantic

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DMC/S&T/31/01
South African Marine Corporation v. Atlantic Reliance Shipping Co.

English Commercial Court: Toulson J: Unreported: 29 October 2001
Nicholas Hamblen QC instructed by Lawrence Graham for Atlantic Reliance, the charterer
Charles Haddon-Cave QC instructed by Ince & Co for South African Marine Corporation, the owner.
TIME CHARTERPARTY: NEW YORK PRODUCE EXCHANGE FORM: NOTICE OF DELIVERY CLAUSE: NOTICE OF REDELIVERY RANGES: WHETHER NOTICE OF REDELIVERY RANGE ALSO A NOTICE OF APPROXIMATE DELIVERY DATE

Summary
In this case, the charterers were successful in their appeal from an award of London arbitrators over the construction of a notice of redelivery clause in a time charterparty on the New York Produce Exchange Form.

DMC Category Rating: Confirmed

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Facts
The dispute was as to the meaning of an additional clause, clause 45, which read: "Charterers to give owners not less that 15/10/7 days' approximate notice of vessel's redelivery and 2/1 days' definite notice ('clause 45.1'). Charterers further to give 45 days' notice of redelivery range ('clause 45.2')".

Atlantic Reliance, the charterers had not given any notice under clause 45.2. Safmarine, the owners, claimed damages in consequence, on the grounds that they had lost the opportunity to fix the ship early in conditions of a falling market.     ╩╩╩

The Arguments
Atlantic Reliance submitted that clause 45.1 was directed at the time of redelivery and clause 45.2 at the place of redelivery. Under clause 45.2 a minimum of 45 days' notice had to be given of the place of redelivery, but thereafter the giving of notices as to the time of redelivery was governed by clause 45.1. Safmarine submitted (and the arbitrators had found) that clause 45.2 required the charterers to give notice, 45 days before the expected date of redelivery, of the range within which the vessel was to be redelivered. The notice should be given on the basis of a bona fide estimate of when redelivery would take place.  ╩╩╩

The Judgment
The judge held that
(1) the question he had to decide was whether clause 45.2 was to be read as requiring the charterers to give 45 days' approximate notice of the actual redelivery range (and, thereby, of the date of redelivery), or whether it was to be read as requiring notice of the redelivery range to be given 45 days (or more) before redelivery. Either interpretation involved reading into clause 45.2 words which were in clause 45.1 (either Ĺapproximateĺ or Ĺnot less thanĺ) but not in clause 45.2.
(2) In notice clauses in general, it was more natural to read a requirement as a minimum rather than an approximation, as the latter could give rise to arguments.
(3) Clause 45.1 and clause 45.2 were directed at different subjects, as the charterers had argued. Clause 45.1 was directed at the time of redelivery and clause 45.2 at the place of redelivery. Under clause 45.2 a minimum of 45 days' notice had to be given of the place of redelivery, but thereafter the giving of notices as to the time of redelivery was governed by clause 45.1.
(4) Evidence from other types of charterparty showed that to construe clause 45.2 in this way would not render it valueless from the ownersĺ point of view.

The Appeal was accordingly allowed.

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