Independent Petroleum v Seacarriers Count

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DMC/SandT/07/05
Independent Petroleum Group Limited v Seacarriers "Count" Pte Limited (The "Count")
English Commercial Court: Toulson J: [2006] EWHC 3222 (Comm): 12 December 2006
Available on BAILII @ http://www.bailii.org/ew/cases/EWHC/Comm/2006/3222.html
Michael Nolan (instructed by Davies Johnson & Co) for the Claimant-Charterer
Edmund Broadbent (instructed by MFB) for the Defendant-Shipowner
VOYAGE CHARTER: UNSAFE PORT: WHETHER PREVAILING CONDITIONS AMOUNTED TO A TEMPORARY HAZARD
Summary
In this case, the court held that a shipowner could bring an unsafe port claim for delay caused by groundings of other vessels at a port, in circumstances where the shipowner’s vessel was not actually in any danger herself but a) the port’s characteristics were not merely a temporary hazard and b) those characteristics had existed at the time of the charterer’s nomination of that port. At the port in question, it was highly unlikely, on the facts, that the buoys in the port’s channel were properly positioned, due to shifting sand banks or shoals, and there was no adequate system in place to monitor the channel, which created a continuing risk of danger to vessels. The "Hermine" [1979] 1 Lloyd's Rep 212 (CA), distinguished

DMC Category Rating: Developed

This case note is based on an Article in the February 2007 Edition of the ‘Marine Bulletin’, published by the Marine team at the international firm of lawyers, DLA Piper. DLA Piper is an International Contributor to this website.

Background
The "Count" was chartered to the claimant-charterer by a voyage charterparty on the Asbatankvoy 1997 form for the carriage of a cargo of petroleum products from Sitra to "1, 2 or 3 safe ports East Africa Mombasa/Beira Range". The charterer nominated Beira and on her arrival on 29 June 2004 the vessel was delayed due to the fact that the channel was blocked by the grounding of another inbound vessel, the "British Enterprise". After being re-floated the "British Enterprise" grounded again on 1 July. The "Count" finally proceeded to the discharge berth on 4 July and discharge was completed early on 9 July. However, the "Count" was unable to sail because a few days earlier yet another vessel, the "Pongola", had grounded in the approach channel in almost the same spot as the "British Enterprise" had first grounded. The "Count" was not able to sail from Beira until 13 July when the channel was re-opened.

The shipowner claimed from the charterer the amount of its loss resulting from the delay caused by the blockage of the channel on the grounds that this loss resulted from breach by the charterer of the safe port warranty in the charterparty. Arbitrators in London upheld the shipowner’s claim and awarded them US$63,241.58 in damages. The arbitrators’ reasoning was that, when Beira was nominated by the charterer, it was highly unlikely that the buoys in the channel were properly positioned and there was no adequate system in place to monitor the channel. As a result, they held that the port was prospectively unsafe at the time that it was nominated by the charterer.

The arbitrators rejected the charterer’s arguments that any misalignment of the buoys in the channel was a result of recent bad weather and not poor monitoring of the channel.

The charterer appealed against the award on the basis that the arbitrators had erred in law:
(i) the arbitrators should have asked themselves whether the port was safe for the "Count" itself and should not have found that the port was unsafe by reference to the fact that two other vessels grounded, and
(ii) that the delay caused by the blocking of the channel was temporary, it was not one which frustrated the adventure and that the port was not therefore unsafe.

In support of proposition (ii) the charterer relied upon the Court of Appeal decision in The "Hermine" [1979] 1 Lloyd's Rep 212.

Judgment
The judge distinguished The "Hermine" on the basis that it had involved allegations of unsafety based on delays alone, the port had been entirely safe at all times in all other respects in that case.

In the present case, the judge decided that the arbitrators’ finding was not based on the fact that there might be a merely temporary hazard. Rather it was based on characteristics which were not merely a temporary hazard, namely that the buoys were out of position due to shifting sand banks or shoals, and there being no adequate system for monitoring the channel in place. These characteristics, which existed at the time of the nomination, were such as to create a continuing risk of danger to vessels, including the "Count", when approaching and leaving the port, and it was therefore an unsafe port to nominate.

The court also rejected the charterer’s arguments that the grounding of the "Pongola" was a breach in the chain of causation between the charterer’s breach of contract in nominating an unsafe port and the shipowner’s loss.

Accordingly, the court rejected the appeal and upheld the arbitrators’ award.

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