TRANSPORT SHIPPING TRADE Project Cargo shipments: tips from legal advisor Natalia Myroshnychenko, Interlegal.

TRANSPORTSHIPPINGTRADE

Project Cargo shipments:tips from legal advisor

Natalia Myroshnychenko, Interlegal

Cancellation of shipment

Pre-shipment

CharterersCharterers

Gencon/Booking Note

OwnersOwners

• Charterers’ cancellation: Non-readiness of cargoFinancial problems of Cargo Buyers

Grounds for cancellation

• Owners’ cancellation: Vessel’s delay for laycanImpossibility to take another part cargo

Charterers:

We hope you understand charterer’s current situation and forgive us for causing trouble for this contract.

Notice of cancellation

•Grounds•Cancelling clause •Jurisdiction

Cancelling Party

Counterparty to Cancelling PartyImmediate short claim•Statement of contract breach •Declaration of damages•Grounds for recovery•Jurisdiction

Voyage

Late delivery

Charterer

?

Shipowner

Charterers’ positionOwners’ failure to prosecute the voyage with due dispatch

Breach of delivery term

Owners’ positionJustifiable deviation

English case law justifiable deviation – voyage charter• to effect repairs to the ship (see Kish v. Taylor [1912])• to avoid capture or confiscation (see the Teutonia [1872])• to save life or property (see Monarch v. Stamp [1880])• to load full cargo (see Wallems v. Muller [1972])

Registered Owners

Registered Owners

ChartererCharterer

Time Charter

Voyage Charter

Time Charterer

Time Charterer

• Agreed port rotation

• Fixed transit time

• ‘First out’ basis

• Penalties clause

DELIVERY TERMCLAUSE/AGREEMENT

Post - voyage

Dispute

“Arbitration in London, English law”

Arbitration in London without any reference to the number of arbitrators

No express mechanism for the appointment of the arbitrator

One arbitrator only

English Law, Arbitration in London, the reference tothree arbitrators in accordance with the LMAA Terms

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