Odfjfell Seachem A/S v Continentale Des Petroles Et D'investissements & Anor [2004] EWHC 2929 (Comm)

Case No 2003 Folio No.966

[2004] EWHC 2929 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEENS BENCH DIVISION

COMMERCIAL COURT

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 15 December 2004

Before

Mr. Nigel Teare QC

Between

ODFJFELL SEACHEM A/SClaimant

(1)CONTINENTALE DES PETROLES ET D’INVESTISSEMENTSDefendants

(2)SOCIETE NATIONALE DE COMMERCIALISATION DE PRODUITS PETROLIERSDefendant

Christopher Smith (instructed by Stepehenson Harwood) for Claimants

Stewart Buckingham (instructed by Ince and Co.) for Defendants

Hearing Hearing dates : 19 November 2004

Judgment

Mr Nigel Teare QC:

[1]This is an application by the Claimants for summary judgment pursuant to CPR Part 24 upon the grounds that the Defendants have no real prospect of successfully defending the claim.

The facts and the claim

[2]The Claimants were the disponent owners of the vessel BOW CEDAR and on 20 August 2002 chartered her to the Defendants for the carriage of a cargo of 13,000 mt of jet fuel, 10,000 mt of gasoline and 10,000 mt of gas oil from Bahrain to Cotonou, Benin for a lump sum freight of US$825,000. The voyage charterparty was on the terms of an amended BPVOY4 form and provided for laycan dates of 27-29 August 2002. I shall refer to the Claimants as the Owners and to the Defendants as the Charterers.

[3]On 27 August at 0130 the vessel tendered notice of readiness and free pratique was granted at 1030 on the same day. Laytime commenced to run on 27 August and expired on 30 August whereafter the vessel incurred demurrage. On 2 September the Charterers sent the Owners an e-mail which stated “Charterers continued attempts to solve the problems on the purchase of the cargo have failed. Charterers therefore herewith cancel the c/p and release the vessel and ask owners to find alternative employment in order to minimise damages.”

[4]On 3 September the Owners accepted the Charterers’ e-mail as a repudation of the charterparty and claimed a “cancelling fee” in the sum of US$677,500 made up of the lost freight and demurrage less saved port costs and bunkers. On 5 September 2002 the Owners chartered the vessel by way of mitigation of their losses for a voyage from Karachi to several European ports.

[5]On 18 September 2002 the Owners’ Defence Club sought confirmation from the Charterers that they would pay the cancellation fee. On 1 October 2002 the Charterers’ solicitors Ince and Co. requested a copy of the charterparty and any other documents supporting the claim from the Club. On 3 October 2002 the Club provided Ince and Co. with a copy of the fixture note and copies of the exchanges between the parties on 2 and 3 September 2002. On 15 October 2002 Ince and Co. requested details of the mitigation fixture and proof that free pratique had been granted in Bahrain. The Club noted the request on 21 October 2002 but it was not until 15 July 2003 that the Club provided a revised damages claim (in the sum of US$551,777.29) which took into account the mitigation voyage.

[6]On 7 August 2003 Ince and Co. said that they were awaiting instruction and added “We are surprised, in view of the time it took you to present your claim (21 October 2002 until 15 July 2003) that you now require a response within days.” The Club replied on 8 August 2002 pointing out that the claim had been presented on 3 September 2002. On 25 August 2002 the Club further revised the claim (to $547,468.02) and provided voyage extracts and evidence of bunker prices. They enquired whether Ince and Co. had instructions to accept service of proceedings.

[7]On 31 October 2003 the Owners issued their Claim Form and applied for and obtained permission to serve the proceedings out of the jurisdiction. After service was effected in Benin the Charterers acknowledged service on 5 April 2004. By their Defence dated 19 April 2004 the Charterers contended that the charterparty had been frustrated by reason of a cargo not being available. On 5 August 2004 the Owners issued their application for summary judgment and on 10 November 2004 the Charterers sought permission to amend their Defence by removing the defence of frustration and substituting a defence based upon the time barring provisions in the charterparty. Permission to amend was opposed but it was agreed on the hearing of the application for summary judgment that the Court should consider the new defence and then consider whether, and if so on what terms, permission to amend should be granted. In addition to the limitation defence the Charterers raised several points concerning the quantum of the claim for damages which, at the time of the hearing, was reduced to US$474,802.31 plus interest.

The limitation defence

[8]This defence is said to arise under clause 20 of the charterparty which provides as follows:

“20 Claims Time Bar 20.1 Charterers shall be discharged and released from all liability in respect of any claim for demurrage, deviation or detention which Owners may have under this Charter unless a claim in writing has been presented to Charterers, together with all supporting documentation substantiating each and every constituent part of the claim within ninety (90) days of the completion of discharge of the cargo carried hereunder. 20.2 Any other claim against Charterers for any and all other amounts which are alleged to be for Charterers’ account under this Charter shall be extinguished, and Charterers shall be discharged from all liability whatsoever in respect thereof, unless such claim is presented to Charterers, together with full supporting documentation substantiating each and every constituent part of the claim, within one hundred and eighty (180) days of the completion of discharge of the cargo carried hereunder.” 20.1 Charterers shall be discharged and released from all liability in respect of any claim for demurrage, deviation or detention which Owners may have under this Charter unless a claim in writing has been presented to Charterers, together with all supporting documentation substantiating each and every constituent part of the claim within ninety (90) days of the completion of discharge of the cargo carried hereunder. 20.2 Any other claim against Charterers for any and all other amounts which are alleged to be for Charterers’ account under this Charter shall be extinguished, and Charterers shall be discharged from all liability whatsoever in respect thereof, unless such claim is presented to Charterers, together with full supporting documentation substantiating each and every constituent part of the claim, within one hundred and eighty (180) days of the completion of discharge of the cargo carried hereunder.”

[9]The Owners’ claim is pleaded as a claim for damages flowing from a breach of the Defendants’ implied obligation to furnish a cargo and from their repudiation of the charterparty.

[10]On behalf of the Charterers Mr.Stewart Buckingham submitted that the Owners’ claim for damages was within clause 20.2 and that where no cargo was discharged there should be implied into clause 20 a term that for the purposes of clauses20.1 and

20.2 the charterers would be discharged and released from liability unless the claim was presented with the required documentation within 90 days and 180 days respectively “of the date on which the cargo should have been delivered.” It was further submitted that the Owners had not done so and therefore that the Charterers were discharged from liability.

[11]On behalf of the Owners Mr.Christopher Smith submitted that no such term should be implied, that the Owners’ claim was not within the class of claims to which clause 20 applied, that the Charterers were estopped from relying upon the suggested limitation defence and that the Owners had in any event complied with the requirements of clause 20.

[12]The submissions of Counsel raise two questions as to the construction of a standard form of charterparty which are related.

[13]The first question of construction is whether the Owners’ claim for damages is “any other claim against Charterers for any and all other amounts which are alleged to be for Charterers’ account under this Charter”.

[14]Counsel for the Charterers emphasised the words “any other claim” and “any and all other amounts” which he suggested were words of wide import which covered all claims not within clause 20.1. On the other hand counsel for the Owners emphasised the words “for Charterers’ account” which he suggested denoted claims for sums which pursuant to the terms of the charterparty were expressly for the account of the charterers and did not encompass claims for damages.

[15]The second question of construction is whether a term can be implied in to clause 20 to provide a start date for the limitation periods of 90 and 180 days in those cases where the cargo was not discharged, namely, the date on which the goods should have been discharged.

[16]Counsel for the Charterers submitted that such a term should be implied to make the contract work and to give effect to the obvious but unexpressed intention of the parties. Counsel for the Owners submitted that it was not possible to imply such a term. Had such a term been intended it would have been expressed; in the shipping world there is a very good example of it being done, namely, the time bar provision contained in Article III rule 6 of the Hague and Hague-Visby Rules.

[17]Clause 20 is entitled “Claims Time Bar”. Whilst the precise scope of clauses of this nature will depend upon the language used in each case the commercial intention underlying such clauses is to ensure that claims are made by the owners within a short period of final discharge so that claims can be investigated and if possible resolved while the facts are still fresh; see Babanaft International Co. SA v Avant Petroleum Inc. [1982] 1 Ll.Rep.448 at p.453 per Bingham J. Although this may well be a desirable objective with regard to all claims by owners against charterers the question whether a limitation clause is intended to apply to all such claims or only some will very much depend upon the language used in the particular case.

[18]Clause 20.2 does not simply refer to “any other claim against Charterers” but to any other claim against Charterers “for all other amounts which are alleged to be for Charterers’ account under this Charter”. These words clearly encompass claims for sums which pursuant to the terms of the charterparty are expressly for the account of the charterers. This charter contains several such sums eg clause 5.2 - the expenses of loading or discharging at more than one berth, clause 8.1 – the cost of equipment for ship to ship transfers, clause 22.3 – the cost of additional bunkers where revised voyage orders are given, and clause 25.5 – port expenses incurred by reason of instructions to divert the vessel. The words do not clearly include claims against charterers for damages for breach of their obligations under the charter. Since time bar clauses should be construed strictly (see Lewison, The Interpretation of Contracts 2004 para.12.17) orthodox principles of construction lead to the conclusion that clause 20.2, objectively construed, was not intended to include claims for damages.

[19]Further, the circumstance that clause 20 provides that the completion of discharge is the date from which the periods of 90 and 180 days begin to run and makes no reference to a commencement date where no cargo has been discharged suggests that the clause was intended to have a limited application. That is because it is not difficult to envisage cases where a breach by the charterer leads to there being no discharge of cargo. The present case is one such. Another case is where the charterer breaches the safe berth warranty causing a marine casualty and the loss of ship and cargo.

[20]Counsel for the Charterers responded that clause20.1 extended to claims for damages since claims for deviation or detention would typically be claims for damages. It was therefore said that, construing clause 20 as a whole, clause

20.2 should also be construed as including claims for damages. It was further said that it would be odd if the charterer were deprived of the time bar in a case where there had been no discharge of cargo, which could occur by reason of a fault of the shipowner. For that reason it was said that the parties, if asked whether there was a time bar where no cargo had been discharged, would reply that it was obvious that time should run from the date when discharge should have taken place. If that were so and if clause 20.2 extended to claims for damages then the suggested term should be implied in order to make clause 20.2 work in the context of claims to damages where no cargo was discharged.

[21]It seems to me that a considerable difficulty in way of the submission that a term should be implied to deal with cases where no cargo has been discharged is that Article III r.6 of the Hague-Visby Rules, which, in relation to claims against shipowners deals expressly with such an eventuality, was incorporated into the charterparty (see clause 38 of the charterparty). Article III r.6 (so far as material) provides as follows:

“……..the carrier and the ship shall in any event be discharged from all liability whatsoever in respect of the goods, unless suit is brought within one year of their delivery or of the date when they should have been delivered……..”

[22]Thus, in the time bar provision dealing with claims against the shipowners, Article III r.6, provision is made for the case where cargo is not delivered but in the time bar provision for claims against the charterers, clause 20, no provision is made for the case where cargo is not discharged. On an objective basis it can therefore be said that where the parties intended time to run from the date when the cargo should have been delivered they said so. They did not say so with regard to claims against the charterers. In those circumstances I do not consider that it can be maintained that it was the parties’ obvious but unexpressed intention that where there was no discharge time should run from the date when the goods should have been discharged.

[23]So far as business efficacy is concerned the Charterers’ argument assumes that clause 20.2 applies to all claims against the charterers (save those within clause20.1 ) including claims to damages. Yet, on orthodox principles of construction and for the reasons I have given, it does not. I accept that some claims for damages are within clause 20.1 but I do not consider that that means that the relevant (and different) words of clause

20.2 should be construed as encompassing claims for damages. Once the assumption underlying the business efficacy argument is seen to be unfounded the argument cannot be sustained.

[24]I accept that it follows that where there is no cargo discharge by reason of the fault of the shipowner it may be the case that there is no time bar for claims against the charterers within clause 20. I do not however consider that this possible consequence makes it appropriate to imply into clause 20 the suggested implied term.

[25]For these reasons I have reached the conclusion that the Charterers have no real prospect of successfully defending the claim on the grounds of their suggested limitation defence. In my judgment, on the true construction of the charterparty the Owners’ claim for damages is not within clause 20 and in circumstances where there was no discharge there is no contractual period within which the claim must be presented with full supporting documentation. In those circumstances there is no dispute that the appropriate course is to refuse permission to amend the Points of Defence to plead the limitation defence.

[26]I shall deal briefly with the remaining points argued on this part of the case. They do not raise matters of construction of the charterparty.

Estoppel

[27]Had I considered that the Charterers’ construction of clause 20 was correct I would have held that there was a real prospect that they would overcome the suggested estoppel on at least two grounds: firstly, the Owners are unable to establish a material representation and secondly, the Owners are unable to establish any material reliance. The suggested representation that there was no applicable time bar was said to be inferred from the failure of the charterers to take the point after their letter dated 7 August 2003. As to reliance it was effectively conceded that reliance could not be established.

Compliance

[28]Had I considered that the Charterers’ construction of clause 20 was correct I would have held that there was a real prospect that they would establish that the Owners had not complied with the clause. The Owners relied upon the documents they supplied on 3 October 2002. They said that they only had to supply documents relating to their claim and that those did not include documents relating to the credit which should be given against their claim for the profits of the substitute voyage. Prior to 3 October 2002 the Owners had entered into a substitute voyage. It is well settled that the normal measure of the Owners’ loss is the difference between the net income the Owners would have earned under the charter and the net income in fact earned under the substitute charter; see The Noel Bay [1989] 1 Ll.Rep.361 at p.363 (per Staughton LJ) and Voyage Charters by Cooke and others 2nd.ed. at para.21.87. In those circumstances it seems to me that the Charterers must have a real prospect of establishing that the documents supplied on 3 October did not amount to “full supporting documentation substantiating each and every constituent part of the claim”. To the extent that details of the substitute fixture were provided on 15 July 2003 there is a real prospect that by then 180 days had elapsed from the date on which the cargo should have been discharged.

Quantum

[29]The parties exchanged schedules setting out the quantum of the claim for damages. There was much common ground. I was asked to consider just three issues of principle and leave any resulting arithmetic to Counsel.

Demurrage

[30]The first point of principle is whether the Charterers have no real prospect of successfully defending that part of the Owners’ claim which is described in the schedule of loss as demurrage. Under that head $101,000 is included in the assessment of the profit that they would have made under the charterparty. It is made up of demurrage incurred before the termination of the charterparty (because the laytime of 84 hours had already expired late on 30 August 2002) and of demurrage which would have been incurred thereafter had the Charterers loaded and discharged the cargo within the laytime of 84 hours.

[31]It is submitted on behalf of the Owners that they are entitled to include in their claim the demurrage which had been incurred before termination. They further say that they are entitled to claim the demurrage which would have been incurred during loading and discharge had the charterparty not been terminated because that would been part of their income under the charterparty. They rely upon the general statements of principle in Voyage Charters by Cooke and others 2nd.ed. at para.21.81, 21.82 and 21.87.

[32]However, it was submitted on behalf of the Charterers that demurrage could not be claimed as part of the Owners’ damages and in this regard reliance was placed upon the decision of the Court of Appeal in The Noel Bay [1989] 1 LL.Rep.361. It was said that damages should be assessed assuming performance by the charterer in accordance with his obligations ie that no demurrage was incurred.

[33]I shall first consider the issue by reference to principle. Demurrage is a liability in damages to which a charterer becomes subject because, by detaining the ship beyond the stipulated laydays, he is in breach of his contract. A demurrage clause liquidates the damages for such breach. It is not a liability which sounds in debt but, in the absence of any provision to the contrary, it accrues de die in diem after the laydays have expired; see President of India v Lips Maritime

[1988] 1 AC 395

at p.422 per Lord Brandon of Oakbrook. Thus, before the Charterers repudiated the charterparty they had incurred a liability in damages pursuant to the laytime and demurrage provisions of the charterparty.

[34]An accepted repudiation brings the primary obligations of the parties which remain unperformed to an end as from the time of acceptance but does not affect rights which have accrued before then; see Chitty on ContractVol.1 General Principles 29th.ed. para.24-047 and 24-051.

[35]It would follow that in principle the Owners should be entitled to claim the demurrage which had accrued before the repudiation of the charterparty. As at that date the laydays had expired and so, had the charterparty been performed, the Owners would have been able to claim a further sum of demurrage in respect of the time which would have been taken to load and discharge the cargo. That further sum can be included in the Owners’ claim for damages caused by the repudiation of the charterparty.

[36]Having considered the matter as one of principle it is necessary to consider The Noel Bay to see whether, as a matter of binding authority, it requires any contrary conclusion to be drawn. In that case a vessel was chartered for a voyage from a port to be nominated on the west coast of Italy to a range of European ports. The charterers were to nominate the loading port before the vessel left her previous port of call. The vessel finished her previous employment at Malta on 29 May and the charterers failed to nominate a loading port. On 1 June the charterers withdrew from the charter and on 3 June the owners accepted that conduct as a repudiation of the charter. It was common ground that the contractual voyage would have ended on 7 June.

[37]The owners claimed the profit they would have made on the voyage plus a sum for the delay from 29 May 2 until 3 June. The Court of Appeal held that the owners were not entitled to recover that latter sum. However, there was disagreement as to why that was so. Balcombe LJ and Stocker LJ considered that a claim for such damages had not been pleaded (see p.368 col.1 and p.367 col.1). Balcombe LJ further said that “on this basis, in my judgment the Judge [Phillips J.] was right to say that the owners had suffered no loss beyond the $35,543 for loss of freight”. Phillips J. had accepted a submission that no damage was caused by the delay in failing to nominate a loading port because the vessel had been returned to the owners sooner than it would have been if the charterparty been performed and held that the damages for the charterers’ repudiation of the charterparty were to be assessed by calculating the profit which would have been earned had a contractual nomination been made on 29 May and contractual performance continued thereafter. On this approach no extra sum could be claimed as damages for delay prior to termination. It is to be noted (from the extract of the judgment of Phillips J. at p.368) that the case was not regarded as giving rise to two breaches but to “a continuous and repudiatory non-performance of the contract which the Owners accepted on 3 June”. Stocker LJ essentially agreed with Balcombe LJ.

[38]Staughton LJ disagreed with the approach of the trial judge and was of the view that the owners were entitled to damages for the charterers’ breach which had occurred before the charter was terminated on 3 June (see p.364 col.1 – p.365 col.1.) But he agreed in the result because he considered that such damages were extinguished by the credit which the owners had to give for profit earned on the substitute voyage (see p.365 co.2 and p.366 col.2).

[39]In the present case particular reliance was placed upon this extract from the judgment of Phillips J. which Balcombe LJ approved (at p.368 col.2):

“[The Court must consider] the position that the Owners would have been in had the Charterers performed properly from first to last. The Owners do not have two separate claims for damages, to be viewed in isolation, but a single claim for the damage flowing from the Charterers’ total failure of performance. …….. I do not consider that the Owners had a vested right to damages for breach of cl.4 that survived the termination of the charter by acceptance of the Charterers’ repudiation. ..… It is wrong in principle to build into the notional contractual performance a delay in the provision of cargo resulting in the accrual of demurrage simply because the Charterers’ repudiatory non-performance included a failure to provide cargo.”

[40]However, the approval given by the majority to the approach of Phillips J. must be read(i) with the circumstance that the majority also accepted that in principle a claim for damages which had accrued before the charterparty had been terminated could be recovered as well as a general damages flowing from the repudiation and cited Saxon Ship Company v Union Steamship [1898] 4 Com.Cas 29,298 and [1900] 5 Com.Cas 381 as an example of such a claim and

(ii) with the circumstance that Balcome LJ said that the trial judge was right to deal with the matter in the way he did on the basis that the only pleaded claim was damages for repudiation.

[41]In those circumstances I do not consider that the passages in the judgment of Phillips J. on which reliance was placed can be regarded as authority for the proposition that where demurrage has been incurred prior to termination it cannot be recovered by the owners. The authors of Voyage Charters 2nd.ed. do not make reference to any such disability. On the contrary they say that demurrage which has accrued before termination can be recovered in addition to damages for the loss of profit consequent upon the termination; see paras. 21.81 and 21.82 where the authors rely upon The Noel Bay and Saxon Ship v Union SS.

[42]There is, in my judgment, a distinction between the present case and The Noel Bay. In the latter case the delay which had occurred before termination was regarded as having caused no loss because the vessel was restored to her owners sooner than if the contract had been performed. Although the vessel in the present case was similarly restored to the Owners sooner than if the contract had been performed it does not seem to me possible to say that the Charterers’ breach before termination has caused no loss because damages for such breach are liquidated by the demurrage clause.

[43]The same (or a similar) distinction also arises in connection with another aspect of The Noel Bay. It was said by Phillips J. at first instance and approved by the majority of the Court of Appeal that there was but one breach of contract, namely, the failure to nominate a loading port which ultimately led to the termination of the charterparty. There was not, in addition, a failure to load within the laydays for which an agreed rate of demurrage was provided. In the present case there was a failure to provide a cargo which ultimately led to the termination of the charterparty but there was also a failure to load within the laydays in respect of which the Charterers were liable to pay demurrage.

[44]For these reasons I do not consider that the decision in The Noel Bay requires me to reach a conclusion different from that which I reached by having regard to principle.

[45]But a final point was taken on behalf of the Charterers. It was said that in the present case the Owners, like the owners in The Noel Bay, had failed to plead the relevant claim, in this case a claim for the demurrage had accrued before termination. It is correct that in form the Owners’ only pleaded claim was one for general damages flowing from the breach of the Charterers’ obligation to furnish a cargo and from their repudiation of the charterparty. However, the particulars of the damages identified, separately, the demurrage which had accrued before termination and the further demurrage which would have accrued thereafter had the charterparty been performed; see Appendix 1 to the Schedule of Damages. There can therefore have been no doubt that in substance the demurrage which had accrued before termination was being claimed, though it was not being claimed as a discrete sum separate from general damages and, as a matter of arithmetic and for the purposes of calculating the credit to be given arising from the mitigation voyage, it was included in the general damages claim. In these circumstances, although counsel for the Owners sought permission to amend his Particulars of Claim, I do not consider that an amendment is necessary.

[46]For these reasons the Charterers do not have a real prospect of establishing that the element of demurrage should not be included in the Owners’ claim.

Free pratique and the commencement of laytime

[47]The second point on quantum relates to the time from which laytime commenced under the charter. This was a short point of construction of clauses 6.3.3 and 7.3.2 of the charterparty. They provide as follows: “Notwithstanding tender of a valid NOR by the Vessel such NOR shall not be effective nor become effective, for the purposes of calculating laytime, or if the Vessel is on demurrage, demurrage unless and until the following conditions have been met:- 6.3.3 free pratique has been granted or is granted within six (6) hours of the Master tendering NOR. If free pratique is not granted within six (6) hours of the master tendering NOR, through no fault of Owners, Agents or those on board the Vessel, the Master shall issue a protest in writing (NOP) to the port authority and the facility at the port (the Terminal) failing which laytime or, if the Vessel is on demurrage, demurrage shall only commence when free pratique has been granted …….. 7.3.2 Laytime, or if the Vessel is on demurrage, demurrage shall commence, at each loading and each discharge port, upon the expiry of six (6) hours after a valid NOR has become effective as determined under clause 6.3, berth or no berth, or when the Vessel commences loading, or discharging, whichever first occurs.” 6.3.3 free pratique has been granted or is granted within six (6) hours of the Master tendering NOR. If free pratique is not granted within six (6) hours of the master tendering NOR, through no fault of Owners, Agents or those on board the Vessel, the Master shall issue a protest in writing (NOP) to the port authority and the facility at the port (the Terminal) failing which laytime or, if the Vessel is on demurrage, demurrage shall only commence when free pratique has been granted ……..

[48]In the present case NOR was given at 0130 on 27 September. Free pratique was not obtained until 1030 ie more than 6 hours after NOR was given. The Owners say that laytime commences at 1030 and the Charterers say that laytime commences at 1630, that is, 6 hours after free pratique was granted.

[49]The commencement of laytime is governed by clause 7. It starts 6 hours after a valid NOR has become effective or when the vessel commenced loading, whichever first occurs. When a valid NOR becomes effective is governed by clause 6.3. One requirement is that free pratique has been granted. If it has been granted before NOR is given that requirement is satisfied and the NOR is effective when it is given. If free pratique is granted within 6 hours of NOR being given it was common ground between the parties that the NOR is effective immediately the NOR is given. (It was not argued that in such case the NOR only became effective once free pratique was granted.) In such cases laytime commences upon the expiry of 6 hours from the NOR becoming effective. If free pratique is not granted through no fault of the ship and the master issues a protest then it seems that the NOR becomes effective on the issue of his protest.

[50]If no such protest is issued then clause 6.3.3 provides that “laytime shall commence when free pratique has been granted.” Having regard to the purpose of clause 6.3 this is odd because clause 6.3 is intended to state when a NOR becomes effective, not when laytime commences running. However, I do not consider it permissible to read the words at the end of clause 6.3.3 as stating merely that the NOR becomes effective once free pratique has been given; for the words state in terms that laytime shall commence when free pratique has been granted. Clauses 6.3.3 and 7.3.2 have to be read together and the way to do so which does least violence to the language of each clause is to regard clause 6.3.3 as stating when laytime commences in the event that free pratique is granted more than 6 hours after the issue of the NOR and to regard clause 7.3.2 as being impliedly subject to any contrary provision in clause 6.3.3.

[51]For these reasons the Charterers do not have a real prospect of showing that laytime commenced at 1630 on 27 August. I consider that upon the true construction of the charterparty laytime commenced at 1030 on 27 August.

The probable length of the contractual voyage

[52]The third point was a factual dispute as to the probable length of the contractual voyage. The Owners assessed the average speed achieved by the vessel on her mitigation voyage which lasted some 45 days in total. The voyage from was from Bahrain to Karachi, through Suez and the Mediterranean to Holland the Northen Ireland. The resulting average speed of 15.99 knots was used to assess how long the contractual voyage would have taken. The Charterers said that since the contractual voyage required the vessel to proceed round the Cape there was no reason to suppose that the vessel would have made the same average speed. Because the contractual voyage would have subjected the vessel to different winds and currents from those she in fact experienced the average speed which would have been made good may have been less than that which was achieved. However, no evidence was put forward to suggest what speed was likely to have been achieved beyond a reference to the warranted speed which was 13.5 knots. I am unable to exclude the possibility that the average speed which was likely to have been made good on the contractual voyage around the Cape may have been less than 15.99 knots and it may be that the evidence as to the average speed made good on the mitigation voyage may well prove to be the best evidence of the average speed which would have been achieved on the contractual voyage. In these circumstances the appropriate order is to give permission to defend in relation to that part of the damages claim which is disputed on account of this point but on condition that the sum in dispute is paid into Court.

Conclusion

[53]Judgment shall be given for the Claimants pursuant to CPR Part 24 upon their claim in such sum as equates to their indisputable claim (in the light of this judgment). Permission to defend will be given for the balance upon condition that it is paid into Court. When this judgment is handed down I shall hear Counsel as to the precise form of the order and in particular the precise amounts for which judgment is to be given and in respect of which conditional permission to defend is to be given.