Charterparty allowed NOR to be tendered at outer anchorage only where no space was available at inner anchorage. Owners did so. Was the NOR valid and, if not, had charterers waived the invalidity of NOR given at outer anchorage in circumstances where the terminal had accepted it?
Ocean Pride Maritime Limited Partnership – v- Qingdao Ocean Shipping Co [2007] EWHC 2796 (Comm)
The voyage charter provided that NOR could be tendered after arrival at inner anchorage of the load port and only at outer anchorage if congestion prevented the vessel from proceeding to the inner anchorage. On arrival, the vessel anchored at the outer anchorage and tendered NOR to the terminal and to charterers’ agents, although there was no congestion at the inner anchorage. There was a cost saving to owners in remaining at the outer anchorage.
The terminal accepted the NOR, orally, and owners contended that laytime commenced 12 hours later. Congestion at the terminal itself delayed berthing for 10 days and charterers contended that laytime only commenced when loading actually began. It was agreed that the failure to proceed to the inner anchorage had no effect on when loading operations had actually commenced.
Owners submitted that the clause in the charter requiring NOR to be tendered at inner anchorage gave way to a clause allowing tender of an NOR “whether in berth or not, whether in port or not…” There was a dispute over the final terms of the charter owing to the use of a string of pro-forma charters. Further, even if this were not the case the terminal’s acceptance of the NOR waived any defect and charterers were estopped from disputing the validity of the notice by reason of this acceptance. If owners were right, demurrage stood at almost US$450,000.
Charterers submitted that owners were not entitled to tender NOR at the outer anchorage absent any congestion at the inner anchorage and acceptance of the NOR by the terminal did not bind them as there was no unequivocal representation by charterers and no reliance by owners capable of giving rise to an estoppel. If charterers were right, they would earn despatch of just under US$45,000.
Mr Richard Siberry QC, sitting as a Deputy Judge, found for the owners.
As to whether the NOR was valid, he held that the terms agreed did not allow owners to tender NOR where they did so as the vessel had not been compelled to wait at the outer anchorage and could have proceeded to the inner anchorage to there wait for a berth. On a true construction the NOR was invalid. The clause in question was not inconsistent with a “whether in port or not” provision. This latter proviso meaning an NOR could be tendered at the outer anchorage provided she was compelled to wait there because of congestion at the inner anchorage and with the agreed clause requiring NOR at the inner anchorage absent such congestion.
As to the second issue, the charter required owners to transmit various loading information, (ETA & drafts etc) to the seller and to seller’s port administration. The seller was the shipper and owner of the terminal. It was the seller making all the arrangements and charterers had no involvement in operational decisions.
The recipient of the NOR was not identified but the Judge held that an NOR tendered to the seller and/or the terminal would be a good notice for the purposes of the charterparty and the terminal, as recipient of the NOR, must be impliedly authorised by charterers to waive any defect in the NOR.
The Judge observed that, as a matter of commercial practicality, an intended recipient of an NOR must have such implied authority. When the terminal accepted the NOR, communicated via charterers’ agents, charterers were taken to have waived the invalidity.
Waiving a defect can only be effective if the recipient knows of the defect. Whilst the terminal knew the vessel was waiting at the outer anchorage it did not know of the charter terms requiring NOR to be tendered at inner anchorage but charterers knew and the Judge held the risk of the terminal accepting a defective NOR was one the charterers ran if they failed to communicate those terms to the terminal.
The terminal, in communicating orally that the NOR was accepted, such acceptance being passed on by the agents without comment, made an unequivocal representation to Owners. In the case of waiver, it was not necessary for owners to show reliance on the representation.
Owners' claim for demurrage succeeded in full.
