The dangers of forgetting

A ship fixed by a commercial manager had a clause in the charterparty which stated that the charterer would reimburse owners any extra costs in relation to the ship being ordered into a war risk area.

It was further agreed that the commercial manager would advise the charterer what the additional costs would be, prior to the ship entering the war risk area, so that the charterer could reclaim the cost from the cargo owner.

On three occasions the commercial manager forgot to advise the charterer of the additional cost and just debited them 3 months later. It was then too late to recover the costs from cargo owners and so the charterer refused to pay, based on the commercial manager’s negligence.

Some negotiations took place to reach an amicable settlement of USD 60,000, which was paid by the commercial manager and reimbursed by ITIC.