On deck/under deck

A shipbroker was approached by the cargo agent of a company which required a ship to transport two tanks from Holland to Wales.

The cargo agent provided the shipbroker with details of the cargo, and these details included various drawings. The shipbroker looked for suitable ships and made his recommendation. The ship was rejected due to cost. The drawings were not therefore forwarded to the shipowner.

A few other ships were looked at, but they were either not suitable or available. The company was desperate to fix a ship to carry the cargo to the UK the following week, and late on the day before the Easter bank holiday weekend the company contacted the shipbroker directly to provide a precise instruction to proceed to fix the ship. On this basis, a charterparty was drawn up and the ship was fixed. The charterparty included the following clause:

“For 2 tanks each 210 m ton 43.00 x 6.54 x 5.90m, one to be loaded under deck and one on deck option Charterers risk and expense”

When the ship arrived at the load port, the Master noticed that one of the legs of the tank would have to be located on the hatch cover. Following some calculations, the Master advised that the hatch lid could not take such a weight, without significant further dunnage. As there was insufficient dunnage, the Master refused to let the tank be loaded on deck, and ordered that, both tanks be loaded below deck. The loading was performed as per the Master’s instructions. This involved turning the ship around as the available crane was unable to reach far enough to perform the revised loading.

As a result, the company complained that it had incurred additional costs that consisted of extra loading days, extra lashing and increased discharge port costs. The company instructed solicitors and claimed against the brokers for the alleged additional costs of EUR 76,244 and GBP 800 that it faced.

The company’s solicitors alleged that the broker’s failure to pass on the drawings to the ship owner was negligent and the cause of the additional costs. They alleged that if the drawings had been passed on, either sufficient dunnage or a larger crane would have been obtained prior to loading. ITIC defended the broker on the basis that the costs were not in fact “additional” at all but, rather, were simply the costs of loading and discharging the cargo to the Master’s satisfaction. It was also argued that there was no negligence because the company had rejected the ship on the basis of cost, and it was therefore reasonable for the shipbroker not to have provided the shipowner with the drawings.

Following a meeting between the parties’ solicitors and detailed correspondence passing between both sides, ITIC made an offer to settle of EUR 5,000. The company rejected this and countered with an offer of EUR 40,000.

ITIC countered with an offer of EUR 10,000 which the company accepted reluctantly.