Unauthorised unconditional extension of laycan

A shipbroker acted for both the owners and charterers in a fixture. Different shipbrokers within the company acted for each party.

The parties concluded a fixture with laycan for 20th August. The ship was delayed due to bad weather. The charterers would not be able to find a replacement so agreed to accept the ship arriving late by 25th August, but as they did not wish to grant a laycan extension, the late arrival was agreed only in consequence of the ship being on a spot basis. This meant that notice of readiness (“NOR”) would be accepted on berthing only and not on arrival.

These messages were duly passed to the principals. The owners then advised that the ship would be further delayed and requested another laycan extension to 31st August. During verbal communication between the two brokers, the charterers’ broker advised the owners’ broker that further late arrival would only be accepted on the same terms as the first, namely that there was no “extension” and NOR would be tendered at berth. This was agreed. However, there was a further delay and on this occasion the charterers’ broker simply confirmed agreement to a laycan extension to 5th September with no further conditions.

The next day, upon discussion with the charterers, the charterers’ broker realised the issue and sent an email to the owners clarifying that the ship had only been accepted on a spot basis, as per the previous agreements, with time not counting until the ship was at berth.

The owners responded a week later, having seen that although they arrived at the load port on 4th September, there were delays in the port such that they could not berth until 16th September. They disagreed that time would start running from the ship berthing only, and claimed demurrage from arrival at the port on 4th September.

Legal advice confirmed that the charterers had indeed granted an extension to the laycan with no condition regarding when NOR would be accepted. As a result the charterers had to settle the owners’ demurrage claim of US$ 140,000. This was claimed against the broker and ITIC reimbursed the full amount.