In London Arbitration 6/22 two separate off-hire disputes came to arbitration.
These related to Hold Cleaning – whether a vessel was off-hire
during hold cleaning, and whether a vessel was off-hire due to alleged crew
sickness because of Covid-19
The vessel was chartered for a trip time charter from
India to China, on an amended NYPE form. Two disputes arose between the owners
and the charterers:
As the disputes are distinct and fact specific, the
arbitration addressed them separately.
The vessel was delivered to charterers on June 29th at 13:44 lt. It arrived at the first load port on June 30th at 04:30.
The charterparty provided for the vessel’s holds to be
washed down and to be ready in all respects to receive the charterers’ intended
cargo at the first discharge port. The relevant provision in the charterparty
read “charterers will give 24 hours free time during ballast passage from…to
intended load port… to owners for cleaning the holds. Any further time and
costs required for cleaning for holds to load charterer’s intended cargo to be
on owner’s account”.
The cleaning of the holds was completed on June 30th at 19:22. The owners accepted that the 24-hour period allowance was exceeded
and that the vessel was off-hire from June 30th at 13:44 to June 30th at 19:22.
However, the charterers did not believe that the hold
cleaning had been completed by 19:22 and saw further sailing by the vessel
after the end of the drifting period as an attempt to delay the vessel’s
arrival time to enable further cleaning. The charterers argued that the vessel
should therefore be off-hire until the vessel tendered the NOR at the first
load port.
The tribunal found in owners’ favour.
It held that:
The charterers placed the vessel off-hire between 14:40
on July 26th and 15:30 on July 28th, a period during which the
vessel was waiting permission from the local authorities to discharge the
cargo. Permission was required as one crew member had temperature of 37.4°C.
The charterers argued that this constituted a ‘deficiency
of men’ or, alternatively, it fell under ‘any other cause’ within the standard
off-hire clause. Further, the charterers
relied on clause 45, which provided that ‘Officers and crew to comply with
vaccination and sanitary regulations in all ports of call and corresponding
certificates to be available on board, enabling the vessel to obtain free
pratique by radio.’
The owners argued that the delay was due to the port
authorities’ health requirements, and evidence demonstrated that the crew
member was neither sick or unable to perform his duties. The owners said that
they had complied with all vaccination and sanitary requirements at the port.
The delay was caused by the requirements of the port, a port to which the
charterers ordered the vessel to go.
The tribunal found in the owners’ favour. It held that
that the crew member was not sick (the temperature was within the normal range)
and hence the actions of the authorities were ‘excessive, seemingly arbitrary
and unjustified’. Further, it held that
the circumstances of the delay did not fall within the deficiency of men or any
other cause provisions of the off-hire clause in the charterparty. Nor was
there a breach of clause 45 as there was no evidence of any failure to comply
with local regulations. Therefore, the
vessel remained on hire for the above period.
Reviewing the arbitration, Standard Club commented that,
while the decision of the tribunal on both disputes was based on the factual
circumstances and evidence presented by the parties, it also provided useful
guidance on how arbitrators were likely to interpret clauses in the charterparty
and decide on issues involving delays caused by the Covid-19 pandemic.
“In this case, in deciding on the dispute relating to the
crew sickness, the tribunal relied on the underlying evidence regarding the
crew’s health and compliance with local requirements, rather than be persuaded
by the actions of the local authorities”, the Club said, noting also that “while
the tribunal acknowledged that the events occurred at the outbreak of Covid-19
in China, and hence it was a sensitive time, it concluded that the quarantine
officer’s actions were unjustified and that circumstances did not give rise to
an off-hire event under the relevant clause in the charterparty”.
