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Starting point - The time charter

Late redelivery under a time charter - The Achilleas from a Norwegian law perspective Anders Evje. Starting point - The time charter . A time charter will typically not include provisions dealing specifically with late redelivery Exception s. Background law – NMC § 389(1).

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Starting point - The time charter

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  1. Late redelivery under a time charter - The Achilleas from a Norwegian lawperspectiveAnders Evje Sjørettsforeningen / Young CMI 18 April 2012

  2. Startingpoint - The time charter • A time charter willtypically not includeprovisionsdealingspecificallywith late redelivery • Exceptions Sjørettsforeningen / Young CMI 18 April 2012

  3. Backgroundlaw – NMC § 389(1) • NMC § 389(1): ”Unless a fixedperiod has beenagreed for redelivery, the time carrier is obligedto commence a newvoyagealthoughthismayextendbeyondtheagreed time for redelivery. This does not apply if theoverlap is longer thanwhatcanbe consideredreasonable.” • What is a ”fixedperiod”? • Wherethere is flexibilitywithrespect to thedurationofthe charter, e.g. minimum 4 – maximum 6 months, ”fixedperiod”, nomargin ofallowance, owners not obliged to commencenewvoyage. • Wherethere is no flexibilitywithrespect to thedurationofthe charter, e.g. 12 monthsfirm, margin ofallowance, ownersobliged to commencenewvoyage. • Whendoestheoverlapextendbeyondwhatcan be considered ”reasonable”? Sjørettsforeningen / Young CMI 18 April 2012

  4. Backgroundlaw – NMC § 389(2) • NMC § 389(2), first sentence: ”For excessof time as is permissibleaccording to paragraph one, the time charterersshallpaytheagreed hire.” • NMC § 389(2), second sentence: ”For otherexcessof time, the time charterershallpaythecurrent market hire, butnot less thantheagreed hire, plusdamagesaccordingto ordinarycontractualrules for other losses incurredby the time carrieras a resultofthedelay.” • How to assess “current market hire”? • Is it a condition for cIaiming ”current market hire” and ”damagesaccording to ordinarycontractualrules” thatthe time charterer has beennegligent? Sjørettsforeningen / Young CMI 18 April 2012

  5. Case law • ND 1989.296 Norwegian ArbitrationAward ”SingaWiltrader”: • Margin ofallowance • Negligence • Damages for late redelivery: ”current market hire” Sjørettsforeningen / Young CMI 18 April 2012

  6. The Achilleas – Remotenessofdamages • Would a Norwegian Court or arbitration tribunal reach a different conclusion? • Preparatoryworks • Legal theory Sjørettsforeningen / Young CMI 18 April 2012

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