Laytime.‘Reachable on arrival’ - The Delian Spirit. Last updated 14-May-2015

… I certainly do not wish to be taken as accepting that, even in that situation, the owners would necesarily be entitled to prosecute an independent claim for damages, without giving credit for the lay time to which the charterers were entitled, and for which, as we have been reminded, they paid when they paid the freight.
Per Sir Gordon Willmer in The Delian Spirit Shipping Developments Corporation v V/O Sojuzneftexport (The Delian Spirit) [1971] 1 Lloyd’s Rep 506.

The Delian Spirit [1971]1 Lloyd’s Rep. 506

The next startling attempt to exploit ‘reachable on arrival’ provision to the shipowner’s full advantage was made several years later in The Delian Spirit case. The Delian Spirit arrived at loading port of Tuapse and tendered NOR but was to anchor 1,5 miles away from the breakwater and wait there for 4.5 days due to congestion at the berth. The loading, however, was so fast that vessel used up only few hours in excess of 120 hours of laytime provided in the charterparty.

The shipowner’s original claim, therefore, was for several hours of demurrage. But inspired by the decision in The Angelos Lusis the shipowner reconsidered their position and instead of few hours of demurrage they claimed 4.5 days of detention, contending inter alia, that since sanitary free pratique was granted only at the berth, then NOR served from the roads was not valid and the vessel cannot be deemed as ‘arrived’ in the technical sense. Both umpire and Donaldson J in the High Court agreed with the owners that, following the decision of Megaw J, in Inca Compaina Naviera S.A. and Commercial and Maritime Enterprises Evanghelos P.Nomikos S.A. v Mofinol, Inc (The President Brand) [1967] 2 Lloyd’s Rep. 338 the charterers were liable in damages for breach of cl 6.

Clause 6.

The vessel shall load and discharge at a place or at a dock or alongside lighters reachable on her arrival, shall be indicated by Charterers, and where she can always lie afloat, any lighterage being at the expense, risk and peril of the Charterers. Charterers have the right of shifting the vessel at (ports) of loading and/or discharge from one loading or discharging berth to another on payment of all expenses incurred.…

Clause 7.

The laying days shall commence from the time the vessel is ready to receive or discharge her cargo, the Captain giving six hours' notice to the Charterers' Agents, berth or no berth, during official office hours.

The case went to the Court of Appeal, where such unusual efforts from shipowner’s side to invalidate a valid NOR, were called the curious spectacle by Sir Gordon Willmer.

However, dealing with the charterers’ breach of clause 6 the Court of Appeal was to do something not only with decision of Megaw J in The President Brand but mainly with the House of Lords test of "arrived ship" in The Aello. Applying Parker’s LJ test adopted in The Aello the vessel was not "arrived ship" because she was not within the commercial area of the port, which is a physical area where ships could be loaded when a berth was available. (Read more Destination Point).

The Court of Appeal preferred to follow the classic test of Kennedy LJ in Leonis Steamship Co Ltd v Rank Ltd [1908] 1 KB 499 holding that The Delian Spirit met all requirements needed to become an "arrived ship" when she anchored at roads of Tuapse. Stretching limits of The Aello’s ‘commercial area’ test, Lord Denning MR underlined in his judgement, that vessel’s position where she tendered NOR was the only place, apart from the loading berth, where the master could effectively place his ship at the disposal of the charterers. Moreover it was held that arrival of the vessel in its technical meaning does not depend on free pratique being given, because vessel was apparently healthy, such that there is no reason to fear delay, then even though she has not been given her pratique, she is entitled to give notice of readiness, and lay time will begin to run.

holding

Therefore commencement of laytime prevented the owners from claiming additional damages for detention.

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