Legal Analysis and Conclusions
See below example of H2S clause:
H2S CLAUSEOWNERS UNDERTAKE THAT PRIOR TO ARRIVAL AT THE LOAD PORT THE HYDROGEN SULPHIDE (H2S) CONTENT IN THE VESSEL’S TANK ATMOSPHERE SHALL HAVE BEEN REDUCED TO BELOW THE LOWER OF:
(I) THE THRESHOLD LIMIT VALUE ("TLV") AS DESCRIBED IN ISGOTT AS AMENDED FROM TIME TO TIME -
(II) ANY TLV APPLICABLE BY VIRTUE OF LOCAL OR NATIONAL LAW, RULE, REGULATION AND/OR PORT REQUIREMENT. WHERE THE CARGO TO BE LOADED ON BOARD THE VESSEL HAS THE POTENTIAL TO CONTAIN LEVELS OF H2S IN THE VAPOUR SPACE, INCLUDING BUT NOT LIMITED TO CRUDE, HEAVY FUELS AND NAPHTHA THE OWNERS SHALL ENSURE THE VESSEL’S MASTER:
(I) REQUESTS SHORE SIDE H2S READINGS IN LIQUID /VAPOUR AND A MSDS FROM THE TERMINAL BEFORE LOADING THE SAID CARGO AND PROMPTLY PROVIDES COPIES OF THE SAME TO CHARTERERS AND SHALL ISSUE A NOTE OF PROTEST IF THE H2S READINGS AND / OR MSDS ARE NOT PROVIDED BY THE TERMINAL; AND
(II) TESTS THE CARGO VAPOUR SPACES FOR H2S AS SOON AS POSSIBLE FOLLOWING COMPLETION OF LOADING AND THEN PROMPTLY INFORMS CHARTERERS OF THE RESULTING H2S LEVELS, MEASURED IN PARTS PER MILLION (PPM)
NOTWITHSTANDING ANY OTHER CARGO TANK VAPOUR TESTS CARRIED OUT PURSUANT TO CHARTERERs’ INSTRUCTIONS DURING THE VOYAGE THE VESSEL’S MASTER SHALL ENSURE THE CARGO TANK VAPOUR SPACES ARE TESTED FOR H2S 24 TO 48 HOURS BEFORE ARRIVAL AT THE DISCHARGE PORT, AND CHARTERERS AND THE DISCHARGE TERMINAL SHALL BE INFORMED OF THE RESULTING H2S LEVELS, MEASURED IN PARTS PER MILLION (PPM) 24 HOURS PRIOR TO ARRIVAL AT THE DISCHARGE PORT.
WHERE THE VESSEL CALLS AT A LOAD PORT WITHIN THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND OWNERS FURTHER UNDERTAKE, THAT UPON ARRIVAL AT PORT THE COMPONENTS OF THE VAPOUR IN THE TANK ATMOSPHERE WILL BE WITHIN THE OCCUPATIONAL EXPOSURE STANDARDS STATED IN HSE DOCUMENTATION EH40 SET DOWN IN THE CONTROL OF SUBSTANCES HAZARDOUS TO HEALTH REGULATIONS, AS AMENDED FROM TIME TO TIME. CURRENTLY THESE REGULATIONS CONTAIN, INTER ALIA, THE FOLLOWING LIMITS: -
HYDROGEN SULPHIDE (H2S) LONG-TERM EXPOSURE LIMIT (8-HOUR TWA REFERENCE PERIOD): 5 PPM
SHORT-TERM EXPOSURE LIMIT (15-MINUTE REFERENCE PERIOD): 10 PPM
Apparently legal issues concerning to local regulations with regard to H2S content put a lot of pressure on the charterers and the owners respectively when level of H2S in tanks is higher than permitted in port of arrival (see for example MARITIME AND PORT AUTHORITY OF SINGAPORE, PORT MARINE CIRCULAR NO. 02 of 2010 07 Jan 2010: HYDROGEN SULPHIDE (H S)).
In case when vessel arrives at the port of loading that is the owners’ duty to provide ship in full readiness for cargo operations. Such readiness includes legal readiness as well, i.e. the vessel must be in full compliance with international rules and local regulations, as to crew and vessel’s certification, environmental protection, etc. That is also includes compliance with any environmental laws, as for example with regard to H2S. Moreover, introduction of express term into the charterparty (see example of H2S clause above) to the effect that owners warrant H2S content in tanks be less than maximum permitted by local law shifts the entire burden to reduce H2S content to the owners’ side.
As to the second case where the vapours of cargo already loaded are of high H2S level, the owners can be protected on basis of properly documented evidence from load port.
Although it may look rather ridiculous to have the owners exposed for risks of delays related to the cargo characteristics the lines of legal defence are not to so easy to draw. There are several main arguments as follows:
1. Obligations of the Carrier.
The Hague and Hague/Visby Rules have qualified common law duty to deliver the goods in same condition in which he received them. This liability is equal to one of insurer to one of "properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried"(art. 3(2)). In this connection "properly keep" cargoes with high H2S content may probably be equal to inerting of crudes and petroleum products carried on tankers, since it also does not affect cargo but serves to safety of vessel. Reduction of O2 content in tanks, however, is internationally recognised procedure, reflected in IMO conventions and well provided with special equipment on board, while all attempts of reducing H2S are technically unsound actions without clear procedural and safety background. If ever H2S vapours prohibition campaign reach such a force that terminals will thorough check and reject vessels with high H2S content, then the owners might be pressed to face their obligation to refuse the cargo if they cannot give it proper stowage and care during the voyage. Proper, in this case would mean such storage which should eliminate by some means all high H2S vapours from cargo tanks before arrival and for as long as necessary to satisfy port regulations.
2. Inherent Vice.
Inherent vice is a protection available to the carrier against cargo interests’ claim when the goods arrive at the destination damaged, being unable to withstand ordinary dangers of sea voyage due to their own specific characteristic. H2S vapours are specific characteristic of high sulphur cargoes, but it is hardly possible to say that H2S evaporation from the cargo during sea carriage causes any deterioration to this cargo, in sense of its physical properties. Another and probably better analogy is with requirements to fumigate some bulk cargoes before discharging, indicates that the charterers are likely to be a party who will be responsible for any delays associated with such specific characteristics of cargo which require special treatment.
3. Dangerous Cargo.
The charterer’s duty with respect to shipment of dangerous cargo oblige him to disclose to the shipowner’s employees of any facts he knows which indicate the unusual danger and of any precautions which should be observed in its carriage. But if all particular difficulties which may arise during shipment are known to both parties at the time of concluding contract, then the charterer is not liable for any damage or delay caused by such shipment. There is, however, one important qualification, that the charterer still can be liable if the cargo possesses some special and not obvious characteristic which creates a danger outside the range of the dangers which a carrier of that type of cargo should foresee and guard against. It is very probable that any delay caused by high H2S content in cargo can fall under this qualification, especially so when no clear and accurate details as to H2S given in MSDS.
With some degree of certainty, supported also by reports from the industry, it can be concluded that liabilities which flow for delays and other consequences of high (or higher than permitted) H2S content in cargo tanks on arrival at load port would completely rest on the shipowner. On the other hand, at discharge port, all such liabilities would be for the charterers account. It will include port delays related to refusal of port authorities to accept vessel with high H2S content, cost of additives to reduce H2S evaporation, bunker and time consumed to dissolve, disperse and circulate additives in cargo as well as charges for transportation additives and additional workforce (chemist and/or surveyor for example) on board when applicable.
Finally, I think one general conclusion is rather evident. In spite of low likelihood of any H2S evaporation at all at the discharge port, all parties concerned must bear in mind that in case of the worst scenario, populism considerations may drive local authorities to impose an extremely strict restriction or even ban the vessel from entering port. Chances for the events to be developing in such direction are not very high, but far from impossible.
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