July 1, 2008
Slow-steaming could bring law suits
The North of England P&I club is warning shipowners to check their contractual positions carefully before slowing down to save on fuel.
To save fuel and reduce environmental impact, many shipowners are considering "slow steaming." But Tony Baker, head of loss prevention, at the North of England Club, cautions: "Before making the decision to slow steam, owners and charterers alike need to ensure their position is protected-- both under the terms of the relevant charterparties and under the bills of lading.'
Slowing chartered ships to save on bunker may bring the risk of being sued for breach of charterparty. Examples might include failing to "proceed with the utmost despatch." under a New York Product Exchange (NYPE) 1946 time charterparty, or failing to "proceed with reasonable despatch" under a voyage charterparty.
Slowed ships may also be exposed to claims under the bills of lading for deviation by delay.
"Another possible risk might be indemnity claims under the charterparty for losses suffered under the bill of lading contract," says Baker.
The North of England club's loss-prevention newsletter Signals' cautions club members to check their contractual position carefully before ordering vessels to slow steam. The club's freight demurrage and defense department is providing members with advice on their potential exposure and, where appropriate, on amendments that can be made to governing contracts.