Slow prosecution

THIS arbitration involved dispute arising out of the chartering of a vessel on the Synacomex form to carry agricultural products from Paranagua to Europe.

The vessel arrived off Paranagua on April 3. Notice of readiness was tendered the same day, but congestion prevented the vessel from berthing until May 11. On April 21, the charterers informed the owners that almost all vessels were "having hull/rudder/chests/propeller fouled and some heavily covered with marine growth which no doubt we believe to be due to stay in Paranagua outer roads", and that the speed performance of most of the vessels had reduced by about 3 or 4 knots, which meant that the vessels had to stop for cleaning at Las Palmas/Tenerife on their trips to Europe.

The charterers urged the owners to have the chests/rudder and propellers cleaned at Paranagua in order to avoid speed/performance claims. The charterers also asked to carry out an underwater survey of the vessel at their own expense to check on the condition of the hull. They said that they would pay for any cleaning required. The owners declined both requests.

The vessel loaded its cargo and sailed from Paranagua on May 16. Although the vessel experienced bad weather on the voyage which affected its speed, it was common ground that its speed was also reduced by fouling of its bottom caused by the length of stay at Paranagua. Eventually, the vessel arrived at its discharge port in Europe having maintained an average speed of about 8.5 knots.

The owners claimed balance of freight and demurrage amounting to $309,879, together with underwater cleaning costs of $6,800. The charterers sought to set off a cross-claim for the delayed arrival of the vessel at the discharge port.

It was common ground that the owners were under an obligation to prosecute the voyage with reasonable despatch and that the charterers' if they could demonstrate some failure on the part of the vessel to proceed as fast as it was able.

The arbitrators were uncomfortable with the owners' submission that, as long as the vessel was seaworthy, they had no had no further obligation as to the state of the vessel. Taking an extreme example of a vessel with its hull so fouled as to be able only to maintain a voyage speed of two or three yachts, the arbitrations could not imagine that the owners of such a vessel might be able to simply disregard the obviously adverse effects that such fouling would have on the vessel's ability to perform the voyage at a commercial speed even though it would be technically seaworthy. Accordingly, mere seaworthiness might not always be enough in itself, and there might be circumstances in which an owner would be obliged to take steps to ensure that the vessel was able to perform the laden voyage at something approaching its normal service speed.

The arbitrators noted that no questions had been raised during the pre-fixture negotiations as to the vessel's speed. Nor had the charterers given any indication to the owners during the negotiations that time was of the essence in the performance of the contract and/or that the cargo was required to reach its destination by any particular date.

Even when they raised the question of bottom cleaning when the vessel was at Paranagua, the charterers did not advise the owners of the delivery deadline. In such circumstances, the charterers were not entitled to hold the owners to the standards that might, for example, apply if a speed warranty had been included in the charter party or an arrival date agreed for the discharge port.

In assessing the standard of any obligation resting with the owners in relation to the vessel's speed, the arbitrators also considered that that had to be of at least no more onerous standing than that expected of them under a time charter party where the standard after delivery was one of taking reasonable steps within a reasonable time.

The owners should reasonably have anticipated that the vessel's bottom would have been fouled to some extent during its stay in Paranagua, but the owners would not have been able to accurately estimate or assess the extent of such fouling or its effect on the vessel's speed before the vessel left Paranagua. Although it was possible that in such circumstances some owners might have decided to clean the vessel's bottom before sailing, the arbitrators did not believe that many would have done so, the majority preferring to wait and see how the vessel performed on the first voyage after Paranagua before making any decision about bottom cleaning.

In the absence of any indication in the charter party, or negotiations leading to it, that time was of the essence, the absence of any express provision in the charter dealing with the vessel's speed, the absence of any clear evidence that the vessel's speed was likely to be seriously affected, and the adoption by the owners of a practical wait-and-see approach to the effect of any fouling, all weighed against a finding that the owners were in any breach of their obligations under the charter by declining to arrange or allow for the vessel's hull to be cleaned before leaving Paranagua.

Accordingly, the charterers' cross-claim was dismissed, and the owners were found to be entitled to the full amount claimed by them.