Wikborg Rein updates

Supreme Court provides guidance on damages and mitigation in New Flamenco
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • July 26 2017

The Supreme Court recently handed down its judgment in New Flamenco (Globalia Business Travel SAU of Spain v Fulton Shipping Inc). In this long-awaited decision, the court considered whether a benefit obtained by the owners relating to the sale of the vessel following the charterers' repudiatory breach of a charter should be taken into account in assessing the damages that the owners were entitled to recover.

Risks of deliberately delaying discharge
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • July 19 2017

A recent Commercial Court decision held that a charterer is 100% responsible under the Inter-Club Agreement for damage to cargo arising from an order to the vessel to delay discharge until the receivers are able to pay for the cargo. Given that it is common for shipments to be delayed, more disputes relating to deliberately delaying discharge can be expected in the future.

Supreme Court defines parameters of safe port undertakings
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • July 12 2017

The Supreme Court recently handed down a judgment addressing three issues of importance to shipowners, charterers and insurers alike, defining the parameters of the safe port undertakings, the rights of subrogation of insurers where vessels are operated under bareboat charter and the right of charterers to limit their liability under the Convention on the Limitation of Liability of Shipowners.

Landmark Supreme Court judgment on wreck removal
Wikborg Rein
  • Shipping & Transport
  • Norway
  • June 21 2017

The Supreme Court recently clarified a number of unsettled issues that will have an impact on other wreck removal cases, including whether vessel owners can use their right to limit liability as a defence against a wreck removal order. Among other things, the decision has clarified the highly disputed interpretation of the relationship between owners' duty to take action and their right to limit liability.

When charterers fail to pay hire: dilemma for owners finally resolved, but proceed with caution
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • February 15 2017

In a recent case, the Court of Appeal decided unequivocally that missing a single instalment of hire under a time charter is not a breach of condition. In other words, there is no right to terminate for one missed instalment and claim damages for loss of bargain – usually the difference between the charter and market rate for the remainder of the charter period. The court also set out useful guidance on what constitutes 'renunciation' (anticipatory repudiatory breach) of a time charter.

Considered ratification of Nairobi International Convention on the Removal of Wrecks
Wikborg Rein
  • Shipping & Transport
  • Norway
  • February 15 2017

A year and a half after the entry into force of the Nairobi International Convention on the Removal of Wrecks, the Ministry of Transport has completed a consultation process on a proposal to ratify the convention and implement it into Norwegian law. The ministry has suggested that the convention be implemented on a dual basis, alongside existing legislation.

How not to start an arbitration
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • February 08 2017

Two recent London decisions involving shipping companies have highlighted problems that can be encountered when starting an arbitration. The first decision concerned an issue with identifying whether a non-signing counterparty is bound by the agreement containing the arbitration clause. The second decision concerned the question of which parties are authorised to accept service of arbitration notices.

Arbitration clauses and third parties in bills of lading and other agreements
Wikborg Rein
  • Shipping & Transport
  • Norway
  • February 01 2017

Since arbitration requires agreement between the parties, a third party is not normally bound by, or enti­tled to invoke, an arbitration clause. However, there are exceptions to the rule. It is recommended, when drafting arbitration clauses, to take into account not only the position of the contractual parties, but also the position of possi­ble third parties, since this may reduce or avoid the risk of difficult procedural questions that may arise if claims are later made by or against a third party.

The New Flamenco: keeping in step with damages and mitigation
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • October 19 2016

A recent Court of Appeal decision acknowledges the difficulties of laying down general principles of law in connection with an innocent party's obligation to mitigate its loss following a repudiatory breach of contract. The case arose in the context of assessing damages for early redelivery where there was no available market at the time of the breach against which to measure the loss.

OW Bunkers: owners stung by double payment
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • August 24 2016

The Supreme Court has handed down judgment in the long-running OW Bunkers case. The decision is unlikely to be welcomed by owners, which now face the prospect of having to pay twice for bunkers: once to their immediate supplier, which may be insolvent, and again to the physical supplier of the bunkers.

Norway and Brazil cooperate on maritime transport
Wikborg Rein
  • Shipping & Transport
  • Norway
  • August 03 2016

Norway and Brazil signed a memorandum of understanding in November 2015 to enhance cooperation within the area of maritime transport. The memorandum is in line with the Norwegian government's long-term cooperation strategy for Brazil and is intended to increase both public and private sector cooperation and awareness to create mutual economic opportunities and promote investment.

Laying up the lay-up agreement
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • July 20 2016

A recent arbitration decision raises a number of interesting points in connection with lay-up agreements and how much can be claimed for continuing to provide services after the original contract has been terminated. It will be of interest to parties that see their unpaid charges increasing, as well as to other involuntary bailees, such as vessel owners left holding cargo with no bills of lading binding them after their charterers have ceased operations.

Force majeure clauses under Norwegian law
Wikborg Rein
  • Shipping & Transport
  • Norway
  • January 06 2016

The civil law concept of force majeure is well established in Norwegian law, covering scenarios such as natural disasters, severe weather and war. It is recognised as both a statutory and contract term. However, although there is extensive practice and doctrine on force majeure clauses, a lack of clarity remains regarding what constitutes force majeure and what the effects of such situations are.

Force majeure clauses under English law
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • January 06 2016

Unlike many civil law countries, there is no implied application of the doctrine of force majeure under English law. Rather, the treatment of an event of force majeure comes from the contract. It is usual for English courts to apply contracts strictly, according to their wording and respecting the parties' freedom to contract on terms they see fit.

Court of Appeal: bunker supply contract not for sale of goods
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • December 23 2015

In a potentially problematic decision, the Court of Appeal recently upheld a High Court judgment that a contract to supply bunkers on credit terms, with a retention of title clause in favour of the sellers until full payment but with permission to consume the bunkers (or some of them) before payment was due, was not a contract for the sale of goods under the Sale of Goods Act.

Well boat charterparties – liability for cargo damage
Wikborg Rein
  • Shipping & Transport
  • Norway
  • December 16 2015

As the Norwegian aquaculture industry continues to grow, so does demand for well boats. These sophisticated vessels not only transport fish, but also undertake complex tasks such as delousing and sorting fish. Damage to or loss of the fish handled by these vessels can result in substantial losses. Therefore, owners and charterers of well boats should regulate the risks associated with such services in their charterparties.

Liening cargo – which lien clause applies to the bill of lading?
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • December 09 2015

In a dry bulk market where a charterer is not paying freight or hire, its counterparty is often left to consider whether it can lien the cargo on board the chartered vessel to obtain payment. When it comes to liening cargo under a Congenbill, English law will look first to the head voyage charterparty as the source of relevant terms to be incorporated into the Congenbill, unless another charter is expressly identified. This can lead to a less-than-obvious outcome.

When charterers fail to pay hire: dilemma for owners
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • September 09 2015

Owners continue to face uncertainty when charterers fail to pay hire under a time charterparty, particularly in respect of when they can withdraw the vessel or terminate and claim damages for future loss of hire. However, these uncertainties can be managed by including appropriate terms in the charterparty and by a careful and well-advised approach when charterers do fail to pay.

Changing tides for cruise ships
Wikborg Rein
  • Shipping & Transport
  • Norway
  • August 26 2015

Historically, cruise ships calling at Norwegian ports have not been allowed to be registered in the Norwegian International Ship Register. However, a recent change to the Norwegian International Ship Register Regulations has relaxed the trading limits and now allows such ships to be registered in the register if certain requirements are fulfilled.

Bunker supply contract not contract for sale of goods
Wikborg Rein
  • Shipping & Transport
  • United Kingdom
  • August 19 2015

A shipowner's bid to avoid the risk of paying twice for bunkers supplied has been thwarted by a recent High Court decision, which held that a contract for the supply of bunkers is not a sale contract falling within the Sale of Goods Act 1979. The decision is important since, as the court recognised, the contract terms in this case are "typical of hundreds or even thousands of such transactions carried out every year".

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