Shipowners routinely give buyers in demolition sales complete freedom to deal with ships as they please following a sale, but do so at their peril. Shipowners are generators of waste under the Basel Convention and other laws and remain liable as such following a sale. Further, shipowners and those assisting them in such transactions may also incur liabilities in tort to third parties in connection with shipyard worker injuries and environmental damage occurring after a sale, as noted in a recent High Court judgment.
The Court of Appeal recently endorsed a first-instance Admiralty Court decision that a failure to properly prepare a passage plan or properly mark up navigational charts to reflect navigational dangers may amount to a failure to exercise due diligence to make the vessel seaworthy, leading to an actionable fault defence for cargo interests who had refused to contribute to the general average.
The Norwegian regulations on ship registration have been criticised for being complicated and outdated, thereby making the Norwegian ship registers unattractive compared with more flexible alternatives offered by the so-called 'flags of convenience'. In response to such criticism, Parliament recently passed a bill effecting certain amendments to the relevant legislation aimed at opening up and facilitating the parallel registration of ships (bareboat registration) both in and out of the Norwegian ship registers.
The Admiralty Court recently handed down a judgment which looked in detail at the scope and meaning of the Convention on Limitation of Liability for Maritime Claims – in particular, the meaning of the phrase "the operator of the ship" in Article 1(2). In determining the meaning of 'operator', it was also necessary for the court to examine the meaning of 'manager'. This is the first time that the English courts have been called on to consider this issue.
A recent High Court decision provides an in-depth analysis of how, if at all, the prevention principle applies to shipbuilding contracts and the importance of good contract management to notify and seek extensions for events of delay. The dispute arose in the context of 11 arbitrations between a seller and a buyer concerning a series of 14 bulk carriers which were to be designed and constructed by the seller in China.
The fast spread of COVID-19 worldwide and the actions taken by regulatory bodies have created challenges for the shipping industry in particular given its international character. Much information is available, but it is fragmented. This article set outs several issues of importance and gives basic information to help parties handle the situation at hand in the best possible manner.
Since May 2019, six oil tankers have been attacked in the Strait of Hormuz. However, despite these attacks, vessels are still taking orders to sail through the strait, albeit with higher war risk insurance rates and, most likely, heightened crew concerns. At what point under UK law can owners refuse such voyage orders on the basis that the strait is contractually unsafe?
Project financing has historically been a popular investment scheme and source of capital in Norway for shipping projects. However, the Norwegian regulatory authorities recently published guidelines regarding the application of the alternative investment fund (AIF) regime to project finance entities. Issuers, advisers, arrangers and investors in shipping projects must be aware of the pitfalls of being captured by the wide definition of an 'AIF' and the steps that they can take in order to adapt to the regulations.
A recent High Court decision provided guidance on the rules of interpretation when construing guarantees that display characteristics of both on-demand and true guarantees. The case concerned a charterer guarantee, which was described as a parent company guarantee and had characteristics of both an on-demand guarantee and a true guarantee.
In the lead up to delivery under shipbuilding and offshore fabrication contracts where delivery is delayed, buyers may occasionally face claims that they have disrupted the contractor's progress in such a way that the contractor is entitled to an extension of the delivery date and/or damages for the additional costs incurred. A recent ruling from the Supreme Court involving land-based construction clarifies the requirements as to causation for such a claim to succeed.
The Supreme Court recently clarified that when determining whether a vessel is a constructive total loss under the Institute Time Clauses Hulls conditions, regard should be had to the costs incurred prior to the owner's notice of abandonment, but not to remuneration payable under a special compensation protection and indemnity clause. The decision is a landmark decision on marine insurance because of its financial and practical implications.
Parliament recently decided that Norway will ratify the Nairobi Wreck Removal Convention and that the convention will be given effect not only in Norway's exclusive economic zone, but also in its territorial waters. Parliament also adopted legislation to implement the convention into Norwegian law once ratified. The legislation will introduce a dual system where the national rules on wreck removal will continue to be in effect and the convention rules will be introduced as a parallel set of rules.
The High Court recently upheld two worldwide freezing orders in a multinational shipping fraud case were upheld, rejecting the defendant's allegations of breaches of full and frank disclosure. Among other things, the judgment is a useful confirmation and strengthening of the standing of intermediary charterers to sue for the full value of the hire in circumstances where the claimant's ultimate loss may be substantially lower.
Unmanned ships are on the horizon and the Norwegian maritime sector is uniquely positioned to take a leading role internationally in the development and commercialisation of this technology. Autonomous shipping may be Norway's maritime equivalent of Project Apollo, but is the legal framework keeping pace?
A recent High Court decision will provide comfort for vessel owners and serve as a reminder to charterers of the importance of documentary obligations within a bareboat charter. The court held that where a vessel is on bareboat charter, the obligation on charterers to keep the vessel with unexpired class certificates at all times is an absolute obligation and a condition of the contract.
The 2019 version of the Nordic Marine Insurance Plan 2013 recently entered into force. Among other things, the revisions introduce an arbitration clause as an option for insurances with Nordic claims leaders. Making arbitration the default position when there is a non-Nordic claims leader aims to align the plan with market practice. However, the change has also been brought about by the looming consequences of Brexit.
In charterparties where no expected time of arrival or readiness to load at the loading port is stated, the question will be whether an equivalent can be identified which can be used as the basis for an absolute obligation requiring the owners to proceed to the loading port by a particular time. The Court of Appeal recently held that the itinerary for an intermediate voyage was such an equivalent.
In a recent judgment in the Full City limitation fund proceedings, the Supreme Court clarified how a global limitation fund established pursuant to the Norwegian Maritime Code should be distributed. The court held that the interest component in the limitation fund should be distributed only on the claims for interest and not on the other claims filed in the fund because vessel owners' limitation of liability should remain the same regardless of whether a limitation fund is established.
A 2017 Commercial Court judgment clarifies the concept of barratry and confirms that there is no qualification to fire when seeking to rely on the fire defence under the Hague or Hague-Visby Rules (assuming that the vessel is seaworthy and that the fire was not caused by the actual fault or privity of the owner). It also confirms that, absent fire, an owner cannot escape liability for deliberate wrongful acts of the crew under the Hague or Hague-Visby Rules even if there is no actual fault or privity on its part.
The High Court recently considered the wording "exposure to sanctions" and ruled that the underwriters of a marine insurance policy could not rely on that wording to avoid a claim on the basis of a "risk of exposure" to the US-Iran sanctions. Rather, for underwriters to do so, there would need to be an actual prohibition on paying the claim in question. This latest judgment deals with a number of key points for drafting effective sanctions exclusion clauses in commercial maritime agreements.