Mediolanum Shipping Co. v. Japan Lines Ltd. (The Mediolanum) - Q.B.D. (Com.Ct.) (Robert Goff J.) - 29 June 1981

Stemming of bunkers - Nature of authority given to local suppliers

The respondents time-chartered the claimants’ vessel Mediolanum on the NYPE form. The ship loaded her cargo at Los Angeles and set off to Ghent on a voyage via the Panama Canal with a full cargo of petroleum coke. The charterers had made arrangements for the Mediolanum to be bunkered at Panama by a company called Refineria Panama S.A. who owned the refinery at Las Minas. In their award, the arbitrators said that “the said bunkers had been stemmed by the respondents from Japan”. This meant that the charterers in Japan had communicated with the refinery and had placed an order with them to supply bunkers to this particular ship. After the Mediolanum had passed through the Panama Canal, the charterers’ Panamanian agents instructed the Master to proceed to the sea buoy off Las Minas for bunkering. This area was found by the arbitrators to be a safe place for the Mediolanum. However, whilst en route to the sea buoy, the Master was instructed directly by Refineria to bring the ship to a different bunkering place which was in fact unsafe and which resulted in the Mediolanum grounding. The issue before the court was whether the owners or the charterers should be liable for the losses suffered by the owners consequent on the grounding.