Riding the storm

Phil Roche, of Norton Rose Fulbright, considers recent developments in shipbuilding disputes

For shipping lawyers, identifying trends in disputes is a question of following the market. The rise and fall of freight rates and the speed of such change is one indicator. After the credit crunch of 2008 and the collapse of freight and charterparty rates, disputes boomed in London. A huge number of arbitrations centred around repudiation of charterparties, contracts of affreightment and forward freight agreements, and a number of shipping companies became insolvent. A rash of enforcement actions by banks against defaulting borrowers was expected, but the market was so bad that the banks decided not to try realising their security. Suffering badly from the downturn like everyone else, they too hunkered down to ride out the storm. Those turbulent days have passed and the volume of disputes has returned to normal levels.