The Zaliv Baikal – a balancing act


Mari Christensen, of Skuld, considers a recent case and its implications for shipping contracts in the future


In the case of The Zaliv Baikal (Gard Shipping AS v Clearlake Shipping Pte Ltd [2017] 2 Lloyd’s Rep 38), the English High Court addressed the correct approach to the construction of contracts. When deciding whether escalated demurrage rates were to apply, the issue turned on the construction of the charterparty. This decision marks the first application of the recent Supreme Court decision in Wood v Capita Insurance Services [2017] UKSC 24, and indicates that the language of the contract will (still) be given more weight than commercial common sense arguments.