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DEMURRAGE AND THE MEANING OF WORDS

Lloyd's Maritime and Commercial Law Quarterly

DEMURRAGE AND THE MEANING OF WORDS

Jonas Atmaz Al-Sibaie and Justin Jun Xiang Tan*

The Eternal Bliss
Suppose I want to hire a ship to transport cargo from Felixstowe to Rotterdam. The shipowner may (understandably) be concerned about my tardiness when loading and unloading the vessel. As a result, our contract may stipulate a rate at which I need to load and unload the cargo. If I take longer than agreed, I must pay the shipowner some predetermined monetary sum as liquidated damages (“demurrage”). Now, suppose that my tardiness causes not only a delay in the voyage, but also some other loss, such as damage to some perishable cargo on board the vessel. Is the shipowner limited to recovering the agreed daily sum from me, or is it entitled to recover that agreed sum and also compensation for the cargo damage? In K Line Pte Ltd v Priminds Shipping (HK) Co Ltd (The Eternal Bliss),1 the Court of Appeal held that the shipowner can recover only the agreed daily sum.2 This note argues that the Court of Appeal’s reasoning is flawed.

Facts

The facts in the Eternal Bliss closely resemble the story above. Priminds chartered a vessel from K Line. Priminds failed to unload the vessel at the contractual unloading
Case and comment

217

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