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ENGLISH ADMIRALTY AND MERCHANT SHIPPING LAW

Lloyd's Maritime and Commercial Law Quarterly

ENGLISH ADMIRALTY AND MERCHANT SHIPPING LAW

Ralph Morley *

CASES

100. Ai Giorgis Oil Trading Ltd v AG Shipping and Energy Pte Ltd (The Marquessa) 1
Charterparty (time)—Shelltime 4—repudiatory breach—renunciatory breach—termination—hire—damages—summary judgment
Claimant Owners chartered their tanker to defendant Charterers on an amended Shelltime 4 form dated 1 June 2020. The vessel was delivered on 15 June 2020. Charterers’ payments of hire were sporadic and a considerable balance of unpaid hire accrued. Owners suspended performance but hire remained unpaid. On 25 November 2020, Owners accepted Charterers’ failures to pay hire as repudiation or renunciation, treating the charterparty as having come to an end. The vessel had been fixed on a voyage charter with sub-charterers; Owners arranged with sub-charterers to continue their contractual voyage. The voyage charter cargo was discharged on 3 December 2020.
Owners claimed hire up to termination and damages equivalent to hire up to discharge of cargo, and applied for summary judgment.2 Charterers did not appear but had argued in correspondence that the periods Owners had suspended performance were off-hire and that Owners had been in repudiatory breach (which Charterers had accepted) by suspending performance and/or coming to an arrangement with sub-charterers.
Decision: Summary judgment for the claimant Owners.
Held: (1) Hire to termination: judgment for Owners. The charterparty expressly provided that Owners had the right to suspend performance “failing the punctual and regular payment of hire” and that during such suspension hire would continue to accrue. Owners had validly exercised their discretion to invoke the provision.
(2) Damages from termination to discharge: judgment for Owners. Payment of hire went to the root of the bargain between Owners and Charterers. By the date Owners accepted the breaches as terminating the charterparty, Charterers had failed to pay several instalments, including under an Addendum giving more time to pay; considerably more hire was due but unpaid than Charterers had paid. Charterers could not or would not perform the charterparty in accordance with its terms and were in repudiatory and renunciatory breach.
(3) Quantum of damages: credit was to be given for bunkers on board as at the date of discharge, not as at the date Owners accepted the termination. The latter approach
English Admiralty and Merchant Shipping Law

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