Demurrage time bar clauses are a commonplace in tanker charters. They require owners to submit their claim with supporting documentation within a specified period of time after completion of discharge, failing which the claim is extinguished. Some clauses extend this regime to all claims by owners against charterers. However, what happens to the time bar when the cargo is never discharged, because charterers have repudiated the charter and have never loaded a cargo?
The Tribunal in London Arbitration 3/18 has found that the clause which discharged the charterer from all liability if appropriate documentation is not provided “within 90 days after completion of discharge at last discharging port” did not affect owners’ load port demurrage claim, nor their cancellation claim. The clause could not operate effectively in circumstances where the contemplated voyage was not performed at all.
If charterers had wanted the clause to operate in these circumstances, they needed to provide clearly for this eventuality, as is the case with the Hague/Hague-Visby Rules which discharge an owner from liability if suit was not brought within one year of the delivery of the goods or of the “date when they should have been delivered”. A similar finding was made by Nigel Teare QC, as he then was, in The Bow Cedar, 1 Lloyd’s Rep 275.