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Chapter One Introduction of Chartering Shipping1

Section 1 Types&Characteristics of Charters1

1 Distinction between chartering and other ways of operating ships1

1.1 Liner shipping1

1.2 Tramp shipping3

2 Comparison of types of charterparties4

2.1 Voyage charter4

2.2 Time charter6

2.3 Demise charter8

2.4 Other charters10

Section 2 Shipbrokers&Charter Market17

1 Function of shipbroker17

2 Types of shipbroker18

3 To be a competent broker18

4 Rights and obligations21

4.1 Right to commission21

4.2 Main legal duties23

4.3 Broker's status under Chinese law25

5 Charter market26

5.1 Main charter markets27

5.2 Market indices28

5.3 Market report30

Section 3 Chartering Practice32

1 Inquiry32

2 Offer34

3 Counter-offer36

4 Firm offer36

5 Acceptance37

6 Recap versus charterparty39

6.1 Recap with"subject to"clause39

6.2 Where there is conflict between recap ＆ charterparty40

6.3 Where there is no formal document but only negotiations41

Section 4 Laws Governing Charterparties42

1 Characteristic of the legal regime governing charterparties42

1.1 Compulsory legal regime versus autonomy of parties42

1.2 Special requirements under Chinese law43

2 Conclusion of charterparties44

2.1 Form of contract44

2.2 Parties to the contract45

3 Validity of charterparties47

3.1 English law47

3.2 Chinese law48

4 Termination of charterparty50

4.1 By execution50

4.2 By mutual agreement50

4.3 By breach50

4.4 By frustration or force najeure55

Chapter Two Voyage Charterparty61

Section 1 Introductory Clauses62

1 Discription of the vessel62

1.1 Vessel's name63

1.2 Vessel's tonnage63

1.3 Vessel's class66

1.4 Flag and nationality67

1.5 Year of built68

1.6 Condition of the vessel and its gear68

2 The voyage68

2.1 Present position of ship68

2.2 ETA69

2.3 Relationship between ETA＆LAYCAN69

3 Ports of loading and discharging71

3.1 The charterer's obligation to nominate ports or places71

3.2 Warranties of safety71

3.3 Owner's right to require a valid nomination74

3.4 "Or so near thereto as she may safely get"75

4 Preliminary voyage76

4.1 To proceed to the loading port with reasonable despatch77

4.2 Interpellation clause77

Section 2 Cargo&Freight Clauses79

1 Cargo clauses79

1.1 Description of cargo79

1.2 Amount of cargo81

2 Freight clauses82

2.1 Freight rate versus lump sum freight82

2.2 Dead freight and damages82

2.3 Conditions to pay the freight82

2.4 Does freight include the cost of loading and discharging?83

2.5 Freight claim versus cargo claim83

Section 3 Loading and Discharging Clauses84

1 Cost of loading and discharging84

1.1 Who shall bear the cost of loading and discharging?84

1.2 Distinction between cost and risk84

2 Laytime85

2.1 Calculation of laytime87

2.2 Commencement of laytime94

2.3 Suspension of laytime103

2.4 Completion of laytime105

3 Demurrage and despatch money107

3.1 Demurrage107

3.2 Despatch money110

Section 4 Other Clauses111

1 Cesser and lien clause111

1.1 Purpose112

1.2 Co-extensive rule112

2 Bill of Lading clause113

3 Incorporation clause114

3.1 Elements to determine whether charterparty terms are incorporated into a bill of lading115

3.2 Standard charterparty clauses in conflict with the Chinese law115

4 Law and arbitration clause119

4.1 Arbitration versus litigation120

4.2 Validity of an arbitration agreement121

4.3 Validity of the arbitration clause incorporated into a bill of lading121

5 Strike Clause126

5.1 What is a strike?127

5.2 Options available128

5.3 Extension of the coverage to after-strike delay128

6 Tanker voyage charterparties130

6.1 Description of vessel130

6.2 Warranty130

6.3 Freight131

Chapter Three Time Charterparty132

Section 1 Description of Vessel132

1 Cargo capacity,speed and fuel consumption132

2 "About"/"on average"/"in good weather condition"135

3 An undertaking applicable at the date of delivery135

4 Seaworthiness136

5 Remedies and defences136

5.1 Remedies136

5.2 Measure of damages137

5.3 Defences137

Section 2 Hire Clauses141

1 Period of hire141

1.1 The precision of the time limit141

1.2 Delivery143

1.3 Redelivery145

2 Payment of hire152

2.1 Payment in cash153

2.2 Payment without deduction153

2.3 Remedies of owners154

3 Off-hire clause162

3.1 What is off-hire clause?162

3.2 Elements triggering off-hire163

3.3 Off-hire cancellation provision169

3.4 Suspension of hire versus off-hire rate170

Section 3 Other Clauses170

1 Identification of carrier170

2 Employment and indemnity clause171

2.1 Shipowner's implied right of indemnity172

2.2 Causation172

2.3 Orders regarding employment or navigation173

3 Inter-club agreement174

4 Safe port176

5 Trading limits178

6 Charterer's liability for oil pollution damage181

6.1 Charterer's direct liability181

6.2 Charterer's liability by way of recourse182

Appendix184

References192