Anti-deductions clauses – a gift or a curse?

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Facts

Under a trip time charter incorporating amended NYPE 1993 form wording (‘the Charterparty’), Charterers hired the vessel for the carriage of bulk cargo from India to China.

Charterers agreed to pay hire of US $20,000 per day, which was payable every five days in advance.

The Charterparty provided that no deductions (including for off-hire or alleged off-hire) were permissible without the ‘express written agreement of Owners at Owners’ discretion’ (Line 146). The key Charterparty provisions in this dispute were Clause 17, the off-hire clause, and Clause 67 (BIMCO terms), which provided that if a crew member is found to be infected with a highly contagious disease, the ‘vessel shall be off-hire’.

On 1 May 2021, three crew members tested positive for Covid-19, so when the vessel arrived at the discharge port on 4 May 2021, she was unable to berth, and the cargo was not discharged. Charterers did not pay hire from 4 May 2021 thereafter and the vessel was eventually redelivered to Owners on 28 August 2021.

Issue

Where a charter party clause provides that… Read more

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