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Quantity

The owners should be responsible in relation to bunkers for a mistake by the master.

The Pantanassa [1958] 2 Lloyd’s Rep 449

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Charterers are not entitled to instruct the Vessel to load bunkers that are not required for charterparty purposes or with a view to making a profit on the sale of excess bunkers, and the Master is entitled to refuse such an instruction;

The Captain Diamantis [1978] 1 Lloyd’s Rep 346

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[b]oth the charterers on delivery and the owners on redelivery take over for their own use property which they would usually otherwise have to buy on the open market.

The Good Helmsman [1981] 1 Lloyd’s Rep 377 at 418-419

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Arbitrators found Owners liable for extra costs in deviating the Azores to lift bunkers as the Master concluded whilst on a voyage that the fuel on board was not sufficient to perform the voyage. On appeal, Neill J held that the arbitrators found that there was an insufficiency of fuel; they decided that that amounted to a breach of cl. 1 of the charter and this was not a case which should be set aside or remitted; the motion would be dismissed. There were various scenarios argued about the excess consumption: First, some incompetent management by the engineers. Secondly, a defect in the fuel itself, or some special call on the fuel, and thirdly, a mechanical defect in the engine. Having rejected various theories the arbitrators concluded that the vessel had insufficient fuel to make the west-bound crossing.

The Marina Di Cassano [1984] 2 Lloyds’ Rep 577

Safety Margin

Some reasonable margin must be added to cover emergencies and unforeseen delays on the voyage, having also regard to the state of the hull, weather conditions engine conditions and performing speed.

A 30% safety margin is mentioned in Susquehanna [1975] 1 Lloyds Rep 216.
In E.B Aaby's Rederi v Union of Indian ( No 2)[1976] 2 Lloyd's Rep 714 it was common between the parties that 25% over the anticipated consumption was sufficient.
The reasonable margin was also discussed in US cases: Hurlburt v Turnure 81 Fed. Rep. 208 (1897) and The Abbazia 127 Fed. Rep. 495 (1904)- ( see further Lowndes & Rudolf: The Law of General Average and The York-Antwerp Rules 15th Ed. 9.04- 9.05)
The Master erred in his distance calculations and speed, making no allowance for current, and the rate of consumption to be used during the voyage. A 25% safety margin was considered. The Evje No 2 [1976] 2 Lloyd’s Rep 714
Although 25 per cent was usually regarded as a reasonable bunker safety margin when dealing with very small, absolute quantities the percentage view could not be sustained- London Arbitration 4/80

Maritime Arbitration

Discrepancies were identified between the bunker quantities reported by the Master upon redelivery and those calculated by the surveyors, amounting to approximately 65 metric tons. The Owners raised concerns regarding several deficiencies in the bunker survey and provided supporting documentation, including copies of the deck and engine logs, the oil record book, noon reports, and a subsequent bunker survey conducted at the next port following redelivery. Regarding the reported shortfall upon redelivery, the Charterers contended that they had adhered to the Masters’ declared quantities and attributed the discrepancy to adverse weather conditions experienced during the voyage. They also submitted a weather routing report to show that the daily consumption declared was wrong. The tribunal examined the on-hire bunker survey along with the relevant documents related to the redelivery bunker quantities to determine whether the figures reported by the Master or those calculated by the surveyors should take precedence. For an SCP arbitration, the volume of documents submitted was substantial. Given the arbitrator's inability to definitively conclude which calculation was more accurate, a fair and equitable approach was adopted by apportioning the difference equally between the parties.

(Unreported, LMAA SCP 2017)

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Charterers were in breach of charter by redelivering with excess bunkers. The local market prices at the redelivery port were applied, not the Charterers prices that purchased the bunkers at the previous port, or the CP prices.

London Arbitration 3/23

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Owners need to prove the actual consumption if the charterers were to be charged for it.

London Arbitration 18/19

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Delivery bunker discrepancies; whether joint bunker survey is conclusive and binding on the parties. Back calculation applied, daily consumption and credible explanations were considered. Owners succeeded.

London Arbitration 1/99

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Dispute over the quantities of the bunkers on delivery affecting redelivery quantities under head CP. Basis a back calculation the ship delivered with less bunkers than that paid by the Disponent Owners. The difference claimed. Based on the facts, the disponent Owners claim failed.

London Arbitration 6/10

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Misrepresentation of actual consumption was argued, whether delivery bunkers inaccurately declared/ concealed bunkers. Based on the vessel's previous records and expert evidence to calculate the consumption paid, the tribunal found in favor of the Charterers after allowing a reduction in the claimed sum as to do justice.

London Arbitration 7/15

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Delivery bunker figures based on masters' estimate or surveyors' findings to prevail. On the evidence, the surveyors' findings were to be preferred and showed more bunkers on delivery.

London Arbitration 5/18

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MGO discrepancies on delivery. Undeclared bunkers argued as practice of chief engineers. The tribunal considered: the terms of the recap , the off hire bunker survey (previous voyage), the on hire bunker survey that the Charterers did not participate despite that agreed in the CP terms and the off hire survey under this charter. Owners succeeded.

London Arbitration 5/21

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Shortage quantities on redelivery, supply of missing quantities, damages claim , proper safety margin considered. charterers are liable for time lost and expenses to supply the missing bunkers. The Heron II applied.

London Arbitration 4/80

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Excess bunkers on redel abt 240 mts. The 'about' means 5 %, Charterers are in breach so damages claim apply - but silent on the prices used to calculate the same.

London Arbitration 17/89

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After departure, the master declared insufficient bunkers to reach next port- deviation to lift bunkers to perform the voyage. On the evidence and the proper sea margin considered, this was justified. Off - hire claim failed.

London Arbitration 2/85

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The master sent a redelivery notice with different bunker figures for Owners and charterers. The owners lost; the unsatisfactory evidence to explain this assisted Charterers. The Limitation Act 1980 operated to avoid a time bar.

London Arbitration 1/06

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Charterers had supplied less bunkers before redelivery and ignored Owners' request thus leading to shortage in bunkers. Arb 13/03 distinguished, a margin of 2% applied for about given the factual matrix. Breakdown of claim is unknown.

London Arbitration 15/13

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Short redelivery IFO; whether slow steaming excused Charterers of redelivering the ship with less bunkers; sudden bunker stem increase of MDO requested by the master precluding Charterers to comply. About is 5%; redelivery bunkers is separate from speed claim- so Charterers' bunkering obligations remain; on owners to prove that the master used due diligence when calculating the required MDO needed. Master's mistake in calculations was considered. Note: this case was cited in practice to show that the obligation is not 'absolute'.

London Arbitration 13/03

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IFO surplus on redelivery; Charterers supplied as per masters' calculated quantity. IFO LS discrepancies between delivery and redelivery, whether payable by charterers. On the facts and the authorities, Market vs Charterers' purschased prices were considered for compensation purposes. Bunkers at cost prices applied. On the LS IFO, no LSFO consumed as to be paid. Note: given the duration of the voyage and optional bunkering ports, it is likely the bunker quantities requested close to her redelivery date thus raising a point of argument - i.e. mistake on the master. Albeit this case cited in practice even to justify this reasoning when bunkers supplied before arrival at the loading port.

London Arbitration 17/15

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Charterers stemmed more MDO quantities basis the estimate given by the master, leading to extra cost. Owners argued that the estimate was given in good faith; but not accepted by the tribunal.

London Arbitration 4/02

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shortage of IFO and MDO on redelivery. Measure of damages. The MDO was not qualified by 'about'. 5% is usual rule for about. MGO was not qualified hence no allowance applied for ' about'. Arb 17/15 distinguished, market prices applied- even if no bunkers supplied by Owners.

London Arbitration 17/19

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Claim for bunkers consumed during the charter period. Suddenly, 84 mts were discovered on board, while the master was reporting a precise daily consumption( emphasis added). Whether MDO consumption was from unpumpable quantities is unknown. Owners succeeded on both items despite the oddities.

London Arbitration 20/19

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Shortage of 19.45 mts MGO on redelivery. Tribunal awarded damages basis 5% for word 'about' as agreed. The damages calculation and clause 58 were not cited in the published summary.

London Arbitration 24/19

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Redelivery bunker shortage. Charterers' alternative defences to these claims were considered. The tribunal accepted the 5% -Arb 15/13 not followed and local prices on redelivery to apply, even not supplied.

London Arbitration 19/21

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The cost of the supplied bunkers due to the vessel's deviation for repairs and underperformance was considered. The cost of bunkers was based on the CP prices. But if the off-hire was due to breach ( here protected by a paramount clause), then Charterers might have a case for damages.

London Arbitration 6/21

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The dispute related to the Market prices to apply for bunkers ondelivery. Any rebates on prices to be given were argued. Market prices are the listed or posted prices, and no discounts apply. The meaning of rebates was discussed on bunker prices.

London Arbitration 31/80

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How to apply the platts prices of bunkers on the date of delivery. Whether the prices published on the date of delivery or the prices that were available at the time of delivery ( i.e. previous day) should apply. The prices of bunkers on the date of delivery applied and not the avaialable prices on that date. Note: It is quite common for the Platts bunker wire prices to be published the next day and not on the same date.

London Arbitration 26/04

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Whether the owners' bunkering affected the Charterers' operation. Whether this means only the physical operation or commercial operation. Rejected the Owners' view and held that it refers to the full use of the ship. Loading the bunkers would result to loading less cargo.

London Arbitration 8/94

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Owners supplied bunkers on Charterers' behalf and there was a delay before reaching agreement between the parties. Charterers claimed the delay was for Owners' account and Owners had failed to mitigate. There was no loss of time as it was due to Charterers' failure to perform their obligations. On the argument of failure to mitigate this was misapplied by the Charterers on the present facts.

London Arbitration 9/16

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Whether the Charterers should recover 50% of time taken to conduct bunker survey. The clause referred to 'cost' of survey and not hire or time. Reading other clauses together, the Charterers claim failed.

London Arbitration 20/91

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Under a MoA, the vessel was arrested after delivery to her buyers by the bunker suppliers. Indemnity sought basis a breach of free of all encumbrances proviso. Sellers contended that the arrest was wrongful and raised defences to the indemnity claim and costs. This was a claim related to bunkers supplied before delivery, and the buyers suffered loss. The tribunal found unclear the warranty ' free from not registered arrests". The buyers' claim was allowed.

London Arbitration 2/17

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Because Charterer redelivered the Vessel with an excess quantity above that stipulated in the Charter, Owner is claiming reimbursement for the difference between the Time Charter price at which Owner had to repurchase fuel and the prevailing market price at Port Said. There is no doubt that the quantities of IFO and MDO with which the Vessel was redelivered to Owner were in excess of the maximum permissible under the provisions of the Charter, and that if Owner thereby suffered financial loss, it is entitled to restitution. Had Charterer made an appearance in this proceeding the Panel would have attempted to discern whether the Master specifically or even tacitly without objection approved the delivery. Lacking the opportunity to do so, the Panel awards to Owner $3,568.50 for losses sustained by reason of fuel onboard at redelivery in excess of Charter maximum quantities.

SMA 2074

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Charterer was entitled to bunker the ship before redelivery and to collect the bunker price specified in the time charter. A clause which described charterer's option to bunker before owner's option to bunker was construed as not requiring charterer to have exercised its option as a condition upon owner's entitlement to exercise its own option.

SMA 2858

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The vessel was not off hire for a period over a weekend while it remained adrift awaiting advice from charterer concerning bunker quantities, even though the master did not send his request for advice via charterer's urgent cable address and the vessel had sufficient bunkers to complete the ordered voyage.

SMA 1957

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Master's refusal to allow charterers' surveyor on board from July 15, when charterers requested the survey, until July 17, when survey was permitted, constituted an interference with charterers' control over the vessel, relieving charterers of a duty to pay hire for that time.

SMA 440

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Enroute to Houston, after the vessel had bunkered at Colombo, Owners state that the vessel diverted into Cape Town because the quantity of MDO aboard was not adequate to have a sufficiently large safety margin aboard to reach Houston. They argue that Masters are given wide latitude in their own determination of what that figure should be. There is no evidence about the essentiality of the MDO replenishment whereas it appears the vessel did require repairs to her radar and transmitter, important equipment for the safe prosecution of the voyage

SMA 3012

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Owners' claim for contributions to general average failed since vessel's stranding at sea was owners' fault in supplying insufficient bunkers. The Panel considered the state of the vessel's seaworthiness particularly as it pertained to the quantity of bunkers on board prior to finally sailing from port and,opined that this low powered, low speed vessel required a bunker safety margin of 30% during this planned voyage and that this margin should have been calculated for a 5190 mile crossing at a maximum service speed of 8 knots. Also the vessel's state of seaworthiness on sailing from port could not have satisfied the standard laid down by the Court in “The Glymont vs. American Trading Co. (U.S.D.C. Southern District of New York February 17, 1932) assuming a speed of 7 knots and a safety margin of 20-25%.

SMA 449

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Where owners failed in their best efforts to replenish bunkers en route (as an accommodation to charterers at their time and expense), due to Arab oil embargo, and where even if owners had fully bunkered vessel at loading port, as per charter party, a bunkering stop would have been necessary, vessel was held to have been seaworthy from commencement of contemplated voyage and owners' orders to ship to proceed to discharge port at half speed to conserve fuel were proper.

SMA 1223

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Where master had miscalculated his consumption and bunkers aboard, had misjudged weather and currents and had proceeded with the voyage when charterer could not provide bunkers as promised, owners' claim for salvage expenses and unpaid hire due to delay caused when vessel ran out of bunkers was denied.

SMA 1101

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The panel declined to award for redelivery bunker loss, where owner contended that the charter required charterer to redeliver the vessel with specified amounts of IFO and diesel oil aboard, and charterer contended that it had the option of redelivering either with the specified amounts of IFO and diesel aboard or with sufficient IFO and diesel to reach the nearest bunkering installation. The panel stated without discussion that owner's claim was not ripe for determination.

SMA 1797

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Charterers who overloaded bunkers just prior to redelivery, were not entitled to receive the charter party price for the excess, after allowing 5% for the quantity “about” equal to bunkers on board at delivery.

SMA 2893

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Charterer was not entitled to reimbursement for overpaid bunkers where it failed to sound the vessel's bunker tanks to determine the actual quantity of bunkers on board at delivery.

SMA 1916

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The amount of bunkers on board the vessel as determined by an independent surveyor during the on-hire survey controls for purposes of bunker reimbursement, not amounts determined by the master while the vessel is underway.

SMA 2991

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Delivery bunkers were properly measured by a joint on-hire survey at the loadport, rather than by the master's estimate at the point of delivery under the charter.

SMA 1900

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Where owner failed to exercise personal due diligence, by neglecting to make the crew aware of all precautions that needed to be taken before attempting to make repairs underway, and an explosion resulted, owner could not rely on the general exceptions clause to escape liability as a bailee for time charterers' bunkers which were lost when the ship sank.

SMA 2797

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The vessel was time chartered to carry grain for one trip from Tacoma, Washington to Manila. Owner's offer, as accepted, specified the quantity of bunkers on board at delivery and required “BUNKER ON REDELY ABT SAME QTTY AS ON DELY. ...” Charterer subsequently redelivered the vessel with less bunkers on board than at delivery. The arbitration panel awarded owner the time and extra costs incurred in replenishing the bunkers.

SMA 1706

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There is no discrepancy as to the amount of bunkers on board at the time of delivery and according to the ships records the consumption in steaming is in accordance with the terms of the charter party. The vessel, however did use an abnormal amount of bunkers in port which is made up of the difference between the bunkers consumed in steaming and the bunkers on board on redelivery. After carefully considering port logs, vessels logs, Engineers reports, etc. including the fact that the vessel used bunkers in order to operate the evaporator for drinking water, boiler water, etc., it is the unanimous opinion of this Panel of Arbitrators that the total bunker consumption charged by the vessel against the Charterer be reduced by 50 tons.

SMA 629

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The price of bunkers upon redelivery stipulated in the C/P does not govern the price for excess fuel consumed. However, since neither party proved overconsumption or underconsumption, the arbitrators made no award in respect of fuel consumed.

SMA 1538

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Where the charter party required the vessel to have a specific quantity of bunkers aboard on both delivery and redelivery, and the vessel delivered with excess bunkers which the charterer accepted and paid for, charterer was not required to redeliver the vessel with bunkers in excess of the quantity stipulated in the charter party.

SMA 2115

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In as much as the Off-Hire Survey, including bunker quantity survey, was taken prior to the actual re-delivery of the vessel, one has to calculate, (based on charter party consumption warranties), what quantity of MDO would reasonably be consumed during the voyage. Both parties advanced convoluted, esoteric calculations in support of their respective positions. This Arbitrator preferred Charterer's scenario.

SMA 3908

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A requirement that a vessel should be redelivered with “about 100 MT of MDO” gave Charterer only 5% leeway against that figure, not 10%, as Charterer contended.

SMA 3643

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Where the evidence revealed that a breakdown of the vessel's fuel pump caused it to significantly increase its consumption of MDO, Charterer would be allowed to recover for the overconsumption, with the price of the excess MDO based on the average price of such fuel stemmed by the ship while the fuel pump problem existed.

SMA 3643

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Charterer must pay the estimated final hire directly to owner rather than to an escrow account. Payment for redelivery bunkers becomes due only after the off-hire survey.

SMA 1614

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The time charter called for a joint offhire survey by a sole surveyor. Owner made no effort to contact charterer about an acceptable surveyor and was responsible for one half of the cost of the surveyor appointed by charterer, with owner being represented by the Master and Chief Engineer during the survey. In considering the Quantity of fuel oil on board on redelivery, the Panel considered the fuel consumption reported at sea and the described fuel consumption in the charter. Bearing in mind the speed of the Vessel, the distances of each leg of the Charter Party and the consumption advised by the Master, I cannot agree that the vessel consumed 21.6 tons of fuel oil per day, which would be the calculation to fit in with the delivery/redelivery certificates and the bunkers supplied at Port Said. It would not be logical for an Owner to describe his ship in the Charter Party as 13 knots on 27 tons of fuel oil when she was in fact 13 knots on 21.6 tons. Therefore, the quantity of fuel oil as stated in the redelivery certificate was in error.

SMA 3774

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The Charter provided for fixed prices of bunkers on delivery/redelivery and that the quantities on redelivery should be “about” the same as on delivery. Charterer stemmed a quantity of bunkers at the final loadport in excess of the delivery quantity, and at a higher price. Charterer was allowed a 5% tolerance in the quantity on redelivery; but Owner was not obligated to pay the higher price for redelivery bunkers in excess of 5% above the delivery quantity.

SMA 4096

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While Charterer's arguments raise serious doubts about reliability of vessel's bunker records, Charterer failed to prove theft of cargo on voyage at issue or any other voyage.

SMA 3173

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Where charterer was acting as a carrier, and the shipowner was found to have converted the cargo for use as bunkers, charterer had standing to maintain a conversion action and recover the full value of the converted cargo, even though it was entitled to various loss allowances under its contract with the cargo receivers.

SMA 2327

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Owner was liable for a settlement between the Time Charterer and the bunker supplier, of a dispute over the quantity of bunkers delivered to the ship since the Master, while noting a difference on the bunker receipt, failed to notify Charterer for a week by which time it was too late to verify the actual quantity received.

SMA 4088

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Under a clause in a time Charterer obligating Owner to redeliver about the same quantities of bunkers as on delivery, the Charterer stemmed the redelivery bunkers at a higher price than it had paid for the delivery bunkers, and then did not tell the Master to limit the quantity taken just to what he calculated was required to satisfy Charterer's obligation to redeliver a certain quantity of bunkers. The bunker barge had been ordered to supply the full amount stemmed, and in the absence of Charterer's orders, the Master was entitled to take the full amount. In any event, slightly over a 12% difference in quantities was an acceptable tolerance.

SMA 4088

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Where the charter provided for redelivery of the vessel with “about 200 long tons” of fuel oil at the price of $22 per long ton, charterer could reasonably redeliver 308.963 long tons at the rate of $22 for the first 210 long tons, and the current market price of $80 for the remaining 98.963 long tons.

SMA 1922

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Where the time charter specified that delivery bunkers would be “determined by the Master declared figures per abstract logs,” Owner was bound by the Master's lower figures, even if it is subsequently proven that the figures were wrong. The panel notes that the obligation is mutual and that charterer would be bound by Master's statement, even if incorrect.

SMA 3685

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Where the ship sales contract required buyer to pay for delivery bunkers at seller's current contract price at the port of delivery, seller was not entitled to include a profit margin in the bunker price; nor was seller entitled to include barging costs, where barging had not been used.

SMA 1913

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Time Charterer was not entitled to deduct from hire for a difference between the Master's measurements of bunkers on board and lower figures found shortly thereafter by a bunker surveyor. Fuel consumption is evaluated over the entire period of the charter, and not for such small measurement discrepancies.

SMA 4096

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Since the charter somewhat unusually gave owners a right to bunker for their own account, but only "without affecting [time] charterer's operations," owners could not exercise their bunkering rights if charterers would thereby have been limited in loading less cargo than they planned.

LMLN 386

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Where owners prudently ordered vessel to proceed to discharge port at half speed to conserve fuel, causing 15 day delay, but where owners failed in their charter obligation to fully bunker vessel at loading port, charterers were awarded 4 1/2 day reduction in charter hire, plus price differential between loading port price of fuel for the 680.9 tons which owners failed to bunker, and average cost of same incurred during voyage when vessel finally did get bunker replenishment.

SMA 1223

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Because of excess fuel consumption, charterers claimed lost profits for fuel that should have been on board on redelivery. Charterers recovered at "owners' contract price".

SMA 271

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Charterers were not required to pay for extra bunkers beyond what was considered a prudent precaution to meet unexpected contingencies. Charterers only had to pay for bunkers up to the "customary safety allowance" of 25% over estimated voyage requirements.

SMA 440

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A low speed vessel on a transpacific voyage was held to require a bunker safety margin of 30%.

SMA 449

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Charterers' claim for port charges at second bunkering port was denied when fuel stemmed there appeared to have been taken to satisfy charterers' redelivery fuel requirements.

SMA 1223

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The parties engaged the services of industry experts to address the cappuccino phenomena. The Panel had not been persuaded that Supplier did supply aerated or cappuccino bunkers. The fact that cases of cappuccino bunker supplies have been observed and dealt with in the past, does not automatically validate a challenge by an owner. It needs to be proven with a preponderance of credible evidence to overcome a prima facie case which Supplier, in this case, has established under the contract and the documentation required.

SMA 4286

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Where the charter provides that an independent surveyor will be engaged to determine the amount of bunkers on board the vessel at delivery, the surveyor's figures will be binding upon the parties unless a protest is made

SMA 2992

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Delivery bunkers were properly measured by a joint on-hire survey at the loadport, rather than by the master's estimate at the point of delivery under the charter.

SMA 1900

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Owners and Charterers disputed the quantity of bunkers on board based on different estimates by vessel's Chief Engineer and Charterer's surveyor. The panel held Charterer's refusal to accept Chief Engineer's offer to apply additional heat to bunkers and to resound tanks was not reasonable. Therefore the Chief Engineer's estimate was held to be more reliable.

SMA 3817

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SMA 4096

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SMA 4096

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Theft of cargo for use as bunkers established sufficient bad faith or malice on the shipowner's part to justify an award of attorneys' fees.

SMA 2033

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Where surveys were inadequate the amount consumed while the vessel was out of charterer's service was estimated on the basis of the vessel's warranted speed and consumption characteristics.

SMA 2164

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Secret structural modifications in the vessel's No. 3 center tank made its ullage readings unreliable and in-transit loss was determined on the basis of shoretank figures

SMA 2508

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Where the vessel had a list and owner failed to supply list correction tables as well as refused to allow an ROB survey upon completion of discharge, charterers may rely on shore figures to establish a shortlanding.

SMA 3051