Monday, July 15, 2024

Underperformance claim- whether the vessel was misdescribed

The charterers relied on a report issued by [X] WRC to support an underperformance claim. The charterers based their claim on a breach of the performance warranty, alternatively, the vessel was misdescribed, or the charterers entered into the charter party by a negligent misrepresentation or there must have been a defect in hull, machinery or equipment causing the loss.

The owners denied that the vessel underperformed and/or misdescribed and submitted a report from a [Y] WRC to support that there was no contractual good weather on the voyage. The Y company’s report was prepared in strict conformity with the wording of the clause, and in particular, only considered “days” of 24 hours of consecutive good weather, excluding periods with adverse currents since the charter party referred to “no adverse currents”.

The dispute was referred to a sole arbitrator, as agreed by the parties, in London.

Held,

Breach of the performance clause

1.The X company’s report considered periods of less than 24 hours to evaluate the vessel’s performance, contrary to the wording “good weather days”. The WRC considered periods with adverse currents and applied a positive current factor. Therefore, the charterers have failed to support an underperformance claim on the basis of the X company’s report.

Misdescription

2. On some of the analysed bad weather days in the X company’s report, the vessel performed very close to the minimum good weather speed. On other bad weather days, her performance speed was again not far from the minimum good weather speed. No evidence was submitted concerning the charterers’ instructions about the service speed at all times. Thus, on the evidence, the claim failed.

Defect in hull, machinery or equipment

3.The charterers submitted no evidence to support their allegations and the claim failed.

The website removes the names of the parties involved in the proceedings. No other information can be provided for this award.

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