The ripple effect following the grounding of the “EVER GIVEN”

The grounding of the “EVER GIVEN” in the Suez Canal between 23rd and 29th March 2021 made headlines worldwide. It highlighted the importance of shipping globally but also what can happen when a crucial shortcut for vessels shipping cargoes between Asia and Europe gets blocked.

Thankfully, after six days of dredging, a favourable high tide and the efforts of tugs / salvors, the “EVER GIVEN” was refloated. However, as over 400 vessels were left queuing to transit through the Suez Canal by the time the local authorities allowed shipping to resume again, there will undoubtedly be a significant ripple effect of claims for losses / delays caused as a consequence of this incident over the forthcoming months.

Shipowners and Charterers of vessels affected by this incident will inevitably be scrutinising the relevant provisions of their Charterparties to assess who is liable for delay. Some Charterparties in their standard form will, unless otherwise amended by additional Rider Clauses (which can often be the case) provide Shipowners with wide exemptions of liability. For example, Clause 2 of the standard GENCON 94 form of Charterparty is more favourable towards Shipowners than the previous (1976) version and other standard Voyage Charterparty forms. It provides that “the Owners are to be responsible for loss of or damage to the goods or for delay in delivery of the goods only in case the loss, damage or delay has been caused by want of due diligence on the part of the Owners or their Manager to make the Vessel in all respects seaworthy…..or by the personal act or default of the Owners or their Manager…..”

Clause 12 of the standard BALTIME 1939 Form of Charterparty provides that “the Owners only shall be responsible for delay in delivery of the Vessel or for delay during the currency of the Charter and for loss or damage to goods onboard, if such delay or loss has been caused by want of due diligence on the part of the Owners or their Manager in making the Vessel seaworthy…or any other personal act or omission or default of the Owners or their Manager……The Owners shall not be responsible in any other case nor for damage or delay whatsoever and howsoever caused….The Owners shall not be liable for loss or damage arising or resulting from strikes, lock-outs or stoppage or restraint of labour (including the Master, officers or crew) whether partial or general….”

As mentioned above, some Charterparties might also contain specifically negotiated Rider Clauses setting out (amongst other things) bespoke force majeure provisions and / or other exemptions from delays resulting from certain circumstances. Those unfortunate parties who are unable to avoid responsibility for such losses / delays on Charterparty terms previously agreed might also wish to consider including a suitable Rider Clause(s) for insertion into any future fixtures.


© JL – April 2021

TKTL Bulletin 4 – 2021

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