Firm Warns on Tanker Traders' Tricks

March 14, 2006

London law firm Lawrence Graham says owners chartering out tankers should fight to keep additional early loading clauses out of the charter party or specifically query each charterer's instruction to clarify laytime issues. The warning follows a High Court decision which Lawrence Graham says places owners at a disadvantage. Writing in the March issue of Lawrence Graham's newsletter, Shipping Lawgram, Stuart Dench, a member of the shipping law team, says, "The charterer, a major trader, uses its commercial muscle to modify a standard charter party to the owner's disadvantage. When it comes to a dispute over interpretation of the additional clauses, the owner can usually rely on arbitrators making a sensible commercial decision. If such a dispute goes to the High Court however, sometimes you end up with a result that flies in the face of commercial reality. Such a case has happened recently, in a dispute with Vitol, the major oil trader. Lawrence Graham was not involved in this dispute but has successfully defeated similar claims by Vitol in London arbitration on the same Vitol clauses. Unfortunately, future arbitrators will now be bound by this court decision, unless it is successfully appealed or the facts of future cases are distinguishable."

Firm Warns on Tanker Traders' Tricks

Related News