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25 Apr 2023

Commodities in Focus Weekly: Deductions from hire

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Did hire remain payable, in the absence of owners' agreement, when vessel was allegedly off hire at the instalment date?

Earlier this year the English Commercial Court had an opportunity to consider the construction of a clause dealing with deductions from hire in Fastfreight Pte Ltd v Bulk Trident Shipping Ltd [2023] EWHC 105 (Comm), which was an appeal from a partial final arbitration award on a question of law. The Court found that non-payment of hire amounted to a deduction from hire if the vessel was allegedly off hire at the instalment date where a charterparty clause provided that no deductions from hire, including for off-hire or alleged off-hire, may be made without the shipowners' consent. Albeit fact specific, as charterparties more frequently contain provisions limiting charterers' rights to withhold hire payments, this is a welcome analysis of how such provisions are interpreted by the Courts.

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