138. Anglo-Oriental Navigation Company, Ltd v T & J Brocklebank, Ltd [1927] 27 Ll.l. Rep. 359; 455

Cesser clause – not constituting defence in respect of claims not covered by owners’ lien

The facts

A cargo of jute was shipped to Dundee under a “lump sum” voyage charter containing the following clauses:

“12.The cargo to be brought to and taken from alongside the steamer at the risk and expense of the charterers.

“18.Charterers’ liability to cease on steamer being loaded and demurrage if any paid.

“22.The captain to have a lien on the cargo for all freight and demurrage.”

There was delay in the discharge of the cargo which resulted in a claim by the owners for detention.

The port authorities required the ship to incur the expense of piling and wheeling the cargo alongside. The owners claimed this expense from the charterers.

The arbitrator appointed by the parties held that the cesser clause protected the charterers from both claims and stated his award as a special case.

Findings

Roche J, found that the cesser clause could only protect the charterers from claims in respect of which the owners had a lien. He distinguished between demurrage at the port of loading and detention at the port of discharge. The charterparty did not envisage, and the bills of lading did not create, a lien for damages for delay at the port of discharge.

He found that the charterers were not responsible for the delay and therefore not liable on the claim for detention.

With regard to the piling expenses, he held that even if there had been a custom for the ship to be liable for these expenses, the contract ran otherwise.

The cesser clause was held not to protect the charterers for the same reason as on the claim for detention.

Commentary

The judgement explains the relationship between the cesser clause and the owners’ lien.

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