Redelivery – redelivery clause interpreted to entitle charterers to send the vessel on an illegitimate last voyage on condition that market rate be paid for extended period if higher than charter rate.
The redelivery clause read as follows:
“[Clause 6]… steamer to be re-delivered on expiration of this charter…should steamer be ordered on a voyage by which the charter period will be exceeded (emphasis supplied), charterers to have use of the steamer to enable them to complete the voyage, but for any time exceeding termination date, charterers to pay market rate, if higher than rate stipulated herein.”
The vessel was ordered on a final voyage which was reasonably anticipated to terminate within the charter period.
Through no fault of the charterers, the vessel was delayed.
The owners contended that they were entitled to the higher market rate by virtue of clause 6. The charterers contended that they would only be liable for the higher rate in those cases where the final voyage was anticipated to be late.
The umpire found in favour of the charterers. His finding was confirmed by Atkinson J in the Kings’ Bench Division. The reasoning of Atkinson J was that the phrase “…ordered on a voyage by which the charter period will be exceeded…” in clause 6 contemplated an illegitimate final voyage i.e. one which was expected to exceed the charter period.
He concluded that the parties intended different treatment for the two types of situation i.e. where the final voyage was anticipated to overrun and one where it was not with clause applying only to the former situation.
The counsel for the owners was Sir Robert Aske KC. Devlin appeared for the charterers.
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