178. Atkins International H.A. v Islamic Republic of Iran Shipping Lines (The “A.P.J. Priti”) [1987] 2 Lloyd’s Rep 37

Safe port – voyage charter – charterers not liable for damage to vessel in approaching agreed port

The facts

During the course of the war between Iraq and Iran, the vessel was hired on an amended Gencon form to carry urea from Damman, a port on the Saudia Arabian bank of the Persian Gulf, to one of three ports on the Iranian bank, Bandar Abbas, Bandar Bushire and Bandar Khomeini.

An ascending rate of hire indicated an ascending level of dangerousness of the respective ports. The closer to Iraq, the more dangerous.

There was an express obligation on the charterers to nominate a safe berth at one of the three named ports.

On the approach to Bandar Khomeini, the most dangerous port, the vessel was hit by a missile and badly damaged.

Despite the unusual circumstances of this charter, the owners argued that the express safe berth obligation remained intact.

Findings

The arbitrators rejected the owners’ contention and their interim final award was confirmed by Saville J.

The Court of Appeal (Parker and Bingham LJJ and Sir Denys Buckley) dismissed an appeal against the decision of Saville J. Bingham LJ pointed out the important difference between the safe port warranty in time and voyage charters with the latter usually involving an agreement between the parties on the named port.

Both Bingham LJ and Parker LJ held that it was not open for the owners to contend that the safe berth warranty extended to the approach voyage in these circumstances where a dangerous port had been agreed to.

Commentary

The distinction made between time charters and voyage charters by Lord Diplock in the Evia 2 was echoed by Bingham LJ. Lord Diplock left open the question of the rights and duties of the parties if some abnormal circumstance made an agreed port in a voyage charter unsafe.

In this case, there was no safe port warranty but only a safe berth warranty. The omission of the safe port warranty was held by Bingham LJ to be deliberate owing to the circumstances. The charterparty had a “voyawar” clause allowing the owners to discontinue if conditions became too hazardous. The owners did not take advantage of this clause.

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