4. Hudson’s Bay Company v Domingo Mumbru Sociedad Anonima [1921] 9 Ll.L Rep 196; [1922] 10 Ll.L Rep 476

“Ready to Load” equated with “arrived ship” – vessel lying in the roads, not an arrived ship

The facts

Clause 3 provided “the steamer shall load as follows, viz, at one or two safe loading places always afloat in the port of Buenos Aires or La Plata”.

Clause 11: “Orders for the first loading place shall be given within four running hours after receipt of written or telegraphic application of the Master or agents to the charterers or their agents in Buenos Aires [between certain hours] or upon notice of arrival in ballast in free pratique at Montevideo or at an Argentine port”;

Clause 12: “Lay days shall not commence before April 20, 1920 unless charterers begin loading sooner; and should the steamer not be ready to load by 6 pm on May 31, 1920, charterers shall have the option of cancelling this charterparty”.

The vessel dropped anchor in the roads of Buenos Aires.

The captain obtained free pratique on May 30 and went ashore on May 31 where he gave notice of readiness at 10h45 and requested orders for loading port.

Near the termination of the “four running hours” referred to in clause 12, charterers gave orders to proceed to the “port” of Buenos Aires. At that point in time it would have been impossible to reach the “port” (the customary loading area) by 6pm on that day ie May 31.

Charterers served notice of cancellation.

Findings

Bailhache J found that, on the authority of Leonis v Rank, the vessel lying in the roads was not an arrived ship at the cut-off time and that charterers were therefore entitled to cancel pursuant to the terms of clause 12.

The Court of Appeal (Bankes, Atkin and Younger LJJ) upheld Bailhache J.

Discussion

The true enquiry was not whether the vessel was an arrived ship, but whether the charterers were entitled to cancel pursuant to clause 12 seen in the context of the entire contract.

The vessel arrived in the roads in ample time to move from there to any loading place nominated by the charterers.

The charterers deliberately nominated the “port” (interpreted as the customary loading area) when it had become impossible for the vessel to reach such area.

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