Voyage charterparty – identity of charterer – agency
The facts
Charterparty entered into in New York on 13 March 1974 on Baltimore Berth Grain Form. The vessel was chartered for a voyage from United States Gulf to Alexandria to carry a cargo of wheat or other specified commodities. The voyage was completed and the cargo was discharged at Alexandria on 17 June 1974.
The owners claimed demurrage. Tradax resisted the claim on the basis that it signed a contract as a mere agent for a third party, General Organization Supply Goods Cairo.
The format of the contract was that Tradax was described as the charterer in the usual position on the front page of the contract at the foot of which there appeared the composite signature of Greenwich Marine Inc. signing as “agent’s” for Tradax.
In fine print on the third page of the agreement the following provision appeared: “this vessel was chartered on behalf and for account of General Organization for Supply Goods Cairo” (the “General Organization”).
Findings
At first instance, Mr Justice Mocatta found for Tradax. His decision was overturned by an unanimous bench in the Court of Appeal.
Importantly, the court of first instance referred to the 18th edition of Scrutton on Charterparties emphasizing the intention of the parties “to be gathered in each case as a matter of construction from the terms of the charterparty as a whole”(report page 139).
The Court of Appeal made the useful observation that, in construing the document, the positioning and prominence of the different components of the agreement, including the description of the parties, were to be looked at.
Without any critical analysis, the court of first instance found that the only way to give effect to the clause describing the General Organization, Cairo as the party on whose behalf the vessel was chartered, was to designate the General Organization as the principal and Tradax as the agent.
The Court of Appeal, on the other hand, pointed out that both Tradax and the General Organisation were potentially liable on the contract. This was so because where an agent signs an agreement without qualifying his signature he is liable as a principal. This situation gives the creditor the election of pursuing either the agent or the principal.
In this case, the Court of Appeal emphasized the unambiguous and prominent description of Tradax as the principal/charterer on the face of the document. The impression created by this circumstance was not displaced by the relatively obscure provision that the end of the contract indicating the General Organization as the charterer.
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