Demurrage Claims: Withholding Supporting Documents Results In Time Bar Of Claim

• Published date: 20 May 2020
• Author: Ms Eleanor Coates and Anna Fomina
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution, Court Procedure, Trials & Appeals & Compensation
• Law Firm: Clyde & Co

Tricon Energy Ltd v MTM Trading LLC [2020] EWHC 700 (Comm) underlines the importance of a thorough consideration of all available documentary evidence when presenting a claim which is subject to a time bar clause requiring the presentation of "all supporting documents". Failure to provide an available document which supports any aspect of the claim may result in the claim being time barred. What constitutes a "supporting document" will be considered in the context of the time bar clause and other clauses of the charterparty.

Facts

The Charterers chartered the vessel "MTM HONG KONG" to transport cargo from Antwerp, Belgium to Houston, USA.

The Charterparty, based on the "Asbatankvoy" form, provided at clause 10(g) that:

"(g) In the event of Vessel being delayed in berthing and the Vessel has to load and / or discharge at the port(s) for the account of others, then such delay and/or waiting time and /or demurrage, if incurred, to be prorated according to the Bill of Lading quantities".

The Charterparty also provided at clause 38 that:

"Charterer shall be discharged and released from all liability in respect of any claim/invoice the Owner may have/send to Charterer under this Charter Party unless a claim/invoice in writing and all supporting documents have been received by Charterer within [90] days after completion of discharge of the cargo covered by this Charter Party or after other termination of the voyage, whichever occurs first. Any claim/invoice which Owner may have under this Charter Party shall be waived and absolutely barred, if claim/invoice and all supporting documents are not received by Charterer before the time bar".

Demurrage was incurred at both the load and discharge ports. Since a second parcel of cargo was discharged at the same berth as the Charterers' cargo in Houston, the demurrage due was pro-rated in accordance with clause 10(e).

Arbitration Proceedings

Owners commenced arbitration proceedings claiming the pro-rated demurrage amount of US$56,049.36. Owners provided the demurrage invoice, laytime and demurrage calculations, notice of readiness, statement of facts, hourly rate and pressure logs and letters of protest within the 90 day contractual time bar.

Charterers disputed the claim on the basis that Owners had not provided the applicable bills of lading (in relation to the Charterers' parcel and the second parcel) within the 90 day time bar and had therefore failed to provide all supporting documentation, thus time barring the...