Osmium Shipping Corporation v Cargill International SA (The Captain Stefanos)

Following last year's reported case of the Saldanha, which finally gave the industry judicial authority on the question of whether a hijacking by pirates constituted an off-hire event under the wording of clause 15 of the standard form NYPE46 time charterparty, the question of whether a vessel is off-hire during a hijacking by pirates has come before the Commercial Court once again.

The Saldanha ([2011] 1 Lloyd's Rep 187) is well known for establishing that detention by pirates is not an off-hire event within the meaning of clause 15 of the NYPE46 form of time charterparty. However, the judge in that case also considered an additional, bespoke clause in the charterparty between the owners and charterers in that case which read as follows:

Clause 40

Should the Vessel be seized, arrested, requisitioned or detained during the currency of this Charter Party by any authority or at the suit of any person having or purporting to have a claim against or any interest in the Vessel, the Charterers' liability to pay hire shall cease immediately from the time of her seizure, arrest, requisition or detention and all time so lost shall be treated as off-hire until the time of her release.

The judge in the case said that clause 40 "plainly...did not extend to cover seizure by pirates". In the event, the charterers failed to bring themselves within any of the exceptions to hire in the charterparty, and hire was accordingly payable during the entire period of the vessel's detention by Somali pirates.

The judge also went on to say that "should the parties be minded to treat seizures by pirates as an off-hire event under a time charterparty, they can do so straightforwardly and most obviously by way of an express provision in a "seizures" or "detention" clause".

A case in which an additional, bespoke clause had precisely that effect has now been decided in favour of charterers by the Commercial Court, on a wording very similar to clause 40 in the Saldanha charterparty, but different in significant respects.

In the Captain Stefanos ([2012] EWHC 571 (Comm)), the charterparty contained the following clause:

Clause 56

Should the vessel put back whilst on voyage by reason of any accident or breakdown, or in the event of loss of time either in port or at sea or deviation upon the course of the voyage caused by sickness of or accident to the crew or any person onboard the vessel (other than supercargo travelling by request of the Charterers) or by reason of the...