Title
Igor Sterzhantov©2011
Laytime
By Igor Sterzhantov©2011
www.lawandsea.net
Introduction
Under a voyage charter the shipowner’s duties are:
1. To tender the vessel ready at the nominated port of loading within laycan time limits
2. To carry the goods with reasonable dispatch to the port of discharge designated by the
charterer
The charterer in his turn has the following duties to perform:
1. To nominate port of loading and discharging
2. To provide the goods for loading and to later to discharge them at the discharging port
In the absence of express stipulations the charterer is impliedly under an absolute obligation to provide1
a cargo according to the charter. Moreover, the cargo must reasonably comply with the terms of the
charter, the charterer must bring the cargo to the loading place and the charterer must perform his part
of the operation of putting the cargo on board the vessel. Since the shipowner is not concerned with the
methods by which the charterer intends to acquire the cargo, the arrangements for procuring that cargo
are outside the scope of the contract. However, if the ship cannot arrive so as to enable laytime to
commence but for the cargo is available for her2 defaulted charterer will be liable in damages to the
shipowner for delay caused by the non-availability of such cargo.3 The provision of the cargo and the
nomination of the berth must be made in sufficient time to enable the vessel to be completely loaded
within the lay days. But failure to do so from the part of the charterer does not give a right to the owner
to rescind4 the charter unless the delay becomes so prolonged that the breach assumes a character so
grave as to go to the root of the contract5.
Although the charterer is under obligation to load and discharge the cargo, it shall be stressed that both
loading and discharging are joint operations, because both operations inevitably require not only shore
side workforce and equipment but also ship’s crew involvement in a varying degree. For instance,
discharge of crude oil or petroleum products from tanker almost completely depends on ship’s pumping
ability whereas receiving terminal provides only crew to connect ship’s manifolds to shore arms.
Arrival of the vessel at the port signifies an end of either loading or carrying voyages and the moment
from which liability of the charterer as to his part of the joint act of loading or unloading starts to
1
Unless the charterer can legally do so he cannot excuse himself that he was prevented from furnishing cargo by
reasons which are entirely beyond his control.
2
Due to, for example, local rules or regulations.
3
The Aello [1961] A.C. 135
4
But gives rise to a claim for damages only; and those damages are liquidated damages paid in the form of
demurrage, see Universal Cargo Carriers v Citati [1957] 2 Q.B. 401 by Devlin, J.
5
Ibid
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Title
Igor Sterzhantov©2011
accrue6. Usually a certain amount of time is agreed between the owner and the charterer for loading
and unloading operations. In absence of express provision a reasonable time is implied by the law7. This
amount of time is called ‘lay days’ or ‘laytime’.
It seems that older authorities like Nielsen v Wait (1885) 16 QBD 67 CA, regarded lay days provision in
charterparty as “always in favour of the charterer”, see Lord Esher MR statement at p.70. On the view
that it allows the charterer to keep the vessel for his services without obligation to pay freight (freight is
primary payment obligation arising under a voyage charter). M. Summerskill in his Laytime, 4th ed. 1989,
says at p.2, that laytime is “usually … an undertaking by the charterers for the benefit of the owners”,
referring to Dixon CJ judgment in an Australian case of President of India v Moor Line Ltd. [1958] 2
Lloyd’s Rep. 5298. The later view makes better sense nowadays, since in modern interpretation laytime
represents certain amount of time which allotted to the charterer for the purpose of performing his
duty to load and discharge. With abandonment of stipulation as to “reasonable dispatch” and
introduction of fixed time period for these operations the charterer is under pressure to release the
vessel in time, otherwise he is to pay damages to the owner (or to pay damages to the owner
otherwise).
Read this article in full: http://www.lawandsea.net/CP_Voy/Charterparty_Voyage_Laytime.html
6
Per Brett L.J. in Postlethwaite v Freeland (1880) 5 App.Cas. 599. See also division of voyage charter into 4 four
successive stages given by Lord Diplock in EL Oldendorff & Co GMBH v Tradax Export SA (The Johanna Oldendorf)
[1974] AC 479 at p556:
7
See Nielsen v Wait (1885) 16 QBD 67 at 70, CA per Lord Esher MR.
8
Dixon CJ said at p.210: “The opening words of clause 9 [Australian grain C/P] which deal with average rate of
loading, contain a description of stipulation which is usually read as imposing an obligation upon the charterer for
the benefit of the shipowner.”
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