A dispute between an Istanbul based shipowner and a New York based charterer has raised interesting issues about the latter's right to insist that a potentially hazardous cargo be carried.
Buyuk Camlica Shipping Trading and Industry has failed to persuade a London high court that it was entitled to refuse charterers instructions to load two cargoes that have been involved in a number of serious bulk carrier fires.
The dispute involved voyage charters of the 34,000-dwt Hilal I (built 1977) on the NYPE (1946) charterparty which contains a clause specifically excluding the carriage of direct reduced iron in any form.
The Hilal I was scrapped last year.The first refusal involved a 2004 voyage of hot moulded briquettes of direct reduced iron (HBI) from Libya and the second a 2005 shipment of direct reduced iron (DRI) from Trinidad to New Orleans.
Both HBI and DRI cargoes have been implicated in a number of ship fires and are the subject of IMO recommendations on the safe carriage of bulk cargoes.
The charterers however claimed that there was a verbally agreed variation of both NYPE agreements that entitled the charterers to insist that the HBI and DRI be carried and the subsequent refusal of the owner to load the cargoes resulted in a substantial loss.
The owners insisted that no oral variation of the charterparty had been agreed. But even if there had been such a deal access to the ports of Misurata in Libya and Point Lisas in Trinidad was so restricted they consitituted unsafe ports for the Hilal I.
But evidence from Ibrahim Mazman of Progress persuaded the arbitrators there had been a verbal agreement with Mustafa Topal of Buyuk Camlica and an undertaking that the Hilal I would load the cargoes at Misurata and Point Lisas.
The arbitrators found that there was a legally binding agreement between the shipowner and charterer that both a HBI and DRI cargo would be carried and the subsequent refusal to undertake the voyages was therefore a breach of the agreement, so entitling the charterers to damage
Gavin Kealey QC, sitting as a deputy high court judge, rejected the shipowner's application to challenge the arbitration award made by Michael Baker-Harber, Charles Measter and Brian Williamson.
TradeWinds reported in January 2009 that the Hilal I had been sold for demolition.