The Gas Enterprise [1993]


The Court of Appeal, via the “Gas Enterprise” [1993] 2 Lloyd’s Rep 352 case, reiterated the methodology set out by “The Didymi” for assessing vessel performance.  The “Gas Enterprise” also stressed the fact that charterers should be compensated for losses across an entire voyage, not just for periods when the vessel steamed under good weather conditions.  The court held that the charter party agreement’s good weather description served as a “contractual yardstick” by which the vessel’s performance shall be assessed.  The court also surmised that a vessel shown to have underperformed during good weather was unlikely to perform as warranted during bad weather.  It followed that the vessel’s performance in good weather represented her maximum capability and should be applied across the entire voyage, including days of bad weather.

The Court of Appeal indicated the following approach for assessing performance:


 1. Find the vessel’s average speed during the charter party defined good weather periods
  a.This determines the speed and consumption capability of the vessel
  b.This determines whether or not the vessel performed as warranted
 2. Once the vessel’s good weather speed/consumption is established, the warranty takes effect.
 3. If the vessel’s speed was less than the minimum warranted speed, and/or if the vessel’s consumption was greater than the maximum warranted consumption for that speed, the charterers are entitled to receive compensation accordingly for the entirety of the voyage, not just for the periods steamed in good weather conditions.
The Court of Appeal thus applied the same procedure as described by “The Didymi.”