Proposed Charter Party Clauses
The most common contribution to disputes that we at Weathernews see is vague charter party terminology. If terms are not clear enough, and multiple different and/or opposing interpretations can be made, disputes will almost certainly arise. For example, the inclusion of the Douglas Sea Scales in many charter party agreements has caused a plethora of disputes resulting in countless hours of disagreement and millions of dollars worth of legal proceedings.
Over the years, Weathernews has inspected thousands of charter party agreements. It is our view that most disputes can be avoided if clearer terms are included in the governing charter party agreement. Through our experience, we have developed the following proposed charter party clause that may be used by either charterers or owners:
Proposed Speed and Consumption Clause
- Owners warrant that the vessel is and shall remain capable of maintaining, throughout the duration of this charter party, a speed of about XXX knots at a consumption of about XXX metric tons / day of fuel oil and about XXX metric tons of diesel oil / day, except in periods of bad weather. The allowance for the term “about” is defined as – 0.5 knots for speed, and +/- 5% for consumption.
- For the purpose of this clause, good weather is defined as winds up to and including Beaufort Force 4 and / a significant wave height up to and including 2.0 meters. A good weather period is assessed when good weather is analyzed for more than half of the period between successive reported positions. A good weather current factor is applied to adjust the vessel’s good weather average speed over ground for the effects of positive and negative currents. A total good weather period of at least 5% of the total steaming time from Start of Sea Passage to End of sea Passage (excluding stoppages, off-hire periods etc) is understood to be a sufficient sample of the total voyage to represent the vessel’s performance.
- Charterers shall supply Weathernews service to the Master during voyages specified by the Charterers and the Master shall comply with the daily reporting procedure of Weathernews service.
- Owners and Charterers agree that evidence of the weather, seas, and ocean currents shall be taken from Weathernews’ independent Voyage Audit Reports, which are accepted by Owners and Charterers as binding on all parties.
- In the event of an alleged breach of the speed and consumption warranty in clause 1, the time loss and bunker consumption calculation for each voyage shall take into account the ship’s speed and consumption calculated on the basis of a good weather analysis in which wind, seas, and ocean currents shall be analyzed by Weathernews. Time loss shall be off-set by consumption savings across the same voyage.
Weathernews believes that the clause, as it is currently written, offers an objective and reasonable means for assessing performance for the following reasons:The clause strictly applies the Good Weather Method as outlined through English Case Law
1.The clause offers lear good weather terms and good weather day assessment methodology
2.The clause offers guidance in the event that a dispute persists
3.The clause is flexible in that it allows the contracting parties to update where/as they deem necessary
It is our belief that inclusion of the Weathernews proposed clause will greatly reduce the likelihood of disputes related to the interpretation of good weather conditions/days, the determination of good weather performance, and/or the calculation of the vessel’s total voyage damages/savings, if any.
WNI Official Performance Auditing