Laytime and Demurrage

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Commencement of laytime

Commencement of laytime

3.1 Normally three conditions must be satisfied before the Charterer can be required to start loading or discharging, as the case may be, and therefore before the laytime allowed starts to run.1 These are that:
  • 1. The ship must have arrived at the destination specified in the charter.
  • 2. The ship must be ready and in a fit condition to receive or discharge her cargo.
  • 3. Where required, notice of her readiness must have been given to the charterer. In the absence of an express provision to the contrary, however, this last requirement applies only at the first load port.
When these conditions have been met, the vessel is an Arrived ship and, subject to the expiry of any period prescribed in the charter, laytime begins to run.

The specified destination

3.2 In The Johanna Oldendorff,2 Lord Diplock analysed the essential characteristics of a voyage charter and divided the adventure into four successive stages:
  • (1) The loading voyage, viz. the voyage of the chartered vessel from wherever she is at the date of the charterparty to the place specified in it as the place of loading.
  • (2) The loading operation, viz. the delivery of the cargo to the vessel at the place of loading and its stowage on board.
  • (3) The carrying voyage, viz. the voyage of the vessel to the place specified in the charterparty as the place of delivery.
  • (4) The discharging operation, viz. the delivery of the cargo from the vessel at the place specified in the charterparty as the place of discharge and its receipt there by the Charterer or other consignee.

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3.3 Arrival at the specified destination is the point both geographically and in time when the voyage stages end and the loading/discharging operations begin. Fixed laytime charters are traditionally divided into berth, dock and port charters depending on where the voyage stages end and these will be considered in more detail later.3 However, whether a charter is a berth, dock or port charter is not necessarily determinative of the specified destination, because berth and port charters, in particular, may contain provisions advancing this.4 Although the same divisions apply to customary laytime charters and there still therefore comes a point at which laytime begins, it is generally a less significant event in such charters because most of the risk of delay thereafter remains with the shipowner. However, the same principles apply. 3.4 Sometimes, instead of naming a specific berth, dock or port, a charter will specify that the vessel concerned is to proceed to one or more berths, docks or ports within a stated geographical area, e.g.:

“one or two safe berths Mississippi River”

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