Galaxy Energy International Ltd v Novorossiys Shipping Company ('The Petr Shmidt') [QBD (Comm)]

JurisdictionEngland & Wales
JudgeLongmore J.
Judgment Date08 November 1996
CourtQueen's Bench Division (Commercial Court)
Date08 November 1996

Queen's Bench Division (Commercial Court)

Longmore J.

Galaxy Energy International Ltd
and
Novorossiys Shipping Co (The Petr Shmidt)

Nicholas Hamblen (instructed by Stephenson Harwood) for the charterers.

Charles Priday (instructed by Lawrence Graham) for the owners.

The following cases were referred to in the judgment:

Christensen v Hindustan Steel LtdWLR[1971] 1 WLR 1369; [1971] 1 Ll Rep 395.

Compania de Naviera Nedelka SA v Tradax Internacional SA (Tres Flores)ELR[1974] QB 264.

Pacific Carriers Corp v Tradax Export SA (The North King)UNK[1971] 2 Ll Rep 460.

Surrey Shipping Co Ltd v Compagnie Continentale (France) SA (The Shackleford)UNK[1978] 2 Ll Rep 154.

Transgrain Shipping BV v Global Transporte Oceanico SA (The Mexico 1)UNK[1990] 1 Ll Rep 507.

Charterparty Notice of readiness to load or discharge Notice to be given within certain hours Whether notice given outside contractual hours was a nullity Whether notice given outside contractual hours took effect when those hours began.

This was a case raising the question whether (as charterers argued) if a clause in a charterparty required a notice of readiness to be tendered within particular hours of the day and it was, in fact, tendered outside those hours but at a time when the ship was physically ready to load or discharge, it was an invalid notice and a nullity so that a fresh notice had to be given inside those hours before laytime could begin; or whether (as owners argued) the notice took effect when those hours began so that laytime began then (or at whatever later time afterwards the charter specified). Arbitrators decided that the relevant notices of readiness although not given during the hours stipulated by the charter, were not legal nullities and the charterers appealed.

Held, dismissing the charterers' appeal:

1. As a matter of construction of the relevant clause, the clause did not say in terms that a notice of readiness given outside the contractual hours would not merely prevent laytime starting but was to be regarded as a nullity so that a second notice of readiness would be required. In the absence of express wording the court would not be inclined to construe the clause as imposing a condition precedent to the beginning of laytime provided always that the vessel was, in fact, ready when the notice was given.

2. To say that notices of readiness given outside the contractual hours were invalid and therefore nullities begged the question. They were accurate but non-contractual and that did not make them invalid in the sense of being nullities. The fact that there were good reasons for holding an inaccurate notice to be of no effect did not mean that the court should hold that a premature notice was of no effect. There was no good reason why the notice should not be effective as at the time which the contract fixed for it to be tendered. If the ship was not in fact ready at the contractual time, the notice would be invalid.

JUDGMENT

Longmore J: Charterparties often contain express clauses requiring a shipowner to tender to the charterer a notice of readiness to load or to discharge as the case may be. Laytime will not begin to run until such a notice has been tendered or until a specified number of hours after tender has elapsed. If the shipowner tenders a notice of readiness when the ship is, in fact, not ready to load or discharge, the notice of readiness is inaccurate and is in law, regarded as invalid and a nullity. Before laytime can begin, it is, therefore necessary to tender a fresh, accurate notice of readiness when the ship is actually ready to load or discharge. This is commercially sensible since the charterer cannot be expected to keep checking whether the ship is ready or not.

This case raises a somewhat different question, namely whether (as the charterer g argues), if a clause in a charterparty requires a notice of readiness to be tendered within particular hours of the day and it is, in fact, tendered outside those hours but at a time when the ship is physically ready to load or discharge, it likewise an invalid notice and a nullity so that a fresh notice must be given inside those hours before laytime can begin...

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3 cases
  • Galaxy Energy International Ltd v Novorossiysk Shipping Company (Petr Schmidt)
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 26 March 1998
    ...held in a reserved judgment on March 10 dismissing the appeal of the plaintiff charterers from the dismissal by Mr Justice Longmore ([1997] 1 Lloyd's Rep 284) on November 8, 1996, of their appeal against the award of arbitrators of May 20, 1996, upholding the defendant shipowners' claim for......
  • TA Shipping Ltd v Comet Shipping Ltd ('The Agamemnon') [QBD (Comm)]
    • United Kingdom
    • Queen's Bench Division (Commercial Court)
    • 25 November 1997
    ...Ltd v Empresa Nacional Pesquera SAUNK [1994] 1 Ll Rep 428 Galaxy Energy International Ltd v Novorossiys Shipping Co (“The Petr Schmidt”) [1997] CLC 402 Massalia, The (No. 2)UNK [1960] 2 Ll Rep 352 Mexico 1, TheUNK [1990] 1 Ll Rep 507 Mozart, TheUNK [1985] 1 Ll Rep 239 Shackleford, TheUNK [1......
  • Galaxy Energy International Ltd v Novorossiysk Shipping Company ('The Petr Shmidt')
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 10 March 1998
    ...sent by telex outside office hours was tendered when office opened. This was an appeal by charterers from a decision of Longmore J ([1997] CLC 402) upholding an arbitrators' award in a demurrage dispute. The question on appeal was formulated as whether if a clause in a charterparty required......

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