Plotting the legal course in murky waters

The House of Lords is set to hear a case which will decide who is reponsible to navigate while at sea. Roger Pearson reports.

The rights of ship charterers to decide the route taken by the vessel they are chartering is to be argued in the House of Lords.

Ship charterer Kawasaki Kisen Kaisha sued Whistler International for breach of its time charter-party, the deed between ship owner and merchant, after the master of the ship Hill Harmony did not take the most direct route on a trip from Canada to Japan.

The arbitrator held that Kawasaki was correct in its submission that the route taken by the vessel was Kawasaki’s decision and not that of the master employed by Whistler. The arbitrator found that Whistler was liable to pay damages for breach of the time charter-party.

But Whistler successfully appealed against that decision to Mr Justice Clarke in the Commercial Court.

In allowing the appeal against the arbitrator’s decision, Justice Clarke noted that the question of the decision on the route by such a vessel was of general public importance. And in the Court of Appeal his decision was upheld.

The Court of Appeal held that the charter-party in the case of Hill Harmony reflected, in the absence of express terms, the pattern of implied obligations imposed on the parties to the time charter. This meant that the master and owners of the ship should proceed with “utmost despatch” by the direct route or a usual and reasonable route.

But the court went on to hold that this still left the master of such a vessel with the right and responsibility in matters of navigation. He was entitled to decide on the route to be taken due to weather conditions and other navigation hazards. The court held that he was under a duty to reach decisions on such matters on the basis of his own judgement and experience.

It was held that in the absence of any special provision in the charter-party governing or restricting the right of a master to choose the route, the arbitrator had been wrong to find in favour of Whistler.

Kawasaki is challenging the Commercial Court and Court of Appeal rulings and leave has been given by Lords Steyn, Hobhouse and Millett for an appeal to the House of Lords.