The Astra: single-hire default entitles owners to withdraw and claim loss of profit for remaining charter period - .PDF file.
A Commercial Court judge has decided that a failure to pay hire under an NYPE charterparty amounts to a breach of condition, entitling a shipowner to terminate and seek damages. This goes against the previous view generally held in the market that the obligation to pay hire under a time charter as it falls due is not a condition such that, if an owner wants to recover its future losses following a termination, it must seek to bring the charter to an end for repudiatory breach of contract, the latter invariably involving a series of consecutive defaults by the charterers.
The Court also considered whether the arbitrators had correctly applied the law on repudiatory breach and whether an addendum to the charter, stating that if the time charter was terminated the owners would be entitled to recover future loss of earnings, constituted a penalty clause…
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