Amount of Cargo

Amount of cargo required to be provided by the charterer may be indicated in the charterparty in a variety of different ways. Where a vessel has been chartered to fulfil an export order or to carry any other specific consignment, the description of the cargo in the
charterparty will be precise, e.g. 200 Ford Escort cars, and the charterer’s obligation will thus be clearly defined. It is, however, more common for the standard forms to include a clause requiring the charterer to provide a ‘full and complete cargo’. Under this clause his
obligation is assessed in relation to the actual capacity of the vessel and not that stated in the charterparty, should the two differ. Thus in one case a ship chartered to load a full and complete cargo of sugar was ‘guaranteed by owners to carry 2,600 tons dead weight, excluding
bunkers’. When it was later discovered that the vessel could in fact safely carry 2,950 tons of this particular cargo, the Court of Appeal held the charterer bound to ship a cargo of 2,950 tons. It should be noted, however, that the capacity of the ship in this respect refers
to the holds and those other parts of the vessel normally used for the carriage of cargo. The charterer is not obliged to provide ballast or to supply cargo to fill space in cabins, bunkers or on deck unless expressly agreed in the contract. In an attempt to be more precise, the obligation to load a ‘full and complete cargo’ is often accompanied by a clause stipulating maximum and minimum quantities. This has been interpreted by the courts as imposing a liability on the charterer to load either a full cargo or the specified maximum, whichever is less. It also amounts to a warranty by the shipowner that the vessel is able to carry the stipulated quantity. A slight variation on this formula provides that the quantity is to be at the shipowner’s option to be declared by the master at the commencement of loading. In such an event the master must declare a figure between the specified maximum and minimum quantities, which then establishes the precise amount to be loaded. A third possibility is provided by some modern charter forms which require a precise quantity of cargo to be stated either as a specific tonnage, cubic capacity or other relevant measurement. Often the stated quantity is accompanied by an allowance of, e.g., ‘5 per cent more or less’, or is qualified by a term such as ‘about’ or ‘thereabouts’. The courts have generally
interpreted the latter phrases as permitting an allowance of from 3 to 5 per cent either way. Failure of the charterer to load all the agreed cargo will naturally result in a loss of freight for the shipowner, for which he will be able to recover damages in the form of ‘dead freight’.
He may also incur additional expenses as, for example, where he has to ship extra ballast to compensate for the shortage of cargo. Such costs would generally be recoverable as damages for breach of contract. One particular problem arises in relation to the obligation to provide a ‘full and complete cargo’ when the charterer is entitled to ship a variety of different cargoes. Where the particular goods are of different shapes and sizes, he is not allowed to leave broken stowage but must fill the gaps left between individual items with other cargo.
Failure to do so will render him liable for the payment of dead freight unless the method of loading adopted is covered by local custom.
When a charterer fails to provide a full cargo, the shipowner is entitled to take reasonable steps to acquire alternative cargo in order to minimise his loss and is allowed a reasonable time in which to make the necessary arrangements. Should the charterer fail to provide a cargo on the arrival of the vessel at the loading port, the shipowner must wait until the laytime has expired and even then it would appear that he is not entitled to withdraw his ship until either it is clear that the charterer has no intention of loading a cargo or the delay is such as to frustrate the object of the charterparty. If, however, the charterer expressly or by conduct refuses to load the vessel, then the shipowner can treat this as an anticipatory breach and withdraw his vessel even before the expiration of the lay days. Should he do so, he will be required to take reasonable steps to mitigate his loss if cargoes are available at that port from other shippers. If the shipowner does not accept the refusal to load as final, then the contract will continue and he will have no claim if the charterer subsequently decides to load a cargo or a supervening event frustrates further performance of the contract.