Circumstances

The Court also remarked that a message sent pursuant to an anti-technicality clause must be couched in clear unambiguous terms and constitute an unmistakable ultimatum that default must be remedied within 48 hours or withdrawal will take place. In What Circumstances may an Owner Lose the Right to Withdraw? He may waive his right if he behaves in such a way after the failure to pay has accrued that he leads the charterer to believe that the charter can continue. He may accept a late payment. He may fail to act reasonably quickly after the default has occurred but on this point owners must be allowed reasonable time to take legal advice and this may involve communicating with lawyers in another country. (The Scaptrade (1981)). Where and if there has been a history of late payments. Only if he give clear advance notice before the due payment that payment is expected on time would he be likely to be allowed to take withdrawal action. It has been judicially established that there is an equitable right of set-off against hire payments [this was decided in The Nanfri (1978)]. This was so, despite the absence of any expressed contractual right of set-off in the charter party itself. For the charterer, however, to be granted this equitable right, he had to “quantify his loss by reasonable assessment made in good faith and then deduct the sum so quantified”. It is up to the charterer to show that he has complied with those requirements. The position as outlined above clearly favours charterers over owners. Some argue there should be no set-off against hire, as there is none against freight, unless the charter party expressly so provides. In The Leon (1985) it was held that a precondition of the right of set-off must be that the breaches complained of must have an effect on the charterer’s use of the vessel.