Commencement of Laytime

Determining when laytime commences can be contentious and, as with many charterparty disputes, will depend upon a careful consideration of the charterparty clauses in the light of the facts. There have been many Court decisions on this subject over the years and no doubt we will see many more in the future. The landmark cases will be highlighted in this section and are a source of further reading if you want to delve into this aspect in greater detail. For laytime to start under a voyage charterparty, four requirements must be met:

1. Arrival at the agreed destination – the vessel must arrive at the agreed destination at the load/discharge port.

2. The vessel must be ready – as well as having arrived at the agreed destination, the vessel must be ready to load or discharge the cargo.

3. Notice of Readiness (NOR) – a valid NOR must be given by the vessel to the charterers, or their agents, confirming that it has arrived at the agreed destination and is ready to load or discharge.

4. Expiry of agreed preparation or notice time – any preparation time which has been permitted under the charterparty must have expired. Where is the Agreed Destination? The agreed destination depends on the terms agreed between the owner and charterer and absent any specific clauses depends on whether the charterparty is a berth charter or a port charter. It is crucial to know which type of charter you are fixed on as this defines the relevant risks and obligations on each party and defines where a vessel becomes an ‘arrived ship’ and where she is permitted to tender her Notice of Readiness. Simply stated, a berth charter obliges the owner to be all fast at the berth before his vessel can be considered as an arrived ship and generally this places on him the risk of any delays in getting to the berth.

There have been many disputes as to whether a charterparty is actually a berth or port charterparty and there is still some confusion today. Donaldson J in The Finix (1975) 2 LLR 668, held that the words ‘one safe berth, London’ would be a berth charterparty, whereas the words ‘London, one safe berth’ would be a port charterparty. Often this is too simplistic to decide this point and such phrases must be read in conjunction with the other terms of the charterparty which may be much more specific about where the vessel must arrive for the purposes of tendering a Notice of Readiness. Usually the phrases quoted have other applications in the charterparty and are agreed, for example, to limit the number of berths that may be used in each port.